continued indications during the week ended March 21 of the anticipated 2014
decrease in mortgage volume and the market's gradual shift to one dominated by
purchasing rather than refinancing. The Mortgage
Bankers Association (MBA) has projected a substantial reduction in the level of
mortgage applications this year, induced principally by a decline in
refinancing. In February the association
said it expected a $1.1 trillion year, almost 40 percent below the $1.8
trillion volume in 2013. The purchase
market is expected to increase modestly, but not enough to compensate for falling
Mortgage Applications Survey was set against a rare revision to earlier data as
MBA changed the previously reported level of the seasonally adjusted Market
Composite Index for the week ended March 14 from -1.2 percent to an increase of
The index for the
most recent week, a measure of overall mortgage application activity, declined
3.5 percent from the revised base. On an
unadjusted basis the index was down 3 percent.
Index dropped 8 percent from the previous week, driven by an 8.1 percent fall
in conventional refinance applications and a 5.8 percent negative shift in the
government refinance index which was at its lowest point since July 2011. Refinancing had a 54 percent share of total
applications, down from 57 percent the previous week and the smallest share for
refinancing since April 2010.
Refinance Index vs 30 Yr Fixed
adjusted Purchase Index however increased 3 percent from the previous week with
a 4.0 percent bump in conventional purchase applications. Government purchase applications were
essentially unchanged. The unadjusted
Purchase Index increased 3 percent week-over-week but was 17 percent below its
level one year earlier.
Purchase Index vs 30 Yr Fixed
were down on both a contract and an effective rate basis. The average contract interest rate for 30-year
fixed-rate mortgages (FRM) with conforming loan balances ($417,000 or less) increased to 4.56 percent, the highest level since January 2014, from 4.50 percent, with points increasing to 0.29 from 0.26. The jumbo 30-year FRM (balances above $417,000) increased to 4.45 percent
from 4.39 percent,
with points increasing to 0.27 from 0.19.
contract interest rate for
30-year FRM backed by the FHA increased to 4.16 percent from 4.13 percent,
with points increasing to 0.23 from 0.18. .
The average contract interest rate for 15-year
FRM increased to 3.62 percent, the highest level since January 2014,
from 3.52 percent,
with points decreasing to 0.24 from 0.25.
The average contract
interest rate for 5/1 adjustable rate mortgages (ARMs) increased to 3.22 percent,
the highest level since January 2014, from 3.09 percent, with points decreasing to 0.32 from 0.38. ARMs
had an 8 percent share of total volume, unchanged from the previous week
MBA's survey, which
has been conducted since 1990, covers over 75 percent of all U.S. retail residential mortgage
applications. Respondents include mortgage
bankers, commercial banks and thrifts. Rate quotes are based on loans with an 80
percent loan to value ratio and points include the origination fee. Base period and value for all indexes is March 16, 1990=100.