Mortgage applications decreased 4.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 26, 2012. 

The Market Composite Index, a measure of mortgage loan application volume, decreased 4.8 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index decreased 5 percent compared with the previous week.  The Refinance Index decreased 6 percent from the previous week to the lowest level since the end of August.  The seasonally adjusted Purchase Index increased 1 percent from one week earlier. The unadjusted Purchase Index declined 0.3 percent compared with the previous week and was 6 percent higher than the same week one year ago.

The refinance share of mortgage activity decreased to 80 percent of total applications from 81 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 4 percent of total applications.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) increased to 3.65 percent from 3.63 percent, with points decreasing to 0.39 from  0.45 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.  The effective rate increased from last week. The 30-year fixed contract rate is at the highest level since mid-September.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) increased to 3.94 percent from 3.85 percent, with points decreasing to 0.36 from 0.42 (including the origination fee) for 80 percent LTV loans.  The effective rate increased from last week.  The 30-year jumbo contract rate is at the highest level since mid-September.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA remained unchanged at 3.41 percent, with points increasing to 0.76 from 0.61 (including the origination fee) for 80 percent LTV loans.  The effective rate increased from last week. The FHA contract rate is at the highest level since the end of September.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.95 percent from 2.96 percent, with points decreasing to 0.35 from 0.36 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs decreased to 2.66 percent from 2.72 percent, with points remaining unchanged at 0.33 (including the origination fee) for 80 percent LTV loans.  The effective rate decreased from last week.