Mortgage applications activity continued to evaporate, according to data from the Mortgage Bankers Association (MBA) for the week ending Sept. 29.
The Market Composite Index, the trade group’s measure of mortgage loan application volume, dropped by 6% on both a seasonally adjusted and unadjusted basis from one week earlier. The seasonally adjusted Purchase Index and the unadjusted index were also both down by 6% from the previous week, while the unadjusted index was also 22% lower than the same week one year ago.
The Refinance Index decreased 7% from the previous week and was 11 percent lower than the same week one year ago. The refinance share of mortgage activity dipped to 31.7% of total applications from 31.9% in the previous week.
Among the federal programs, the FHA share of total applications increased to 14.5% from 14.1% the week prior while the VA share of total applications decreased to 10.1% from 10.9% and the USDA share of total applications remained unchanged at 0.5%.
“Mortgage rates continued to move higher last week as markets digested the recent upswing in Treasury yields. Rates for all mortgage products increased, with the 30-year fixed mortgage rate increasing for the fourth consecutive week to 7.53% – the highest rate since 2000,” said Joel Kan, MBA’s vice president and deputy chief economist. “As a result, mortgage applications ground to a halt, dropping to the lowest level since 1996. The purchase market slowed to the lowest level of activity since 1995, as the rapid rise in rates pushed an increasing number of potential homebuyers out of the market. ARM loan applications picked up over the week and the ARM share increased to 8%, as some borrowers searched for ways to lower their payments.”