Mortgage applications decreased 6.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending Dec. 20, 2013. The Market Composite Index, a measure of mortgage loan application volume, decreased 6.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased seven percent compared with the previous week. The Refinance Index decreased eight percent from the previous week. The seasonally adjusted Purchase Index decreased four percent from one week earlier. The unadjusted Purchase Index decreased five percent compared with the previous week and was 11 percent lower than the same week one year ago.
“Following the Federal Reserve’s taper announcement, mortgage application volume dropped again last week, with rates increasing and refinance application volume falling to its lowest level since November 2008,” said Mike Fratantoni, MBA’s vice president of research and economics. “Purchase application volume was weak too, continuing to run more than ten percent below last year’s pace. Notably, government purchase application volume is almost 25 percent below where it was at this time last year, with the larger drop compared to conventional purchase likely due to the increase in FHA premiums over the course of the year.”
The refinance share of mortgage activity decreased to 65 percent of total applications from 66 percent the previous week. The adjustable-rate mortgage (ARM) share of activity rose to 8.3 percent of total applications, the highest level since July 2008.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.64 percent, the highest level since September 2013, from 4.62 percent, with points increasing to 0.41 from 0.38 (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 $417,000) increased to 4.63 percent, the highest level since September 2013, from 4.61 percent, with points remained unchanged at 0.24 (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 4.29 percent from 4.25 percent, with points decreasing to 0.24 from 0.32 (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 3.74 percent, the highest level since September 2013, from 3.66 percent, with points decreasing to 0.29 from 0.35 (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 3.26 percent, the highest level since September 2013, from 3.20 percent, with points decreasing to 0.39 from 0.42 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
