WASHINGTON, D.C. (5/15/14)--Boosted by refinancing activity, mortgage applications increased 3.6% for the week ending May 9, according to the weekly report from the Mortgage Bankers Association.
Refinances accounted for 50% of all applications and 44% of the prospective loan volume, although the refi index hovers near a 5 1/2-year low, Moody's reminded (Economy.com May 14). The refinance index increased 7% from the previous week.
Activity in adjustable-rate mortgages (ARMs) decreased to 8% of total applications.
Lenders are competing to attract higher-priced residential loans, displayed by the average contract interest rate for a 30-year fixed jumbo mortgage at 4.29% is lower than the 4.39% for 30-year fixed-rate mortgages with a conforming loan balance, "a rare phenomenon," Moody's noted.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.4%, the lowest since November, from 3.52%.