November 17 2010 (Chris Moore)
The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 5, 2010. The Market Composite Index, a measure of mortgage loan application volume, decreased 14.4 percent on a seasonally adjusted basis from one week earlier, and the Index’s four week moving average is down 2.8 percent. The results do not include an adjustment for Veterans Day.

On an unadjusted basis, the Index decreased 15.4 percent compared with the previous week.

The seasonally adjusted Purchase Index decreased 5.0 percent from one week earlier, the first decrease in three weeks. The four week moving average is up 1.3 percent for the seasonally adjusted Purchase Index. The unadjusted Purchase Index decreased 8.2 percent compared with the previous week and was 11.3 percent lower than the same week one year ago.

Michael Fratantoni, MBA’s Vice President of Research and Economics stated, “Rates increased sharply last week due to stronger economic data and lingering uncertainty regarding the structure and impact of the Fed’s QE2 program. Mortgage applications, particularly for refinances, dropped in response.”

The refinance share of mortgage activity decreased to 80.3 percent of total applications from 81.7 percent the previous week, a decrease of 16.5 percent from the previous week. That is at the lowest level observed since July of this year. The adjustable-rate mortgage (ARM) share of activity remained at 5.3 percent of total applications.

The average contract interest rate for 30-year fixed-rate mortgages increased to 4.46 percent from 4.28 percent, with points increasing to 1.13 from 1.05 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate increased from last week and is the highest observed since September.

The average contract interest rate for 15-year fixed-rate increased to 3.87 percent from 3.64 percent last week, with points decreasing to 0.91 from 1.08 (including the origination fee) for 80 percent LTV loans. The effective rate also increased from last week.

Tags: MBA, home purchase applications, mortgage rates, fixed rate mortgage, adjustable rate mortgage, refinance, interest rate