Mortgage Loan Applications Up in Latest MBA Survey
|May 8, 2002|
Refinance and Purchase Indexes Increase from Previous Week
WASHINGTON, D.C. (May 8) The market composite index of mortgage loan applications-a measure of mortgage loan applications for purchases and refinancings-for the week ending May 3 increased 8.1 percent to 583.2 on a seasonally adjusted basis from 539.3 the previous week, according to the Weekly Mortgage Applications Survey of the Mortgage Bankers Association of America (MBA), which was released today. On an unadjusted basis, the application index increased 8.3 percent and was up 5.7 percent compared to the same week a year earlier.
The MBA seasonally adjusted Purchase Index increased to 382.7 from 368.4 the previous week. The seasonally adjusted Refinance Index increased to 1749.9 from 1533.5 the previous week. Other seasonally adjusted index activity included the Conventional Index, which increased to 777.6 from 727.0 the previous week, and the Government Index, which increased to 258.9 from 226.1 the previous week.
The seasonally adjusted Purchase Index reached a record high last week, beating the previous record of 375.9 set the week ended January 4, 2002. "Very favorable interest rates, an improving economy, and good consumer confidence are having a positive impact on the U.S. housing industry," said Phil Colling, an economist with the MBA. "In addition, loan applications are being made now for home purchases in June and July, which are traditionally busy months for home purchases."
Refinancing activity represented 40.8 percent of total applications, increasing from 38.7 percent the previous week. The share of ARM activity decreased to 15.1 percent from 15.4 percent the previous week.
The average contract interest rate for30-year fixed rate mortgages was 6.66 percent,decreasing from 6.82 percent the previous week, with points increasing to 1.60 from 1.34 the previous week (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The 30-year fixed rate of 6.66 percent was the lowest since the week ended November 9, 2001 when the 30-year rate reached 6.37 percent.
The average contract interest rate for15-year fixed rate mortgages was 6.18 percent, decreasing from 6.23 percent the previous week, with points decreasing to 1.31 from 1.34 the previous week (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The previous time that the 15-year fixed rate was below 6.18 percent was the week ended November 9, 2001, when the rate reached 5.79 percent.
The average contract interest rate for1-year ARMs was 4.72 percent,decreasing from 4.87 percent the previous week, with points decreasing to 1.02 from 1.05 the previous week (including the origination fee) for 80 percent LTV loans. The previous time that the 1-year ARM rate was below 4.72 was the week ended March 4, 1994, when the rate was 4.54 percent.
Source: Mortgage Bankers Association