The Real Deal Miami

Increased mortgage refinance activity drives another week of record low rates

June 06, 2012 02:15PM

Though the Memorial Day weekend pushed U.S. mortgage activity down 9 percent overall for the week ending June 1, applications increased 1.3 percent when factoring in an adjustment for the extended holiday, according to weekly data from the Mortgage Bankers Association. The gain was powered by refinance applications which upticked 2 percent, offsetting a slight decrease in the number of applications for purchase. Refinances comprised 78 percent of all applications last week, up 1 percentage point from the previous week to their greatest share in more than three months.

The rise in refinance applications came on the heels of another week of falling mortgage rates. All four of the most common mortgage types stood at historic lows for the end of the week. Rates for 30-year fixed rate mortgages with conforming loan balances fell 4 basis points to 3.87 percent and rates for jumbo loans dropped one-tenth of a percentage point to 4.13 percent. Interest rates for 30-year fixed-rate mortgages backed by the FHA held steady at 3.70 percent and 15-year fixed mortgage rates declined to 3.20 percent from 3.23 percent.

In May 2012, 85 percent of all mortgage applications were for 30-year fixed-rate loans. — Adam Fusfeld