The Mortgage Bankers Association (MBA) says that its seasonally adjusted Market Composite Index, a measure of mortgage application volume, decreased 1.2 percent during the week ending November 4, 2016 compared to the previous week.  It was the lowest level for the index since May. The downturn was measured at 2.0 percent on an unadjusted basis. 

The Refinance Index decreased 3 percent from the previous week, also to its lowest level since May 2016.  The refinance share of mortgage activity decreased to 62.3 percent of total applications from 62.7 percent during the week ended October 28. 

The seasonally adjusted Purchase Index increased 1 percent from the week ended October 28 while the unadjusted Purchase Index was down by the same amount. The unadjusted index was 11  percent higher than during the same week in 2015. 

FHA’s share of total applications increased to 11.6 percent from 11.1 percent the previous week while the VA share decreased to 12.3 percent from 12.4 percent.. USDA applications received what appears to be a nearly permanent 0.7 percent share.

The average contract interest rate for 30-year fixed-rate mortgages (FRM) with conforming loan balances ($417,000 or less) rose to the highest level since June 2016, 3.77 percent, from 3.75 percent.  Points increased to 0.38 from 0.36. The effective rate increased from the previous week. 

The jumbo version of the 30-year FRM, loans with balances greater than $417,000, had an average rate of 3.75, the highest level since June and 1 basis point higher than the previous week.  Points dipped to 0.27 from 0.32,  leaving the effective rate unchanged. 

The average contract interest rate for 30-year FRM backed by the FHA rose to the highest level since June, 3.61 percent, from 3.59 percent. Points increased to 0.35 from 0.33, raising the effective rate as well. 

The contract rate of the 15-year FRM  eased back by 1 basis point to 3.03 percent.  Points increased to 0.38 from 036 and the effective rate was down.  

The share of applications that were for adjustable rate mortgages (ARMs) ticked up from 4.4 percent the prior week to 4.5 percent. The average contract interest rate for 5/1 ARMs dropped 5 basis points to 2.92 percent, with points increasing to 0.47 from 0.40. The effective rate decreased.  

MBA’s Weekly Mortgage Applications Survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted since 1990.  Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100 and interest rate information presumes loans with an 80 percent loan-to-value ratio and points that include the origination fee.