PhotoMortgage applications surged last week following a sharp decline the week before.

According to the Mortgage Bankers Association (MBA), applications rose 5.5% in the week ending November 18, driven largely by purchase applications, which were up 13%.

“The increase in purchase activity was driven by borrowers seeking larger loans and that drove up the average loan amount on home purchase applications to $310 thousand, the highest in the survey, which dates back to 1990,” said Michael Fratantoni, Chief Economist and Senior Vice President of Research & Technology at the MBA.

The Refinance Index fell 3% to its lowest level since January, with the refinance share of mortgage activity dropping to 58.2% of total applications from 61.9% the previous week.

The adjustable-rate mortgage (ARM) share of activity increased to 5.2% of total applications, the FHA share dipped to 11.7% from 12.2% a week earlier, the VA share was 12.5%, and the USDA share of total applications increased to 0.8% from 0.6% the week before.

Contract interest rates

  • The average contract interest rate for 30-year fixed-rate mortgages (FRMs) with conforming loan balances ($417,000 or less) shot up 21 basis points -- from 3.95% to 4.16% -- its highest level since January, with points unchanged at 0.39 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate increased from last week.
  • The average contract interest rate for 30-year FRMs with jumbo loan balances (greater than $417,000) surged to its highest level since January -- 4.04%, from 3.89% -- with points increasing to 0.37 from 0.26 (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 rose 17 basis points to 3.90%, its highest level since January, with points increasing to 0.36 from 0.28 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 15-year FRMs moved to its highest level since January -- 3.35%, from 3.15% -- with points increasing to 0.32 from 0.29 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 5/1 ARMs rose 13 basis points to 3.24%, its highest level since last December, with points decreasing to 0.28 from 0.42 (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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