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Refi Mortgage Applications Jump

During the recent holiday week, new applications for mortgage refinances surged. But similar strength was not exhibited for new purchase activity.

A 7 percent increase on a seasonally adjusted basis was recorded in the week ended July 8 from a week previous for the Market Composite Index.

Foregoing seasonal adjustments, the index,
a measure of mortgage loan application volume, dropped 14 percent during the week that included July 4.

The index is part of the
Weekly Mortgage Applications Survey from the Mortgage Bankers Association.

Applications for refinances climbed a seasonally adjusted 11 percent from the week ended July 1. Refinance share widened to 64.0 percent from 61.6 percent a week earlier
and 50.8 percent a year earlier.

Purchase financing applications held steady versus the prior week. But without seasonal adjustments, purchase applications slid by a fifth from the last report and were down 5 percent from the week ended July 10, 2015.

MBA reported that applications for mortgages insured by the Federal Housing Administration accounted for a 10th of total activity. FHA share widened from 9.5 percent in the report from seven days earlier but was far thinner than 13.8 percent in the report from 12 months earlier.

Department of Veterans Affairs applications made up 12.1 percent of all applications. VA share was more narrow than 12.8 percent the prior week
but wider than 10.8 percent a year prior.

Fixed rates on jumbo mortgages averaged 1 basis point more than conforming rates in the most-recent report. The jumbo-conforming spread
was no different than in the week-earlier report and swung from a negative 3 BPS in the year-earlier report.

Applications for adjustable-rate mortgages represented
5.2 percent of the latest week’s activity. ARM share thinned from 5.6 percent in the prior report and 7.4 percent in the year-prior report.

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