Due to rising interest rates, applications for home mortgages dipped for a second week in a row last week, according to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
The survey, covering 75% of all U.S. retail residential mortgage applications, shows that during the week ending May 17, applications for home mortgages decreased about 9.8%, on a seasonally adjusted basis, compared to the week before.
Applications for refinancing dipped 12%, according to the report. The seasonally adjusted Purchase Index decreased 3%, while the unadjusted Purchase Index decreased 4% and was 10% higher year-over-year. Fixed 30-year mortgage rates climbed 11 basis points to average 3.78% – up from 3.67% the week prior.
‘Mortgage rates increased to their highest level since March last week, leading to the largest single week drop in refinance applications this year,’ said Mike Fratantoni, MBA's vice president of research and economics.
‘The refinance index has fallen almost 19 percent over the past two weeks and is back to its lowest level since late March,’ he added. ‘Purchase activity declined over the week but is still running about 10 percent above last year's pace at this time.’
The refinance share of total mortgage activity slipped to 74% of applications, down from 76% the week ending May 10.