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Applications for Refis, Purchases Surge to Highest Point in 3 Years
There wasrnabsolutely no bad news out of the Mortgage Bankers Association’s Weekly MortgagernApplications Survey this morning. Resultsrnof the survey for the week ended June 8 showed that mortgage applicationsrnvolume soared in every category. ThernMarket Composite Index which measures all application volume was up 18.0rnpercent on a seasonally adjusted basis and 30 percent on an unadjusted basisrnfrom the previous week. While the previousrnweek which ended June 1 was shortened by the Memorial Day holiday, that alonerndid not account for the surge in volume which sent the seasonally adjustedrnindex to its highest level since May 2009.</p
The RefinancernIndex was up 19 percent from the previous week, its highest level since Aprilrn2009. Refinancing accounted for 79rnpercent of application activity compared to 78 percent the previous week. Thernseasonally adjusted Purchase Index was about 13 percent higher than a weekrnearlier and the unadjusted index was up 23 percent from the previous week andrnwas 4 percent higher than during the same week in 2011.</p
“Mortgage application volume increased sharply lastrnweek. The increase was accentuated due to the comparison to the weekrnincluding Memorial Day, but the level of refinance and total market activity isrnthe highest since the spring of 2009,” said Michael Fratantoni, MBA’s VicernPresident of Research and Economics. “Refinance volume increased asrnborrowers were able to lock in at mortgage rates below 4 percent, and purchasernapplication volume was its highest level in over six months. HARP volumernhas been steady in recent weeks at about 28 percent of refinance applications.”</p
Purchase Index vs 30 Yr Fixed</b</p
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Refinance Index vs 30 Yr Fixed</p
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The average contract interest rate for conforming 30-yearrnfixed-rate mortgages (FRM) increased to 3.88 percent with 0.43 point from 3.87rnpercent with 0.46 point. Conformingrnloans are those with a balance under $417,500. rnThe rate for loans with balances above that limit, jumbo 30-year FRM,rndecreased from 4.13 percent to 4.12 percent with points increasing to 0.41 fromrn0.35. </p
FHA-backed 30-year FRM had an average rate of 3.23 percentrnwith 0.48 point, up from 3.20 percent with 0.46 point the previous week. The rate for 15-year FRM increased 3 basisrnpoints to 3.23 percent with points increasing to 0.48 from 0.46.</p
The average contract interest rate for 5/1 adjustable raternmortgages (ARMs) remained unchanged at 2.78 percent, withrnpoints increasing to 0.49 from 0.40. The ARM share of activity remains around 5rnpercent of total applications, essentially unchanged from the previous week.</p
The effective rate of all of the above loans increased forrnthe week. All rates are given for loansrnwith an 80 percent loan-to-value ratio and points include the origination fee.</p
MBA reports that during May the average loan size of allrnloans for home purchase was $243,733, up from $238,135 in April. The Pacific regionrnhad the largest loans for purchase at $357,978. rnThe average loan size for a refinance was $226,576, up from $219,664 inrnApril with the largest of these loans made in the Pacific region as well,rnaveraging $313,826. </p
The weekly MBA survey covers over 75 percent of all U.S.rnretail residential mortgage applications, and has been conducted weekly sincern1990. Respondents include mortgage bankers, commercial banks andrnthrifts. Base period and value 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 MortgageNewsDaily.com is prohibited.
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Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.
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