Applications for home loan refinancings jumped by double digits last week as interest rates continued to fall, the Mortgage Bankers Association reported today.

The group’s market composite index, a measure of home loan application volume, got an 8.3 percent boost last week on a seasonally adjusted basis from the second week of January as refinance applications climbed 16.9 percent during the period. Filings for purchase loans, however, fell 4.6 percent, MBA reported.

Since the beginning of November 2007, refinance applications have risen 92 percent and purchase-loan applications are up 7 percent, according to Jay Brinkmann, MBA’s vice president of research and economics. “With tighter credit conditions we do not know how many of these applications will become loans, but it is clear that borrowers are responding to the 40- to 80-basis-point drop in rates we have seen since Nov. 2 across products.”

Borrowing costs on all loan products sank again last week, as the average contract interest rate on 30-year fixed-rate mortgages fell to 5.49 percent from 5.62 percent; the average rate on 15-year fixed loans dropped to 4.96 percent from 5.07 percent; and average rates on the one-year adjustable-rate mortgage (ARM) tumbled to 5.51 percent from 5.77 percent.

Points, or loan-processing fees expressed as a percent of the total loan amount, averaged 1.07 on the 30-year loans, 1.22 on the 15-year, and 1.01 on one-year ARMs. These points include the origination fee and are based on loan-to-value ratios of 80 percent.

According to MBA, the refinance share of applications increased to 66 percent last week from 62.7 percent the previous week, and the ARM share grew to 9.3 percent from 9.2 percent.

The Mortgage Bankers Association survey covers approximately 50 percent of all U.S. retail residential mortgage originations, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts.

***

What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription