Mortgage Applications Start the Year in the Right Direction

January 11, 2012 (Chris Moore)

Mortgage applications started the New Year on a positive note as both applications for home purchases and refinances increased from the previous week according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 6, 2012.

The Market Composite Index, a measure of mortgage loan application volume which includes purchase applications and refinance applications, increased a seasonally adjusted 4.5 percent from the previous week.

On an unadjusted basis, the Index increased 34.4 percent from the previous week. The four week moving average for the seasonally adjusted Market Index is down 0.53 percent.

Purchase Applications:

The seasonally adjusted Purchase Index increased 8.1 percent from the previous week. The four week moving average is down 1.92 percent for the adjusted Purchase Index.

The unadjusted Purchase Index increased 41.9 percent compared with the previous week and was 17.9 percent lower than the same week a year ago.

Refinance Applications:

The Refinance Index increased 3.3 percent from the previous week. The four week moving average for the Index is down 0.09 percent.

The refinance share of mortgage activity decreased to 80.8 percent of total applications from 81.9 percent the previous week.

Mortgage Interest Rates:

Average Contract Mortgages Rates
(80% loan-to-value)

Type of
Loan

Interest Rate (%)

Points

Effective Rate

Current

Previous

Current

Previous

30-Year FRM Conforming
($417,500 or less)

4.11

4.07*

0.41

0.53

Increased

30-Year FRM Non-Conforming
($417,501 or more)

4.34*

4.41

0.47

0.44

Decreased

15-Year FRM

3.40

3.37*

0.37

0.50

Decreased

FHA 30-Year

3.96

3.96

0.72

0.71

Unchanged

5/1 ARM

2.90

2.91

0.49

0.48

Decreased

*Yearly low

The adjustable-rate mortgage (ARM) share of activity increased to 5.4 percent of total applications from 4.7 percent the previous week.

The results from this week’s report include an adjustment for the New Years holiday.

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