Mortgage Rates Lower on Mideast Tension

Washington, DC, Feb. 24, 2011 -- Mortgage application volume increased 13.2% from one week earlier, according to the Mortgage Bankers Association.

The Refinance Index increased 17.8% from the previous week, while the Purchase Index increased 5.1% from one week earlier.

"Ongoing turmoil in the Middle East brought interest rates lower last week. Borrowers took advantage of these lower rates, bringing application activity back near levels from two weeks ago, following sharp declines last week," said Michael Fratantoni, MBA's Vice President of Research and Economics.

The refinance share of mortgage activity increased to 65.7% of total applications from 64.0% the previous week.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 5.00% from 5.12%.