Lower Rates Boost Refinancing Activity

Washington, DC, March 25, 2009--Mortgage refinancing application volume rose an unadjusted 41.5% last week, compared with the week before, the latest Mortgage Bankers Association survey results, released on Wednesday.

Mortgage applications filed to purchase a home were up a seasonally adjusted 4.2% compared with the week before.

"Mortgage rates fell sharply to low levels not seen in six decades following the Federal Reserve's announcement on the Treasury bond and mortgage-backed securities purchase programs. The drop offered a sizable refinance incentive for most homeowners sparking a pickup in refinance activity," said Orawin Velz, associate vice president of economic forecasting for the MBA, in a news release.

The 30-year fixed-rate mortgage averaged 4.63% last week, down from 4.89% the previous week, the MBA said. Fifteen-year fixed-rate mortgages averaged 4.48%, down from 4.52%. One-year adjustable-rate mortgages averaged 6.22%, up from 6.20%.

All mortgage applications, including refinance and purchase applications, were up a seasonally adjusted 32.2% last week, compared with the week before.

Refinance applications made up a 78.5% share of all applications, up from 72.9% the previous week.