"Economists are pessimists: they've predicted 8 of the last 3 depressions."
--Barry Asmus

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Wednesday, May 4, 2011

MBA Weekly Applications Survey

If you recall from last week, the Mortgage Bankers Association didn't have a lot of good news.  They reported a 5.6% decline in the Market Composite Index for the week ending 4/22, driven by a mild decline in refinancing (0.6%) and a steep decline in first time applications (13.6%).  Most of the decline was laid at the feet of the FHA, which recently increased premiums.  The average contract interest rate for a 30-year fixed-rate mortgage slipped to 4.80%.
 
Things substantially improved for the week ending 4/29.  The Market Composite Index increased 4.0%, with the Refinance Index increasing 6.0% and the Purchase Index increasing 0.3%.  Refinancing accounted for 62.7% of total applications (up 110 bps from last week) and adjustable-rate mortgages accounted for 6.7% of mortgage activity (up 20 bps).  And the average contract interest rate for 30-year fixed-rate mortgages?  That fell to 4.75%.
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