The volume of mortgage applications increased for both refinancing and purchasing during the week ended March 27.  It was the second consecutive week that the Mortgage Bankers Association's Market Composite Index and each of its components advanced and did so convincingly.

Lynn Fisher, MBA's Vice President of Research and Economics said, "There was a broad based increase in mortgage applications last week relative to the week prior. The increase in purchase volume was led by a nearly 6 percent increase in both conventional and government markets, perhaps signaling that households are finally ready to begin the home-buying season."

The Market Composite Index, a measure of overall application volume, increased 4.6 percent from the previous week on a seasonally adjusted basis and was up by 5.0 percent on an unadjusted basis.  The Refinance Index increased 4.0 percent from a week earlier but the share of applications that were for refinancing slipped from 61 percent during the week ended March 20 to 60 percent.  The seasonally adjusted Purchase Index rose 6 percent compared to one week earlier. Unadjusted, the index rose 6 percent week-over-week and was 8 percent higher than the same week one year ago.

Refinance Index vs 30 Yr Fixed

Purchase Index vs 30 Yr Fixed

The respective shares of government-backed mortgages shifted around a bit with12.8 percent of applications intended for FHA mortgages and 10.5 percent for VA mortgages compared to 13.3 percent and 10.1 percent the previous week.  The USDA share was unchanged at 0.8 percent.

Mortgage interest rates were mixed.  The average contract interest rate for 30-year fixed-rate mortgages (FRM) with conforming loan balances ($417,000 or less) decreased to 3.89 percent from 3.90 percent.  Points slipped from 0.37 to 0.36 and the effective rate declined.

The average rate for 30-year FRM with jumbo loan balances (greater than $417,000) increased to 3.90 percent with 0.34 point from 3.89 percent with 0.25 point.  The effective rate increased from the previous week.

FHA-backed 30-year FRM had an average rate of 3.73 percent with 0.13 point.  The previous week the rate was 3.71 percent with 0.21 point.  The effective rate remained unchanged.

The contract interest rate for 15-year fixed-rate mortgages decreased one basis point to 3.21 percent while points increased from 0.28 to 0.29. This effective rate was also unchanged from the prior week.

The share of applications for adjustable rate mortgages (ARM) declined from 5.8 percent to 5.6 percent.  The average contract interest rate for 5/1 ARMs decreased to 2.93 percent from 2.97 percent and points increased to 0.41 from 0.38.  The effective rate decreased from the previous week. 

MBA's Weekly Mortgage Applications Survey covers over 75 percent of all U.S. retail residential mortgage applications.  Survey respondents include mortgage bankers, commercial banks and thrifts.  The survey has been conducted since 1990 and the base period and value for all indexes is March 16, 1990=100.  Mortgage interest rates are quoted for a loans with an 80 percent loan-to-value ratio and points include the origination fee.