Mortgage Applications Surge As Rates Fall

Mortgage Bankers Association's weekly index shows that interest rates edged downward to lowest level since early December.

NEW YORK (Reuters) -- Last week borrowers emerged in droves to refinance their existing home loans as interest rates fell to their lowest mark since early December, an industry trade group said Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity for the week ended March 2 increased 7.3 percent to 671.6.
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.04 percent, down 0.12 percentage point from the previous week, to its lowest level since the week ended Dec. 8, 2006, when it stood at the same level.
Interest rates were also below year-ago levels of 6.31 percent.
The MBA's seasonally adjusted purchase index, widely considered a timely gauge of U.S. home sales, rose 1 percent to 405.3. The index was also above its year-ago level of 399.0.
The group's seasonally adjusted index of refinancing applications surged 15 percent to 2,234.2.
The pace of refinancing affects such mortgage lenders as Wachovia (Charts), Wells Fargo & Co. (Charts) and Countrywide Financial (Charts).
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Article from CNNMoney.com