Industry NewsMortgage

Rising rates put dent in refi plans

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An abrupt rise in interest rates helped cut mortgage application volume by 1.9 percent last week, the Mortgage Bankers Association reported today. According to MBA, the seasonally adjusted decline was led by a 4.7 percent decrease in the index that tracks refinancings, despite a 1.4 percent gain in the purchase-loan index. As a result, the refinance share of applications fell to 50.6 percent from 52.4 percent two weeks ago, and the adjustable-rate mortgage (ARM) share dipped to 15.5 percent from 17.3 percent. Borrowing costs in the latest survey climbed significantly, MBA reported, with interest rates rising between 39 and 89 basis points since the final week of February. The average interest rate on 30-year fixed-rate mortgages jumped from 5.98 percent to 6.37 percent; the 15-year fixed-rate average rose from 5.26 percent to 5.72 percent; and the average rate on one-year ARMs soared from 5.83 percent to 6.72 percent. Points, or loan-processing fees expressed as a percent...