Mortgage applications show rebound

Mortgage Bankers Association reports 10.9% rise in applications for week of June 6.

June 11, 2008: 7:30 AM EDT

WASHINGTON (AP) -- Mortgage application volume rose 10.9% during the week ending June 6, rebounding from a sharp decline one week earlier, according to the Mortgage Bankers Association's weekly application survey.

The MBA's mortgage application index rose to 557.1 during the week, from 502.3 the previous week when volume fell 15.3%.

Refinance application volume increased 8.4% during the week ending June 6, while purchase application volume jumped 12.8%. Refinance applications accounted for 39.8% of total 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 557.1 means mortgage application activity is 5.571 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.

Average interest rates: Application volume rose despite a rise in interest rates. The average interest rate for a traditional, 30-year fixed-rate mortgage rose to 6.24% from 6.17%.

The average rate for 15-year fixed-rate mortgages, a popular option for refinancing a home, rose to 5.78% from 5.7%.

Rates for one-year adjustable-rate mortgages rose to 6.87% from 6.8%.