NEW YORK — Mortgage applications slipped 0.8% in the week ended June 15, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey.
The refinance index rose 1%, and the seasonally adjusted purchase index fell 9%.
“Refinance volume increased again last week, but the composition of activity changed markedly. Despite rates remaining near all-time lows, conventional refinance application volume declined, and the HARP share of refinance activity dropped to 20 percent,” said Michael Fratantoni, MBA's Vice President of Research and Economics. “On the other hand, FHA refinance volume exploded to an all-time high, more than doubling over the week. New, lower FHA premiums on streamlined refinance loans came fully into effect, and borrowers seized the opportunity to lower their mortgage rates without increasing their FHA premiums. Purchase activity fell off last week, but this is likely only a recalibration following the Memorial Day holiday, as the level of activity remains within the narrow band seen for the past 3 years.”
Refinances were 81% of total applications, up from 79% a week earlier, while adjustable-rate mortgages decreased to 4% of total applications.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) decreased to 3.87%, matching the lowest rate in the history of the survey, from 3.88%.
The average contract interest rate for 15-year fixed-rate mortgages increased to 3.25% from 3.23%.