Mortgage Applications in U.S. Jumped Last Week

NEW YORK, Sept 23 Applications for US home mortgages rose last week as both purchase and refinancing applications climbed, an industry group said on Wednesday. In addition, the Refinance Index increased 18 percent from the week before and the seasonally adjusted Purchase Index improve by 9 percent too, actually reaching its highest level since June of 2015.

According to the MBA, last week’s average mortgage loan rate for a conforming 30-year fixed-rate mortgage remained unchanged last week at 4.09%.

The Refinance Index increased 18 percent from the previous week, and the refinance share of mortgage activity increased to 58.4 percent of total applications from 56.2 percent the previous week.

Mortgage News Daily reported on Tuesday that most mortgage lenders are now offering 30-year fixed-rate mortgages in a range of 3.875% to 4.00%, with some more aggressive lenders offering rates as low as 3.75%. The share of home purchase loans going to low- and moderate-income borrowers dipped one point to 25 percent, and the share of refinances by LMI borrowers rose one point to 21 percent.

The FHA share of total applications decreased to 12.9 percent from 14.2 percent the week prior. The Veterans Affairs’ share of total applications was 10.0%, down from 10.7% the week prior.

Mortgage rates were the beneficiaries of increased jitters about the health of the global economy following the Federal Open Market Committee’s latest meeting.

5-year adjustable-rate mortgages priced at 2.91% with an average 0.5 point.

Nervous investors typically flock to safe-haven US government bonds, to which mortgage rates are closely related.

ARM interest rates in the 5 year category at HSBC have been listed at 3.04% carrying an April of 3.174% to start.

The 30-year fixed rate remained unchanged over last week, even though there was substantial intra-week fluctuation, he added. Wells Fargo stock has been slumping, partly on the overall market and partly due to the Fed’s decision not to raise rates, which likely would have meant wider loan spreads for banks.