Refinance applications jump 88% from prior week as 30-year fixed-rate mortgage drops to 5.82%.
September 17, 2008: 2:47 PM EDT
WASHINGTON (AP) -- Homeowners rushed to take advantage of the drop in interest rates following the government's takeover of Fannie Mae and Freddie Mac, data released Wednesday showed.
Applications by homeowners looking to refinance their mortgages spiked 88% last week, according to the Mortgage Bankers Association. Refinances accounted for nearly 52% of all application activity, up from 36% the previous week, the trade group said.
The volume of purchase applications also edged up last week by 5%.
The average rate for traditional, 30-year fixed-rate mortgages dropped to 5.82% from 6.06% the prior week. The average rate for 15-year fixed-rate mortgages, often a popular option for refinancing a home, fell to 5.54% from 5.73%.
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