The Mortgage Bankers Association (MBA) states that its seasonally adjusted index of mortgage applications increased by 0.7%. 
"The main story on applications versus rates is that the bulk of the rate increase was Friday and most of the applications were spread across the week, so we will probably see the impact in next week's numbers," said Douglas Duncan, chief economist at the MBA.

Interest rates on mortgage loans rose 6.31% last week, up 0.13% from the week before, the highest level since early December, when it rose to 6.32%.
A 30-year fixed-rate mortgage is the industry standard, and was above the 2005 level of 5.47% in June of last year, and 0.02% below the high of last year, which was 6.33% in November. 
Seasonally adjusted refinancing applications rose for at a record rate for the second week in a row.  The gain was 2.6% from 1,614.4, compared to 1,575.5 the week before.

The MBA’s seasonally adjusted purchase index dropped for the second week, losing 0.4% to 399.0 from the week before, at 400.8.  The mortgage index is considered a good gauge of home sales, and was also below the level of a year ago, which was 451.7.Fixed 15-year mortgage rates were at an average of 5.97%, slightly up from the week before, at 5.84%.  One-year fixed-rate mortgages rose from 5.64% to 5.69%.

Experts believe that increasing number of borrowers are converting their ARMs into fixed-rate loans, since the difference between adjustable rate and fixed rate mortgage interest narrows.

Patricia Fuller 

Real Estate Portal