Applications Down Again MBA Weekly Survey

MBA (3/19/2008 ) Kemp, Carolyn
Mortgage applications fell again last week, dropping by 2.9 percent despite another yo-yo drop in key interest rates, according to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending March 14.
The Market Composite Index fell to 652.0, a decrease of 2.9 percent on a seasonally adjusted basis from 671.7 one week earlier. On an unadjusted basis, the Index decreased 2.8 percent compared with the previous week and was down 3.7 percent compared with the same week one year earlier. The four-week moving average fell by 6 percent to 668.4 from 711.1.

The Refinance Index decreased by 4.6 percent to 2335.0 from 2448.2 the previous week. The four-week moving average was down by 10.9 percent to 2452.8 from 2752.5. The refinance share of mortgage activity decreased to 49.7 percent of total applications from 50.6 percent the previous week.

The seasonally adjusted Purchase Index decreased by 1.0 percent to 365.0 from 368.8 one week earlier. The Conventional Purchase Index decreased 3.1 percent, while the Government Purchase Index (largely FHA) increased 7.7 percent and the Government Refinance Index increased by 11.4 percent. On an unadjusted basis, the Purchase Index decreased 1.0 percent to 406.8 from 410.8 the previous week. The four-week moving average is up 0.5 percent to 363.8 from 361.9.

The seasonally adjusted Conventional Index decreased 5.3 percent to 850.1 from 898.0 the previous week; the seasonally adjusted Government Index increased 9.2 percent to 321.7 from 294.5 the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 5.98 percent from 6.37 percent, with points decreasing to 0.89 from 1.05 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. Rates have fluctuated over the past five weeks, from a low of 5.72 percent the week of Feb. 8 to 6.37 percent last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 5.24 percent from 5.72 percent, with points decreasing to 0.97 from 1.06 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year adjustable-rate mortgages increased to 6.95 percent from 6.72 percent, with points increasing to 1.64 from 1.27 (including the origination fee) for 80 percent LTV loans. The ARM share of activity decreased to 7.9 percent from 15.5 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.