Press Release - Weekly Application Survey


Title: Mortgage Applications Increase in Latest MBA Weekly Survey
Source:   MBA
Date: 12/7/2011

WASHINGTON, D.C. (December 7, 2011) — Mortgage applications increased 12.8 percent from one week earlier (which included the Thanksgiving holiday), according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending December 2, 2011. 

The Market Composite Index, a measure of mortgage loan application volume, increased 12.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 60.2 percent compared with the previous week. The Refinance Index increased 15.3 percent from the previous week. The seasonally adjusted Purchase Index increased 8.3 percent from one week earlier to its highest level since August 5, 2011. The unadjusted Purchase Index increased 47.2 percent compared with the previous week and was 0.8 percent lower than the same week one year ago.

“Coming out of the Thanksgiving holiday, applications increased significantly as mortgage rates dropped to their lowest levels in about two months,” said Michael Fratantoni, MBA's Vice President of Research and Economics. “In particular, refinance applications increased sharply, with some lenders seeing refinance volume double. Despite this surge, aggregate refinance activity is still below levels reported two weeks ago. Some lenders indicated they are beginning to see an increase in HARP loans, but that increase is still a small portion of the move this week."

The four week moving average for the seasonally adjusted Market Index is down 3.20 percent. The four week moving average is up 3.33 percent for the seasonally adjusted Purchase Index, while this average is down 5.13 percent for the Refinance Index.

The refinance share of mortgage activity increased to 76.0 percent of total applications from 73.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 5.7 percent from 5.8 percent of total applications from the previous week.

In November 2011, among refinance borrowers, 52.9 percent of applications were for fixed-rate 30-year loans, 26.2 percent for 15-year fixed loans, and 5.8 percent for ARMs. The share of refinance applications for “other” fixed-rate mortgages with amortization schedules other than 15 and 30-year terms was 15.1 percent of all refinance applications. The shares for 30-year fixed and the “other” fixed category increased from the previous month, while the 15-year fixed and ARM shares decreased from last month. 

For applications for home purchase, 85.5 percent were for fixed-rate 30-year loans, 6.8 percent for 15-year fixed loans, and 5.9 percent for ARMs. This is the second lowest ARM share for purchases since January 2011.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.18 percent, the lowest rate since September 30, 2011, from 4.21 percent, with points decreasing to 0.48 from  0.49 (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 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) decreased to 4.52 percent, the lowest rate since September 30, 2011, from 4.55 percent, with points increasing to 0.47 from 0.45 (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 30-year fixed-rate mortgages backed by the FHA  decreased to 3.98 percent, the lowest rate since January 2011, from 4.00 percent, with points decreasing to 0.52 from 0.62 (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 3.53 percent, the lowest rate since October 7, 2011, from 3.58 percent, with points unchanged at 0.45 (including the origination fee) for 80 percent LTV loans. The effective rate also decreased from last week.

The average contract interest rate for 5/1 ARMs increased to 3.01 percent from 2.98 percent, with points increasing to 0.54 from 0.47 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate also increased 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.