Mortgage Refinance Application Volume Up In Latest Survey
May 25, 2005
The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending May 20. The Market Composite Index - a measure of mortgage loan application volume - was 729.6, an increase of 4.3 percent on a seasonally adjusted basis from 699.2 one week earlier. On an unadjusted basis, the Index increased 4.0 percent compared with last week and was up 14.9 percent compared with the same week one year earlier.
The seasonally adjusted Purchase Index increased by 2.8 percent to 482.3 from 469.3 the previous week whereas the seasonally adjusted Refinance Index increased by 6.4 percent to 2167.9 from 2036.7 one week earlier. On a year-over-year basis the Purchase Index is up 7.5 percent overall while the Conventional Purchase Index is up 12.0 percent.
"Rates have declined 14 basis points over the last two weeks. While the number of refinance applications increased 6.5 percent last week, the dollar volume increased by more than twice that amount, 13.5 percent, consistent with the idea that borrowers with larger balance loans respond quickly to even small rate incentives to refinance," said Jay Brinkmann, Vice President, Research and Economics Department.
Other seasonally adjusted index activity included the Conventional Index, which increased 4.9 percent to 1099.1 from 1047.5 the previous week. The Government Index decreased 4.3 percent to 113.0 from 118.1 the previous week.
The refinance share of mortgage activity increased to 40.3 percent of total applications from 39.3 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 34.8 percent of total applications from 33.9 percent the previous week.
The average contract interest rate for 30-year fixed-rate mortgages decreased to 5.63 percent from 5.73 percent one week earlier, with points increasing to 1.27 from 1.17 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 5.24 percent from 5.28 percent one week earlier, with points decreasing to 1.18 from 1.22 (including the origination fee) for 80 percent LTV loans.
The average contract interest rate for one-year ARMs increased to 4.21 percent from 4.11 percent one week earlier, with points decreasing to 0.94 from 0.95 (including the origination fee) for 80 percent LTV loans.