US weekly mortgage demand falls sharply as rates rise

The U.S. home loan demand fell sharply in the week ended Nov. 26, as the mortgage rates continue to rise from their lowest levels, the Mortgage Bankers Association (MBA) said on Wednesday.

The total loan applications index, a measure of mortgage loan application volume, fell 16.5 percent on a seasonally adjusted basis from a week earlier. Mortgage loan application volume increased sharply by 2.4 percent, reaching a two-year high in the previous week.

The refinancing loans index was down 21.6 percent last week, posting a decline for three straight weeks. The index touched its lowest level since June this year.

However, the purchase index went up by 1.1 percent compared with a week earlier, reaching the highest level since the expiration of the homebuyer tax credit in April.

While the average contract interest rates for 30-year fixed rate mortgage increased to 4.56 percent from 4.50 percent in the previous week, 15-year fixed-rate mortgages increased to 3.91 percent from 3.83 percent.