Mortgage applications rise 1.7%

Number of applicants for home loans increased last week as interest rates fell.

July 16, 2008: 10:06 AM EDT

WASHINGTON (AP) -- Mortgage application volume rose 1.7% during the week ending July 11, according to the trade group Mortgage Bankers Association's weekly application survey.

The MBA's application index rose to 522.2 during the week, from 513.4 a week earlier.

Refinance application volume rose 6.9%, while purchase volume fell 1.7%, on an adjusted basis. Refinance applications accounted for 39.2% of all applications.

The index peaked at 1,856.7 during the week ending May 30, 2003, at the height of the housing boom.

An index value of 100 is equal to the application volume on March 16, 1990, the first week the MBA tracked application volume. A reading of 513.4 means mortgage application activity is 5.134 times higher than it was when the MBA began tracking the data.

The survey provides a snapshot of mortgage lending activity among mortgage bankers, commercial banks and thrifts. It covers about 50% of all residential retail mortgage originations each week.

The average rate for traditional, 30-year fixed-rate mortgages fell to 6.22% during the week ending July 11, from 6.43% the previous week.

The average interest rate for 15-year fixed-rate mortgages -- a popular option for refinancing a home -- fell to 5.74% from 5.94%.

Rates for one-year adjustable-rate mortgages fell to 7.16% from 7.24% the prior week.