U.S. mortgage applications hit 4-month low – MBA

NEW YORK, Nov 17 (BestGrowthStock) – U.S. mortgage applications
dropped last week to their lowest level in four months as home
loans rates jumped, an industry group reported on Wednesday.

The Mortgage Bankers Association said its seasonally
adjusted index of mortgage applications (USMGM=ECI: ), which
includes loans for home purchases and refinancings, fell 14.4
percent to 713.6 in the week ended Nov. 12, the lowest since
the July 9 week.

Borrowing costs on 30-year fixed-rate mortgages surged to a
two-month high of 4.46 percent in the week, up from 4.28
percent in the previous period. The rate last month reached
4.21 percent, the lowest level in the survey, which has been
conducted weekly since 1990.

Market interest rates have risen despite the U.S. Federal
Reserve’s pledge to keep them low with the purchase of $600
billion in U.S. Treasury securities. Treasury rates, which help
guide mortgage rates, have jumped amid concern that the Fed’s
effort would be its last, or even cut short if the economy
shows more signs of life, economists said.

“Rates increased sharply last week due to stronger economic
data and lingering uncertainty regarding the structure and
impact of the Fed’s” program, known as quantitative easing,
Michael Fratantoni, the MBA’s vice president of research and
economics, said in a statement.

The MBA’s seasonally adjusted index of refinancing
applications (USMGR=ECI: ) slumped 16.5 percent to 3,831.0. The
seasonally adjusted purchase index (USMGPI=ECI: ) slipped 5
percent to 179.2.

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For a graphic on mortgage applications, click on:
http://r.reuters.com/xyk75q

The MBA said fixed 15-year mortgage rates averaged 3.87
percent, up from 3.64 percent in the previous week.

(Reporting by Al Yoon; Editing by Diane Craft)

U.S. mortgage applications hit 4-month low – MBA