Fixed Mortgage Rates Increase In Latest MBA Survey
|October 23, 2002|
Mortgage Applications Remain Very Strong
WASHINGTON, D.C.-- The Market Composite Index of mortgage loan applications -- a measure of mortgage loan applications for purchases and refinancings -- for the week ending October 18 decreased 12.4 percent to 1128.3 on a seasonally-adjusted basis from 1288.4 the previous week, according to the Weekly Mortgage Applications Survey of the Mortgage Bankers Association of America (MBA), which was released today. Last week was the thirteenth consecutive week that the Market Composite Index has been above 1000. On an unadjusted basis, the Index decreased 21.3 percent but was up 12.9 percent compared to the same week a year earlier.
The MBA seasonally adjusted Purchase Index increased to 361.5 from 341.9 the previous week. The seasonally adjusted Refinance Index decreased to 5588.7 from 6793.8 the previous week. Last week marked the thirteenth consecutive week that the Refinance Index has been above 4000, and the Refinance Index has been above 5000 for ten of those thirteen weeks. Other seasonally adjusted index activity included the Conventional Index, which decreased to 1631.6 from 1868.3 the previous week. The Government Index decreased to 288.4 from 320.6 the previous week.
"The increase in fixed mortgage rates that has occurred the last two weeks is consistent with increases in Treasury Note yields," noted MBA Economist Phil Colling. "Several improved company earnings reports led investors to pull money out of bonds and invest in stocks, resulting in higher interest rates. Regardless, long-term interest rates last week were at 38-year lows, and the massive wave of mortgage applications that began in late July is continuing."
Refinancing activity represented 73.4 percent of total applications, decreasing from 78.0 percent the previous week. The share of ARM activity increased to 13.9 percent from 12.8 percent the previous week.
The average contract interest rate for30-year fixed rate mortgages increased to 6.21 percent from 5.96 percent the previous week, with points decreasing to 1.37 from 1.50 the previous week (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.
The average contract interest rate for15-year fixed rate mortgages increased to 5.63percent from 5.31 percent the previous week, with points decreasing to 1.36 from 1.49 the previous week (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.
The average contract interest rate for1-year ARMs was 4.16 percent, increasing from 4.07 percent the previous week, with points increasing to 1.09 from 1.06 the previous week (including the origination fee) for 80 percent LTV loans.
Source: Mortgage Bankers Association