Mortgage Interest Rates Inch Back up Slightly

Home Loan Applications Increase 5.7 Percent Last Week – second consecutive week of increased home buyer activity

Dennis Norman

The Mortgage Bankers Association (MBA) released its weekly mortgage applications survey for the week ending March 5, 2010. The report showed the MBA Purchase Index (a measure of the volume of loan applications related to a home purchase) increased 5.7 percent from the week before and the four-week moving average for the index is up 0.7 percent.

The mortgage activity seems consistent with recent increased sales activity.  I think a key factor going forward is going to be interest rates and the concern I have, as well as many in the industry, is when the Treasury stops buying mortgage-backed securities we will see interest rates increase.

Interest rates and fees for the week:

• 30 year fixed-rate mortgage interest rates continued the roller coaster ride with the 5.0 percent mark, this week inching back above it slightly to 5.01 percent, up from 4.95 percent, with fees decreasing  to .82 percent from .99 percent on loans that are 80 percent of the value of the home.
• 15 year fixed rate mortgage interest rates increased slightly to 4.32 percent from 4.27 percent, with fees decreasing to .88 percent from 1.36 percent on loans that are 80 percent of the value of the home.
• One-year ARM interest rates increased slightly to 6.80 percent from 6.77 percent with fees increasing to 0.30 percent from 0.29 percent for loans that are 80 percent of the value of the home.

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