Mortgage applications dropped 2.0% in the week ended April 1, as refinancings fell, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey.
Refinancings were down 6.2%, while the purchase index rose 6.7%, hitting its highest level of the year. The government purchase index surged 10.3%.
“Purchase application volume increased last week, reaching the highest level of the year, but remains relatively low by historical standards, at levels last seen in 1997,” said Michael Fratantoni, the association’s vice president of research and economics.
“The increase last week was due to a sharp increase in applications for government loans. Borrowers were likely motivated to apply before a scheduled increase in FHA insurance premiums.” Fratantoni wrote. “Rates were flat last week, but refinance activity fell, as the pool of borrowers who have both the incentive and the ability to qualify for a refinance continues to shrink.”
The four-week moving average for the seasonally adjusted market index slid 1.9%, the four-week purchase index moving average rose 0.9%, and the refinance index decreased 3.2%.
Refinancings accounted for 61.2% of applications, off from 64.3% the week before.
Adjustable-rate mortgages grew to a 6.1% share from 5.7%.