Mortgage Applications Rise Significantly This Week
Across the United States of America, home mortgage applications rose for the first time in three weeks as interest rates fell sharply and demand surged for both home purchase loan products and refinancing.
The Mortgage Bankers Association said its seasonally adjusted index of home loan applications, which includes both purchase and refinance activity, increased 8.1 percent to 656.5 the week ending August 3.
That’s the highest point for the index since June.
The four-week moving average of mortgage applications, which smooths out the volatile weekly figures somewhat, was also up, rising 1.2 percent to 626.0.
Borrowing costs on 30-year fixed-rate mortgages averaged 6.41 percent, down 0.09 percent from the previous week and below the year-ago average mortgage rates - 6.45 percent.
The MBA’s seasonally adjusted purchase index, widely considered a timely gauge of U.S. home sales, rose 7.4 percent to 447.4. The index was also above its year-earlier level of 388.9.
The seasonally adjusted index of home loan refinancing applications soared 9.1 percent to 1,881.1, above year-ago levels of 1,518.1.
The share of overall applications taken out by people to refinance home loans increased to 39.9 percent from 39.4 percent the prior week.
Fixed 15-year mortgage rates, always a popular refinancing option for many borrowers, averaged 6.16 percent, down from 6.20 percent.
Also last week, rates on one-year adjustable-rate mortgages (ARMs) decreased to just 5.69 percent from 5.73 percent. The ARM share of activity increased to 22.5 percent, up from 22.3 percent a week earlier.
The National Association of Realtors last week said that in the month of June, pending sales of previously owned U.S. homes rose at their fastest pace in more than three years.
These industry indexes are generally very volatile, but recent data suggests hope - at least in part - for the beleaguered housing market.
The MBA survey covers about 50 percent of all U.S. residential home loans. Respondents include mortgage banks, commercial banks and thrifts.
SOURCE: Reuters