The Mortgage Bankers Association (MBA) today released its Mortgage Applications Survey for the week ending March 27, 2009, which shows that refinance activity is continuing to dominate home loan applications as struggling homeowners across the country take advantage of record-low interest rates.

The refinance share of mortgage activity rose to 79.1 percent of total applications, up from 78.5 percent the previous week. MBA reported that the Refinance Index increased 3.7 percent from the previous week, and is up 20.3 percent when looking at the four week moving average.
MBA’s measure of total mortgage application volume increased 3.0 percent from the previous week, and is up an incredible 68.8 percent compared with the same week last year. That annual jump is solely a result of the strong refinance activity. The Purchase Index increased only 0.1 percent from the week before. The Conventional Purchase Index rose 1.0 percent, and the Government Purchase Index (largely FHA loans) decreased 1.4 percent.
MBA also reported that mortgage interest rates across the board dropped again last week. The association recorded the average contract interest rate for 30-year fixed-rate mortgages (FRMs) at 4.61 percent, down from 4.63 percent the previous week. The rate for 15-year FRMs last week decreased to 4.45 percent from 4.48 percent the week before.
The average contract rate for one-year adjustable-rate mortgages (ARMs) decreased to 6.20 percent from 6.22 percent, MBA said. The ARM share of loan activity increased to 1.5 percent of total applications, up slightly from 1.4 percent the previous week.