Mortgage Applications Slip in MBA Weekly Survey

MBA (7/23/2008 ) Kemp, Carolyn
Mortgage applications fell for the first time in a month as key interest rates bumped up, according to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending July 18.
The Market Composite Index fell to 489.6, a decrease of 6.2 percent on a seasonally adjusted basis from 522.2 one week earlier. On an unadjusted basis, the Index decreased by 6.1 percent compared with the previous week and was down by 19.6 percent compared with the same week one year earlier. The four-week moving average, however, based on previous weeks’ activity, rose by 1.4 percent to 500.7 from 493.7.

The seasonally adjusted Refinance Index decreased by 5.6 percent to 1392.7 from 1474.9 the previous week. The four-week moving average continued to rise, however, by 3.4 percent to 1379.0 from 1333.9. The refinance share of mortgage activity increased to 39.4 percent of total applications from 39.2 percent the previous week.

The seasonally adjusted Purchase Index decreased by 6.7 percent to 335.6 from 359.7 one week earlier. The Conventional Purchase Index decreased by 6.3 percent while the Government Purchase Index (largely FHA) decreased by 7.7 percent. The four-week moving average, however, rose by 0.2 percent to 351.0 from 350.5.

The average contract interest rate for 30-year fixed-rate mortgages increased to 6.59 percent from 6.22 percent, with points decreasing to 1.05 from 1.21 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.

The average contract interest rate for 15-year fixed-rate mortgages increased to 6.10 percent from 5.74 percent, with points decreasing to 1.11 from 1.13 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year adjustable-rate mortgages remained unchanged at 7.16 percent, with points decreasing to 0.29 from 0.36 (including the origination fee) for 80 percent LTV loans. The ARM share of activity decreased to 8.5 percent from 9.1 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.