January 2016 is closing with the lowest average mortgage rates in the past 3 months. However, despite the decreasing rates this past month, last year mortgage rates were much lower.

30-year fixed-rate mortgages dropped to 3.79% this week compared to 3.81% one week ago. One year ago at this time 30-year rates were at 3.66%.

15-year fixed-rate mortgages also decreased this week, reaching 3.07% compared to 3.1% last week. During the last week of January 2015, this rate was 2.98%.

5/1-year adjustable-rate mortgages dropped slightly as well, from 2.91% last week to 2.9% this week. However, last year this rate was at 2.86%.

This decreasing mortgage rate trend has increased the amount of mortgage applications this year. Last week, ending January 22, 2016, mortgage applications rose 8.8% compared to a year earlier.

According to the MBA Weekly Mortgage Applications Survey, although mortgage applications have increased, the refinance share of mortgage activity dropped slightly last week to 59% of all applications compared to 59.1% the previous week. Meanwhile, the adjustable-rate mortgage share of activity rose to 6.9% of all applications last week compared to 6% a week earlier.

The FHA share of all mortgage applications dropped from 13.7% two weeks ago to 12.7% one week ago, while the VA share of total applications rose from 10.8% to 11.1% during this same period. The USDA share of all applications remained at 0.7% as it was a week earlier.

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