The number of mortgage applications for the week ending March 29 declined 4% on a seasonally adjusted basis compared to the prior week's data, according to a report released today.
The overall decline was primarily due to a 6% drop in the refinance index, according to the latest Market Composite Index survey compiled by the Mortgage Bankers Association (MBA). Refinancing accounted for 74% of all mortgage applications, down from the prior week's 75%.
The drop in refinance mortgage applications was partially offset by a 1% seasonally adjusted improvement in purchase applications. The number of purchase applications for government loans jumped nearly 7%, and was "likely driven by borrowers applying for loans prior to the scheduled increase in FHA [Federal Housing Administration] premiums that took effect on April 1," according to Mike Fratantoni, vice president of research and economics at MBA.
Rates for 30-year fixed mortgages backed by the FHA, 30-year fixed conventional, and 30-year jumbo fixed mortgages (loan balances of $417,500 or greater), all declined versus the previous week. Of the mortgage types tracked by the MBA survey, 5/1 adjustable-rate mortgages (ARMs) saw the only weekly increase in average rate, rising two basis points to 2.60%.
The weekly mortgage survey consists of more than 75% of all U.S. retail mortgage applications, and has been conducted since 1990.