Historically low mortgage rates failed once more to entice borrowers, with the ""Mortgage Bankers Association"":http://mbaa.org/default.htm (MBA) recording a seasonally adjusted 4.3-percent plunge in mortgage applications last week. The numbers arrive amid a flurry of action from the Federal Reserve.[IMAGE]
Releasing the ""Weekly Mortgage Applications Survey"":http://store.mortgagebankers.org/ProductDetail.aspx?product_code=EC6-300045-RW-I, the trade group penciled in a 4.5-percent decline on a seasonally unadjusted basis, alongside downward revisions for the Purchase Index at a seasonally adjusted 0.8 percent and seasonally unadjusted 1.7 percent. The Refinance Index also fell 5.2 percent from the past week.
""Interest rates continued to fall last week, driven by the latest ""Federal Reserve"":http://www.federalreserve.gov/ actions to invest in longer-term Treasury and mortgage securities, but potential borrowers largely remained on the sidelines, seemingly unimpressed by the lowest (by any measure) mortgage rates since the 1940s,"" ""Mike Fratantoni"":http://www.mortgagebankers.org/MichaelFratantoni.htm, MBA's VP of research and economics, said in a ""statement"":http://www.mortgagebankers.org/NewsandMedia/PressCenter/78131.htm.
""Refinance application volume declined and purchase volume was little changed,"" he added. ""Purchase borrowers continue to value the government lending programs that permit lower down payments.""[COLUMN_BREAK]
The four-week moving average shot up 2.44 percent for the Market Index on a seasonally adjusted basis, while seasonally adjusted numbers for the same on the Purchase Index fell 0.33 percent, the MBA said.
The trade group also found overall refinance activity in mortgage markets inching below 79.7 percent from last week to crest at 79.1 percent this week.
Adjustable-rate mortgage (ARM) activity also climbed to 6.4 percent from 6.1 percent last week.
The MBA said that the 15-year refinance scope of activity hovers at the highest level since a re-benchmarking in January this year, with over half of applications filed by borrowers for 30-year fixed-rate mortgages, less than a third for 15-year loans, and 7.1 percent for ARMs.
Some 90 percent of home purchase applications fell under the fixed-rate 30-year category, with 7.7 percent under 15-year fixed-rate mortgages and 6.6 percent under ARMs, a new low for the latter in terms of purchases since January this year, according to the trade group.
The MBA largely noted declines across the board for contract interest rates on average for 30-year fixed-rate mortgages, with a 4.24-percent decline to 4.18 percent for conforming loan balances and 30-years with jumbo loan balances falling from 4.53 percent to 4.49 percent.
Thirty-year fixed-rate loans insured by the Federal Housing Administration likewise saw a decrease from 4.06 percent to 4.05 percent, even while contract interest rates on average leapt upward for 15-year loans, increasing from 3.46 percent to 3.49 percent, the trade group said.
Meanwhile, average contract interest rates for 5-year and 1-year ARMs found their way to 3.02 percent from 2.95 percent, the MBA said.