Mortgage application activity slowed for the week ending April 11, according to data from the Mortgage Bankers Association.
The Market Composite Index, the MBA’s measure of mortgage loan application volume, decreased 8.5% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index was down by 8% compared with the previous week.
The seasonally adjusted Purchase Index decreased 5% from one week earlier and the unadjusted index took a 4% drop – the latter was also 13% higher than the same week one year ago.
The Refinance Index decreased 12% from the previous week, although it was also 68% higher than the same week one year ago. The refinance share of mortgage activity shrank to 41.3% of total applications from 43.6% the previous week.
Among the federal programs, the FHA share of total applications decreased to 15.8% from 16.3% the week prior while the VA share of total applications decreased to 13.7% from 15.7% and the USDA share of total applications remained unchanged at 0.5%.
Mike Fratantoni, MBA’s senior vice president and chief economist, observed, “One notable change last week was the full percentage point increase in the ARM share. Given the jump in rates, more borrowers are opting for the lower initial rates that come with an ARM, with initial fixed rates closer to 6% in our survey last week. The ARM share at 9.6% was the highest since November 2023, and this reflects the share of units. On a dollar basis, almost a quarter of the application volume last week was for ARMs, as borrowers with larger loans are even more likely to opt for an ARM.”
