Purchase Applications Rise for Second Week

By:: Kara Johnson | July 28, 2010

Mortgage applications for home purchases have increased for the second week in a row, following 10 weeks of almost unbroken declines.

Applications for mortgages to purchase a home rose a seasonally adjusted 2.0 percent last week, according to today’s weekly report by the Mortgage Bankers Association (MBA), reaching their highest level since the end of June. In unadjusted terms, applications were up 2.4 percent.

Purchase applications dropped sharply in the weeks following the April 30 deadline for the homebuyer tax credit. Last week’s level of purchase applications was down 34.3 percent from the same week one year ago.

Applications to refinance existing mortgages declined last week, as average interest rates rose following several weeks of declines. Refinances tend to be more sensitive to fluctuations in interest rates than home purchases are, because of the longer lead time involved in buying a home.

The average interest rate on a 30-year fixed-rate loan rose to 4.69 percent last week, up from the previous week’s record low of 4.59 percent, for mortgages with an 80 percent loan-to-value ratio. Average points paid, including origination fees, declined to 0.88, down from 1.04 the previous week.

The average rate on 15-year fixed-rate loans rose to 4.12 percent last week, up from the record low of 4.05 percent the week before, with points declining to 0.83 from 0.88.

With the higher rates, the MBA’s Refinance Index declined a seasonally adjusted 5.9 percent. Overall, mortgage applications of all types declined a seasonally adjusted 4.4 percent, with refinances making up 78 percent of all activity.

The MBA weekly mortgage rate survey covers activity for the week ending on Friday, July 23.

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Loan Type	Today	+/-
30 yr fixed	3.72
15 yr fixed	3.03
5/1 ARM	2.75

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