NEW YORK – U.S. mortgage applications rose sharply last week, reflecting a surge in home refinancing loans as interest rates remained near recent lows, an industry trade group said on Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and purchasing loans, increased 8.8 percent to 620.9 for the week ended November 3 from the previous week's 570.8.
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.24 percent, unchanged from the previous week, but well-below a four-year high of 6.86 percent touched in June. Interest rates were also below year-ago levels of 6.31 percent.
Demand for home purchase loans was also robust.
The MBA's seasonally adjusted purchase index, widely considered a timely gauge of U.S. home sales, rose 7.1 percent to 402.2. The index was substantially below its year-ago level of 465.7.
The group's seasonally adjusted index of refinancing applications increased 11 percent to 1,897.9. A year earlier the index stood at 1,798.8.
The refinance share of applications edged up to 46.3 percent from 45 percent the previous week.
Fixed 15-year mortgage rates averaged 5.96 percent, up from 5.94 percent. Rates on one-year adjustable-rate mortgages, or ARMs, dipped to 5.89 percent from 5.93 percent.
The ARM share of activity increased to 26.4 percent of total applications from 25.9 percent the previous week.
The MBA's survey covers about 50 percent of all U.S. retail residential loans. Respondents include mortgage banks, commercial banks and thrifts.