MBA Says Mortgage Refinance Applications Increase 14.6 Percent

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(WASHINGTON, DC) - According to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending February 26, 2010, the Market Composite Index increased 14.6 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index increased 15.5 percent compared with the previous week.

"Mortgage applications rebounded last week, particularly refis, as rates dropped back below 5 percent," said Michael Fratantoni, MBA's Vice President of Research and Economics.  "Purchase activity remains subdued, with application volumes remaining within the narrow range seen in the last few months."

The Refinance Index increased 17.2 percent from the previous week and the seasonally adjusted Purchase Index increased 9.0 percent from one week earlier.  The unadjusted Purchase Index increased 11.7 percent compared with the previous week and was 9.8 percent lower than the same week one year ago.

The four week moving average for the seasonally adjusted Market Index is up 0.4 percent.  The four week moving average is down 2.7 percent for the seasonally adjusted Purchase Index, while this average is up 1.8 percent for the Refinance Index.

The refinance share of mortgage activity increased to 69.1 percent of total applications from 68.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 4.8 percent from 4.7 percent of total applications from the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.95 percent from 5.03 percent, with points decreasing to 0.99 from 1.34 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 4.27 percent from 4.35 percent, with points increasing to 1.36 from 1.31 (including the origination fee) for 80 percent LTV loans. This is the lowest 15-year fixed-rate observed in the survey since the week ending November 27, 2009.

The average contract interest rate for one-year ARMs decreased to 6.77 percent from 6.80 percent, with points decreasing to 0.29 from 0.33 (including the origination fee) for 80 percent LTV loans.

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