Mortgage application volume increased 8.5 percent during the week ending Dec. 4, as more borrowers refinanced loans to lock in interest rates near record lows, according to a report Wednesday from the Mortgage Bankers Association.
Refinancing activity jumped 11.1 percent on an adjusted basis during the week ending Dec. 4, compared with the previous week. Purchase volume rose 4 percent.
Customers looking to refinance existing mortgages accounted for 74.4 percent of total applications, up from 72.1 percent the previous week.
Interest rates near historic lows have made it more enticing for customers trying to reduce the size of their monthly payments. The first uptick in interest rates in six weeks might have also pushed borrowers to lock in rates now before they potentially climb.
The average rate for a traditional, 30-year fixed-rate mortgage increased to 4.88 percent last week from 4.79 percent the week before.
The average interest rate on a 15-year fixed-rate mortgage, which is often more popular with refinance customers, increased slightly to 4.33 percent from 4.27 percent.
The survey provides a snapshot of mortgage lending activity among mortgage bankers, commercial banks and thrifts. It covers more than 50 percent of all residential retail mortgage originations each week.