Mortgage Applications Drop? Causes Subprime, Loss Mitigation ,REO
Saturday, May 10, 2008
The Mortgage Bankers Association's (MBA) Market Composite Index—a measure of the weekly mortgage loan application volume—hit 637.6 for the week ending April 18, 2008, a drop of 14.2-percent on a seasonally-adjusted basis from an Index of 743.4 a week before.
This data was published in the MBA's most recent Weekly Mortgage Applications Survey. The survey shows on an unadjusted basis the Index dropped 13.4-percent when compared to the week before and was down 3.2-percent when compared to the previous week.
The Refinance Index, which experienced a significant increase in a more recent survey, also decreased from 2866.0 to 2286.3—a drop of 20.2-percent. In addition, the seasonally-adjusted Purchase Index fell 6.4-percent from 381.6 to 357.3, the Conventional Purchase Index dropped 7.5-percent, and the Government Purchase Index (which includes FHA loans) declined 2.7-percent.
The MBA added that, “The refinance share of mortgage activity decreased to 49.2-percent of total applications from 53.5-percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6.6 from 6.0-percent of total applications from the previous week.”
The latest report also includes the following changes:
30-year fixed-rate mortgages: average contract interest rate increased to 6.04-percent from 5.74-percent
15-year fixed rate mortgages: average contract interest rate hit 5.6-percent, an increase from 5.27-percent the week before
one-year ARM: average contract interest rate fell 7.02-percent to 6.93-percent
This data was published in the MBA's most recent Weekly Mortgage Applications Survey. The survey shows on an unadjusted basis the Index dropped 13.4-percent when compared to the week before and was down 3.2-percent when compared to the previous week.
The Refinance Index, which experienced a significant increase in a more recent survey, also decreased from 2866.0 to 2286.3—a drop of 20.2-percent. In addition, the seasonally-adjusted Purchase Index fell 6.4-percent from 381.6 to 357.3, the Conventional Purchase Index dropped 7.5-percent, and the Government Purchase Index (which includes FHA loans) declined 2.7-percent.
The MBA added that, “The refinance share of mortgage activity decreased to 49.2-percent of total applications from 53.5-percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6.6 from 6.0-percent of total applications from the previous week.”
The latest report also includes the following changes:
30-year fixed-rate mortgages: average contract interest rate increased to 6.04-percent from 5.74-percent
15-year fixed rate mortgages: average contract interest rate hit 5.6-percent, an increase from 5.27-percent the week before
one-year ARM: average contract interest rate fell 7.02-percent to 6.93-percent


