Mortgage Apps Continue Brisk, Possibly Mysterious Downtrend
The Mortgage Bankers Association (MBA) reported that, as usuallyrnoccurs during a holiday week, mortgage applications declined significantly duringrnthe week ended September 11. The businessrnweek was shortened by the Labor Day holiday on Monday and both seasonallyrnadjusted and unadjusted numbers were down. It was the second week in a row forrnacross the board declines for the weekly numbers so it is unclear whether therndownturn was totally a result of the holiday disruption, or if some other factor was in play (such as variations in school schedules).</p
MBA’s Market Composite index, a measure of applicationrnvolume fell by 7.0 percent from the week ended September 4 and was down 17rnpercent on an unadjusted basis. Data isrnadjusted to account for the holiday. . </p
The Refinance Index was down 9 percent from a week earlier and the sharernof total applications accounted for by refinancing dipped to 56.2 percent fromrn56.9 percent. The seasonally adjusted PurchasernIndex declined 4 percent and the unadjusted Index was 16 percent lowerrnweek-over-week and 5 percent higher than a year earlier. The smallest annual increasernsince March was a function of Labor Day occurring a week later this year thanrnlast, also MBS’s explanation for the 41 percent increase in the index during thernweek ended September 4. </p
Refinance Index vs 30 Yr Fixed</p
Purchase Index vs 30 Yr Fixed</p
The FHA share of total applicationsrnincreased to 14.2 percent from 13.4 percent the previous week and the VA sharerndropped 0.1 point to 10.7 percent. ThernUSDA share of total applications wasrnunchanged from 0.8 percent the week prior.</p
When averaged for the week interest ratesrnwere mixed but largely unchanged from averages the week before. The average contract interest rate forrn30-year fixed-rate mortgages (FRM) with conforming loan balances ($417,000 orrnless) eased back by 1 basis point to 3.09 percent while a higher effective raternreflected an increase in points from 0.39 to 0.42 from 0.39.</p
The rate for 30-year FRM with jumbo loanrnbalances in excess of $417,000 increased to 4.04 percent from 4.03 percent. Points declined to 0.26 from 0.28 while therneffective rate remained unchanged. </p
Thirty-year fixed-rate mortgages backed byrnthe FHA had an average rate down 2 basis points to 3.88 percent. Points jumped to 0.35 from 0.23, increasingrnthe effective rate from the prior week. </p
The average rate for 15-year fixed-rate</bmortgages dipped to 3.33 percent from 3.34 percent, with points decreasing torn0.26 from 0.28. The effective rate decreased from the prior week.</p
Adjustable-rate mortgage (ARM) applicationsrnclaimed a 6.8 percent share of the total compared to 6.9 percent the previousrnweek. The average contract interest raternfor 5/1 ARMs eked out a 0.01 point increase while points moved to 0.36 fromrn0.27, increasing the effective rate from the previous week. </p
MBA’s data is collected through its WeeklyrnMortgage Applications Survey which covers over 75 percent of all U.S. retailrnresidential mortgage applications, and has been conducted since 1990. Survey respondentsrninclude mortgage bankers, commercial banks and thrifts. Base period and valuernfor all indexes is March 16, 1990=100rnand interest rate information is based on mortgages with an 80 percent loan tornvalue ratio and points that include the origination fee.
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