Refinance Applications Hit High Not Seen Since April

As rates increased for the second straight week, the share of applications from consumers looking to refinance their mortgages rose to the highest level since the end of April, said the Mortgage Bankers Association in its Weekly Mortgage Applications Survey for the week ending Dec. 11. The Market Composite Index, a measure of mortgage loan application volume, increased 0.3% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 0.3% compared with the previous week. The Refinance Index increased 0.9% from the previous week and the seasonally adjusted Purchase Index fell 0.1% from one week earlier. The share of refinance activity increased to 75.2% of total applications, up from 74.4% the previous week. This is the largest share of refinance applications since the week of April 24, 2009. The adjustable-rate mortgage share of activity decreased to 4.1% from 4.7%. This is the lowest share of ARM applications since mid-June. The average contract interest rate for 30-year fixed-rate mortgages increased from 4.88% to 4.92%, with points decreasing to 1.08 from 1.17 (including the origination fee) for loans with an 80% percent loan-to-value ratio, the association reported. The average contract interest rate for 15-year FRMs for the second consecutive week was 4.33%. For one-year adjustable rate loans, rates decreased by 3 BPs to 6.52%. The MBA stopped disclosing index values with the July 31 data release. The MBA can be found online at http://www.mortgagebankers.org.