Mortgage apps jump as rates keep falling

May 11, 2011 08:53AM

Mortgage activity rose across the U.S. last week as mortgage rates continued along their downward trend.

According to data from the Mortgage Bankers Association, released today, mortgage loan application volume rose by 8.2 percent during the week that ended May 6.

Refinance applications were up 9 percent week-over-week, though they are still more than 50 percent below levels seen last fall. Meanwhile, purchase applications rose by 7.1 percent last week, but are down 25.8 percent from their level during same week last year.

Michael Fratantoni, vice president of research and economics for the MBA, noted that the Federal Reserve’s QE2 asset purchase program has been putting downward pressure on interest rates over the last month, which in turn has led to an 18 percent spike in refinance activity over a four-week period.

Refinancing now accounts for 63.1 percent of all U.S. mortgage applications — its highest share since the week that ended March 25.

The 30-year fixed-rate mortgage came in with an interest rate of 4.67 percent last week, down from 4.76 percent in the week prior. The average contract interest rate for the 15-year fixed-rate mortgage was 3.81 percent, down from 3.96 percent one week ago. TRD