The Mortgage Bankers Association reports Mortgage applications are on the increase over the week previous. The Weekly Mortgage Applications Survey for the week ending December 2, 2011 shows a 12.8 percent rise. “Coming out of the Thanksgiving holiday, applications increased significantly as mortgage rates dropped to their lowest levels in about two months,” says Michael Fratantoni, MBA’s Vice President of Research and Economics. “In particular, refinance applications increased sharply, with some lenders seeing refinance volume double. Despite this surge, aggregate refinance activity is still below levels reported two weeks ago.” The four week moving average for the seasonally adjusted Market Index is down 3.20 percent. The four week moving average is up 3.33 percent for the seasonally adjusted Purchase Index, while this average is down 5.13 percent for the Refinance Index. For applications for home purchase, 85.5 percent were for fixed-rate 30-year loans, 6.8 percent for 15-year fixed loans, and 5.9 percent for ARMs. The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.98 percent, the lowest rate since January 2011, from 4.00 percent, with points decreasing to 0.52 from 0.62 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.
