U.S. mortgage applications fell for a third straight week, dragged down by a decline in home refinancings to a 16-month low even as interest rates dipped, an industry trade group figures showed on Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity for the week ended Nov. 25 decreased 1.8 percent to 624.1, down from the previous week’s 635.4.
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.20 percent last week, down 0.06 percentage point from the previous week’s 6.26 percent. It was the second decline in four weeks.
Interest rates fell for a second consecutive week. However, the rate was still substantially above the 30-year rate’s 2005 low of 5.47 percent in late June.
Interest rates were also higher than a year ago when the mortgage rate stood at 5.78 percent.
The MBA’s seasonally adjusted purchase mortgage index rose 0.8 percent to 476.2 from the previous week’s 472.3. The index is considered a timely gauge on U.S. home sales.
The group’s seasonally adjusted index of refinancing applications dropped 6.3 percent to 1,484.3 compared with 1,584.1 in the previous week. The index fell for a sixth straight week, and volume was at its lowest level since the week ended June 25, 2004 when the index reached 1,386.9.
Fixed 15-year mortgage rates averaged 5.72 percent, down from 5.83 percent the previous week. Rates on one-year adjustable-rate mortgages decreased to 5.39 percent from 5.41 percent.
The MBA’s survey covers about 50 percent of all U.S. retail residential mortgage originations. Respondents include mortgage bankers, commercial banks and thrifts.