Mortgage Applications Slow as Average Rates Rise

Mortgage
applications
decreased during the week ended February 17 according to the
Weekly Mortgage Applications Survey released this morning by the Mortgage
Bankers Association (MBA),   The Market
Composite Index measuring the volume of applications decreased 4.5 percent on a
seasonally adjusted basis and 3.6 percent unadjusted from the week ended
February 10.

The
Refinancing Index declined 4.8 percent while the volume of applications for home
purchases decreased 2.9 percent on a seasonal adjusted basis.  The unadjusted Purchase Index was 1.4 percent
lower than the week before and down 9.2 percent from the same week in
2011.  Applications for refinancing
composed 80.1 percent of all applications compared to 81.1 percent the previous
week.

The
four week moving average of the seasonally adjusted Market Composite Index
slipped by 0.30 percent, and the moving average for the seasonally adjusted
Purchase Index was down 3.1 percent.  The
moving average of the Refinance Index rose 0.33 percent. 

 

Purchase Index vs 30 Yr Fixed

Click Here to View the Purchase Applications Chart

Refinance Index vs 30 Yr Fixed

Click Here to View the Refinance Applications Chart

 

The
average contract interest rate for conforming (balances under $417,500) 30-year
fixed-rate mortgages
(FRM) increased one basis point to 4.09 percent with
points increasing from 0.51 to 0.53 point. 
The effective rate also increased from the previous week.  Rates for jumbo 30-year mortgages with
balances over $417,500 averaged 4.32 percent with 0.42 point compared to 4.30
percent with 0.44 point a week before. The effective rate decreased.  FHA-backed 30-year FRM rates were unchanged
at 3.87 percent with points dropping from 0.78 to 0.41.  The effective rate decreased.

Average
rates for 15-year FRM increased to 3.38 percent with 0.37 point from 3.33
percent with 0.40 point and the effective rate also increased.

Rates for
hybrid 5/1 adjustable rate mortgages (ARMs) increased one basis point to 2.94 percent
and points increased to 0.44 from 0.42. 
The effective rate also increased. 
Applications for ARMs as a share of all mortgage applications declined
slightly from 5.4 percent to 5.3 percent.

The preceding rate
information is for 80 percent loan-to-value mortgages and points quoted include
the origination fee.

During the month
of January 57.2 percent of applications for refinancing were for 30-year FRM
mortgages, 24.4 percent were for 15 year FRM and 5.5 percent were seeking ARMS.  The percentage of applications in all three
categories increased from December figures. 
Applications for mortgages with amortization schedules other than
30-year or 15-year terms constituted 12.9 percent of refinance applications, lower
than in December.

MBA’s weekly
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.

…(read more)

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