Homeowners Continue to Refi: Leads Jump This Week

RISMEDIA, Jan. 17, 2008-Looks like refinancing continues to be a popular option for homeowners. Refinance loans topped mortgage application news this week with The Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 11, 2008. Let’s look at the numbers:

The Market Composite Index, a measure of mortgage loan application volume, was 906.4, an increase of 28.4% on a seasonally adjusted basis from 706.0 one week earlier. On an unadjusted basis, the Index increased 64.8% compared with the previous week which was shortened by the New Year’s holiday and was up 39.0% compared with the same week one year earlier.

The Refinance Index increased 43.4% to 3575.5 from 2494.2 the previous week which was shortened by the New Year’s holiday, and the seasonally adjusted Purchase Index increased 11.4% to 461.2 from 414.0 one week earlier. The Conventional Purchase Index increased 10.5% while the Government Purchase Index (largely FHA) jumped 17.6%. On an unadjusted basis, the Purchase Index increased 45.2% to 365.7 from 251.8 the previous week. The seasonally adjusted Conventional Index increased 28.6% to 1305.5 from 1015.3 the previous week, and the seasonally adjusted Government Index increased 26.7% to 241.2 from 190.4 the previous week.

The four week moving average for the seasonally adjusted Market Index is up 10.1% to 687.5 from 624.4. The four week moving average is up 2.5% to 407.6 from 397.9 for the Purchase Index, while this average is up 18.2% to 2401.5 from 2031.0 for the Refinance Index.

The refinance share of mortgage activity increased to 62.7% of total applications from 57.7% the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 9.2 from 9.3% of total applications from the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 5.62% from 5.73%, with points decreasing to 0.94 from 1.10 (including the origination fee) for 80% loan-to-value (LTV) ratio loans.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 5.07% from 5.21%, with points decreasing to 1.09 from 1.18 (including the origination fee) for 80% LTV loans.

The average contract interest rate for one-year ARMs decreased to 5.77% from 6.04%, with points increasing to 1.00 from 0.99 (including the origination fee) for 80% LTV loans.

For additional information, visit www.mortgagebankers.org.

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