The survey covers U.S. closed-end residential mortgage applications originated through retail and consumer direct channels and includes mortgage bankers, commercial banks, thrifts, and credit unions.
The market composite index, which measures the volume of mortgage applications, experienced that growth on a seasonally adjusted basis from the prior week. On an unadjusted basis, the index grew by 10 percent from the previous week.
An analysis of home mortgage refinancing saw the refinance index advance by 23 percent from the prior week, and by 10 percent from the same week in 2024.
Both the seasonally adjusted and unadjusted purchase indexes increased by 1 percent from one week earlier. However, the unadjusted purchase index jumped 17 percent higher than the same week in 2024.
“The 30-year fixed mortgage rate declined to 6.67 percent last week, which spurred the strongest week for refinance activity since April,” Joel Kan, MBA’s vice president and deputy chief economist, said in a statement.
Kan said that refinancing represented 46.5 percent of applications, with the average loan size increasing to $366.400.
The previous week showed a 41.5 percent jump in refinancing, with the adjustable rate mortgage (ARM) share of activity moving ahead by 9.6 percent.
“Given the relative attractiveness of ARM rates compared to fixed rate loans, ARM applications increased 25 percent to their highest level since 2022, and the ARM share of all applications was almost 10 percent,” Kan said.
In the meantime, the Federal Housing Administration’s share of total applications declined from 18.5 percent the previous week to 18.4 percent on the week ended Aug. 8.
The Veterans Administration’s share of total applications grew from 13.3 percent the prior week to 14.2 percent. The Department of Agriculture’s share of total applications remained stable at 0.5 percent from the prior week.
For loan balances of $806,500 or less, the average contract interest rate for a 30-year fixed mortgage remained at 6.67 percent last week. with points increasing to 0.64 from 0.59 (including the origination fee). However, that rate increased to 6.7 percent for jumbo loan balances (above $860,500) for 30-year fixed-rate mortgages. In this case, points decreased to 0.45 from 0.59.
Those opting for 15-year fixed-rate mortgages can save money, with the average contract rate at 5.93 percent—a decrease from the prior week at 6.03 percent. Points also decreased from 0.66 to 0.63.
For ARMs, the average contract interest rate for a 5/1 ARM declined to 5.8 percent from 6.06 percent, but points increased from 0.67 percent from the prior week’s 0.49 percent. With a 5/1 ARM, the interest rate remains the same for the first five years, and after year 5, it adjusts once a year for the life of the loan. ARM loans usually include rate caps limiting the amount by which the interest rate can increase or decrease.
