October 7, 2009
It stands to reason than when mortgage rates fall, the number of consumers who want to take advantage of lower rates goes up. That's what happened last week, according to the Mortgage Bankers Association.
Once again, however, it was mostly people seeking to refinance their existing mortgage to a lower monthly payment, not people trying to buy a home. The association's Refinance Index increased 18.2 percent from the previous week, following the third consecutive week where the 30-year fixed mortgage rate was below five percent, and is at its highest level since mid-May.
The seasonally adjusted Purchase Index increased 13.2 percent from one week earlier, which puts the index at its highest level since January. The unadjusted Purchase Index increased 12.9 percent compared with the previous week and was 2.2 percent lower than the same period one year ago. Additionally, the seasonally adjusted Government Purchase index is at a record level in the survey after a 14.4 percent increase from the week before.
The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.89 percent from 4.94 percent, with points increasing to 1.13 from 0.94 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. This rate is at its lowest level since May 2009 when it was 4.81 percent.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 4.32 percent from 4.34 percent, with points increasing to 1.04 from 1.01 (including the origination fee) for 80 percent LTV loans. This is the lowest 15-year fixed-rate ever recorded in the survey.
The average contract interest rate for one-year ARMs increased to 6.56 percent from 6.40 percent, with points increasing to 0.30 from 0.29 (including the origination fee) for 80 percent LTV loans.
