Mortgage applications increased 2.7% from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending May 22, 2020.
The Market Composite Index, a measure of mortgage loan application volume, increased 2.7% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 3% compared with the previous week.
The Refinance Index decreased 0.2% from the previous week and was 176% higher than the same week one year ago. The seasonally adjusted Purchase Index increased 9% from one week earlier. The unadjusted Purchase Index increased 7% compared with the previous week and was 9% higher than the same week one year ago.
“The home purchase market continued its path to recovery as various states reopen, leading to more buyers resuming their home search. Purchase applications increased 9% last week – the sixth consecutive weekly increase and a jump of 54% since early April. Additionally, the purchase loan amount has increased steadily in recent weeks and is now at its highest level since mid-March,” said Joel Kan MBA’s associate vice president of economic and industry forecasting. “Despite mortgage rates hovering near MBA’s all-time survey low, refinance activity was essentially flat but still 176% higher than last year. Conventional refinance applications increased 2%, while government refinancing was down almost 7%.”
The refinance share of mortgage activity decreased to 62.6% of total applications from 64.3% the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 3.4% of total applications.
The FHA share of total applications decreased to 11.2% from 11.5% the week prior. The VA share of total applications decreased to 12.4% from 13.4% the week prior. The USDA share of total applications decreased to 0.6% from 0.7% the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) increased to 3.42% from 3.41%, with points remaining unchanged at 0.33 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $510,400) increased to 3.71% from 3.66%, with points decreasing to 0.29 from 0.37 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.41% from 3.46%, with points decreasing to 0.30 from 0.33 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.87% from 2.88%, with points increasing to 0.30 from 0.27 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
The average contract interest rate for 5/1 ARMs decreased to 3.08% from 3.19%, with points increasing to 0.01 from -0.05 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
