Mortgage applications rebounded last week as rates fell: MBA

NEW YORK Wed Mar 27, 2013 7:05am EDT

Construction equipment sits next to signs advertising new condominium homes for sale in South San Francisco, California, December 22, 2009. REUTERS/Robert Galbraith

Construction equipment sits next to signs advertising new condominium homes for sale in South San Francisco, California, December 22, 2009.

Credit: Reuters/Robert Galbraith

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NEW YORK (Reuters) - Applications for home mortgages rebounded last week as interest rates pulled back for the first time in three weeks, data from an industry group showed on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, rose 7.7 percent in the week ended March 22.

The index has declined for six of the past nine weeks as rates have pulled higher. Still, interest rates remain low on a historical basis, kept down by the Federal Reserve's efforts to boost the economy by buying bonds and mortgage-backed securities.

The seasonally adjusted index of refinancing applications jumped 8 percent, while the gauge of loan requests for home purchases, a leading indicator of home sales, gained 6.7 percent.

The refinance share of total mortgage activity was unchanged at 75 percent of applications.

Fixed 30-year mortgage rates averaged 3.79 percent in the week, down 3 basis points from 3.82 percent the week before.

The survey covers over 75 percent of U.S. retail residential mortgage applications, according to MBA.

(Reporting by Leah Schnurr; Editing by Leslie Adler)

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Comments (1)
TommyPaine wrote:
The article says that rates fell last week. With all of the talk about Cyprus, the DOW reaching new highs, etc., no one has mentioned to biggest financial story of all: the yield on the 10-yr US Treasury bond has dropped from more than 2% last week down to 1.86% this morning. What is going on that has driven the rate down this dramatically, while the equity markets are surging? In the recent past, there was a positive correlation between rising equity prices and rising rates; but that relationship has now completely broken.

Are the bond markets telling us that equities are ready to drop?

Mar 27, 2013 8:02am EDT  --  Report as abuse
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