As fixed rates retreated to lows not seen since the beginning of last year, the pool of prospective borrowers applying for mortgages grew.
A seasonally adjusted one-tenth week-over-week improvement was recorded for the Market Composite Index in the week ended April 8.
Foregoing any seasonal adjustment, the weekly measure of mortgage loan applications was still up 10 percent from the previous report.
The details were included in the Weekly Mortgage Applications Survey from the Mortgage Bankers Association.
The trade group said the survey covers more than 75 percent of all U.S. retail residential loan applications.
Applications for refinances climbed a seasonally adjusted 11 percent from the week ended April 8.
Refinance share widened to 54.9 percent from 54.5 percent the previous week but was trimmed from 58 percent a year previous.
Purchase financing activity ascended 8 percent from a week earlier to the highest level since October 2015.
Excluding seasonal adjustments, purchase applications were 9 percent stronger than the prior week and up nearly a quarter from the week ended
April 10, 2015.
MBA reported that applications for mortgages insured by the Federal Housing Administration accounted for 10.8 percent of the latest week’s volume. FHA share thinned from 11.3 percent a week earlier.
Also more narrow was the share of applications that were for loans guaranteed by the Department of Veterans Affairs. VA share fell to 11.9 percent from 12.2 percent.
“Helped by a persistently strong job market and low rates, applications for both conventional and government home purchase loans increased last week,” MBA Chief Economist Mike Fratantoni said in the report. “The purchase index was at its second highest level since May 2010.”
Applications for adjustable-rate mortgages accounted for 5 percent of total activity, up from 4.7 percent the previous week but off from 5.4 percent a year previous.
Interest rates on jumbo mortgage were 8 basis points lower than on conforming loans. The jumbo-conforming spread
thinned from a negative 10 BPS in the last report but was wider than a negative 3 BPS in the year-earlier report.
Fratantoni added, “The 30 year contract rate decreased to its lowest level since January 2015.”
