MBA's Purchase Index for mortgages drops to lowest level in almost 9 years

Dennis Norman

The Mortgage Bankers Association (MBA) released its weekly mortgage applications survey for the week ending November 6, 2009. The report showed the MBA Purchase Index (a measure of the volume of loan applications related to a home purchase) decreased 11.7 percent from the week before, bringing it to it’s lowest level since December 2000 in spite of the fact that long-term interest rates decreased for the week and remained below 5.0 percent for a 30-year fixed-rate mortgage.

For the past four weeks the Purchase Index is down 6.6 percent while the Refinance Index is down 3.4 percent during the period.

Homeowners refinancing their existing mortgages continue to dominate the mortgage application activity jumping to 71.5 percent of loan applications for the week up from 66.1 percent the week before.

Interest rates and fees for the week:

• 30 year fixed-rate mortgage interest rates decreased to 4.90 percent from 4.97 percent the previous week, with fees increasing slightly to 1.03 percent from 1.01 percent on loans that are 80 percent of the value of the home.
• 15 year fixed rate mortgage interest rates remained unchanged at 4.33 percent with fees decreasing to 1.15 percent from 1.33 percent on loans that are 80 percent of the value of the home.
• One-year ARM interest rates increased to 6.85 percent from 6.83 percent with fees decreasing to 0.29 percent from 0.31 percent for loans that are 80 percent of the value of the home.

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