Mortgage application volume slips slightly

Mortgage applications fall for the week

According to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending May 25, 2012, mortgage application volume is down 1.3 percent from the week prior. The results do not include an adjustment for early closings on Friday prior to the Memorial Day holiday.

The Refinance Index decreased 1.5 percent from the week prior, and the Purchase Index fell 0.6 percent during the same period. The refinance share of mortgage activity was unchanged at 76.6 percent of total applications.

The MBA reports that mortgage rates fell to a new survey low, and the adjustable-rate mortgage (ARM) share of activity decreased to 4.9 percent from 5.0 percent of total applications from the previous week.

Current interest rates

According to the MBA, the average contract interest rates hit new lows:

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• The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) decreased to 3.91 percent, the lowest rate in the history of the survey, from 3.93 percent, with points increasing to 0.46 from 0.39 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate 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 4.23 percent from 4.25 percent, with points decreasing to 0.40 from 0.42 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
• The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.70 percent, the lowest rate in the history of the survey, from 3.73 percent, with points increasing to 0.59 from 0.57 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
• The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.23 percent, the lowest rate in the history of the survey, from 3.26 percent, with points decreasing to 0.39 from 0.42 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
• The average contract interest rate for 5/1 ARMs decreased to 2.77 percent, the lowest rate in the history of the survey, from 2.83 percent, with points decreasing to 0.38 from 0.42 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.