Mortgage Applications Index Tumbled 17% Last Week - MBA Reports
|October 22, 2008|
Mortgage applications in the U.S. fell last week to the lowest level in almost eight years as the worst financial crisis in seven decades dried up lending according to the Mortgage Bankers Association (MBA) Weekly Mortgage Applications Survey.
For the week ending October 17, 2008, and adjusted for the Columbus Day holiday, the Market Composite Index (a measure of mortgage loan application volume) fell 16.6 percent to 408.1 from 489.3 one week earlier. On an unadjusted basis, the Index decreased 25 percent compared with the previous week and was down 44 percent compared with the same week one year earlier.
The Refinance Index decreased 23.5 percent to 1158.8 from the previous week and the seasonally adjusted Purchase Index decreased 10.9 percent to 279.3 from one week earlier. The Conventional Purchase Index decreased 10.5 percent while the Government Purchase Index (largely FHA) decreased 11.9 percent. The four week moving average for the seasonally adjusted Market Index is down 9.2 percent. The four week moving average for the seasonally adjusted Purchase Index is down 4.9 percent, while this average is down 14.2 percent for the Refinance Index.
The refinance share of mortgage activity decreased to 42.6 percent of total applications from 46.4 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 2.7 percent from 2.6 percent of total applications from the previous week.
The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.28 percent from 6.47 percent, with points decreasing to 1.09 from 1.14 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 6.05 percent from 6.17 percent, with points decreasing to 1.11 from 1.18 (including the origination fee) for 80 percent LTV loans.
The average contract interest rate for one-year ARMs increased to 6.97 percent from 6.67 percent, with points decreasing to 0.40 from 0.43 (including the origination fee) for 80 percent LTV loans.