Mortgage Applications Jumped 1.9% Last Week As Mortgage Rates Decline

(RTTNews) - With the 30-year fixed mortgage rate decreasing for the third straight week, the Mortgage Bankers Association released a report on Wednesday showing a notable increase in mortgage applications in the week ended May 17th.

The MBA said the Market Composite Index, a measure of mortgage loan application volume, jumped 1.9 percent last week after rising by 0.5 percent in the previous week.

"Rates coming down from recent highs spurred some borrowers to act, with increases across both conventional and government refinance applications," said Joel Kan, MBA's Vice President and Deputy Chief Economist.

However, he added, "Purchase activity continues to lag despite this recent decline in rates, down 11 percent from a year ago, as potential buyers still face limited for-sale inventory and high list prices."

The report said the Refinance Index surged 7 percent from the previous week and was 21 percent higher than the same week a year ago.

Meanwhile, the MBA said the unadjusted Purchase Index decreased 2 percent compared with the previous week and was 11 percent lower than the same week last year.