Applications for refinance loans jumped nearly 30 percent during the week ending March 13, as interest rates for 30-year fixed-rate loans dipped below 5 percent to tie a record low seen in January.

In its weekly survey of members, the Mortgage Bankers Association said mortgage applications were up 21.2 percent from a week earlier, driven by a 29.6 percent increase in applications for refinance loans.

Applications for conventional purchase loans were up 2.1 percent, while applications for government-backed purchase loans (largely FHA) were up 0.4 percent.

The refinance share of mortgage activity increased to 72.9 percent of total applications, up from 67.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 2 percent, down from 2.3 percent of total applications from the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.89 percent from 4.96 percent, with points increasing to 1.23 from 1.16 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The contract rate ties the survey’s record low reached in January 2009.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 4.52 percent from 4.54 percent, with points decreasing to 1.18 from 1.2 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year ARMs decreased to 6.2 percent from 6.21 percent, with points decreasing to 0.14 from 0.16 (including the origination fee) for 80 percent LTV loans.

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