Mortgage Applications Down 3.7%; 30-yr FRM Ends Year at Record Low

by devteam January 4th, 2012 | Share

The Mortgage Bankers Associationrnreleased an abbreviated report Wednesday on mortgage activity over the two week</bChristmas and New Year's holiday periods. The combined Weekly MortgagernApplications Survey covered the work weeks which ended on December 30 and wasrnboth seasonally adjusted and adjusted to reflect the shortened schedule. </p

Mortgage applications over the two weeksrndecreased 3.7 percent from the previous period, the week ended Decemberrn16.  The Refinance Index was down 1.9 percentrnfrom the previous period and the seasonally adjusted Purchase Index decreased 9.7rnpercent.  On a year over year basis thernMarket Composite Index, a measure of total mortgage loan application volume wasrn39 percent higher than in the comparable two week period in 2010.</p

The share of refinancing applications torntotal applications volume set a record for the year, finishing up at 81.9rnpercent, up from 80.7 percent in the previous summary.</p

Because of the two week reportingrnperiod, MBA did not give the usual four week moving averages for the indices.</p

“Mortgagernapplication activity declined over the last two weeks, even after adjusting forrnthe typical seasonal decline in activity.  Refinance applications continuernto account for the vast majority of total application volume, with thernrefinance share reaching its highest level in 2011.  As part ofrnlegislation to extend the payroll tax holiday, guarantee fees for loansrnpurchased by the GSEs and mortgage insurance premiums for FHA loans willrneventually increase.  Given the announced implementation of this change,rnwe do not expect to see an impact on mortgage rates and application activityrnuntil at least February,” said Michael Fratantoni, MBA’s Vice President ofrnResearch and Economics.</p

Averagerninterest rates for the conforming (mortgage balance of $417,500 or less) 30-yearrnfixed-rate mortgages (FRM) during the week ended December 30 was 4.07 percentrnwith 0.53 point. This was the lowest rate for the entire year.  The rate for jumbo 30-year FRM (balancesrnabove $417,500) was 4.41 percent with 0.44 points.  Conforming 15-year FRMs carried a rate ofrn3.37 percent with 0.50 point.</p

FHA-backedrn30-year FRM had an average rate during the last week of the year of 3.96rnpercent with 0.71 point and the interest rate for 5/1 hybrid adjustable raternmortgages was 2.91 percent with 0.48 point.</p

Allrnrates quoted are for products with loan-to-value ratios of 80 percent or lessrnand quoted points include the origination fee.</p

Thernsurvey covers over 75 percent of all U.S. retail residential mortgagernapplications, and has been conducted weekly since 1990.  Respondentsrninclude mortgage bankers, commercial banks and thrifts.  Base period andrnvalue for all indexes is March 16, 1990=100.

All Content Copyright © 2003 – 2009 Brown House Media, Inc. All Rights Reserved.nReproduction in any form without permission of is prohibited.

About the Author


Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

See all blogs


Leave a Comment

Leave a Reply

Latest Articles

Real Estate Investors Skip Paying Loans While Raising Billions

By John Gittelsohn August 24, 2020, 4:00 AM PDT Some of the largest real estate investors are walking away from Read More...

Late-Stage Delinquencies are Surging

Aug 21 2020, 11:59AM Like the report from Black Knight earlier today, the second quarter National Delinquency Survey from the Read More...

Published by the Federal Reserve Bank of San Francisco

It was recently published by the Federal Reserve Bank of San Francisco, which is about as official as you can Read More...