Mortgage Application Activity Slows Preceding Holiday Weekend

December 28, 2005

WASHINGTON, D.C.-- The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending December 23. The Market Composite Index - a measure of mortgage loan application volume was 554.1 -- a decrease of 6.8 percent on a seasonally adjusted basis from 594.6 one week earlier. A holiday adjustment was included in the seasonally adjusted numbers to help account for the reduced application activity prior to the holiday weekend. On an unadjusted basis, the Index decreased 17.0 percent compared with the previous week and was up 3.1 percent compared with the same week one year earlier.

The seasonally-adjusted Purchase Index decreased by 4.5 percent to 432.9 from 453.1 the previous week whereas the Refinance Index decreased by 11.2 percent to 1259.1 from 1418.1 one week earlier. Other seasonally adjusted index activity includes the Conventional Index, which decreased 7.1 percent to 824.9 from 888.2 the previous week, and the Government Index, which decreased 2.7 percent to 102.2 from 105.0 the previous week.

The four week moving average for the seasonally-adjusted Market Index is down 2.8 percent to 606.2 from 623.7. The four week moving average is down 2.3 percent to 464.8 from 475.6 for the Purchase Index while this average is down 3.8 percent to 1428.9 from 1485.2 for the Refinance Index.

The refinance share of mortgage activity decreased to 40.2 percent of total applications from 41.7 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 32.5 percent of total applications from 32.6 percent the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.21 percent from 6.22 percent on week earlier, with points decreasing to 1.18 from 1.19 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.

The average contract interest rate for 15-year fixed-rate mortgages remained at 5.76 percent, with points decreasing to 1.20 from 1.22 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year ARMs decreased to 5.36 percent from 5.41 percent one week earlier, with points increasing to 0.98 from 0.95 (including the origination fee) for 80 percent LTV loans.

Source: MBA

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