Mortgage Applications Decrease in Latest MBA Weekly Survey

WASHINGTON, D.C. – November 23, 2011 – (RealEstateRama) — Mortgage applications decreased 1.2 percent from one week earlier (which included the Veterans Day holiday), according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending November 18, 2011.

The Market Composite Index, a measure of mortgage loan application volume, decreased 1.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 8.6 percent compared with the previous week. The Refinance Index decreased 4.0 percent from the previous week to its lowest level since July 29, 2011. The seasonally adjusted Purchase Index increased 8.2 percent from last week to its highest level since August 12, 2011. The unadjusted Purchase Index increased 15.2 percent compared with the previous week and was 4.8 percent lower than the same week one year ago.

“Purchase applications increased last week, returning to levels from before the Veteran’s Day holiday,” said Michael Fratantoni, MBA’s Vice President of Research and Economics. “However, purchase activity remains almost 5 percent below last year’s level. Overall, refinance activity dropped for the week, but there was an increase in refinance applications for government loan programs.”

The four week moving average for the seasonally adjusted Market Index is down 0.42 percent. The four week moving average is up 3.08 percent for the seasonally adjusted Purchase Index, while this average is down 1.39 percent for the Refinance Index.

The refinance share of mortgage activity decreased to 75.9 percent of total applications from 77.3 percent the previous week. This is the lowest refinance share since September 9, 2011. The adjustable-rate mortgage (ARM) share of activity decreased to 5.7 percent from 6.1 percent of total applications from the previous week. The government share of refinance activity increased to 13.0 percent of all refinance applications from 11.8 percent the previous week. This is the highest government share of refinance applications since April 15, 2011.

In October 2011, the government share of refinance activity increased to 12.3 percent of all refinance applications. This is the highest monthly government share of refinance activity since January 2011 when MBA began tracking this metric. The West South Central and East South Central regions saw the highest levels (17.2 percent and 17.9 percent, respectively), as well as the biggest increases in government refinance activity (up 2.1 percent and up 2.0 percent respectively from September 2011). The government share of purchase activity increased 0.5 percent in October 2011 to 42.9 percent for the nation. By region the East North Central and East South Central accounted for the highest levels of this measure (at 48.8 percent and 50.9 percent, respectively), while the Mountain and Pacific region saw the largest increases in government activity for purchase applications (up 2.0 percent and up 2.1 percent, respectively from September 2011).

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) remained unchanged at 4.23 percent, with points decreasing to 0.46 from  0.52 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate also decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) increased to 4.59 percent from 4.56 percent, with points decreasing to 0.40 from 0.46 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate also increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA  increased to 4.05 percent from 4.03 percent, with points decreasing to 0.55 from 0.59 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate also increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 3.58 percent from 3.54 percent, with points increasing to 0.53 from 0.47 (including the origination fee) for 80 percent LTV loans. The effective rate also increased from last week.

The average contract interest rate for 5/1 ARMs decreased to 3.00 percent from 3.01 percent, while points remained unchanged at 0.49 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. This is the lowest average contract interest rate for the 5/1 ARM since September 23, 2011. The effective rate also decreased from last week.

If you would like to purchase a subscription of MBA’s Weekly Applications Survey, please visit www.mortgagebankers.org/WeeklyApps, contact "> or click here.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts.  Base period and value for all indexes is March 16, 1990=100.

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The Mortgage Bankers Association (MBA) is the national association representing the real estate finance industry, an industry that employs more than 280,000 people in virtually every community in the country. Headquartered in Washington, D.C., the association works to ensure the continued strength of the nation’s residential and commercial real estate markets; to expand homeownership and extend access to affordable housing to all Americans. MBA promotes fair and ethical lending practices and fosters professional excellence among real estate finance employees through a wide range of educational programs and a variety of publications. Its membership of over 2,200 companies includes all elements of real estate finance: mortgage companies, mortgage brokers, commercial banks, thrifts, Wall Street conduits, life insurance companies and others in the mortgage lending field. For additional information, visit MBA’s Web site:  www.mortgagebankers.org.

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The Mortgage Bankers Association (MBA) is the national association representing the real estate finance industry, an industry that employs more than 280,000 people in virtually every community in the country. Headquartered in Washington, D.C., the association works to ensure the continued strength of the nation’s residential and commercial real estate markets; to expand homeownership and extend access to affordable housing to all Americans. MBA promotes fair and ethical lending practices and fosters professional excellence among real estate finance employees through a wide range of educational programs and a variety of publications. Its membership of over 2,400 companies includes all elements of real estate finance: mortgage companies, mortgage brokers, commercial banks, thrifts, Wall Street conduits, life insurance companies and others in the mortgage lending field.

Contact:

Mortgage Bankers Association
1331 L Street, NW
Washington, DC 20005

Phone: (202) 557-2700

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