NEW YORK (Reuters) - Applications for U.S. home mortgages fell last week as interest rates rose to their highest since October 2014, an industry group said on Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell 5.5 percent in the week ended June 12.
The MBA’s seasonally adjusted index of refinancing applications fell 6.9 percent to the lowest level since January, while the gauge of loan requests for home purchases, a leading indicator of home sales, fell 4.2 percent.
Fixed 30-year mortgage rates averaged 4.22 percent in the week, the highest level since October 2014. They were up 5 basis points from 4.17 percent the previous week.
“Rising rates continue to create volatility in weekly mortgage applications activity. The 10-year Treasury hit 2.5 percent last week and our survey’s 30-year fixed rate of 4.22 percent is at its highest level since October 2014. The refinance index dropped to the lowest level since January 2015 as rates continued to increase,” said Mike Fratantoni, MBA’s chief economist.
The survey covers over 75 percent of U.S. retail residential mortgage applications, according to MBA.
Reporting by Caroline Valetkevitch; Editing by Diane Craft