According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates moved higher last week across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. Joel Kan, MBA’s vice president and deputy chief economist, says there were a few reasons for the increase. “Treasury yields rates rose last week and mortgage rates followed suit, due to a combination of the Treasury’s funding announcement and the downgrading of the U.S. government debt rating,” Kan said. Higher rates led to a slowing of mortgage demand, including a 3 percent decline in the number of prospective home buyers applying for loans to buy homes. Purchase loan activity is now 27 percent below where it was last year at the same time. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)
