According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending March 27, mortgage applications increased 15.3% from one week earlier.
Also, the Refinance Index increased 26% from the previous week and was 168% higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 11% from one week earlier.
“Mortgage rates and applications continue to experience significant volatility from the economic and financial market uncertainty caused by the coronavirus crisis,” says Joel Kan, MBA’s associate vice president of economic and industry forecasting. “After two weeks of sizeable increases, mortgage rates dropped back to the lowest level in MBA’s survey, which in turn led to a 25 percent jump in refinance applications.
“The bleaker economic outlook, along with the first wave of realized job losses reported in last week’s unemployment claims numbers, likely caused potential home buyers to pull back,” he adds. “Purchase applications were down over 10 percent, and after double-digit annual growth to start 2020, activity has fallen off last year’s pace for two straight weeks.”
The refinance share of mortgage activity increased to 75.9% of total applications, up from 69.3% the previous week.
The adjustable-rate mortgage (ARM) share of activity decreased to 3.2% of total applications.
The FHA share of total applications increased to 9.1% from 8.4% the week prior, while the VA share of total applications remained unchanged from 12.5%. The USDA share of total applications also remained unchanged (0.4%).
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) decreased to 3.47% from 3.82%, with points decreasing to 0.33 from 0.35 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
The average contract interest rate for 5/1 ARMs decreased to 3.35% from 3.38%, with points decreasing to -0.03 from 0.26 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.