Purchases Drive Mortgage Bankers' Application Increase

Purchase mortgage application volume had a strong week and was the driver of the increase in the Mortgage Bankers Association's Market Composite Index for the week of Feb. 26. The MCI, a measure of mortgage loan application volume, increased 0.5% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 1.2% compared with the previous week. The Refinance Index decreased 1.5% from the previous week and the seasonally adjusted Purchase Index increased 5.7% from one week earlier. The market share of refi applications reached its lowest level since October 2009, MBA said. This fell to 67.2% of total applications, down from 69.1% the previous week. On the other hand, the market share of adjustable-rate mortgage applications is at its highest level since November 2009. This was 5.1%, up from 4.8% for the previous week. After a single week below the 5% mark, the average contract interest rate for 30-year fixed-rate mortgages is 5.01%. This is up 6 basis points from the previous week's 4.95%, with points declining to 0.82 from 0.99 (including the origination fee) for loans with an 80% percent loan-to-value ratio. The average contract interest rate for 15-year FRMs increased by 5 bps to 4.32%. The average contract interest rate for one-year ARMs increased by 3 bps to 6.80% from 6.77%.