The Mortgage Bankers Association (MBA) released its weekly report on mortgage applications this morning, noting an increase of 16.6% in the group's seasonally adjusted composite index compared with last week's total. Applications for refinancing rose 20% (seasonally adjusted), while seasonally adjusted purchase applications increased by 4% from the previous week. Unadjusted, the purchase index also rose 4% compared with the previous week and rose 11% compared with the same week a year ago.
The refinancing rate is the highest since April 2009, and refinancings now account for 83% of total applications, up from 81.2% a week ago. About 96% of the applications were seeking fixed-rate loans.
The average contract interest rate for a conforming 30-year fixed-rate mortgage fell slightly from 3.63% to 3.53%. The rate for a jumbo 30-year fixed-rate mortgage also fell, from 3.87% to 3.82%. The average interest rate for a 15-year fixed-rate mortgage decreased from 2.98% to 2.90%.
The contract interest rate for a 5/1 adjustable rate mortgage fell from 2.61% to 2.59%.
An MBA executive summed it up:
Refinance application volume jumped to the highest level in more than three years last week as each of the five mortgage rates in MBA's survey dropped to new record lows in the survey. Financial markets continue to adjust to QE3, as the ongoing presence of the Federal Reserve as a significant buyer of mortgage-backed securities applies downward pressure on rates.
Filed under: 24/7 Wall St. Wire, Banking, Housing, Research