Press Release - Weekly Application Survey


Title: Mortgage Applications Surge with Large Drop in Rates in Latest MBA Weekly Survey
Source:   MBA
Date: 12/3/2008
Contacts:
Name:Phone:Email:
 Carolyn Kemp(202) 557-2727ckemp@mortgagebankers.org

WASHINGTON, D.C. (December 3, 2008) — The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 28, 2008, which was a shortened week due to the Thanksgiving holiday.   The Market Composite Index, a measure of mortgage loan application volume, was 857.7, an increase of 112.1 percent on a seasonally adjusted basis from 404.4 one week earlier.  On an unadjusted basis, the Index increased 51.4 percent compared with the previous week and was down 21.9 percent compared with the same week one year earlier.

“Many borrowers missed an opportunity to take advantage when rates dropped sharply for a brief period when the GSEs were placed under conservatorship,” said Orawin Velz, Associate Vice President of Economic Forecasting. “When rates plummeted following the Fed’s announcement that it would buy GSE debt and MBS, many of those on the sidelines decided to quickly jump in and take advantage of lower rates before they began to rebound.”

The Refinance Index increased 203.3 percent to 3802.8 from the previous week and the seasonally adjusted Purchase Index increased 38.0 percent to 361.1 from one week earlier.  The Conventional Purchase Index increased 37.4 percent while the Government Purchase Index (largely FHA) increased 39.2 percent. All results include an adjustment to account for the Thanksgiving holiday. 
 
The four week moving average for the seasonally adjusted Market Index is up 29.7 percent this week.  The four week moving average is up 9.5 percent for the seasonally adjusted Purchase Index, while this average is up 56.1 percent for the Refinance Index.

The refinance share of mortgage activity increased to 69.1 percent of total applications from 49.3 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 1.4 percent from 3.0 percent of total applications from the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 5.47 percent from 5.99 percent, with points decreasing to 1.16 from 1.23 (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 5.13 percent from 5.78 percent, with points decreasing to 1.28 from 1.29 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year ARMs decreased to 6.61 percent from 6.87 percent, with points decreasing to 0.52 from 0.64 (including the origination fee) for 80 percent LTV loans.

**SPECIAL NOTES**

The survey covers approximately 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.

 

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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.mba.org.