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Refinance Index vs 30 Yr Fixed</p

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 “Interestrnrates dropped last week due to continuing anxieties regarding the fragilerneconomic situation in Europe,” said Michael Fratantoni, MBA’s VicernPresident of Research and Economics.  “With mortgage rates reachingrnnew lows, refinance volume jumped and MBA’s refinance index reached its highestrnlevel in the last six months.  Purchase activity also increased as buyersrnreturned to the market after the holiday season.”</p

Withrnthe exception of jumbo loans (with balances over $417,500) interest rates continuedrntheir downward trend. Three of the rates, in fact, hit the lowest level in thernhistory of the MBA applications survey.  Thernjumbo rate – for 30-year fixed-rate (FRM) loans – increased to 4.40 percentrnfrom 4.34 percent with points decreasing to 0.37 from 0.47 point.  The effective rate also increased. </p

Thirty-yearrnFRM with conforming (under $417,500) balances hit a new low, decreasing to 4.06rnpercent with 0.48 point from 4.11 percent with 0.41 point. The effective raternalso decreased. </p

Ratesrnfor FHA guaranteed 30-year FRM werernat 3.91 percent with 0.59 point, the lowest FHArnrate in the history of MBA’s application survey, down from 3.96 percent with 0.72 point.  The effective rate also decreased from the previous week. </p

Thernthird all-time low is the 3.33 percent rate with 0.39 point for the 15-year FRM. rnThis was a drop from 3.40 percent with 0.37 point rate the previous week.  The effective rate also decreased.</p

Thernaverage contract interest rate for 5/1rnARMs was unchanged at the record low 2.90 percent established the previousrnweek.  Points decreased to 0.45 from 0.49.   Therneffective rate also decreased from last week. </p

Allrnrates quoted are for 80 percent loan-to-value originations and points includernthe application fee.</p

 MBA’s coversrnover 75 percent of all U.S. retail residential mortgage applications, and hasrnbeen conducted weekly since 1990.  Respondents include mortgage bankers,rncommercial banks and thrifts.  Base period and value for all indexes isrnMarch 16, 1990=100.

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