Mortgage applications decreased 4.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending March 8, 2013. The Market Composite Index, a measure of mortgage loan application volume, decreased 4.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased four percent compared with the previous week. The Refinance Index decreased five percent from the previous week. The seasonally adjusted Purchase Index decreased three percent from one week earlier. The unadjusted Purchase Index decreased one percent compared with the previous week and was nine percent higher than the same week one year ago.
“The announcement of stronger than anticipated job growth last week led to an increase in interest rates, with the 30-year fixed mortgage rate in our survey reaching the highest level in more than six months,” said Mike Fratantoni, MBA’s VP of Research and Economics. “Refinance applications declined as a result, but remain high given the steady flow of HARP applications.”
The refinance share of mortgage activity decreased to 76 percent of total applications, the lowest level since May 2012, from 77 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to five percent of total applications. The HARP share of refinance applications increased to 30 percent from 28 percent the prior week.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) increased to 3.81 percent, the highest rate since August 2012, from 3.70 percent, with points remaining unchanged at 0.39 (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) increased to 3.90 percent from 3.80 percent, with points increasing to 0.46 from 0.37 (including the origination fee) for 80 percent LTVs. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.53 percent from 3.47 percent, with points increasing to 0.38 from 0.33 (including the origination fee) for 80 percent LTVs. The effective rate increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages increased to 3.01 percent from 2.96 percent, with points increasing to 0.42 from 0.36 (including the origination fee) for 80 percent LTVs. The effective rate increased from last week.
The average contract interest rate for 5/1 ARMs increased to 2.62 percent from 2.55 percent, with points decreasing to 0.33 from 0.37 (including the origination fee) for 80 percent LTVs. The effective rate increased from last week.
“The ups and downs of mortgage application volume the past few weeks is no reflection on the larger picture of an improving housing market," said Quicken Loans Chief Economist Bob Walters. "Chances are the drop in mortgage applications is tied to rates ticking up due to a better-than-expected unemployment report that showed the job market is improving, removing investor desire for safer assets.”
