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Mortgage applications up 5.1% last week: MBA
Refinancing volumes keyed to volatility in rates, data show
By Amy Hoak, MarketWatch
Last Update: 7:06 AM ET Oct 15, 2008
CHICAGO (MarketWatch) -- Mortgage applications filed last week increased a seasonally adjusted 5.1% compared with the week before, reflecting an increase in refinancing activity, the Mortgage Bankers Association reported on Wednesday.
But while lower interest rates charged on mortgages initially enticed some applicants to move ahead with refinancings, an upturn in rates caused activity to slow at the end of the week, the Washington-based MBA said.
"Treasury yields were extremely volatile last week," said Orawin Velz, MBA's associate vice president of economic forecasting, in a news release. "The yield on the 10-year Treasury note -- the benchmark for the 30-year fixed mortgage rate -- moved up about 40 basis points over the course of the week.
"Lower yields earlier in the week appeared to have spurred refinance activity, which then faded as the week went on and rates began to rise."
Overall, applications volume slumped 17% for the week ended Oct. 10 from the same week in 2007, the MBA said.
Refinancing filings rose 12.5% on a week-to-week basis, while applications to purchase homes were down a seasonally adjusted 0.3%.
The four-week moving average for all mortgages was down 7.9%, the MBA's latest survey showed. It covers about one half of all U.S. retail residential mortgage applications.
Refinancings made up 46.4% of all mortgage applications filed last week, up from 43.4% the week before. Adjustable-rate mortgages also rose, accounting for 2.6% of all applications, up from 2.3%.
The rate charged on 30-year fixed-rate mortgages averaged 6.47% last week, up from 5.99% the week before, while 15-year fixed-rate mortgages had an average rate of 6.17% last week, up from 5.71%.
The rate on one-year ARMs averaged 6.67% last week, up from 6.60% the previous week.
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