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Mortgage

Refinance application volume rises again, hits three-year high

Seeing slight increases for the week, mortgage application volumes for refinance and new purchases continue their slow rise.

mortgage trends

Mortgage application volume

According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 27, 2012, mortgage applications increased 0.2 percent from one week earlier, continuing the trend of slowly increasing.

The Market Composite Index, a measure of mortgage loan application volume, rose 0.2 percent for the week on a seasonally adjusted and on an unadjusted basis, hitting its highest level in weeks.

The Refinance Index increased 0.8 percent from the previous week to its highest level since the week ending April 17, 2009. The MBA said in a statement, “the slight increase in refinance activity was muted by a 6 percent drop in government refinance applications, while conventional refinance activity increased about 2 percent over the week.”

The seasonally adjusted Purchase Index decreased about 2 percent from one week earlier, while the unadjusted Purchase Index dropped slightly.

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The refinance share of mortgage activity increased to 81 percent of total applications from the previous week to its highest level since the week ending January 20, 2012. The refinance share has rested around this level for over a year.

The adjustable-rate mortgage (ARM) share of activity decreased to 4.1 percent of total applications from the previous week.

Mortgage interest rates

According to the MBA:

  • “The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) increased to 3.75 percent from 3.74 percent, with points increasing to 0.51 from 0.43 (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) increased to 4.01 percent from 3.99 percent, with points increasing to 0.32 from 0.28 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA remained unchanged at 3.52 percent from the previous week, which is the lowest FHA rate recorded in the survey, with points increasing to 0.55 from 0.52 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 15-year fixed-rate mortgages increased to 3.09 percent from 3.07 percent, with points increasing to 0.49 from 0.45 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 5/1 ARMs increased to 2.73 percent from 2.68 percent, with points increasing to 0.41 from 0.35 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.”

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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