Record low rates drive mortgage applications up 7.6%

Posted by Emily Ray-Porter Group on Wednesday, July 21st, 2010 at 10:34am.

Wednesday, July 21stUSA Today

 

NEW YORK (AP) — Applications for home loans rose last week as rates on 30-year and 15-year fixed-rate loans sank to the lowest levels on record.

The Mortgage Bankers Association said Wednesday that applications increased nearly 7.6% from a week earlier. That incorporates an adjustment for the Independence Day holiday.

Applications to refinance home loans climbed 8.6%. Applications to buy homes rose 3.4%.

Refinance applications accounted for 79% of applications, the most since April last year.

Mortgage rates have fallen since mid-April after investors, concerned over European debt problems and the health of the global economy, poured money into the safety of U.S. Treasury bonds. That has caused yields on those bonds to fall. Long-term fixed mortgage rates tend to track those yields.

The average rate for a 30-year fixed loan fell to 4.59% last week and the rate for a 15-year fixed loan dropped to 4.05%. Both were the lowest rates recorded in the MBA's survey, which has been conducted since 1990.

The Mortgage Bankers Association's survey covers more than half of all applications nationwide.

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