Econintersect: Mortgage applications increased 1.1% week-over-week for the week ending May 20, 2011. According to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey on an unadjusted basis, the Index increased 0.9 percent compared with the previous week.
The driving factor for the growth is refinancing existing mortgages which increased 0.9% to its highest level since December 10, 2010. The seasonally adjusted Purchase Index increased 1.5 percent from one week earlier. The refinance share of mortgage activity increased to 66.8 percent of total applications from 66.7 percent the previous week. This is the highest refinance share since January 28, 2011.
Econintersect believes mortgage applications are no longer predicitive of home sales as over 1/3 of the current home purchases are not financed.
The average contract interest rate for 30-year fixed-rate mortgages increased to 4.69 percent from 4.60 percent, with points decreasing to 0.69 from 0.93 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.
