Home loan apps jump 28%

Mortgage application volume during the second week of January posted a huge increase as interest rates continued to decline, the Mortgage Bankers Association reported today. The group's market composite index, a measure of home loan application volume, climbed 28.4 percent on a seasonally adjusted basis between the first and second weeks of January. This double-digit gain comes on the heels of a 32.2 percent rise in the index one week earlier, the largest in four years. The index that tracks refinancings posted the largest gain, rising 43.4 percent last week on a seasonally adjusted basis from the week before, while the index tied to purchase loans grew 11.4 percent. According to MBA, the average contract interest rate on 30-year fixed-rate mortgages sank to 5.62 percent from the previous week's 5.73 percent, and the average rate on 15-year fixed loans dropped to 5.07 percent from 5.21 percent. Rates on adjustable-rate mortgages (ARMs) fell sharply during the period, with the average o...