Mortgage applications slip as rates rise
According to the Mortgage Bankers Association's weekly application survey, volume fell 15.3% during the week ended May 30.
June 4, 2008: 9:46 AM EDTWASHINGTON (AP) -- Mortgage application volume fell 15.3 percent during the week ended May 30, according to the trade group Mortgage Bankers Association's weekly application survey.
The MBA's application index fell to 502.3 during the week, from 593.3 the previous week. The results were adjusted to account for the Memorial Day holiday.
Refinance volume declined 25.7 percent, pushing total volume lower. Refinance applications accounted for 40.6% of total applications, down from 46.1% a week earlier.
Purchase volume declined 5.4%.
The index peaked at 1,856.7 during the week ended May 30, 2003, at the height of the housing boom. An index value of 100 is equal to the application volume on March 16, 1990, the first week the MBA tracked application volume. A reading of 502.3 means mortgage application activity is 5.023 times higher than it was when the MBA began tracking the data.
The survey provides a snapshot of mortgage lending activity among mortgage bankers, commercial banks and thrifts. It covers about 50% of all residential retail mortgage originations each week.
Application volume declined as interest rates climbed. The average interest rate for traditional, 30-year fixed-rate mortgages increased to 6.17% from 5.96% a week earlier.
Rates for 15-year fixed-rate mortgages - a popular option for refinancing a home - averaged 5.7% during the week ending May 30, compared with 5.49% the previous week.
The average interest rate for one-year adjustable-rate mortgages fell to 6.8% from 6.92%.
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