30-year mortgage rate tracked by MBA drops below 3%
Mortgage applications fell 1.7% in the week ending July 30, according to the latest report from the Mortgage Bankers Association. That’s despite the 30-year fixed rate falling to its lowest level in roughly six months.
It’s an about-face from the prior week, in which applications increased 5.7% on the strength of descending mortgage rates.
Mike Fratantoni, MBA’s senior vice president and chief economist, said this past week’s drop in mortgage applications can be attributed to the market’s assessment of the latest COVID-19 delta variant.
“Thirty-year mortgage rates dropped below 3% in our survey for the first time since February, presenting an opportunity for many homeowners who have not yet refinanced to lower their rate and payments,” he said. “Refinance application volume slightly decreased following an 11% jump last week, and purchase application volume decreased again, reflecting the ongoing lack of inventory that continues to drive rapid home-price appreciation across the country.”
The refinance share of activity of total mortgage applications increased slightly to 67.6% from 67.5% the previous week. On an unadjusted basis, the market composite index decreased 2% compared with the previous week (when it increased 6%). The seasonally adjusted purchase index decreased as well, down 2% from the previous week.
August 4, 2021, 7:00 amBy Tim Glaze