Home Purchase Apps Increase, Refinances Slip as Rates Edge Up

Home Purchase Apps Increase, Refinances Slip as Rates Edge Up

The Mortgage Bankers Association (MBA) reported Wednesday that its index of home purchase applications jumped 6.3 percent for the week ending September 3, 2010, reaching its highest level since the end of May.

Michael Fratantoni, MBA’s VP of research and economics, noted the rise in purchase activity relative to recent months, but he says homebuying demand is still well below levels seen prior to the expiration of the federal tax credit, and is almost 40 percent below the level recorded one year ago.

MBA’s index of applications for mortgage refinancing fell 3.1 percent from the previous week, as interest rates edged up slightly. The refinance share of mortgage activity dropped from 82.9 percent to 81.9 percent of total applications.

It was the first time refinance volume has dropped in six weeks, but Fratantoni says the level of applications to refinance remains close to recent highs, as historically low mortgage rates continue to entice borrowers…

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