Mortgage Applications Rebound In MBA Weekly Survey

MBA (8/27/2008 ) Kemp, Carolyn
Mortgage application activity, buoyed by dropping interest rates, rebounded following two weeks of declines, according to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending August 22.
The Market Composite Index rose to 421.6, an increase of 0.5 percent on a seasonally adjusted basis from 419.3 one week earlier. On an unadjusted basis, the Index decreased 0.9 percent compared with the previous week and fell by 31.2 percent compared with the same week one year earlier. The four-week moving average rose by 0.05 percent.

The seasonally adjusted Refinance Index increased by 0.3 percent to 1038.0 from the previous week. The four-week moving average fell by 0.85 percent. The refinance share of mortgage activity increased to 35.2 percent of total applications from 34.8 percent the previous week.

The seasonally adjusted Purchase Index increased by 0.6 percent to 315.9 from one week earlier. The Conventional Purchase Index decreased by 0.6 percent while the Government Purchase Index (largely FHA) increased by 3.3 percent. The four-week moving average rose by 0.51 percent.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.44 percent from 6.47 percent, with points decreasing to 1.03 from 1.10 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 5.94 percent from 5.99 percent, with points decreasing to 1.13 from 1.18 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year adjustable-rate mortgages increased to 7.15 percent from 7.07 percent, with points decreasing to 0.36 from 0.42 (including the origination fee) for 80 percent LTV loans. The ARM share of activity decreased to 7.9 percent from 8.0 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.