MBA Notes "Broad Increase" in Applications

The volume of mortgage applications increased for both refinancing andrnpurchasing during the week ended March 27. rnIt was the second consecutive week that the Mortgage BankersrnAssociation’s Market Composite Index and each of its components advanced andrndid so convincingly. </p

Lynn Fisher, MBA’s Vice President ofrnResearch and Economics said, “Therernwas a broad based increase in mortgage applications last week relative to thernweek prior. The increase in purchasernvolume was led by a nearly 6 percent increase in both conventional and government markets, perhaps signaling that householdsrnare finally ready to begin the home-buying season.”</p

The Market Composite Index, a measure ofrnoverall application volume, increased 4.6 percent from the previous week on arnseasonally adjusted basis and was up by 5.0 percent on an unadjustedrnbasis.  The Refinance Index increased 4.0rnpercent from a week earlier but the share of applications that were forrnrefinancing slipped from 61 percent during the week ended March 20 to 60rnpercent.  The seasonally adjustedrnPurchase Index rose 6 percent compared to one week earlier. Unadjusted, the index rose 6 percent week-over-weekrnand was 8 percent higher than the same week one year ago.</p

Refinance Index vs 30 Yr Fixed</p

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Purchase Index vs 30 Yr Fixed</p

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The respectivernshares of government-backed mortgages shifted around a bit with12.8 percent ofrnapplications intended for FHA mortgages and 10.5 percent for VA mortgagesrncompared to 13.3 percent and 10.1 percent the previous week.  The USDA share was unchanged at 0.8 percent. </p

Mortgagerninterest rates were mixed.  The average contract interestrnrate for 30-year fixed-rate mortgages (FRM) with conforming loan balances ($417,000 or less) decreased to 3.89 percent fromrn3.90 percent.  Points slipped from 0.37rnto 0.36 and the effective rate declined. </p

The average raternfor 30-year FRM with jumbo loan balances (greater than $417,000)rnincreased to 3.90 percentrnwith 0.34 point from 3.89 percent with 0.25 point.  The effective rate increased from thernprevious week.</p

FHA-backed 30-year FRM had an average raternof 3.73 percent with 0.13 point.  Thernprevious week the rate was 3.71 percent with 0.21 point.  The effective rate remained unchanged. </p

The contract interest rate for 15-year</bfixed-rate mortgages decreased one basis point to 3.21 percent while pointsrnincreased from 0.28 to 0.29. This effective rate was also unchanged from thernprior week. </p