On an unadjusted basis, the composite index decreased by 17% week over week. The seasonally adjusted purchase index fell by 4%, compared with the week ended September 4. The unadjusted purchase index decreased by 16% for the week and is now 5% higher year over year. The calendar shift of the Labor Day holiday may have had some impact on the mortgage business last week.
The MBA’s refinance index decreased by 9% week over week and the percentage of all new applications that were seeking refinancing dropped from 56.9% to 56.2%.
Adjustable rate mortgage loans accounted for 6.8% of all applications, down slightly from 6.9% in the prior week.
It appears that bond traders have decided to head for the sidelines ahead of the Federal Reserve announcement on interest rates due Thursday, according to Mortgage News Daily. That means they will be selling bonds, and that translates into higher interest rates. Last Friday Mortgage News Daily noted that an “increasing number of lenders” were offering 30-year conventional mortgages at 3.875% to top-tier customers, but that rate has now been pushed aside as anxiety grows about a potential hike in interest rates.
According to the MBA, last week’s average mortgage loan rate for a conforming 30-year fixed-rate mortgage fell from 4.10 to 4.09%. The rate for a jumbo 30-year fixed-rate mortgage increased from 4.03% to 4.04%. The average interest rate for a 15-year fixed-rate mortgage decreased from 3.34% to 3.33%.
The contract interest rate for a 5/1 adjustable rate mortgage loan increased from 3.03% to 3.04%. Rates on a 30-year FHA-backed fixed-rate loan decreased from 3.90% to 3.88%.
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