September 28, 2011 (Chris Moore)
Borrowers seeking to refinance their current mortgages jumped up11.2 percent last week as refinance applications accounted for almost 80 percent of all mortgage applications submitted according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 23, 2011.
The Market Composite Index, a measure of mortgage loan application volume, which includes purchase applications and refinance applications, increased a seasonally adjusted 9.3 percent from the previous week.
On an unadjusted basis, the Index increased 9.2 percent compared with the previous week. The four week moving average for the seasonally adjusted Market Index is up 1.96 percent.
Purchase Applications:
The seasonally adjusted Purchase Index increased 2.6 percent from the previous week. The four week moving average is down 0.18 percent for the adjusted Purchase Index.
The unadjusted Purchase Index increased 2.2 percent compared with the previous week and was 0.1 percent higher than the same week a year ago.
Refinance Activity:
The Refinance Index increased 11.2 percent from the previous week. The four week moving average is up 2.60 percent.
The refinance share of mortgage activity increased to 79.7 percent of total applications from 78.3 percent the previous week.
Mortgage Interest Rates:
|
Average Contract Mortgage Rates |
|||||
|
Type of |
Interest Rate (%) |
Points |
Effective Rate |
||
|
Current |
Previous |
Current |
Previous |
||
| 30-Year FRM Conforming ($417,500 or less) |
4.25 |
4.29 |
0.35 |
0.41 |
Decreased |
| 30-Year FRM Non-Conforming ($417,501 or more) |
4.51 |
4.55 |
0.38 |
0.46 |
Decreased |
| 15-Year FRM |
3.47 |
3.46 |
0.45 |
0.45 |
Increased |
| FHA 30-Year |
4.05 |
4.07 |
0.39 |
0.51 |
Decreased |
| 5/1 ARM |
2.95 |
2.96 |
0.48 |
0.49 |
Decreased |
The adjustable-rate mortgage (ARM) share of activity decreased to 6.1 percent of total applications from 6.7 percent the previous week.
“Mortgage rates declined last week, at least partially in response to the Fed’s announcement that they would shift their portfolio towards longer-term Treasury securities, and that they would resume buying mortgage-backed securities,” said Mike Fratantoni, MBA’s Vice President of Research and Economics. “With lower rates, refinance application volume increased to its highest level since August 19, 2011. Purchase application volume also increased. However, the increase was in conventional purchase applications, which were up by 4.9 percent. Purchase applications for government loans fell by 0.6 percent over the week, likely influenced by the pending decline in FHA loan limits.”
This week’s results are based on an enhanced sample which captures more than 75% of all retail and consumer direct channel mortgage applications, compared to 50% previously.
Tags: MBA, home purchase applications, mortgage rates, fixed rate mortgage, adjustable rate mortgage, refinance, interest rate
Sources:
Mortgage Bankers Association
