Volume Dips During Holiday Shortened Week

The Mortgage Bankers Association released its Weekly Mortgage Applications Survey for the week ending November 25. The Market Composite Index — a measure of mortgage loan application volume – was 624.1 a decrease of 1.8 percent on a seasonally adjusted basis from 635.4, one week earlier. On an unadjusted basis, the Index decreased 33.2 percent compared with the previous week but was down 8.0 percent compared with the same week one year earlier. The seasonally-adjusted indexes include an additional adjustment to account for the Thanksgiving holiday.

The seasonally-adjusted Purchase Index increased by 0.8 percent to 476.2 from 472.3 the previous week whereas the Refinance Index decreased by 6.3 percent to 1484.3 from 1584.1 one week earlier. Other seasonally adjusted index activity includes the Conventional Index, which decreased 2.1 percent to 933.8 from 953.4 the previous week, and the Government Index, which increased 2.2 percent to 106.9 from 104.6 the previous week.

The four week moving average for the seasonally-adjusted Market Index is down 0.9 percent to 644.6 from 650.3. The four week moving average is up 2.1 percent to 473.0 from 463.4 for the Purchase Index while this average is down 5.4 percent to 1642.4 from 1737.0 for the Refinance Index.

The refinance share of mortgage activity decreased to 39.1 percent of total applications from 39.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 33.0 percent of total applications from 33.2 percent the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.20 percent from 6.26 percent on week earlier, with points increasing to 1.17 from 1.11 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 5.72 percent from 5.83 percent, with points increasing to 1.26 from 1.12 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year ARMs decreased to 5.39 percent from 5.41 percent one week earlier, with points decreasing to 0.96 from 0.99 (including the origination fee) for 80 percent LTV loans.

What are people saying about mortgages today:

Rates on 30-year mortgages edged down last week to a seven-month low. Mortgage-giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages fell to 6.3 percent, down slightly from 6.31 percent two weeks ago. It put rates at the lowest level since they were at 6.24 percent the first week of March.

Bank of Hawaii, Central Pacific Bank, Territorial Savings Bank and Wells Fargo Home Mortgages all cut their 30-year mortgage rates to 5.75 percent this week.

Most people think of a mortgage as a means to an end. After all, you buy a house, not a home loan. But a mortgage is much more than the path to homeownership. It is a financial instrument that must be managed, just like any other financial investment.