Skip to main content

FHA Refi Volume Hits All-Time High

NationalMortgageProfessional.com
Jun 20, 2012

Mortgage applications decreased 0.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending June 15, 2012. 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 more than one percent compared with the previous week. The Refinance Index increased one percent from the previous week. The seasonally adjusted Purchase Index fell nine percent from one week earlier. The unadjusted Purchase Index decreased more than nine percent compared with the previous week and was two percent lower than the same week one year ago. “Refinance volume increased again last week, but the composition of activity changed markedly. Despite rates remaining near all-time lows, conventional refinance application volume declined, and the HARP share of refinance activity dropped to 20 percent,” said Michael Fratantoni, MBA's vice president of research and economics. “On the other hand, FHA refinance volume exploded to an all-time high, more than doubling over the week. New, lower FHA premiums on streamlined refinance loans came fully into effect, and borrowers seized the opportunity to lower their mortgage rates without increasing their FHA premiums. Purchase activity fell off last week, but this is likely only a recalibration following the Memorial Day holiday, as the level of activity remains within the narrow band seen for the past three years.” The refinance share of mortgage activity increased to 81 percent of total applications from 79 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to four percent of total applications. During the month of May, the investor share of applications for home purchase was at 6 percent, unchanged from the previous month, even though regions including East South Central and South Atlantic increased by 0.5 percent. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) decreased to 3.87 percent, matching the lowest rate in the history of the survey, from 3.88 percent, with points increasing to 0.49 from 0.43 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week. The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) decreased to 4.06 percent, the lowest rate in the history of the survey, from 4.12 percent, with points decreasing to 0.38 from 0.41 (including the origination fee) for 80 percent LTVs. The effective rate decreased from last week. The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.72 percent from 3.71 percent, with points decreasing to 0.47 from 0.59 (including the origination fee) for 80 percent LTVs. The effective rate decreased from last week. The average contract interest rate for 15-year fixed-rate mortgages increased to 3.25 percent from 3.23 percent, with points decreasing to 0.45 from 0.48 (including the origination fee) for 80 percent LTVs. The effective rate increased from last week. The average contract interest rate for 5/1 ARMs decreased to 2.75 percent, the lowest rate in the history of the survey, from 2.78 percent, with points decreasing to 0.33 from 0.49 (including the origination fee) for 80 percent LTVs. The effective rate decreased from last week.
Published
Jun 20, 2012
Rocket Launches Visa Signature Card

Rocket says its first-of-its kind credit card will help clients save on home purchases and homeowners pay off mortgages.

Guild Mortgage Acquires Cherry Creek Mortgage

Terms of purchase not disclosed; reverse mortgage volume added to Guild.

Mar 14, 2023
Vigilance, Dedication, And Commitment Forge Legends

Submit a nomination for Mortgage Banker Magazine’s Legends of Lending.

Mar 10, 2023
FTC Moves To Block Black Knight, ICE Merger

Says it 'would drive up costs, reduce innovation, and reduce lenders’ choices.'

Mar 09, 2023
Rocket Arms Brokers With Bully Shield Vs. UWM

Rocket covers penalties and court fees for brokers who want to get out of United Wholesale Mortgage’s ultimatum contract. 

Feb 06, 2023
Top Texas Originator Sees No Surrender To 2023

Big cities will determine the battle

Jan 26, 2023