Hope for the future

It's important we end the blogging year on a positive note. And remember - the people who are predicting a long, drawn-out recession are the same people who wrung their hands last summer worrying about $200 a barrel oil and $5 a gallon gasoline.

Mortgage applications mushroom on lower rates
Refinancings pace upsurge; ARMs all but disappear

By Amy Hoak, MarketWatch

Last update: 7:00 a.m. EST Dec. 24
CHICAGO (MarketWatch) -- With mortgage rates approaching record lows, the volume of applications filed for mortgages jumped a seasonally adjusted 48% last week compared with the previous week, according to the Mortgage Bankers Association's weekly survey.

Applications for the week ended Dec. 19 ran 124.6% ahead of the mortgage activity seen during the same week last year, the Washington-based MBA said. Its survey covers about half of all U.S. retail residential mortgage applications.

The boost in applications coincided with another drop in mortgage rates, as the government's efforts to thaw out the home-mortgage market show further signs of having the desired effect.

According to the MBA's survey, rates on 30-year fixed-rate mortgages averaged 5.04% last week, down from 5.18% the previous week. This interest rate hasn't been lower since the 4.99% average rate seen for the week ended June 13, 2003.
Fifteen-year fixed-rate mortgages averaged 4.91%, down from 4.93% the week before.
And one-year ARMs averaged 6.36%, down from 6.63%.

Applications to refinance existing mortgages increased 62.6% on a week-to-week basis, while applications filed for mortgages to buy homes increased a seasonally adjusted 10.6%.

The four-week moving average for all mortgage applications was up 28.8%.
Refinancings made up 83.2% of all applications filed last week, up from 76.9% the previous week. The share of applications for ARMs decreased to 0.8%, down from 1.1%.
Amy Hoak is a MarketWatch reporter based in Chicago.