The share of refinance of the total activity for mortgages increased to 58.3% of the application from 56.3% the prior week.
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“We saw significant rate volatility last week surrounding the [Federal Open Market Committee] meeting, and rate declines toward the end of the week likely drove applications from both prospective home buyers and borrowers looking to refinance”, explains Mike Fratantoni, chief economist for the MBA, in a statement.
Home loan applications surged in the most recent week, the Mortgage Bankers Assn. said. The Refinance Index increased 18% from the previous week.
The average for the two was 13.9% during the week that ended September 18, while the refinancing demand was up 17.7% and the gauge of loan request, for purchases of home, a leading indicator of sales of home was up 9.1% to its highest since June. But there was rate decreases in other loan products, such as the 15-year fixed, 5/1 ARM, and 30-year jumbo.
The contract interest rate for a 5/1 adjustable rate mortgage loan decreased from 3.04% to 2.95%, also the lowest rate since May.
The Federal Housing Administration (FHA) share of total applications decreased to 12.9 percent, from 14.2 percent the week prior. In addition, a slight drop in mortgage interest rates helped boost applications for refinances. Mortgage loan rate changes remained unchanged or fell last week. The Veterans Affairs’ share of total applications was 10.0%, down from 10.7% the week prior.
In terms of demographics, the share of home purchase loans for one- to four-family properties made to African-American borrowers rose from 4.4 percent in 2013 to almost 4.9 percent a year ago, while the share made to Hispanic White borrowers rose from 6.9 percent to 7.5 percent.
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The 30-year fixed rate mortgage remained at the same for the week even though there had been a substantial fluctuation intra week. The effective rate decreased from last week. The effective rate increased from last week. The rate for a jumbo 30-year fixed-rate mortgage decreased from 4.04% to 3.99%, its lowest level since May.
