Mortgage Application Volume Bounces Bank from Holiday Lull

by devteam January 9th, 2013 | Share

Despite the shorter holiday week,rnmortgage applications rose 11.7 percent on a seasonally adjusted basis duringrnthe week ended January 4 and 49 percent on a seasonally unadjusted basis.  The Mortgage Bankers Association’s (MBA) Market Composite Index’s seasonallyrnadjusted figure included an additional adjustment to account for the New Years Dayrnholiday. </p

The Refinance Index increased 12 percent from Christmas week and thernrefinancing share of mortgage activity remained constant at 82 percent.  The share of refinancing done through thernHome Affordable Refinancing Program (HARP) decreased to 25 percent from 27rnpercent the prior week.  </p

The Purchase Index was up 10 percent on a seasonallyrnadjusted basis and 49 percent on an unadjusted basis compared to the week endedrnDecember 28. Compared to the last pre-holiday week (the week ended December 21)rnthe Refinancing Index was up less than one percent and the seasonally adjusted PurchasingrnIndex was down 8 percent.  </p

Purchase Index vs 30 Yr Fixed</b</p

ChartManager.loadChart(‘purchaseappschart’, ‘PurchaseMtgAppChart’);


Refinance Index vs 30 Yr Fixed</p

ChartManager.loadChart(‘refiappschart’, ‘RefiMtgAppChart’);


Both contract and effective mortgage rates rose during thernweek with the rate for the 30-year fixed-rate mortgage (FRM) reaching itsrnhighest contract level since November 2012. rnThe average rate for the conventional 30-year FRM (with balances ofrn$417,500 or less) increased to 3.61 percent with 0.41 point from 3.52 percentrnwith 0.48 point.</p

The average contract interest rate for 30-year fixed-raternmortgages with jumbo loan balances (greater than $417,500) increased to 3.78rnpercent from 3.75 percent, with points increasing to 0.38 fromrn0.30.  </p

FHA-backed 30-year FRM rates increased to an average of 3.35rnpercent from 3.34 percent, with points increasing to 0.69 fromrn0.61. </p

Fifteen-year FRM had an average rate of 2.88 percent withrn0.39 point compared to 2.86 percent with 0.27 point the previous week.  </p

The average contract interest rate for 5/1 adjustable raternmortgages (ARMs) decreased to 2.64 percentrnfrom 2.65 percent, with points decreasing to 0.37 from 0.42.</p

Application and rate information is derived from the WeeklyrnMortgage Application Survey which MBA has conducted since 1990.  Respondents include mortgage bankers,rncommercial banks, and thrifts.  Rates arernbased on mortgages with a loan-to-value ratio of 80 percent and points includernthe application fee.  Base period andrnvalue for all indexes is March 16, 1990=100.

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About the Author


Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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