Refis Comprise 82 Percent of Overall Apps in Final Week of 2011
The Mortgage Bankers Association (MBA) has released its Weekly Mortgage Applications Survey for the weeks ending Dec. 23, 2011 and Dec. 30, 2011, finding that mortgage apps for the week ending Dec. 30, 2011 decreased 3.7 percent from the week ending Dec. 16, 2011 (two weeks prior), according to data from the MBA. The results include adjustments to account for the Christmas and New Year’s Day holidays.
The Refinance Index decreased 1.9 percent compared to the week ending Dec. 16. The seasonally adjusted Purchase Index decreased 9.7 percent compared with levels reported two weeks ago. The Market Composite Index, a measure of total mortgage loan application volume was 39 percent higher in the last two weeks of 2011 than in the last two weeks of 2010, on a seasonally adjusted basis.
The refinance share of mortgage activity for the week ending Dec. 30, 2011 increased to 81.9 percent of total applications. This is the highest refinance share in 2011.
“Mortgage application activity declined over the last two weeks, even after adjusting for the typical seasonal decline in activity,” said Michael Fratantoni, MBA’s vice president of research and economics. “Refinance applications continue to account for the vast majority of total application volume, with the refinance share reaching its highest level in 2011.”
►For the week ending Dec. 30, the average contract interest rate for 30-year fixed-rate mortgages (FRMs) with conforming loan balances ($417,500 or less) was 4.07 percent, with points at 0.53 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. This was the lowest 30-year fixed rate in 2011.
►The average contract interest rate for 30-year FRMs with jumbo loan balances (greater than $417,500) was 4.41 percent, with points at 0.44 (including the origination fee) for 80 percent LTVs.
►The average contract interest rate for 30-year FRMs backed by the FHA was 3.96 percent, with points at 0.71 (including the origination fee) for 80 percent LTVs.
►The average contract interest rate for 15-year FRMs was 3.37 percent, with points at 0.50 (including the origination fee) for 80 percent LTVs.
►The average contract interest rate for 5/1 ARMs was 2.91 percent, with points at 0.48 (including the origination fee) for 80 percent LTVs.
“As part of legislation to extend the payroll tax holiday, guarantee fees for loans purchased by the GSEs and mortgage insurance premiums for FHA loans will eventually increase,” said Fratantoni. “Given the announced implementation of this change, we do not expect to see an impact on mortgage rates and application activity until at least February.”
Posted via email from Title Insurance Posted via email from Title Insurance The National Association of Independent Land Title Agents (NAILTA) has announced that it is opposed to a provision in legislation offered by Senator Bob Corker (R-TN) that would create “MERS 2”, a federal mortgage registry modeled after and designed to replace the existing bank-owned MERS mortgage registry. In its position paper on the Corker bill, Senate Bill 1834, NAILTA says that it “is opposed to any reconstituted MERS system because the MERS model is a deeply flawed system that continues to harm consumers, small business owners, and county governments across the United States.” According to NAILTA, “[A]ny consideration of creating a new MERS without having successfully resolved the well-known flaws and inadequacies of the previous MERS system is a foolhardy exercise. S.B. 1834 proposes no solution to the prevalent flaws with the current MERS system. Instead, it merely seeks to establish MERS 2.0 based upon the MERS in use on the date of enactment.” One of those purported flaws in MERS is that it “fails to reconcile 50 states worth NAILTA claims that MERS, a system “built by the mortgage industry, for the mortgage industry” according to its founders, has harmed the land title industry in particular by shifting the business of title insurance away from title professionals and toward banks. NAILTA says that MERS has also damaged land title records and deprived local governments of fees used for general purposes such as public safety. NAILTA characterizes MERS 2 as a Federal Torrens title system– subject to the considerable expense and difficulty of reconciling states’ differing recording and foreclosure laws into one system. MERS failed because of the same pitfall, and consumers, county governments, and title agents have borne this expense while only the owners of MERS have benefited, according to NAILTA. NAILTA has contacted Senator Corker’s office and requested a meeting with the Senator, to express its “deep reservations and opposition concerning MERS and the specific problem we have with [the MERS 2] provision.” Posted via email from Title Insurance
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NAILTA Announces Opposition to “MERS 2” Proposal
of mortgage recording and foreclosure law.”
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