Mortgage Applications Increase, Driven by Refinances

RISMEDIA, Dec. 18, 2008-The Mortgage Bankers Association (MBA) released its Weekly Mortgage Applications Survey for the week ending December 12, 2008. The Market Composite Index, a measure of mortgage loan application volume, was 841.4, an increase of 2.9% on a seasonally adjusted basis from 817.7 one week earlier, which was revised from 796.8.* On an unadjusted basis, the Index increased 2.9% compared with the previous week and was up 37.3% compared with the same week one year earlier.The Refinance Index increased 6.5% to 4156.0 from the previous week and the seasonally adjusted Purchase Index decreased 4.5% to 286.1 from one week earlier. The Conventional Purchase Index decreased 6.7% while the Government Purchase Index (largely FHA) was virtually unchanged.

The four week moving average for the seasonally adjusted Market Index is up 17.9%. The four week moving average is up 3.2% for the seasonally adjusted Purchase Index, while this average is up 28.1% for the Refinance Index.

The refinance share of mortgage activity increased to 76.9% of total applications from 74.3% the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 1.1% of total applications from the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 5.18% from 5.44%, with points decreasing to 1.13 from 1.24 (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 4.93% from 5.08%, with points increasing to 1.34 from 1.26 (including the origination fee) for 80% LTV loans.

The average contract interest rate for one-year ARMs decreased to 6.63% from 6.76%, with points increasing to 0.3 from 0.26 (including the origination fee) for 80% LTV loans.

*All other survey results from the week ending December 5, 2008 have also been revised.

The survey covers approximately 50% 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.

For more information, visit www.mortgagebankers.org.