Refinance Applications Jump Up as Interest Rates Drop

March 16, 2011 (Chris Moore)
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The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending March 11, 2011. The Market Composite Index, a measure of mortgage loan application volume, decreased 0.7 percent on a seasonally adjusted basis from last week.

On an unadjusted basis, the Index decreased 0.5 percent compared with the previous week. The four week moving average for the seasonally adjusted Market Index is up 4.9 percent.

The seasonally adjusted Purchase Index decreased 4.0 percent from one week earlier. The four week moving average is up 1.6 percent for the seasonally adjusted Purchase Index. The unadjusted Purchase Index decreased 3.2 percent compared with the previous week and was 15.5 percent lower than the same week one year ago.

The Refinance Index increased 0.9 percent from the previous week. This is the highest level since December 2010. The four week moving average is up 6.6 percent.

The refinance share of mortgage activity increased to 66.4 percent of total applications from 65.5 percent the previous week.

The adjustable-rate mortgage (ARM) share of activity decreased to 5.6 percent from 6.0 percent of total applications from the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.79 percent from 4.93 percent last week, with points decreasing to 1.07 from 0.87 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 4.03 from 4.17 percent last week, with points increasing to 0.85 from 1.15 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

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