Mortgage application volume falls on few refinancings

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April 30, 2008

WASHINGTON—Mortgage application volume fell 11.1 percent during the week ending April 25, according to the Mortgage Bankers Association's weekly application survey.

The MBA's application index fell to 567 from 637.6 the previous week.

Refinance volume fell 16.7 percent, while purchase application volume decreased 4.8 percent during the week. Refinance applications accounted for 45.7 percent of total application volume.

The index peaked at 1,856.7 during the week ending May 30, 2003, at the height of the housing boom.

An index value of 100 is equal to the application volume on March 16, 1990, the first week the MBA tracked application volume. A reading of 567 means mortgage application activity is 5.67 times higher than it was when the MBA began tracking the data.

The survey provides a snapshot of mortgage lending activity among mortgage bankers, commercial banks and thrifts. It covers about 50 percent of all residential retail mortgage originations each week.

Application volume fell despite declines in interest rates. The average interest rate for traditional, 30-year fixed-rate mortgages fell to 6.01 percent during the week ending April 25 from 6.04 percent the previous week. Rates for 15-year fixed-rate mortgages, often a popular option for refinancing a loan, fell to 5.53 percent from 5.6 percent.

The average rate for one-year adjustable-rate mortgages declined to 6.86 percent from 6.93 percent.