Lower Refi Activity Leads to Drop in Mortgage Applications

Mortgage applications decreased 4.1% from one week earlier, according to the Mortgage Bankers Association.

The MBA's Weekly Mortgage Applications Survey for the week ending May 27 found that the seasonally adjusted purchase index decreased 5% from the prior week.

The refinance index decreased 4% from the previous week and the refinance share of all mortgage activity increased to 54.3% from 53.7%.

The adjustable-rate mortgage share of activity decreased to 5% of total applications from 5.7% the week prior, while the FHA share of total applications decreased to 12.5% from 12.7%.

The VA share increased to 12% from 11.5% the week prior and the USDA share of total applications remained unchanged at 0.7%.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) remained unchanged at 3.85%.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) decreased to 3.81% from 3.82%.

The average rate the 30-year backed by the FHA decreased five basis points to 3.65%, while for 15-year fixed-rate mortgages, the average rate increased six basis points to 3.12%.

The average rate for 5/1 ARMs decreased to 3% from 3.09%.