Posted by Larry/IL on 4/10/13 7:26am
Msg #465142
Refinance demand drives U.S. mortgage applications higher
(Reuters) - Applications for U.S. home mortgages rose last week, driven by improved refinance demand as interest rates tumbled, an industry group said on Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, rose 4.5 percent in the week ended April 5.
The seasonally adjusted index of refinancing applications gained 6.3 percent. But the gauge of loan requests for home purchases, a leading indicator of home sales, slipped 1.3 percent.
Within that decline there was a significant divergence between conventional and government markets, said Mike Fratantoni, MBA's vice president of research and economics.
Government purchase applications fell by almost 14 percent following the increase in Federal Housing Administration mortgage insurance premiums starting at the beginning of the month, while applications for conventional purchase loans rose by more than 5 percent, Fratantoni said.
The refinance share of total mortgage activity climbed to 75 percent of applications from 74 percent the week before.
Fixed 30-year mortgage rates fell 8 basis points to the lowest level since late January at 3.68 percent.
The survey covers over 75 percent of U.S. retail residential mortgage applications, according to MBA. (Reporting by Leah Schnurr; Editing by Leslie Adler)
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