Mortgage applications in US see decline last week as rates recover from 3-month low
(MENAFN) In the latest report from the Mortgage Bankers Association (MBA), US mortgage applications experienced a decline last week as mortgage rates rebounded from their lowest levels in over three months. The market composite index, which measures mortgage loan application volume, fell by 2.6 percent on a seasonally adjusted basis for the week ending June 28. However, on an unadjusted basis, the index showed a notable increase of 8 percent compared to the previous week.
According to Mike Fratantoni, Chief Economist at MBA, mortgage rates saw an upward trend last week, surpassing the 7 percent mark. This increase comes despite ongoing expectations in the market for a potential rate cut from the Federal Reserve later this year, fueled by the latest inflation data.
Fratantoni noted that purchase applications declined during the final week of June, despite an increase in both new and existing inventories in recent months. Refinance activity also remained subdued, although there was a slight uptick in applications for conventional refinance loans.
The average contract interest rate for 30-year fixed-rate mortgages rose to 7.03 percent from 6.93 percent the previous week, marking a reversal from recent lows. Similarly, the rate for 15-year fixed-rate mortgages climbed to 6.56 percent from 6.46 percent during the same period.
The MBA survey, which covers a substantial portion of US retail residential mortgage applications, provides insights into the shifting dynamics of the housing market amidst evolving economic conditions and interest rate movements.
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