Mortgage applications decreased four percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending March 29, 2013. The Market Composite Index, a measure of mortgage loan application volume, decreased four percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index also decreased four percent compared with the previous week. The Refinance Index decreased six percent from the previous week. The seasonally adjusted Purchase Index increased one percent from one week earlier. The unadjusted Purchase Index increased two percent compared with the previous week and was 4 percent higher than the same week one year ago.
“Total purchase applications increased last week, due to an almost seven percent increase in purchase applications for government loans. This was likely driven by borrowers applying for loans prior to the scheduled increase in FHA premiums that took effect on April 1,” said Mike Fratantoni, MBA’s vice president of research and economics. “On a year over year basis, purchase applications are up about four percent, in line with the trend we are seeing in home sales volumes.”
The refinance share of mortgage activity decreased to 74 percent of total applications from 75 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained constant at five percent of total applications. The HARP share of refinance applications decreased to 28 percent from 29 percent the prior week.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) decreased to 3.76 percent from 3.79 percent, with points decreasing to 0.43 from 0.44 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) decreased to 3.85 percent from 3.90 percent, with points decreasing to 0.37 from 0.42 (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 decreased to 3.48 percent from 3.51 percent, with points decreasing to 0.38 from 0.43 (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 decreased to 2.99 percent from 3.02 percent, with points decreasing to 0.36 from 0.42 (including the origination fee) for 80 percent LTVs. The effective ratedecreased from last week.
The average contract interest rate for 5/1 ARMs increased to 2.60 percent from 2.58 percent, with points unchanged at 0.32 (including the origination fee) for 80 percent LTVs. The effective rate increased from last week.
“Purchase demand is growing regardless of lower housing inventory, creating fierce competition among the most sought after properties," said Quicken Loans Chief Economist Bob Walters. "I expect purchases to continue to heat up along with the weather as we move into the spring home buying season.”
