Mortgage application volume and the shutdown
According to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 11, 2013, mortgage applications increased 0.3 percent from one week earlier.
The Refinance Index increased 3.0 percent from the previous week while the Purchase Index actually decreased 5.0 percent compared with the previous week, falling 1.0 percent from the same week one year ago.
“The government shutdown had a notable impact on the mortgage market last week. Purchase applications for government programs dropped by more than 7 percent over the week to their lowest level since December 2007, and the government share of purchase applications dropped to its lowest level in almost three years,” said Mike Fratantoni, MBA’s Vice President of Research and Economics. “Conventional purchase applications dropped as well, but not to the same extent, falling almost 4 percent for the week.”
The refinance share of mortgage activity increased to 66 percent of total applications from 64.0 percent the previous week, markedly lower than the average 80 percent for most of 2012. The adjustable-rate mortgage (ARM) share of activity decreased to 6.0 percent of total applications.
Mortgage interest rates
According to the MBA:
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.46 percent from 4.42 percent, with points decreasing to 0.31 from 0.44 (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 $417,000) increased to 4.51 percent from 4.45 percent, with points decreasing to 0.15 from 0.21 (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 increased to 4.16 percent from 4.15 percent, with points increasing to 0.44 from 0.37 (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 3.53 percent from 3.52 percent, with points decreasing to 0.31 from 0.34 (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 remained unchanged at 3.25 percent, with points increasing to 0.32 from 0.29 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
