Mortgage Applications Increase in July 12th MBA Weekly Survey

Mortgage applications increased 0.9 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 7, 2023.  This week’s results include an adjustment for the observance of Independence Day.

The Market Composite Index, a measure of mortgage loan application volume, increased 0.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 19 percent compared with the previous week. The Refinance Index decreased 1 percent from the previous week and was 39 percent lower than the same week one year ago. The seasonally adjusted Purchase Index increased 2 percent from one week earlier. The unadjusted Purchase Index decreased 19 percent compared with the previous week and was 26 percent lower than the same week one year ago.

“Incoming economic data continue to send mixed signals about the economy, with the overall impact leaving Treasury yields higher last week as markets expect that the Federal Reserve will need to hold rates higher for longer to slow inflation. All mortgage rates in our survey followed suit, with the 30-year fixed rate increasing to 7.07 percent, the highest level since November 2022,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “The jumbo rate also increased to 7.04 percent, a record high for the jumbo series, which dates back to 2011.”

Added Kan, “Purchase applications increased, but remained at a very low level and are 26 percent lower than the same week last year. The rise in purchase activity was driven by increases in both FHA and VA purchase applications. The refinance index dropped to its lowest level since early June, as demand for rate/term and cash-out refinances remains extremely low with mortgage rates over 7 percent.”

The refinance share of mortgage activity decreased to 26.8 percent of total applications from 27.4 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6.6 percent of total applications.

The FHA share of total applications increased to 13.3 percent from 13.0 percent the week prior. The VA share of total applications increased to 12.6 percent from 11.7 percent the week prior. The USDA share of total applications remained unchanged at 0.4 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) increased to 7.07 percent from 6.85 percent, with points increasing to 0.74 from0.65 (including the origination fee) for 80 percent 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 $726,200)increased to 7.04 percent from 6.95 percent, with points decreasing to 0.59 from 0.64 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.86 percent from 6.68 percent, with points increasing to 1.23 from 0.98 (including the origination fee) for 80 percent LTV loans.  The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 6.42 percent from 6.30 percent, with points increasing to 1.22 from 0.91 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs increased to 6.24 percent from 6.00 percent, with points increasing to 1.42 from 1.23 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks, and thrifts. Base period and value for all indexes is March 16, 1990=100.

Contact:

Falen Taylor – Media Contact – (202) 557-2771

Source: Mortgage Bankers Association