Mortgage application activity fell 4.7% during the week ended Oct. 3, regardless that the average rate for a 30-year dropped to 6.43%, down from 6.46% the previous week, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.
Applications for refinances decreased 8% compared with the previous week but were up 18% compared with the same week one year ago.
Applications for purchases decreased 1% compared with the previous week but were up 14% compared with the same week one year ago.
“With mortgage rates on fixed-rate loans little changed last week, refinance application activity generally declined, with the exception of a modest increase for FHA refinance applications,” says Mike Fratantoni, senior vice president and chief economist, in a statement. “Refinance volume remains somewhat elevated relative to levels of a month ago. Purchase activity declined by about 1 percent for the week but continues to show moderate growth on an annual basis, and stronger growth for FHA loans, favored by first-time homebuyers.”
“The ARM share increased to 9.5 percent last week from 8.4 percent the prior week,” Fratantoni adds. “Our survey shows 5/1 ARM rates are averaging almost a percentage point below 30-year fixed rates, and this differential is leading more purchase and refinance applicants to consider ARMs.”
The refinance share of mortgage activity decreased to 53.3% of total applications, down from 55.0% the previous week.
The adjustable-rate mortgage (ARM) share of activity increased to 9.5 percent of total applications.
Photo: Annika Wischnewsky