After falling about 3.2% the week prior, mortgage application volume increased 1.3% on an adjusted basis during the week ended Jan. 30, according to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
On an unadjusted basis, volume increased 15% compared with the previous week.
Applications for refinances increased 3%, while applications for purchases decreased 2%.
On an unadjusted basis, applications for purchases increased 16% compared with the previous week and were 3% higher compared to the same week one year ago.
‘Following several weeks of already elevated refinance activity due to falling interest rates, Federal Housing Administration [FHA] refinance applications increased 76.5 percent in response to a reduction in annual mortgage insurance premiums that took effect Jan. 26,’ says Lynn Fisher, vice president of research and economics for the MBA, in a release. ‘Conventional refinance volume was up only 0.5 percent for the week, while Veterans Affairs [VA] refinance volume was down 24.3 percent. FHA purchase applications were also up 12.4 percent over the week prior, despite a decrease in purchase applications in the rest of the market."
The refinance share of mortgage activity decreased to 71% of total applications, down slightly from 72% the previous week.
The fact that certain mortgage rates continued to tick down probably helped boost applications for refinances. The average rate for a 30-year fixed-rate mortgage (FRM) with conforming loan balance ($417,000 or less) was 3.79%, down from 3.83% the previous week.
The average rate for a 30-year FRM with jumbo loan balance (greater than $417,000) was 3.82%, down from 3.87%.
The average rate for a 30-year FRM backed by the FHA was 3.69%, down from 3.71%.
The average rate for a 15-year FRM was 3.14%, down from 3.15% the previous week.
The average rate for a 5/1 adjustable-rate mortgage (ARM) was 3.03%, up from 2.96%.
The ARM share of activity decreased to 5.3% of total applications.
All rates are based on closings. The MBA's survey covers about 75% of the loan production in the U.S.
Looking at application volume by loan type, applications for mortgages backed by the FHA represented 13.1% of all applications, up from 9.1% the previous week. Applications for VA mortgages represented 8.5% of all loans, down from 10.7% the previous week. Applications for mortgages through the U.S. Department of Agriculture were 0.6% of all applications, down from 0.7% the previous week.