Mortgages applications rise as interest rates slip
Applications for U.S. home loans increased in the latest week as rates continued to edge lower, data from an industry group showed on Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, jumped 6.4 percent in the week ended Oct. 25. The index had dipped 0.6 percent in the previous week.
The figures came against the backdrop of a 16-day U.S. federal government shutdown in the first half of the month. The potential economic damage from the shutdown fueled views that the U.S. Federal Reserve will maintain its bond-buying program for longer than previously thought to prop up the economy. The Fed is currently buying $85 billion per month in Treasuries and mortgage-backed securities.
MBA data showed 30-year mortgage rates edged down 6 basis points to 4.33 percent, the lowest rate since June. The refinancing index rose 8.7 percent. The gauge of loan requests for home purchases, a leading indicator of home sales, rose 2.3 percent.
The mortgage survey covers over 75 percent of U.S. retail residential mortgage applications, according to MBA.
(Read more: What pending homes plunge means for the recovery)