Mortgage applications decreased for the second week, down 3.9% from last week’s decline of 2.2%, according to the latest Weekly Applications Survey from the Mortgage Bankers Association’s (MBA) for the week ending July 26, 2024. But recent patterns of ups and downs, along with “bursts of refinance activity” indicate buyers may be holding out for lower rates, MBA noted.
“Mortgage rates were little changed last week, with the 30-year fixed mortgage rate unchanged at 6.82%,” said Mike Fratantoni, MBA’s SVP and chief economist. “In recent weeks, there have been some small bursts of refinance activity, particularly for FHA and VA loans. Last week, VA refi application volume dropped sharply, which drove the aggregate result. Borrowers may be waiting for signs that mortgage rates will drift lower as the Federal Reserve begins to cut short-term rates. Purchase volume also dropped slightly because of ongoing affordability challenges.”
This week’s numbers:
- The refinance share of mortgage activity saw another sharp decline, down 38.2% of total applications from 39.7% the previous week.
- The adjustable-rate mortgage (ARM) share of activity decreased to 5.7% of total applications.
- The FHA share of total applications increased to 14.2% from 13.4% the week prior.
- The VA share of total applications decreased to 13.5% from 14.8% the week prior.
- The USDA share of total applications increased to 0.5% from 0.4% the week prior.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) remained unchanged at 6.82%, with points increasing to 0.62 from 0.59 (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 $766,550) decreased to 7.07% from 7.09%, with points decreasing to 0.53 from 0.54 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 6.69% from 6.71%, with points decreasing to 0.84 from 0.86 (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 increased to 6.27% from 6.21%, with points decreasing to 0.49 from 0.51 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
- The average contract interest rate for 5/1 ARMs increased to 6.22% from 6.19%, with points decreasing to 0.45 from 0.52 (including the origination fee) for 80% LTV loans. The effective rate remained unchanged from last week.
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