PhotoThere was a surge in mortgage applications in the week ended September 8.

The Mortgage Bankers Association reports applications jumped 9.9% during the week, which included an adjustment for the Labor Day holiday.

The seasonally adjusted Purchase Index shot up 11%, while the Refinance Index rose 9%, pushing the refinance share of mortgage activity to 51.0% of total applications from 50.9% a week earlier.

The adjustable-rate mortgage (ARM) share of activity slipped to 6.7% of total applications; the FHA share rose to 9.9% from 9.6% the week before, the VA share jumped to 10.3% from 9.7% the prior week; and the USDA share was unchanged at 0.7%.

Contract interest rates

  • The average contract interest rate for 30-year fixed-rate mortgages (FRMs) with conforming loan balances ($424,100 or less) was down three basis points -- from 4.06% to 4.03% -- with points increasing to 0.40 from 0.38 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
  • The average contract interest rate for 30-year FRMs with jumbo loan balances (greater than $424,100) rose to 4.00% from 3.96%, with points increasing to 0.24 from 0.20 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 30-year FRMs backed by the FHA dropped four basis points to 3.94%, with points decreasing to 0.34 from 0.35 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
  • The average contract interest rate for 15-year FRMs went from 3.44% to 3.30%, with points increasing to 0.39 from 0.38 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
  • The average contract interest rate for 5/1 ARMs inched up three basis points to 3.17%, with points increasing to 0.36 from 0.31 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.

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


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