WASHINGTON, D.C. – February 9, 2011 – (RealEstateRama) — The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending February 4, 2011. The Market Composite Index, a measure of mortgage loan application volume, decreased 5.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 3.9 percent compared with the previous week.
The Refinance Index decreased 7.7 percent from the previous week. The seasonally adjusted Purchase Index decreased 1.4 percent from one week earlier. The unadjusted Purchase Index increased 4.8 percent compared with the previous week and was 16.6 percent lower than the same week one year ago.
“Mortgage rates increased last week as many incoming economic indicators continue to show stronger growth than had been anticipated. Refinance volume continues to be low, as fewer homeowners with equity have any incentive to refinance,” said Michael Fratantoni, MBA’s Vice President of Research and Economics. “We are at the beginning of the spring buying season, but purchase volume remains weak on a seasonally adjusted basis.”
The four week moving average for the seasonally adjusted Market Index is down 0.9 percent. The four week moving average is down 0.8 percent for the seasonally adjusted Purchase Index, while this average is down 1.5 percent for the Refinance Index.
The refinance share of mortgage activity decreased to 66.6 percent of total applications from 69.3 percent the previous week. This is the lowest refinance share observed in the survey since the beginning of May 2010. The adjustable-rate mortgage (ARM) share of activity increased to 5.9 percent from 5.5 percent of total applications from the previous week.
The average contract interest rate for 30-year fixed-rate mortgages increased to 5.13 percent from 4.81 percent, with points decreasing to 0.84 from 1.02 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. This is the highest contract 30-year rate recorded in the survey since the week ending April 9, 2010. The 32 basis point jump is the largest rate increase since June 2009. The effective rate also increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages increased to 4.29 percent from 4.13 percent, with points increasing to 1.02 from 1.01 (including the origination fee) for 80 percent LTV loans. This is the highest contract 15-year rate recorded in the survey since the week ending May 7, 2010. The effective rate also increased from last week.
If you would like to purchase a subscription of MBA’s Weekly Applications Survey, please contact MBA Research at (202) 557-2830 or or click here.
The survey covers over 50 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.
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.
Melissa Key 202-557-2799