WASHINGTON (8/6/15)--After three soft weeks of activity, the final seven days of July saw mortgage applications surge, according to the Mortgage Bankers Association’s (MBA) weekly mortgage application survey.
The overall composite index climbed 4.7% during the week, driven by refinance applications with a 5.9% increase. Purchase applications rose by 3.3% for the week ending July 31 (Economy.com Aug. 5).
“Despite recent concerns about the economy, both purchase and refinance applications increased strongly in response to lower interest rates last week,” said Lynn Fisher, MBA vice president of research and economics (Housingwire.com Aug. 5). “Refinance activity was the highest since May when rates were last at this level.”
The contract rate for 30-year fixed-rate mortgages dropped by 4 basis points to 4.13% during the week, or 10 points lower than the prior month and 22 points lower annually.
For 30-year fixed-rate jumbo mortgages, the rate fell by 4 basis points to 4.08%, while the five-year adjustable rate mortgage rate slipped 2 basis points to 3.02%.
“Conditions remain prime for first-time and entry-level homebuyers,” said Michal Ferlez, Moody’s analyst (Economy.com). “In the most recent Senior Loan Officer Opinion Survey, lending standards on mortgages were looser.”
Added Ferlez: “Additionally, mortgage rates continue trending downward as fears about China and Greece abate. This will provide homebuyers one final window before the Fed likely begins raising rates this fall.”