Mortgage Purchase Applications and Refinances Stable as Rates Rise

December 8 2010 (Chris Moore)

The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 26, 2010. The Market Composite Index, a measure of mortgage loan application volume, decreased 0.9 percent on a seasonally adjusted basis from last week.

On an unadjusted basis, the Index increased 22.8 percent compared with the previous week, which included the Thanksgiving Holiday. The four week moving average for the seasonally adjusted Market Index is down 8.0 percent.

The seasonally adjusted Purchase Index increased 1.8 percent from one week earlier and is at its highest level since May 2010. The four week moving average is up 2.8 percent for the seasonally adjusted Purchase Index. The unadjusted Purchase Index increased 21.2 percent compared with the previous week, but was still 12.0 percent lower than the same week one year ago.

The Refinance Index decreased 1.4 percent from the previous week and is the lowest Refinance Index observed since the end of June. This is the fourth straight week that the Refinance Index has declined. The four week moving average is down 10.9 percent.

The refinance share of mortgage activity increased to 75.2 percent of total applications from 74.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 5.6 percent from 5.7 percent of total applications from the previous week.

The average contract interest rate for 30-year fixed-rate mortgages increased to 4.66 percent from 4.56 percent, with points decreasing to 0.95 from 0.96 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. This is the fourth consecutive week that the average contract interest rate has increased and is the highest since July 2010. The effective rate also increased from last week.

The average contract interest rate for 15-year fixed-rate increased to 3.98 percent from 3.91 percent last week, with points increasing to 0.97 from 0.88 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week. This is the second week in a row that the average contract rate has increased and it is at the highest level since early September 2010.

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