For the week ending October 9, 2020, the Mortgage Bankers Association Weekly Application Survey showed a 0.7% drop in overall application activity from the previous week on a seasonally adjusted basis, as shown in its Market Composite Index. The constituent indices for Purchase and Refinance decreased by 1.6% and 0.3%, respectively, for the week.
Despite the weekly declines, year-over-year gains continue to be strong. Compared to the same week last year, on a non-seasonally adjusted basis, purchasing was 24% higher and refinancing was 44% higher. Per MBA, the 30-year fixed-rate mortgage rate reached a new low this week, decreasing by 1 basis point to 3.00%.
The MBA attributes the gains to the low-interest rate environment and undiminished homebuyer demand. However, refinancing gains have been diminishing since their spike at the start of the pandemic in March.
The refinance share of mortgage activity increased to 65.6 percent of total applications from 65.4 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 2.0 percent of total applications.