Demand for purchase loans was up for the third week in a row last week, even as mortgage rates surged to the highest level in a month, according to a weekly survey by the Mortgage Bankers Association.
After adjusting for seasonal factors, applications for purchase loans were up 1 percent week-over-week, but down 14 percent from a year ago. Requests to refinance, which accounted for 62.5 percent of all applications, were up 3 percent week-over-week, but down 9 percent from a year ago.
“Purchase applications have regained an upward trend over the past few weeks,”
said the MBA’s Joel Kan in a statement. “Activity was slightly higher for the third straight week, but remained lower than the same week a year ago. Government purchase applications drove most of last week’s increase, which also contributed to a slightly lower overall average purchase loan size.”
The MBA reported average rates for the following types of loans during the week ending June 18:
- For 30-year fixed-rate conforming mortgages (loan balances of $548,250 or less), rates averaged 3.18 percent, up from 3.11 percent the week before. With points increasing to 0.48 from 0.36 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans, the effective rate also increased from last week.
- Rates for 30-year fixed-rate jumbo mortgages (loan balances greater than $548,250), rates averaged 3.26 percent, up from 3.20 percent the week before. Points decreased to 0.44 from 0.46, but the effective rate still increased from last week.
- For 30-year fixed-rate FHA mortgages, rates averaged 3.21 percent, up from 3.14 percent the week before. Points increased to 0.34 from 0.33, and the effective rate increased from last week.
- Rates for 15-year fixed-rate mortgages averaged 2.58 percent, up from 2.49 percent the week before. Points increased to 0.39 from 0.25, and the effective rate increased from last week.
- For 5/1 adjustable-rate mortgages (ARMs), rates remained unchanged at 2.69 percent. Points decreased to 0.26 from 0.38, so the effective rate decreased from last week.
In their latest forecast, Fannie Mae economists projected rates on 30-year fixed-rate mortgages will rise to 3.3 percent in 2022, triggering a $1.2 trillion decline in refinancing. Purchase loan volume is expected to hold steady at over $1.8 trillion next year.