Mortgage loan application volume last week fell 16.2 percent on a seasonally adjusted basis from one week earlier, even taking into account Memorial Day. The Mortgage Bankers Association said refinance activity dropped 24.1 percent from the previous week, decreasing to 62.4 percent of total applications from 69.3 percent the previous week.
But purchase volume went up 4.3 percent over the previous week.
Now for the bad news, as previewed in my post earlier this week: The average contract interest rate for 30-year fixed-rate mortgages increased to 5.25 percent from 4.81 percent. At that rate for loans covering 80% of the purchase cost, points slipped to 1.02 from 1.28 (including the origination fee). The 44 basis point increase in the 30-year rate was the largest since October 2008.
If you’re still reading, you’re probably dizzy from the figures and ready to tune out. But anyone with more than a passing interest in the housing market would do well to read on. I also urge you to check out my biweekly newsletter for more comprehensive information.
The average contract interest rate for 15-year fixed-rate mortgages increased to 4.8 percent from 4.44 percent, with points decreasing to 1.10 from 1.16. And the average contract interest rate for one-year ARMs increased to 6.61 percent from 6.55 percent, with points increasing to 0.15 from 0.12 (including the origination fee) for 80 percent LTV loans.
Although mortgage rates have remained tantalizingly low for months and months, any tick up is bound to spook buyers. Continue reading