Mortgage applications rise despite higher rates

WASHINGTON – Mortgage applications nationwide rose last week as more homeowners tried to refinance, the Mortgage Bankers Association reported today.
In the seven days ended Jan. 25, the trade group’s Market Composite Index – a measure of mortgage loan application volume – rose 7.5 percent from the previous week’s level to a seasonally adjusted 1,054.9 points (March 16, 1990 = 100) after rising 8.3 percent in the week ended Jan. 18. Compared with the same week of 2007, the index rose 70.7 percent.
The MBA’s seasonally adjusted Refinance Index rose 22.1 percent to 5,103.6 points, accelerating from the previous week’s 16.9-percent rise. Meanwhile, the Purchase Index fell 17.7 percent to 362.0 points, after dipping 4.6 percent in the week ended Jan. 18.
Refinancing accounted for 73.0 percent of loan applications last week, up from the previous week’s 66.0 percent. But adjustable-rate mortgages (ARMs) decreased to 8.6 percent of the total, from 9.3 percent in the week ended Jan. 18.
Interest rates ended their decline, with the rate on the average 30-year fixed-rate mortgage rising to 5.60 percent from the previous week’s 5.49 percent, while the rate on the average one-year ARM rose to 5.70 percent from the previous week’s 5.51 percent
The Mortgage Bankers Association is a trade group representing the real estate finance industry. Its 3,000 member companies include mortgage firms, commercial banks, thrifts, life insurance companies and others. Additional information, including the MBA’s Weekly Application Survey, is available at www.mortgagebankers.org.