July 11, 2024 4:12:27 AM
(MENAFN) The number of mortgage applications in the United States fell last week as mortgage rates stabilized around 7%, according to a Mortgage Bankers Association (MBA) report released on Wednesday. The market composite index, which measures mortgage application volume, fell 0.2% on a seasonally adjusted basis for the week ended July 5. However, the unadjusted index was down a much larger 20% compared to the previous week.
Joel Kang, MBA vice president and deputy chief economist, said the recent rise in mortgage rates is contributing to the slowdown in demand, which he noted reflects the relatively flat number of mortgage applications, which has kept mortgage rates steady at around 7%.
The decline in mortgage applications was particularly notable in refinance activity, which declined for the fourth consecutive week as rising interest rates reduced incentives for borrowers. Despite the significant increase in home equity values in recent years, many borrowers have limited motivation to refinance at current interest rates.
Specifically, the average contract rate for 30-year fixed-rate mortgages decreased slightly to 7% from 7.03% the previous week. Conversely, the average contract rate for 30-year fixed-rate mortgages with jumbo loan balances greater than $766,550 increased slightly to 7.13% from 7.11%. The average contract rate for 15-year fixed-rate mortgages increased from 6.56% to 6.63% over the same period.
The MBA survey covers the majority of retail mortgage applications in the United States and provides insight into trends and changes in the mortgage market. These figures highlight how fluctuations in mortgage interest rates continue to affect borrower behavior and overall mortgage application volumes in the U.S. housing market.
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