by Calculated Risk on 11/01/2006 12:28:00 AM

The Mortgage Bankers Association (MBA) reports: Mortgage Rates and Applications Decline

The MBA Purchase Index is at the lowest level since 2003.

Click on graph for larger image.

The Market Composite Index, a measure of mortgage loan application volume, was 570.8, a decrease of 3 percent on a seasonally adjusted basis from 588.6 one week earlier. On an unadjusted basis, the Index decreased 3.3 percent compared with the previous week and was down 11.2 percent compared with the same week one year earlier.

The seasonally-adjusted Refinance Index decreased by 4.5 percent to 1709.2 from 1790.4 the previous week and the Purchase Index decreased by 1.8 percent to 375.6 from 382.4 one week earlier.

Mortgage rates decreased:

The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.24 percent from 6.36 percent ...

The average contract interest rate for one-year ARMs decreased to 5.93 percent from 5.97 percent ...

The second graph shows the Purchase Index and the 4 and 12 week moving averages since January 2002.

The four week moving average for the seasonally-adjusted Market Index is down 2.6 percent to 586.1 from 601.9. The four week moving average is down 1.9 percent to 381.5 from 388.8 for the Purchase Index, while this average is down 3.5 percent to 1778.7 from 1844.1 for the Refinance Index.

The 4 week and 12 week moving averages for the Purchase Index are at the lowest levels since 2003. The downtrend in purchase activity is continuing.