Mortgage Applications Increase in Late November

According to the Mortgage Bankers Association's Weekly Mortgage Applications Survey for the week ending November 23, 2018, mortgage applications in the U.S. increased 5.5 percent from one week earlier. This week's results include an adjustment for the Thanksgiving holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 5.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 29 percent compared with the previous week.

The Refinance Index increased 1 percent from the previous week. The seasonally adjusted Purchase Index increased 9 percent from one week earlier. The unadjusted Purchase Index decreased 28 percent compared with the previous week and was 2 percent higher than the same week one year ago.

"After several weeks of market volatility, 30-year fixed mortgage rates decreased four basis points to 5.12 percent last week. Homebuyers responded, with purchase applications 1.7 percent higher than a year ago, and after adjusting for the Thanksgiving holiday, they increased almost 9 percent from the previous week," said Mike Fratantoni, MBA's Chief Economist. "The rise in purchase activity was led by conventional purchase applications, which surged almost 12 percent, while government purchases were essentially unchanged over the week. This also pushed the average loan size for purchase applications higher, which likely meant there were fewer first-time homebuyers in the market last week."

Added Fratantoni, "Refinance activity increased slightly overall, driven by conventional refinances, while government refinances decreased, as both FHA and VA applications dropped over the past week."

The refinance share of mortgage activity decreased to 37.9 percent of total applications from 38.5 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.9 percent of total applications.

The FHA share of total applications decreased to 9.6 percent from 10.7 percent the week prior. The VA share of total applications decreased to 9.9 percent from 10.6 percent the week prior. The USDA share of total applications remained unchanged from 0.7 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) decreased to 5.12 percent from 5.16 percent, with points decreasing to 0.46 from 0.48 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100) remained unchanged at 4.88 percent, with points increasing to 0.31 from 0.29 (including the origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 5.11 percent from 5.08 percent, with points remaining unchanged at 0.63 (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 remained unchanged at 4.53 percent, with points remaining unchanged at 0.51 (including the origination fee) for 80 percent LTV loans.

The effective rate decreased from last week. The average contract interest rate for 5/1 ARMs increased to 4.29 percent from 4.24 percent, with points decreasing to 0.42 from 0.51 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.