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Refis Drop as Rates Decline

NationalMortgageProfessional.com
Sep 29, 2010

The Mortgage Bankers Association (MBA) has released its Weekly Mortgage Applications Survey for the week ending Sept. 24, 2010. The Market Composite Index, a measure of mortgage loan application volume, decreased 0.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased one percent compared with the previous week. The Refinance Index decreased 1.6 percent from the previous week, which is the fourth straight weekly decrease. The seasonally adjusted Purchase Index increased 2.4 percent from one week earlier. The increase in the Purchase Index was driven by a 4.5 percent increase in government purchase applications, while conventional purchase applications increased 0.8 percent. The unadjusted Purchase Index increased 1.5 percent compared with the previous week and was 32.4 percent lower than the same week one year ago. The four week moving average for the seasonally adjusted Market Index is down 3.3 percent. The four week moving average is up 1.1 percent for the seasonally adjusted Purchase Index, while this average is down 4.2 percent for the Refinance Index. The refinance share of mortgage activity decreased to 80.7 percent of total applications from 81.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6.0 percent from 5.9 percent of total applications from the previous week. The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.38 percent from 4.44 percent, with points increasing to 1.01 from 0.81 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The 30-year contract rate is a new low for this survey. The previous low was 4.43 percent for the week ending August 27, 2010. The effective rate also decreased from last week. The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.77 percent from 3.88 percent, with points increasing to 1.13 from 0.86 (including the origination fee) for 80 percent LTV loans. The 15-year contract rate is the lowest recorded in the survey, while the previous low was observed last week. The effective rate also decreased from last week. The average contract interest rate for one-year ARMs increased to 7.04 percent from 6.96 percent, with points increasing to 0.22 from 0.21 (including the origination fee) for 80 percent LTV loans. The survey covers over 50 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100. For more information, visit www.mortgagebankers.org.
Published
Sep 29, 2010
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