US mortgage applications rise 0.6% to rebound from lowest level since 1996

By Ovunc Kutlu

ISTANBUL (AA) - US mortgage applications rose 0.6% last week, bouncing back from the lowest since 1996, but mortgage interest rates rose further, according to a report Wednesday by the Mortgage Bankers Association (MBA).

The Market Composite Index, a measure of mortgage loan application volume, rose 0.6% on a seasonally adjusted basis for the week ending Oct. 6 compared to the previous week. On an unadjusted basis, the index increased 1%.

The 30-year fixed mortgage rate climbed to 7.67% from 7.53% a week ago, which is still at the highest since 2000 and 40 basis points higher than a month ago, according to the MBA.

"Application activity remains depressed and close to multi-decade lows, with purchase applications still almost 20 percent behind last year’s pace," MBA Vice President and Deputy Chief Economist Joel Kan said in the report.

"Refinance applications also continue to be limited, and the average loan size has fallen to its lowest level since 2017," he added.

The average contract interest rate for a 15-year fixed-rate mortgage jumped to 6.97% from 6.86%.

The MBA survey covers more than 75% of US retail residential mortgage applications.