Mortgage applications increased 7.8 percent from one week earlier, according to data from the Mortgage Bankers Association's Weekly Mortgage Applications Survey for the week ending May 13, 2011. The Market Composite Index, a measure of mortgage loan application volume, increased 7.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 7.1 percent compared with the previous week. The Refinance Index increased 13.2 percent from the previous week and is at its highest level since the week ending Dec. 10, 2010. The seasonally adjusted Purchase Index decreased 3.2 percent from one week earlier. The unadjusted Purchase Index decreased 3.3 percent compared with the previous week and was 1.7 percent lower than the same week one year ago.
"The 30-year fixed mortgage rate is now 53 basis points below its 2011 peak, and has decreased for five straight weeks," said Michael Fratantoni, vice president of research for the Mortgage Bankers Association (MBA). "Over this five week span, the refinance index has increased by about 33 percent. Refinance application volumes remain about 50 percent below the most recent peak last October. "
The four week moving average for the seasonally adjusted Market Index is up 3.6 percent. The four week moving average is down 2.9 percent for the seasonally adjusted Purchase Index, while this average is up 7.2 percent for the Refinance Index.
The refinance share of mortgage activity increased to 66.7 percent of total applications from 63.1 percent the previous week. This is the largest refinance share observed since late January. The adjustable-rate mortgage (ARM) share of activity decreased to 6.3 percent from 6.5 percent of total applications from the previous week.
The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.60 percent from 4.67 percent, with points decreasing to 0.94 from 1.10 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. This is the lowest 30-year rate recorded in the survey since the end of November 2010. The effective rate also decreased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.75 percent from 3.81 percent, with points increasing to 1.22 from 1.05 (including the origination fee) for 80 percent LTV loans. This is the lowest 15-year rate recorded in the survey since early November 2010. The effective rate also decreased from last week.
