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Economic News

Mortgage application volume rebounds slightly

Applications rise a bit

Mortgage application volume ended the final week of 2011 with a thud, dropping 4.1 percent overall, with refinance applications falling 2.5 percent and purchase loan requests dipping 9.6 percent on a seasonally adjusted basis, despite historically low interest rates.

For the first week of the year, the market has seen a slight increase, rising 4.5 percent, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey, adjusted to include the holiday. On an unadjusted basis, the Index increased 34.4 percent compared with the previous week. The Refinance Index increased 3.3 percent from the previous week. The seasonally adjusted Purchase Index increased 8.1 percent from one week earlier. The unadjusted Purchase Index increased 41.9 percent compared with the previous week and was 17.9 percent lower than the same week one year ago.

Detailed stats

According to a statement from the MBA:

  • The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) increased to 4.11 percent from 4.07 percent, with points decreasing to 0.41 from 0.53 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate also increased from last week.
  • The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) decreased to 4.34 percent from 4.41 percent, with points increasing to 0.47 from 0.44 (including the origination fee) for 80 percent LTV ratio loans. The effective rate also decreased from last week.
  • The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA remained unchanged at 3.96 percent, with points increasing to 0.72 from 0.71 (including the origination fee) for 80 percent LTV ratio loans. The effective rate also remained unchanged from last week.
  • The average contract interest rate for 15-year fixed-rate mortgages increased to 3.40 percent from 3.37 percent, with points decreasing to 0.37 from 0.50 (including the origination fee) for 80 percent LTV loans. The effective rate also decreased from last week.
  • The average contract interest rate for 5/1 ARMs decreased to 2.90 percent from 2.91 percent, with points increasing to 0.49 from 0.48 (including the origination fee) for 80 percent LTV ratio loans. The effective rate also decreased from last week.

The MBA said last week that they do not anticipate a quick rebound in the mortgage sector as borrowers struggle to make a down payment and most continue to worry about underemployment and unemployment.

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Tara Steele is the News Director at The American Genius, covering entrepreneur, real estate, technology news and everything in between. If you'd like to reach Tara with a question, comment, press release or hot news tip, simply click the link below.

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