Mortgage applications increased 0.3 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending September 10, 2021. This week's results include an adjustment for the Labor Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 0.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 10 percent compared with the previous week. The Refinance Index decreased 3 percent from the previous week and was 3 percent lower than the same week one year ago. The seasonally adjusted Purchase Index increased 8 percent from one week earlier. The unadjusted Purchase Index decreased 5 percent compared with the previous week and was 12 percent lower than the same week one year ago.

"Purchase applications - after adjusting for the impact of Labor Day - increased over 7 percent last week to their highest level since April 2021. Compared to the same week last September, which was right in the middle of a significant upswing in home purchases, applications were down 11 percent - the smallest year-over-year decline in 14 weeks," said Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting. "Both conventional and government purchase applications increased, and the average loan size for a purchase application rose to $396,800. The very competitive purchase market continues to put upward pressure on sales prices."

Added Kan, "While the 30-year fixed rate was unchanged at just over 3 percent, it was not enough to drive more refinance activity. Refinance applications slipped to their slowest pace since early July, and the refinance share of applications fell to 65 percent, which was also the lowest since July."

The refinance share of mortgage activity decreased to 64.9 percent of total applications from 66.8 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 3.3 percent of total applications.

The FHA share of total applications decreased to 9.9 percent from 10.9 percent the week prior. The VA share of total applications decreased to 10.2 percent from 10.4 percent the week prior. The USDA share of total applications decreased to 0.4 percent from 0.5 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) remained unchanged at 3.03 percent, with points decreasing to 0.32 from 0.33 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $548,250) decreased to 3.13 percent from 3.14 percent, with points decreasing to 0.21 from 0.30 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.04 percent from 3.07 percent, with points decreasing to 0.27 from 0.30 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.34 percent from 2.37 percent, with points increasing to 0.29 from 0.26 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs increased to 2.68 percent from 2.56 percent, with points decreasing to 0.11 from 0.17 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.