Press Release - Weekly Application Survey


Title: Refinance Applications Surge, Purchase Applications Drop in Latest MBA Weekly Survey
Source:   MBA
Date: 5/12/2010
Contacts:
Name:Phone:Email:
 Carolyn Kemp(202) 557-2727ckemp@mortgagebankers.org

WASHINGTON, D.C. (May 12, 2010) — The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending May 7, 2010.  The Market Composite Index, a measure of mortgage loan application volume, increased 3.9 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index increased 3.4 percent compared with the previous week.

The Refinance Index increased 14.8 percent from the previous week and the seasonally adjusted Purchase Index decreased 9.5 percent from one week earlier.  The unadjusted Purchase Index decreased 8.9 percent compared with the previous week and was 0.6 percent lower than the same week one year ago.

“The recent plunge in rates on US Treasury securities, due to a flight to quality as investors worldwide sought shelter from the Greek debt crisis, benefitted US mortgage borrowers last week. Rates on 30-year mortgages dropped to their lowest level since mid-March.  As a result, refinance applications for conventional loans jumped, hitting their highest level in six weeks,” said Michael Fratantoni, MBA’s Vice President of Research and Economics.  “In contrast, purchase applications fell almost 10 percent in the first week following the expiration of the homebuyer tax credit, as the tax credit likely pulled some sales into April that would otherwise have occurred in May or later.” 
 
The four week moving average for the seasonally adjusted Market Index is up 4.4 percent.  The four week moving average is up 4.5 percent for the seasonally adjusted Purchase Index, while this average is up 4.4 percent for the Refinance Index.

The refinance share of mortgage activity increased to 57.7 percent of total applications from 51.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 6.3 percent of total applications from the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.96 percent from 5.02 percent, with points decreasing to 0.91 from 0.92 (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 15-year fixed-rate mortgages decreased to 4.32 percent from 4.34 percent, with points increasing to 0.81 from 0.80 (including the origination fee) for 80 percent LTV loans. The effective rate also decreased from last week.

The average contract interest rate for one-year ARMs decreased to 6.86 percent from 7.03 percent, with points increasing to 0.35 from 0.28 (including the origination fee) for 80 percent LTV loans.


If you would like to subscribe to MBA’s Weekly Applications Survey, please contact MBA Research at (202) 557-2830 or mbaresearch@mortgagebankers.org or click here.

Media inquiries should be directed to Carolyn Kemp at (202) 557-2727 or ckemp@mortgagebankers.org.

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.

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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.