Fewer people were taking out mortgage applications for the week ending July 31, according to data from the Mortgage Bankers Association (MBA).
The Market Composite Index, the MBA’s measure of mortgage loan application volume, decreased 2.9% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index was down by an even 3%.
Both the seasonally adjusted and unadjusted Purchase Index recorded 4% declines from one week earlier. The unadjusted index was also 3% lower than the same week one year ago.
The Refinance Index was down by 2% from the previous week and was 9% lower than the same week one year ago. The refinance share of mortgage activity inched up to 39.9% of total applications from 39.5% in the previous week.
Among the federal programs, the FHA share of total applications increased to 17.3% from 16.9% the week prior while the VA share of total applications dipped to 12.3% from 12.6% and the USDA share of total applications inched up to 0.5% from 0.4% the week prior.
“In the wake of the July FOMC meeting, longer-term rates increased, with mortgage rates reaching their highest level in more than a year, with the 30-year fixed mortgage rate rising to 6.81%,” said Mike Fratantoni, MBA’s senior vice president and chief economist. “Application volume for both refinance and purchase loans declined for the week, and are now running behind last year’s pace, indicating that higher mortgage rates have weakened overall demand.”
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