Mortgage Volume Drops on Lower Refinancing

Washington, D.C., February 27, 2008 — Mortgage volume fell 19.2 percent the week ending Feb. 22 from the previous week due to a drop off in refinancing, according to the Mortgage Bankers Association.

The Refinance Index decreased 30.4 percent but the Purchase Index increased 0.2 percent to 358.2 from 357.6 one week earlier. The Conventional Purchase Index decreased 1.5 percent while the Government Purchase Index (largely FHA) increased 8.4 percent..

The refinance share of mortgage activity decreased to 52 percent of total applications from 61.7 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 15.0 from 12.8 percent of total applications from the previous week.

The average contract interest rate for 30-year fixed-rate mortgages increased to 6.27 percent from 6.09 percent, while the average rate for 15-year fixed-rate mortgages increased to 5.77 percent from 5.55 percent.

The average contract interest rate for one-year ARMs increased to 5.84 percent from 5.72 percent.