Mortgage volume rises

Number of new mortgages up less than 1% last week, survey says.

August 27, 2008: 7:32 AM EDT

WASHINGTON (AP) -- Mortgage application volume rose less than 1% during the week ended Aug. 22, according to the Mortgage Bankers Association's weekly application survey.

The trade group's application index rose to 421.6 during the week, from 419.3 a week earlier, which had been the lowest index level in nearly eight years.

Refinance volume rose 0.3%, while purchase volume increased 0.6% during the week. Refinance volume accounted for 35.2% of all applications.

The index peaked at 1,856.7 during the week ending May 30, 2003, at the height of the housing boom.

An index value of 100 is equal to the application volume on March 16, 1990, the first week the MBA tracked application volume. A reading of 421.6 means mortgage application activity is 4.216 times higher than it was when the MBA began tracking the data.

The survey provides a snapshot of mortgage lending activity among mortgage bankers, commercial banks and thrifts. It covers about 50% of all residential retail mortgage originations each week.

Application volume increased slightly as fixed-rate mortgages dipped. The average rate for traditional, 30-year fixed-rate mortgages fell to 6.44% from 6.47% during the prior week. The average rate for 15-year fixed-rate mortgages, often a popular option for refinancing a home, decreased to 5.94% from 5.99%.

The average rate for one-year adjustable-rate mortgages increased to 7.15% from 7.07%.