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U.S. Mortgage Applications Rise Despite Higher Costs

U.S. mortgage applications rose last week for the fourth out of the past five weeks, despite a rise in long-term borrowing costs to their highest level since early February, an industry group said Wednesday.

The Mortgage Bankers Association said its mortgage application index rose 1.6% to a seasonally adjusted 686.2 in the week ended May 18.

It was the highest reading since 690.5 in the March 9 week and well above 552.6 in the same week a year earlier.

Applications for both home purchases and mortgage refinancing climbed in the past week. Borrowing costs also climbed across the board.

Average 30-year fixed-rate mortgages, excluding fees, rose 0.1% to 6.23% from 6.13% the prior week, the biggest weekly increase this year.

While this increase brought rates just below the peak of 6.24% reached in the Feb. 9 week, long-term borrowing costs have held to an extremely narrow range between 6.03% and 6.29% all year.

In the same week a year earlier, 30-year mortgage rates averaged 6.61%.

The MBA's seasonally adjusted purchase index climbed 1.3% to 438.1 in the week ended May 18. The group's refinancing applications index rose 1.9% to a seasonally adjusted to 2,154.7.