Thanks to a substantial rise in purchase mortgage application and a decrease in refinance activity, the Mortgage Bankers Association’s Market Composite Index was left essentially unchanged as of April 3rd. Based on a seasonally adjusted basis, the Composite (a measure of application volume) did see an increase of 0.4% from the previous week. As of March 27th, the composite saw an increase of 1% when measured on an unadjusted basis.
Similar to the Composite, the Purchase Index also saw an increase of 7% in both its seasonally adjusted and unadjusted counterparts respectively. To put this increase into perspective, the unadjusted index was 12 percent higher than during the same week in 2014.
Based on the findings of MBA’s Chief Economist, Michael Frantatoni, this is the third straight week purchase volume has increased, making this the highest level of activity for the seasonally adjusted Purchase Index has had since July 2013. Meanwhile, the Refinance Index has its lowest market share since early October, decreasing 3% from 60% to 57%.
According to experts the FHA share of total applications increased from 12.8% the previous week to 13.2%. Similarly, the VA share rose from 10.5% to 10.7%, and leaving the USDA portion of application volume unchanged at 0.8%.
Recent reports indicate that as of April 3rd, both effective and contract mortgage interest rates were lower than they have been in previous weeks. For example, the average contract interest rate for a 30-year mortgage with conforming loan balances decreased to 3.86%. Dropping 3 basis points, the rate went from 0.30 to 0.27. 30-year FRM with FHA guarantees had an average contract rate of 3.69 percent and the average contract interest rate for 15-year fixed-rate mortgages decrease from 3.21% to 3.15 %. Whereas the jumbo 30-year FRM saw the lowest level since May 2013 with an average contract rate of 3.81%
Showing their lowest level since May 2013, the average contract interest rate for 5/1 adjustable rate mortgages declined by 17 basis points. The ARM share of applications saw a decrease from 5.6% to 5.5%.
For more information on mortgage rates or to pre-qualify to purchase a new home, please feel free to contact Dave Kevelighan today.
