Another move higher in U.S. mortgage interest rates pushed weekly applications down. Total volume fell 1.5 percent week-to-week on a seasonally adjusted basis for the week ending May 15th, according to the Mortgage Bankers Association (MBA).
While higher rates usually affect rate-sensitive refinances, the drop in loan applications to purchase a home was surprisingly large, down 4 percent from the previous week to the lowest level since April, though still 11 percent higher than the same week one year ago. This in the heart of the spring housing market.
"The drop this week may indicate borrowers being wary of the recent run up in mortgage rates," said Mike Fratantoni, MBA's chief economist.