The Real Deal Miami

Low interest rates spur mortgage activity

March 03, 2010 11:11AM

Michael Fratantoni, vice president of research and economics with the MBA

Declining interest rates spurred a rebound in mortgage loan application volume nationwide, according to the Mortgage Bankers Association, with mortgage refinancing in particular on the rise.

Michael Fratantoni, the vice president of research and economics at the
MBA, said that the while the level of new mortgage purchasing is down,
the downward momentum of the average 30-year mortgage interest rate —
which dipped below 5 percent this week to 4.95 percent from 5.03
percent — has kept overall activity strong.

The MBA’s market composite index, which measures loan application volume, climbed 14.6 percent during the week ending Feb. 26, over the previous week.

“Mortgage applications rebounded last week,” Fratantoni said. “Purchase activity remains subdued, with application volumes remaining within the narrow range seen in the last few months.”

While the MBA’s purchase index is 9 percent higher than the week before, it’s still 9.8 percent lower than the rate seen the same week a year earlier. TRD