Mortgage application volume surged last week as falling interest rates spurred refinance activity, according to the Mortgage Bankers Association Weekly Mortgage Applications Survey.
The group’s Market Composite Index rose a seasonally adjusted 8.3 percent to 981.5 for the week ended January 18, and a whopping 110 percent on an unadjusted basis.
Mortgage application volume was up an unadjusted 63.7 percent from the same period.
The surge was led by an increase in refinance activity, which made up 66 percent of total applications, up from 62.7 percent the week prior.
The Refinance Index increased 16.9 percent to 4178.2, the highest level since March 2004, while the Purchase Index fell 4.6 percent to 439.9.
“Refinance applications are up 92% since the beginning of November and purchase applications are up 7%. With tighter credit conditions we do not know how many of these applications will become loans, but it is clear that borrowers are responding to the 40-80 basis point drop in rates we have seen since November 2 across products,” said Jay Brinkmann, Vice President of Research and Economics at the Mortgage Bankers Association.
Low Low Rates
The average 30-year fixed rate mortgage fell to 5.49 percent from 5.62 percent, while the 15-year fixed dipped to 4.96 percent from 5.07 percent.
ARMs also showed improvement, with the one-year falling to 5.51 percent from 5.77 percent a week earlier, though the share of applications that were adjustable-rate mortgages showed modest gains, up to 9.3 percent from 9.2 percent the previous week.
Related Topics:
