According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates rose again last week, with increases seen for 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 5/1 ARMs. Rates for 15-year fixed-rate loans saw the week’s only decline. With rates continuing to move higher, demand for mortgage loan applications fell. Joel Kan, MBA’s vice president and deputy chief economist, says higher rates have pushed borrower interest in adjustable-rate mortgages. “The speed and level to which rates have climbed this year have greatly reduced refinance activity and exacerbated existing affordability challenges in the purchase market,” Kan said. “With rates at these high levels, the ARM share rose to 12.8 percent of all applications, which was the highest share since March 2008. ARM loans continue to remain a viable option for borrowers who are still trying to find ways to reduce their monthly payments.” The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)
