Mortgage Applications Drop, Rates Rise on 30-year Loans

Mortgage Weekly Update

Mortgage activity slowed this week, as the COVID-19 outbreak worsened across the country. According to the weekly applications survey from the Mortgage Bankers Association, purchase activity was down 12% for the week and 33% for the year, while refinance applications dipped 19% for the week. They were still 144% higher than one year prior.

Activity dipped even further in coronavirus hotspots like New York and Washington. In New York, purchase applications were down 47.5% over the year, and in Washington, activity slid almost 60%.

Here’s how Joel Kan, MBA’s associate vice president of economic and industry forecasting, explains it: “Mortgage applications fell last week, as economic weakness and the surge in unemployment continues to weigh heavily on the housing market. With much less liquidity and tighter credit in the jumbo market, average loan sizes declined, and mortgage rates for jumbo loans increased to a high last seen in January.” 

Refinances accounted for about 74% of all mortgage activity last week, down from nearly 76% the week before. FHA loans accounted for 10.6% of applications, while VA loans accounted for 14.3%. 

More Mortgage and Housing News

  • The industry saw a slew of layoffs and furloughs. Companies who slashed ranks include Compass, Realogy, Vacasa, Unison, and Redfin, which furloughed 41% of its agents earlier this week.
  • ATTOM Data Solutions released a list of the U.S. housing markets that are more vulnerable to coronavirus impacts. According to the report, the Northeast and Florida are most at-risk, while the Western and Midwestern parts of the country are least vulnerable.
  • According to a poll from the National Association of Home Builders, 93% of the nation’s builders and remodelers have seen a dip in prospective buyers, and 89% say homeowners are concerned about interacting with remodeling crews. Another 86% have seen remodeling inquiries drop, while 82% say projects are being delayed or all-out canceled due to the pandemic.

Mortgage Rates

The average interest rate on 30-year, fixed-rate loans increased slightly for the week, rising from 3.47% to 3.49% — still a significant decrease over last year. Rates on jumbo loans and 5/1 ARMs also increased minimally, while FHA loans and 15-year loans saw rates drop.

Here’s a glimpse at where average mortgage rates landed for the week:

  • All 30-year, fixed-rate loans: 3.49%, 0.28 points
  • Jumbo 30-year, fixed-rate loans: 3.87%, 0.26 points
  • FHA 30-year, fixed-rate loans: 3.54%, 0.19 points
  • 15-year, fixed-rate loans: 3.04%, 0.25 points
  • 5/1 ARMs: 3.39%, -0.02 points

Be sure to check back next week for the latest mortgage rates.

Information contained in this article may include links or references to third-party resources or content. Embrace Home Loans does not endorse or guarantee the accuracy of this third-party information. If you follow these links, you will be linking to a third party website not operated by Embrace. We are not responsible for the content of that website and its privacy & security policies may differ from those practiced by Embrace.

​This information is distributed for professional use and is not intended to be shared with, or viewed by, consumers. To the average consumer, the information here may be misleading or exclude important disclosures.

Share this:

Aly Yale

Aly J. Yale is a freelance writer focusing on real estate, mortgage, and the housing market. Her work has been featured in Forbes, Bankrate, The Motley Fool, Business Insider, The Balance, and more. Prior to freelancing, she served as an editor and reporter for The Dallas Morning News. She graduated from Texas Christian University's Bob Schieffer College of Communication with a major in radio-TV-film and news-editorial journalism. Connect with her at or on Twitter at @AlyJwriter.