Mortgage Loan Rates Inched Higher Last Week

The Mortgage Bankers Association (MBA) released its report on mortgage applications Wednesday morning. It noted a week-over-week increase of 7.3% in the group’s seasonally adjusted composite index for the week ending December 18, following a decrease of 1.1% for the week ending December 11. Mortgage loan rates increased on all fixed-rate loans and decreased slightly on adjustable-rate loans.

On an unadjusted basis, the composite index increased by 7% week over week. The seasonally adjusted purchase index increased by 4% compared with the week ended December 11. The unadjusted purchase index increased by 2% for the week and is now 37% higher year over year.

The MBA’s refinance index increased by 11% week over week, and the percentage of all new applications that were seeking refinancing rose from 60.7% to 62.8%.

Adjustable rate mortgage loans accounted for 6.1% of all applications, up from 6% the prior week.
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In its report Tuesday on existing home sales, the National Association of Realtors noted the impact of new lending regulations and suggested that may have been at least partially responsible for the plunge in sales during November. Mortgage Daily News believes the impact is limited however:

The uptick in the share of delayed closings and the total time mortgage-related transactions took to close suggests that new disclosure requirements from the Consumer Financial Protection Bureau that took effect in early October had an impact on the housing market. However, the impact appears to be limited as the majority of mortgage-related home sales continued to close on time under the CFPB’s Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure (TRID) rule.

According to the MBA, last week’s average mortgage loan rate for a conforming 30-year fixed-rate mortgage increased from 4.14% to 4.16%. The rate for a jumbo 30-year fixed-rate mortgage increased from 4.01% to 4.04%. The average interest rate for a 15-year fixed-rate mortgage rose from 3.38% to 3.45%.

The contract interest rate for a 5/1 adjustable rate mortgage loan decreased from 3.25% to 3.24%. Rates on a 30-year FHA-backed fixed-rate loan rose from 3.90% to 3.92%.