Mortgage Applications Decrease In Latest MBA Survey

MBA (4/23/2008 ) Kemp, Carolyn
Mortgage application activity fell by 14.2 percent last week as key interest rates rose by 30 basis points and topped 6 percent, according to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending April 18.
The Market Composite Index fell to 637.6, a decrease of 14.2 percent on a seasonally adjusted basis from 743.4 one week earlier. On an unadjusted basis, the Index decreased 13.4 percent compared with the previous week and was down 3.2 percent compared with the same week one year earlier. The four-week moving average for the seasonally adjusted Market Index fell by 10.5 percent to 698.7 from 780.8.

The seasonally adjusted Refinance Index decreased by 20.2 percent to 2286.3 from 2866.0 the previous week. The four-week moving average fell by 15.8 percent to 2628.2 from 3120.5. The refinance share of mortgage activity decreased to 49.2 percent of total applications from 53.5 percent the previous week.

The seasonally adjusted Purchase Index decreased 6.4 percent to 357.3 from 381.6 one week earlier. The Conventional Purchase Index decreased 7.5 percent while the Government Purchase Index (largely FHA) decreased 2.7 percent. The four-week moving average was down by 3 percent to 369.9 from 381.5.

The average contract interest rate for 30-year fixed-rate mortgages increased to 6.04 percent from 5.74 percent, with points decreasing to 1.04 from 1.05 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.

The average contract interest rate for 15-year fixed-rate mortgages increased to 5.6 percent from 5.27 percent, with points decreasing to 1.06 from 1.19 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year adjustable-rate mortgages decreased to 6.93 percent from 7.02 percent, with points increasing to 1.38 from 1.28 (including the origination fee) for 80 percent LTV loans. The ARM share of activity increased to 6.6 percent from 6.0 percent of total applications from the previous week.

The survey covers 50 percent of all U.S. retail residential mortgage originations and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts.