Press Release - Weekly Application Survey


Title: Mortgage Applications Increase in Latest MBA Weekly Survey
Source:   MBA
Date: 1/18/2012

WASHINGTON, D.C. (January 18, 2012) — Mortgage applications increased 23.1 percent from one week earlier (last week’s results included an adjustment for New Years Day), according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 13, 2012. 

The Market Composite Index, a measure of mortgage loan application volume, increased 23.1 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index increased 38.1 percent compared with the previous week.  The Refinance Index increased 26.4 percent from the previous week to its highest level since August 8, 2011.  The seasonally adjusted Purchase Index increased 10.3 percent from one week earlier to its highest level since December 12, 2011. The unadjusted Purchase Index increased 28.4 percent compared with the previous week and was 2.2 percent higher than the same week one year ago.

The four week moving average for the seasonally adjusted Market Index is up 5.99 percent.  The four week moving average is up 1.96 percent for the seasonally adjusted Purchase Index, while this average is up 7.00 percent for the Refinance Index.

The refinance share of mortgage activity increased to 82.2 percent of total applications from 80.8 percent the previous week.  This is the highest refinance share since October 22, 2010. The adjustable-rate mortgage (ARM) share of activity increased to 5.6 percent from 5.4 percent of total applications from the previous week.

“Interest rates dropped last week due to continuing anxieties regarding the fragile economic situation in Europe,” said Michael Fratantoni, MBA’s Vice President of Research and Economics.  Fratantoni continued, “With mortgage rates reaching new lows, refinance volume jumped and MBA’s refinance index reached its highest level in the last six months.  Purchase activity also increased as buyers returned to the market after the holiday season.”

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.06 percent from 4.11 percent, with points increasing to 0.48 from  0.41 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.  This is the lowest 30-year fixed rate in the history of the Survey. The effective rate also decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) increased to 4.40 percent from 4.34 percent, with points decreasing to 0.37 from 0.47 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.  The effective rate also increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA  decreased to 3.91 percent from 3.96 percent, with points decreasing to 0.59 from 0.72 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. This is the lowest 30-year FHA rate in the history of the Survey.  The effective rate also decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.33 percent from 3.40 percent, with points increasing to 0.39 from 0.37 (including the origination fee) for 80 percent LTV loans.  This is the lowest 15-year fixed rate in the history of the Survey. The effective rate also decreased from last week.

The average contract interest rate for 5/1 ARMs remained unchanged 2.90 percent, with points decreasing to 0.45 from 0.49 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. This is the lowest 5/1 ARM rate since MBA started tracking the series in January 2011.  The effective rate also decreased from last week.

If you would like to purchase a subscription of MBA’s Weekly Applications Survey, please visit www.mortgagebankers.org/WeeklyApps, contact mbaresearch@mortgagebankers.org or click here.

The survey covers over 75 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.