MBA: Application Volume Flat, Rates Directionless as Month Ends

The Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey reported this morning that applications for home purchase mortgages increased slightly during the week ended April 27 but were largely offset by a drop in applications for refinancing.  The Market Composite Index, a measure of overall application volume, increased 0.1 percent on a seasonally adjusted basis and 0.4 percent unadjusted from the previous week.

Applications for refinancing were down 0.7 percent from the week ended April 20 while the seasonally adjusted Purchase Index rose 2.9 percent and the unadjusted Purchase Index increased 3.7 percent.  The latter measure was 3.0 percent higher than during the same week in 2011.  The four week moving averages of the Market Composite Index and Refinance index were up 0.09 percent and 0.75 percent respectively while the seasonally adjusted Purchase Index was down 1.77 percent.

Applications for refinancing constituted a 72.6 percent share of all applications, down from 73.4 percent the previous week.  The government share of purchase applications was unchanged at 37 percent and has remained at this approximate level, the lowest share since 2009, for the past three weeks.  

Purchase Index vs 30 Yr Fixed

Refinance Index vs 30 Yr Fixed

Mortgage rates were mixed.  The average contract rate for a conforming (balance under $417,500) 30-year fixed-rate mortgage (FRM) increased to 4.05 percent with 0.44 point from 4.04 percent with 0.40 point and the rate for jumbo mortgages (balances over $417,500) increased to 4.32 percent from 4.27 percent with points decreasing to 0.38 from 0.44.  Effective rates increased for both types of loans.

Rates for FHA-backed 30-year FRM decreased to 3.80 percent with 0.50 point from 3.81 percent with 0.52 point and 15-year FRM were down to 3.31 percent from 3.32 percent with points unchanged at 0.41 percent.  The effective rates were both down and the contract rates for each were the lowest in the history of the survey.   

The average contract interest rate for 5/1 adjustable rate mortgages (ARMs) increased to 2.87 percent from 2.81 percent, with points decreasing to 0.35 from 0.37.  The effective rate increased from last week.

Rates are quoted for loans with loan-to-value rations of 80 percent and points include the application fee.

During the month of March, the investor share of applications for home purchase was at 5.7 percent, a slight decrease from 6.1 percent in February.  This change was led by a decline in the West South Central region.  In addition, the share of purchase mortgages for second homes remained constant at 5.8 percent.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990.  Respondents include mortgage bankers, commercial banks and thrifts.  Base period and value for all indexes is March 16, 1990=100.