US mortgage applications fall 3% as rates increase

US mortgage applications fall 3% as rates increase

30-year fixed rate rises to 6.93% from 6.87%

By Ovunc Kutlu

ISTANBUL (AA) - US mortgage applications declined 3% last week as rates increased, according to a report by the Mortgage Bankers Association (MBA) on Wednesday.

The Market Composite Index, a measure of mortgage loan application volume, fell 3.0% on a seasonally adjusted basis for the week ending July 28, compared to the previous week. On an unadjusted basis, the index also declined 3%.

The 30-year fixed mortgage rate rose to 6.93%, from 6.87%, during that period. For the week ending July 7, the index had soared to 7.07% -- the highest since November 2022.

"The purchase index decreased for the third straight week to its lowest level since the beginning of June and remains 26 percent behind last year’s levels," MBA Vice President and Deputy Chief Economist Joel Kan said in a statement.

"The decline in purchase activity was driven mainly by weaker conventional purchase application volume, as limited housing inventory and rates still close to 7 percent are crimping affordability for many potential homebuyers," he added.

The average contract interest rate for a 15-year fixed-rate mortgage increased to 6.39%, from 6.37%, for the week.

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

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