Mortgage Apps: A Near Complete Halt

Bottom Line:  Mortgage rates averaged over 7% in the final week of September, nearly bringing mortgage applications to a complete halt. The Mortgage Bankers Association's application index was down over 14%. The Refi Index hit a new record low, while the purchase index nearly hit levels last seen in late 2014. On the plus side, secondary mortgage market yields were lower this week, suggesting the average 30-year fixed-rate mortgage should be back below 7% this week. Still, this trend will take years to reverse as the mortgage market adjusts to this year's historic move in rates.The MBA Mortgage Application Index FELL sharply , DOWN -14.2% to 219.0, BELOW the 13-week average of 267.0 and -68.0% BELOW the year-ago level. Non-seasonally adjusted the index FELL -14.2%.
 
The Purchase Index FELL sharply , DOWN -12.6% to 174.0, BELOW the 13-week average of 202.0 and -36.9% BELOW the year-ago level.
 
The Refinancing Index FELL sharply , DOWN -17.8% to 431.0, BELOW the 13-week average of 593.0 and -85.8% BELOW the year-ago level.
 
The effective (adjusted for points paid) 30-year mortgage rate ROSE 17bps to 7.03%, ABOVE the 13-week average of 6.11% and 117bps ABOVE the year-ago level.Current coupon yields in the secondary market were up 19.0 bps last week, closing at 5.68%, and were down -26.0 bps this week through Tuesday.