MBA: Mortgage Applications Rise In Shortened Week

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Mortgage applications inched higher in the Thanksgiving holiday-shortened week as interest rates hit a six-month low.

In its weekly mortgage applications survey, the Mortgage Bankers Association reported that its market composite index, a measure of loan application volume, increased 2.1 percent on a seasonally adjusted basis.

Unadjusted, the index decreased 29.3 percent from the previous week.

The 2.1 percent increase (adjusted to account for the Thanksgiving holiday) indicates relatively subdued consumer sentiment, even though interest rates on 30-year fixed-rate mortgages fell from 4.82 percent to 4.79 percent, moving closer to the record low rate of 4.61 percent set in March.

This marked the sixth straight week of declines for interest rates on 30-year mortgages, and the fifth straight week the rates have remained below the psychological tipping point of five percent.

Interest rates of 15 year-fixed rate mortgages also fell, decreasing to 4.27 percent from 4.32 percent, while rates on one-year adjustable-rate mortgages decreased to 6.56 percent from 6.66 percent.

After slumping 9.5 percent the previous week, refinance applications rebounded only slightly, increasing 1.7 percent. Purchase applications continued to rise, increasing 4.1 percent after bouncing up 9.6 percent the previous week.

Unadjusted, however, the purchase application index decreased 30.4 percent from the previous week, and 34.9 percent from the same week in 2008.

Last week's slight increases continue to provide signs of stabilization in the housing market, which has seen an increase in activity since the Obama Administration's home-buyer tax credit was extended until next April.

Refinance shares of mortgage activity increased to 72.1 percent of total applications from 71.7 percent the week before. The ARM share of activity decreased to 4.8 percent of applications from 5.3 percent the previous week.

The four week moving average for the seasonally adjusted market index increased, rising 0.2 percent. The same average for the seasonally adjusted purchase index is down 2.0 percent, while it is up 1.5 percent for the refinance index.

Mortgage applications inched higher in the Thanksgiving holiday-shortened week as interest rates hit a six month low. In its weekly mortgage applications survey, the Mortgage Bankers Association reported that its market composite index, a measure of loan application volume increased 2.1 percent on a seasonally adjusted basis. (Market News Provided by RTTNews)