• Refinancing applications surge but purchase applications fall.

• Mortgage interest rates reach record lows.

The Mortgage Bankers Association Mortgage Loan Applications Index rebounded 4.6% (38.4% y/y) in the week ended October 2 after having declined 4.8% in the previous week.

Applications to refinance an existing loan surged 8.2% (49.8% y/y) following a 6.5% decline in the previous week. Purchase applications declined 1.5% (+21.1% y/y) after falling 1.9% in the previous week. The refinance share of mortgage activity rose to 65.4% of total applications. That remained down from the recent peak of 74.4% during all of April 2020. The adjustable-rate mortgage (ARM) share of activity held steady at 2.2% of total applications.

The effective rate on a 30-year fixed rate interest rate declined to a record low of 3.12% from 3.20% in the week ended September 25. The rate on 15-year loans fell to 2.68% from 2.77%. The effective rate for a Jumbo mortgage loan eased six basis points to 3.39%. The rate on the 5-year adjustable rate mortgage weakened 23 basis points to 2.92%.

The average mortgage loan size edged 0.4% higher (-1.9% y/y) to $322,500. The average size of a purchase loan improved 0.2% (12.4% y/y) to $371,500. The average loan size to refinance gained 1.5% (-9.4% y/y) to $296,600.

Applications for fixed-rate loans rebounded 4.6% (42.7% y/y) and applications for adjustable rate mortgages increased 3.2% (-43.3% y/y).

The survey covers over 75% of all U.S. retail residential mortgage applications and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for all indexes is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver's SURVEYW database.

The minutes to the latest FOMC meeting can be found here.