Mortgage Applications Closed 2011 In A Decline

Posted by Orb Staff on January 04, 2012 No Comments
Categories : Residential Mortgage

10635_money_house Mortgage Applications Closed 2011 In A Decline Mortgage applications for the week ending Dec. 30, 2011, were down 3.7% from the week ending Dec. 16, 2011, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey. The results include adjustments to account for the Christmas and New Year's Day holidays.Â

The MBA refinance index decreased 1.9% compared to the week ending Dec. 16, while the seasonally adjusted purchase index decreased 9.7% compared with levels reported two weeks earlier.Â

The market composite index – a measure of total mortgage loan application volume – was 39% higher in the last two weeks of 2011 than in the last two weeks of 2010, on a seasonally adjusted basis. The refinance share of mortgage activity for the week ending Dec. 30 increased to 81.9% of total applications, marking the highest refinance share in 2011.

‘Mortgage application activity declined over the last two weeks, even after adjusting for the typical seasonal decline in activity,’ says Michael Fratantoni, the MBA's vice president of research and economics. ‘Refinance applications continue to account for the vast majority of total application volume, with the refinance share reaching its highest level in 2011.’

Fratantoni adds that because of the payroll tax holiday signed into law last month by President Obama, guarantee fees for loans purchased by the government-sponsored enterprises and mortgage insurance premiums for Federal Housing Administration loans will increase.Â

"Given the announced implementation of this change, we do not expect to see an impact on mortgage rates and application activity until at least February," Fratantoni explains.

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