Mortgage applications ticked up last week and there was a notable shift is in how borrowers are financing their purchases.
With the 30-year fixed rate holding near 6.79% — its highest level in four weeks — the share of applications for adjustable-rate mortgages (ARM) climbed to 8%, the biggest ARM share recorded in five weeks, according to the Mortgage Bankers Association.
“Mortgage rates reached their highest levels in four weeks as investors’ concerns about inflation and growing deficits push yields higher across the globe,” said Mike Fratantoni, MBA’s SVP and Chief Economist. “Refinance volume dropped in response, but purchase volume increased modestly over the week and was slightly below last year’s level. In many local markets, potential buyers have plenty of homes to choose, and this is likely supporting transaction volume. Another trend we’re monitoring is more borrowers choosing ARMs.”
