Lower Interest Rates Spur Mortgage Demand

Washington, DC, May 16, 2012 -- Mortgage application volume surged last week, as low interest rates drove increased demand for refinancing, according to the Mortgage Bankers Association.

MBA said its index of mortgage application activity rose 9.2 percent in the week ended May 11.

Refinancing applications spiked up 13.0 percent, while requests for home purchases fell 2.4 percent.

Fixed 30-year mortgage rates averaged 3.96 percent in the week, down from 4.01 percent.

The refinance share of total mortgage activity rose to 74.9 percent of applications from 72.1 percent.