Purchase Apps Rise in Latest MBA Survey

The ""Mortgage Bankers Association"":http://www.mortgagebankers.org (MBA) released its ""Weekly Mortgage Applications Survey"":http://www.mbaa.org/NewsandMedia/PressCenter/69084.htm on Wednesday, which shows an increase in purchase activity. This gain, though, was countered by an even larger decline in refinance applications last week.
Based on MBA's study, for the week ending May 29, 2009, overall mortgage application volume fell 16.2 percent from one week earlier (taking into account a seasonal adjustment for the Memorial Day holiday). Compared to the same week last year, home loan applications are up 14.4 percent.
MBA reported that the seasonally adjusted Purchase Index increased 4.3 percent to 267.7 from the week prior, while the the Refinance Index dropped 24.1 percent. The refinance share of mortgage activity last week also declined - making up 62.4 percent of total applications, compared to 69.3 percent the previous week.
The industry association also provided average mortgage interest rates for the home loan petitions submitted last week, which jumped substantially for long-term products. Thirty-year rates crossed the five percent threshold for the first time in months.
The average contract interest rate for 30-year fixed-rate mortgages (FRMs) increased to 5.25 percent. The week prior, 30-year FRMs averaged 4.81 percent. MBA said the increase in the 30-year rate was the largest the association has recorded since October of last year.
Interest rates for 15-year FRMs last week also rose, averaging 4.8 percent, compared to 4.44 percent the week before.
The average contract rate for one-year adjustable-rate mortgages (ARMs) increased to 6.61 percent. The week before, they came in at 6.55 percent. MBA reported that the ARM share of activity increased to 3.0 percent of total applications last week, up from 2.6 percent the previous week.
MBA's survey covers more than 50 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks, and thrifts.