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Mortgage applications rose by 4.9% from one week earlier on a seasonally adjusted basis over the week ending October 19th, 2018, according to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey. Last week’s results do not include an adjustment for Columbus Day.

On an unadjusted basis, the Market Composite Index, a measure of mortgage loan application volume, rose by 5%. The Refinance Index rose by 10% over the same period. Both the seasonally-adjusted and unadjusted Purchase Index rose by 2% from one week earlier.

“Mortgage application activity rebounded the week following the Columbus Day holiday, but both purchase and refinance levels remained lower than where they were two weeks ago,” says Joel Kan, MBA AVP of economic and industry forecasts. “The holiday impacted refinance applications more than purchases, as refinances rebounded almost 10 percent. Meanwhile, purchase applications increased two percent over the prior week but were still four percent lower than two weeks ago – a sign that both the jump in mortgage rates and tight inventory continue to hold back application activity. Mortgage rates increased over the week for most loan types, with most rates remaining at seven-year highs.”

The refinance share of mortgage activity rose to 39.8% of all applications, up from 38.1% the previous week. The adjustable-rate mortgage (ARM) share of mortgage activity fell to 7.0% of all applications. The FHA share fell to 10.1% from 10.4%, the VA share fell to 10.1% from 10.4%, and the USDA share fell to 0.7% from 0.8%.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) rose to its highest level since February 2011 at 5.11%, up from 5.10% the previous week. Points for 80% loan-to-value ratio (LTV) loans fell to 0.52 from 0.55. (All 80% LTV loan reports include the origination fee.) The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100) rose to 5.01% from 4.98%. Points for 80% LTV loans fell to 0.28 from 0.34, and the effective rate increased.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA rose to 5.07% from 4.99%. Points for 80% LTV loans fell to 0.61 from 0.69, and the effective rate remained unchanged.

The average contract interest rate for 15-year fixed-rate mortgages remained unchanged at 4.50%. Points for 80% LTV loans rose to 0.55 from 0.54, and the effective rate increased from last week.

The average contract interest rate for 5/1 ARMs rose to its highest level since the series began in 2011 at 4.47%, up from its previous high of 4.34% the previous week. Points for 80% LTV loans rose to 0.37 from 0.35, and the effective rate increased from last week.