Mortgage Applications Dip as Rates Rise Above 5%

Demand for mortgage applications was unable to keep pace with the five-month peak reached in final week of September, according to the Mortgage Bankers Association on Wednesday. The weekly survey said rates for a 30-year mortgage moved above 5% for the time in four weeks, driving down the indexes for new mortgages, refinancing, and purchases.

Average mortgage rates for a 30-year loan moved up to 5.02% in the week ending October 9. Higher rates helped drive applications down 1.8%, following a 16.4% surge in the prior week’s survey.

Despite the one-week loss, average lending rates remains at historic lows and the four-week average for mortgage applications is up +5.6%.

Refinances, which accounted for 67.4% of all loans in the period, fell by 0.1%, and purchases dropped 5.0%. 

Yesterday, a report from Zillow.com showed the state average is below 5.15% in all 50 states. Lenders in New York and Illinois offer the highest rates with an average of 5.15%, while rates in Colorado, Virginia and Washington are currently the lowest at 4.90%.