Mortgage Applications Down In MBA Weekly Survey

MBA (7/30/2008 ) Stokes, Aleis
Mortgage applications fell for the second straight week despite a drop in key interest rates, according to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending July 25.
The seasonally adjusted Market Composite Index fell by 14.1 percent to 420.8 from 489.6 one week earlier. On an unadjusted basis, the Index decreased by 13.7 percent compared with the previous week and was down by 30.3 percent compared with the same week one year earlier. The four-week moving average fell by 2.8 percent to 486.5 from 500.7.

The seasonally adjusted Refinance Index decreased by 22.9 percent to 1074.4 from 1392.7 the previous week. The four-week moving average fell by 3.5 percent to 1330.3 from 1379.0. The refinance share of mortgage activity decreased to 35.2 percent of total applications from 39.4 percent the previous week.

The seasonally adjusted Purchase Index decreased by 7.8 percent to 309.5 from 335.6 one week earlier. The Conventional Purchase Index decreased by 7.1 percent while the Government Purchase Index (largely FHA) fell by 9.5 percent. The four-week moving average dropped by 2.4 percent to 342.6 from 351.0.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.46 percent from 6.59 percent, with points increasing to 1.16 from 1.05 (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 5.98 percent from 6.10 percent, with points increasing to 1.18 from 1.11 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year adjustable-rate mortgages increased to 7.25 percent from 7.16 percent, with points increasing to 0.39 from 0.29 (including the origination fee) for 80 percent LTV loans. The ARM share of activity decreased to 7.3 percent from 8.5 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.