Applications for mortgages rise 48 percent

The home-mortgage market appears to be thawing..

MCCLATCHY NEWSPAPERS

CHICAGO — With mortgage rates approaching record lows, the volume of applications filed for mortgages jumped a seasonally adjusted 48 percent last week compared with the previous week, according to the Mortgage Bankers Association’s weekly survey.

Applications for the week ending Dec. 19 ran 124.6 percent ahead of the mortgage activity seen during the same week last year, the Washington-based MBA said. Its survey covers about half of all U.S. retail residential mortgage applications.

The boost in applications coincided with another drop in mortgage rates, as the government’s efforts to thaw out the home-mortgage market show further signs of having the desired effect.

According to the MBA’s survey, rates on 30-year fixed-rate mortgages averaged 5.04 percent last week, down from 5.18 percent the previous week. This interest rate hasn’t been lower since the 4.99 percent average rate seen for the week ended June 13, 2003.

Fifteen-year fixed-rate mortgages averaged 4.91 percent, down from 4.93 percent the week before. And one-year ARMs averaged 6.36 percent, down from 6.63 percent.

Applications to refinance existing mortgages increased 62.6 percent on a week-to-week basis, while applications filed for mortgages to buy homes increased a seasonally adjusted 10.6 percent.

The four-week moving average for all mortgage applications was up 28.8 percent.

Refinancings made up 83.2 percent of all applications filed last week, up from 76.9 percent the previous week. The share of applications for ARMs decreased to 0.8 percent, down from 1.1 percent.