PhotoA drop in mortgage applications last week following two consecutive increases.

The Mortgage Bankers Association reports applications were off 0.5% for the week ending August 18, 2017.

The Refinance Index inched up 0.3%, taking the refinance share of mortgage activity up to 48.7% of total applications from 47.8% a week earlier.

The adjustable-rate mortgage (ARM) share of activity dropped 6.4% percent of total applications, the FHA share of total edged down to 10.1% from 10.2%, the VA share of total applications fell to 10.2% from 10.5% the prior week and the USDA share of total applications was unchanged at 0.8%.

Contract interest rates

  • The average contract interest rate for 30-year fixed-rate mortgages (FRMs) with conforming loan balances ($424,100 or less) was unchanged from the previous week at 4.12%, with points increasing to 0.39 from 0.38 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate was unchanged from last week.
  • The average contract interest rate for 30-year FRMs with jumbo loan balances (greater than $424,100) dipped five basis points -- to 3.99% from 4.04%, with points decreasing to 0.26 from 0.27 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
  • The average contract interest rate for 30-year FRMs backed by the FHA rose to 4.02% from 4.01%, with points decreasing to 0.37 from 0.40 (including the origination fee) for 80% LTV loans. The effective rate was unchanged from last week.
  • The average contract interest rate for 15-year FRMs slipped one basis point to 3.40%, with points increasing to 0.38 from 0.35 (including the origination fee) for 80% LTV loans. The effective rate was unchanged from last week.
  • The average contract interest rate for 5/1 ARMs dropped to 3.27% from 3.34% with points increasing to 0.31 from 0.29 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The survey covers over 75% of all U.S. retail residential mortgage applications.

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Jobless claims

Initial jobless claims rose last week, but stayed well below the Briefing.com forest of 240,000.

According to the Labor Department (DOL), first-time applications for state unemployment benefits rose by 2,000 in the week ending August 19, to a seasonally adjusted 234,000 from the previous week's unrevised level.

The 4-week moving average, seen by many economists as a more accurate barometer of the labor market due to it's relative lack of volatility was down 2,750 from a week earlier to 237,750.

The complete report is available on the DOL website.


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