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Purchases Lead Drop in Mortgage Activity

Purchases Lead Drop in Mortgage ActivityMortgage Market Index 383 for week ended Aug. 19

Aug. 19, 2011

By staff

Falling mortgage rates weren’t enough to ignite increased activity this week, with purchase and government business leading the decline. Still, interest in lending remains strong. Fixed mortgage rates were lower as of Friday and look likely to continue the improvement, while the 15-year rate became a more attractive option.

Mortgage pricing inquiries for purchase transactions were down nearly a quarter for the week ended Aug. 19. Compared to a year ago, purchase inquiries were 12 percent lower.

Not far behind was activity for mortgages insured by the Federal Housing Administration, which tumbled 21 percent from last week.

The statistics are based on the U.S. Mortgage Market Index report from Mortech Inc. and Mortgage Daily. The report tracks pricing inquiries for consumers who a shopping for a mortgage.

Conventional pricing inquiries were off 18 percent, while adjustable-rate-mortgage activity was down 17 percent. ARM share was 6.63 percent, elevated from 6.33 percent in the report for the week ended Aug. 12.

Refinance activity fell 16 percent but remained elevated from the same week last year. Refinance share rose to 71 percent from 69 percent last Friday and 64 percent in the week ended Aug. 18, 2010. This week’s refinance share included a rate-term share of 58 percent and a cashout share of 13 percent.

Overall activity was 19 percent worse than last week’s all-time high, with the Mortgage Market Index landing at 383. Activity was still strong by historical standards.

The index was 350 a year ago.

The 30-year fixed-rate mortgage for this week was 4.25 percent, 2 basis points below seven days ago. A year ago, the 30 year was 4.32 percent.

An indication of which way mortgage rates are headed, the yield on the 10-year Treasury note, closed today at 2.07 percent based on Department of the Treasury data. The yield sank from 2.24 percent last Friday.

The 10-year activity suggests that the 30 year could be as much as 20 BPS better in next week’s report — though recent market volatility could just as easily cause rates to swing higher.

The spread between the conforming 30 year and the jumbo 30 year jumped to 65 BPS from 53 BPS last week. Jumbos were priced much worse last year at 88 BPS above conforming rates.

The 15-year mortgage was priced 80 BPS better than the 30 year this week. This week’ spread was more than the 75-basis-point spread that existed last week.

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Full Mortgage Market Index Report

Week Ended Aug. 19, 2011

National Average Loan Amount
Top 3 States state
$281,946 DC
$281,365 MA
$280,282 CA

Bottom 3 States state
$153,399 SD
$158,609 NE
$163,569 AR

National Average Rate-Term Refinance Amount

Top 3 States state
$288,679 CA
$287,831 DC
$286,621 MA

Bottom 3 States state
$161,042 SD
$162,668 NE
$170,751 MS

National Average Cashout Refinance Amount

Top 3 States state
$285,944 HI
$273,934 CA
$271,967 MD

Bottom 3 States state
$127,904 ID
$132,638 WV
$136,982 MI

National Average Jumbo Loan Amount

Top 3 States state
$1,372,241 ME
$954,699 WI
$900,882 DE

Bottom 3 States state
$467,571 AK
$491,800 WV
$494,393 NM

National Rate-Term Refinance Share

National Cashout Refinance Share

National Total Refinance Share

Product state State Average
Conv30 MA $301,846
Conv30 MO $205,950
Conv15 MA $277,791
Conv30 CA $302,725
Conv15 MO $195,481
Conv20 MA $283,196
Conv30 IL $247,103
Conv30 NJ $293,029
Conv30 TX $216,606
Conv30 NE $173,993
Conv30 KS $210,516
Conv30 PA $235,152
Conv15 NE $158,220
Conv15 TX $212,456
Conv30 NC $246,660

Average rate for each product from All investors Product
4.246% Conv30
3.448% Conv15
3.223% 5-1LiborARM
4.062% FHA30
3.478% FHA15
4.103% VA30
4.900% Jumbo30

Mortgage Market Index

National ARM Share

National FHA Share

 Mortgage Market Index 383 for week ended Aug. 19

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