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Mortgage application volume rises 3.4 percent

2013 has already been quite a roller coaster for mortgage application volume as interest and disinterest has spiked and plummeted, this week rising a bit.

mortgage trends

mortgage trends

Mortgage application volume rises

According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending February 1, 2013 rose 3.4 percent from the week prior on a seasonally adjusted basis, and on an unadjusted basis, the index rose 16 percent with the Refinance Index rising 4.0 percent during the same period. This increase makes up slightly for last week’s 8.1 percent plunge.

The MBA reports that the seasonally adjusted Purchase Index increased 2.0 percent from one week earlier and was at its highest level since the week ending May 7, 2010. The unadjusted Purchase Index increased 21 percent compared with the previous week and was 16 percent higher than the same week one year ago.

The refinance share of mortgage activity decreased to 78 percent of total applications from 79 percent the previous week and is the lowest refinance share observed since early July 2012, as it has hovered around 80 to 81 percent for roughly the last year. The adjustable-rate mortgage (ARM) share of activity remained constant at 4 percent of total applications.

Mortgage application volume has not steadily increased or decreased in 2013 so far, rather been somewhat of a rollercoaster, which could even out as the spring buying season begins, but with substantial drops and spikes, it is difficult to forecast buyer interest and behavior.

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Average contract interest rates

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances increased to 3.73 percent from 3.67 percent, with points increasing to 0.43 from 0.42 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The contract interest rate for 30-year fixed mortgages has increased for seven of the last eight weeks.

According to the MBA:

  • The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) increased to 3.96 percent from 3.95 percent, with points decreasing to 0.38 from 0.39 (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 3.53 percent from 3.48 percent, with points increasing to 0.38 from 0.33 (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 3.00 percent from 2.95 percent, with points decreasing to 0.33 from 0.38 (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 2.72 percent from 2.60 percent, with points decreasing to 0.30 from 0.33 (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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