Home loan application volume cooled last week as mortgage rates jumped, according to the latest survey from the Mortgage Bankers Association.
The closely watched application index slipped 9.8 percent on a seasonally adjusted basis (10.3 percent on an unadjusted basis) for the week ending January 16, but was still up 23.1 percent compared with the same week last year.
The weekly drop was led by a 12.4 percent slide in refinance applications, likely attributed to the sharp rise in interest rates.
However, the refinance share of activity still made up 83.3 percent of total applications, down from 85.3 percent the previous week.
The benchmark 30-year fixed-rate mortgage increased to 5.24 percent from 4.89 percent, while the 15-year fixed jumped to 4.99 percent from 4.63 percent.
The average interest rate for a one-year ARM remained unchanged at 5.89 percent.
The MBA’s weekly survey, conducted since 1990, covers about half of all retail residential home loan applications.
It doesn’t take into account multiple or declined applications, which have both surely increased as a result of the current lending environment.
Freddie Mac Weekly Rates Rise for First Time in Nearly Three Months
Meanwhile, Freddie Mac said interest rates increased this week after 11 straight weeks of declines.
“Fixed-rate mortgages followed bond yields and edged up this holiday week,” said Frank Nothaft, Freddie Mac chief economist.
The 30-year increased to 5.12 percent from 4.96 percent, but still remains below the 5.48 percent average seen this time last year.
The 15-year averaged 4.80 percent, up from 4.65 percent last week and slightly below its year-ago average of 4.95 percent.
The one-year ARM inched up three basis points to 4.92 percent, while the one-year fell a single basis point to 5.24 percent.
(photo: jurekd)
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