By Kevin Chiu
Refinancing applications rose for the third straight week in a row as interest rates took a slight decline, according to the Mortgage Bankers Association.
The refinance index rose 7.7% for the week ending January 14 th, as refinances rise to the highest level since before the holiday season in early December. The seasonally adjusted purchase index slipped a slight 1.9%.
Mortgage rates on a 30-year fixed rate loan fell just .01% to 4.77% from 4.78% on a fully contracted mortgage, according to the bankers’ survey, which includes about half of all mortgages underwritten by the industry nationwide. Points increased to 1.20 from 0.91 for the rate on an 80% loan-to-value mortgage.
The average contract rate on a 15-year fixed rate loan increased marginally for the week to 4.16%, a slight .01 rise. “Mortgage rates have moved somewhat lower since the beginning of the year, as mixed data on the job market continue to cloud the outlook for the economy,” said Michael Fratantoni, MBA’s Vice President of Research and Economics.
“Refinance applications have picked up as borrowers take advantage of lower rates, but purchase applications remain quite low, indicating that home sales are unlikely to pick up any time soon.”
The monthly moving average for the seasonally adjusted market index rose 1.4%. The four week moving average is down 0.8% for the seasonally adjusted purchase index, while refinances are down 2.3%. Refinances rose to compile 73% of all mortgage application activity.