Mortgage Applications Fall 3.8% in Lackadaisical Holiday Week

The volume of mortgage applications decreased 3.8rnpercent on a seasonally adjusted basis during the week ended February 22rnaccording to the Mortgage Bankers Association (MBA). On an unadjusted basis thernMarket Composite Index, a measure of loan application volume, was down 3rnpercent compared to the previous week.  MBArnmade no adjustment in the numbers to compensate for the Presidents’ Day holidayrnon Monday of that week.</p

The Refinancing Index was down 3 percent from thernprevious week although the refinance share of applications was unchanged at 77rnpercent.  Loans through the HomernAffordable Refinance Program (HARP) accounted for 30 percent of thosernrefinances, up from 29 percent the previous week. </p

The seasonally adjusted Purchase Index was down 5rnpercent for the week, reaching its lowest level since the last week ofrn2012.  On an unadjusted basis thernpurchase index was down 2 percent compared with the week ended February 15 butrnwas 14 percent higher than the same week in 2011.</p

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

FHA-backed 30-year FRM had an average rate of 3.54 percent,<bunchangedrnfrom the previous week.  Points increasedrnto 0.41 from 0.40 and the effective rate increased. </p

Rates for 15-year FRM were also unchanged at 3.03rnpercent.  Points dropped from 0.38 torn0.34 and the effective rate decreased.</p

Adjustable raternmortgages (ARM) garnered a four percent share of loan applications, the same asrnthe prior week.  The average interestrnrate for 5/1 ARMS decreased to 2.65 percent from 2.66 percent with pointsrnincreasing to 0.36 from 0.32.  Therneffective rate decreased.</p

Interest rates are based on loans with an 80 percentrnloan-to-value ratio and points include the origination fee.</p

MBA derives its application volume and interest rate datarnfrom a weekly survey of mortgage bankers, commercial banks and thrifts.  The survey has been conducted since 1990 andrnthe base period for all indices is March 16, 1990 =100.

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