The Mortgage Bankers Association (MBA) has released its Weekly Mortgage Applications Survey for the week ending Dec. 17, 2010. The Market Composite Index, a measure of mortgage loan application volume, decreased 18.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 20.0 percent compared with the previous week. The Refinance Index decreased 24.6 percent from the previous week. The Refinance Index has declined six straight weeks and is at its lowest level since the week ending April 30, 2010. The seasonally adjusted Purchase Index decreased 2.5 percent from one week earlier. The unadjusted Purchase Index decreased 4.9 percent compared with the previous week and was 8.4 percent lower than the same week one year ago. "Refinance application volume dropped sharply this week as mortgage rates held near six month highs," said Michael Fratantoni, MBA's vice president of research and economics. "Purchase applications fell for a second week, with the level of applications little changed over the past month, indicating that home sales are likely to remain relatively weak over the next few months." The four week moving average for the seasonally adjusted Market Index is down 9.8 percent. The four week moving average is down 1.2 percent for the seasonally adjusted Purchase Index, while this average is down 12.7 percent for the Refinance Index. The refinance share of mortgage activity decreased to 72.3 percent of total applications from 76.7 percent the previous week. This is the lowest refinance share observed in the survey since early June 2010. The adjustable-rate mortgage (ARM) share of activity increased to 6.1 percent from 5.5 percent of total applications from the previous week. The average contract interest rate for 30-year fixed-rate mortgages increased to 4.85 percent from 4.84 percent, with points decreasing to 0.96 from 1.33 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate decreased from last week. The average contract interest rate for 15-year fixed-rate mortgages increased to 4.22 percent from 4.21 percent, with points decreasing to 1.19 from 1.28 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week. For more information, visit www.mortgagebankers.org.