MBA Reports Mortgage Applications in U.S. Decrease Last Week Despite Low Rates

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According to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending April 20, mortgage applications decreased 3.8 percent from one week earlier.

The Market Composite Index, a measure of mortgage loan application volume, decreased 3.8 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index decreased 3.3 percent compared with the previous week.

The Refinance Index decreased 5.6 percent from the previous week, with the Conventional Refinance Index decreasing by 6.1 percent and the Government Refinance Index decreasing by 2.1 percent. The seasonally adjusted Purchase Index increased 2.7 percent from one week earlier. The unadjusted Purchase Index increased 3.6 percent compared with the previous week and was essentially unchanged from the same week one year ago.

The four week moving average for the seasonally adjusted Market Index is up 1.23 percent.  The four week moving average is down 0.67 percent for the seasonally adjusted Purchase Index, while this average is up 1.92percent for the Refinance Index.

The refinance share of mortgage activity decreased to 73.4 percent of total applications from 75.2 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 5.6 percent from 5.3 percent of total applications from the previous week.

Within refinance applications taken in March 2012, 58.8 percent were for fixed-rate 30-year loans, 23.1 percent for 15-year fixed loans and 5.2 percent for ARMs. The share of refinance applications for "other" fixed-rate mortgages with amortization schedules other than 15 and 30-year terms was 12.8 percent of all refinance applications.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) decreased to 4.04 percent from 4.05 percent, with points decreasing to 0.40 from 0.45 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. This is the lowest 30-year fixed interest rate recorded in the history of the survey. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) decreased to 4.27 percent from 4.36 percent, with points increasing to 0.44 from 0.36 (including the origination fee) for 80 percent LTV loans. This is the lowest 30-year jumbo interest rate recorded since MBA started tracking the series in January 2011. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.81percent from 3.83 percent, with points decreasing to 0.52 from 0.61 (including the origination fee) for 80 percent LTV loans. This is the lowest FHA interest rate recorded in the history of the survey. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.32 percent from 3.33percent, while points remained unchanged at 0.41 (including the origination fee) for 80 percent LTV loans. This is the lowest 15-year fixed interest rate recorded in the history of the survey. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs decreased to 2.81 percent from 2.83 percent, with points increasing to 0.37 from 0.35 (including the origination fee) for 80 percent LTV loans. This is the lowest 5/1 ARM interest rate since March 2, 2012. The effective rate decreased from last week.