This week mortgage rates have increased compared to a week earlier, bringing an end to the mortgage rate decrease during the first weeks of October. However, rates still remain at one of the lowest levels we've seen since May 7 this year.

According to Freddie Mac, 30-year fixed-rate mortgages rose this week to 3.82% compared to 3.76% a week ago. Last year at this time, rates sat at 3.97%.

15-year fixed-rate mortgages increased from 2.99% last week to 3.03% this week, although they remain lower than the 3.18% rate we saw one year ago.

5-year adjustable-rate mortgages remained at 2.88%. This is slightly below the 2.92% 5-year rate from one year ago.

1-year adjustable-rate mortgages decreased slightly to 2.54% this week compared to 2.55% one week ago. In October 2014, 1-year rates were at 2.38%.

Despite the relatively low mortgage rates this month, mortgage applications dropped 27.6% last week compared to a week before, mainly due to change in lenders' business processes that took place after the new TILA-RESPA disclosures implementation.

According to the MBA Weekly Mortgage Applications Survey for the week ending October 9, 2015, the refinance share of mortgage activity rose from 57.4% two weeks ago to 61.2% this week, even considering the decrease in mortgage applications. The adjustable-rate mortgage share of activity decreased to 7.5% last week compared to 7.6% the week before.

The share of total FHA applications declined slightly to 12.6% last week compared to 12.7% the previous week while the VA share of all applications rose considerably from 9.2% two weeks ago to 11.5% last week. The USDA share of all mortgage applications dropped to 0.5% last week compared to 0.7% a week earlier.

Although mortgage applications are currently decreasing, according to data from the MBA Builder Application Survey for September 2015, there has been a 3% increase in mortgage applications to purchase homes during September compared to a month earlier. There has also been an increase in the average loan size between August and September, rising from $317,035 to $324,884 during this period.

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