Residential mortgage applications increased 10.3 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending Nov. 4, 2011. The Market Composite Index, a measure of mortgage loan application volume, increased 10.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 9.9 percent compared with the previous week. The Refinance Index increased 12.1 percent from the previous week. The seasonally adjusted Purchase Index increased 4.8 percent from one week earlier to the highest level since August 2011. The unadjusted Purchase Index increased 2.7 percent compared with the previous week and was 2.5 percent lower than the same week one year ago.
The four week moving average for the seasonally adjusted Market Index is down 0.37 percent. The four week moving average is up 0.89 percent for the seasonally adjusted Purchase Index, while this average is down 0.72 percent for the Refinance Index.
"Treasury rates dropped last week, as renewed turmoil in Europe once again led to a flight to quality, and 30-year mortgage rates dropped to their second lowest level of the year," said Mike Fratantoni, MBA's VP of research and economics. "Refinance applications jumped more than 12 percent to their highest level in a month and some lenders experienced even larger increases. As has been the case all year, many refinance applicants are opting to deleverage by choosing 15-year mortgages."
Following three consecutive weeks of decline, the refinance share of mortgage activity increased to 78.6 percent of total applications from 77.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged from 5.8 percent of total applications from the previous week.
The average contract interest rate for 30-year fixed-rate mortgages (FRMs) with conforming loan balances ($417,500 or less) decreased to 4.22 percent from 4.31 percent, with points decreasing to 0.41 from 0.49 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate also decreased from last week.
The average contract interest rate for 30-year FRMs with jumbo loan balances (greater than $417,500) decreased to 4.57 percent from 4.69 percent, with points increasing to 0.47 from 0.45 (including the origination fee) for 80 percent LTVs. The effective rate also decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 4.02 percent from 4.09 percent, with points decreasing to 0.49 from 0.51 (including the origination fee) for 80 percent LTVs. The effective rate also decreased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.54 percent from 3.63 percent, with points remaining unchanged from 0.45 (including the origination fee) for 80 percent LTVs. The effective rate also decreased from last week.
The average contract interest rate for 5/1 ARMs decreased to 3.01 percent from 3.09 percent, with points decreasing to 0.47 from 0.50 (including the origination fee) for 80 percent LTVs. The effective rate also decreased from last week.
