Mortgage Applications on the Rise in the United States

The Mortgage Bankers Association (MBA) has reported a 5.4% increase in mortgage applications in the United States for the week ending December 6, according to their Weekly Mortgage Applications Survey released on Wednesday.

Interest Rates and Market Index

The average contract interest rate for 30-year fixed-rate mortgages dropped slightly to 6.67% from 6.69%. This change contributed to an increase in the Market Index, which rose to 225.5 from 213.9 in the previous week. However, the Purchase Index saw a decrease, dropping from 161.5 to 154.9.

Refinance Index and VA Applications

The Refinance Index experienced a significant advance, moving up to 634 from 498.5 in the prior week. This surge was largely driven by a 27% increase in refinance activity, as borrowers sought to take advantage of lower rates to reduce their payments. Notably, VA refinance applications increased by 85% from the previous week, matching some of the larger swings in VA activity reported in recent months, according to MBA Deputy Chief Economist Joel Kan.