Investing.com - The number of mortgage applications in the U.S. fell last week, as uncertainty over the timing of a Federal Reserve rate hike weighed, industry data showed on Wednesday.
In a report, the Mortgage Bankers Association said their mortgage market index, a measure of mortgage loan application volume, decreased by a seasonally adjusted 4.1% in the week ending May 27 to 476.1. That follows a gain of 2.3% to 496.5 in the preceding week.
Refinance applications declined 4% from the previous week, seasonally adjusted, and purchase applications slumped 5%.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances held steady at 3.85%, unchanged from the preceding week.
"Market expectations for a June Fed rate hike have increased recently, leading to a flattening of the yield curve, as short-term rates have risen more than longer-term rates. As a result, we saw an increase in rates for 15-year mortgages last week, even as rates on 30-year loans remained unchanged," said MBA Chief Economist Mike Fratantoni.
The survey covers over 75% of U.S. retail residential mortgage applications, according to MBA.