“Mortgage
rates
moved
20
basis
points
higher
last
week,
abruptly
slowing
the
pace
of
mortgage
application
activity
with
refinance
volume
dropping
12%
and
purchase
volume
falling
5%
for
the
week,”
said

Mike
Fratantoni,
MBA’s
senior
vice
president
and
chief
economist.
“Purchase
volume
remains
almost
13%
above
last
year’s
level,
but
economic
uncertainty
and
the
volatility
in
rates
is
likely
to
make
at
least
some
prospective
buyers
more
hesitant
to
move
forward
with
a
purchase.

“One
notable
change
last
week
was
the
full
percentage
point
increase
in
the
ARM
share,”
he
added.
“Given
the
jump
in
rates,
more
borrowers
are
opting
for
the
lower
initial
rates
that
come
with
an
ARM,
with
initial
fixed
rates
closer
to
6%
in
our
survey
last
week.”

The
MBA’s

refinance
index
was
down
12%
from
the
previous
week,
although
it
was
68%
higher
than
the
same
week
a
year
ago.
The
refinance
share
of
mortgage
activity
also
decreased,
accounting
for
41.3%
of
total
applications
(compared
to
43.6%
the
previous
week).

The
seasonally
adjusted
purchase
index
decreased
5%
from
one
week
earlier.
The
unadjusted
purchase
index
was
down
4%
week
over
week
and
was
13%
higher
on
a
year-over-year
basis.

By
product
type,
the


Federal
Housing
Administration
(FHFA)
share
of
total
applications
decreased
from
16.3%
to
15.8%
during
the
week.
The


U.S.
Department
of
Veterans
Affairs
(VA)
share
of
applications
dropped
from
15.7%
to
13.7%,
while
the


U.S.
Department
of
Agriculture
(USDA)
share
was
unchanged
at
0.5%.

The
average
contract
interest
rate
for
30-year
fixed-rate
mortgages
increased
to
6.81%,
up
from
6.61%
a
week
earlier,
while
rates
for
30-year
fixed
mortgages
with
jumbo
loan
balances
rose
by
19
basis
points
(bps)
to
6.84%.

FHA
mortgages
saw
rates
rise
19
bps
to
6.52%,
while
15-year
fixed
rates
were
up
18
bps
to
6.11%.
The
average
rate
for
5/1
ARMs
increased
from
5.93%
to
6.11%.