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Mortgage applications in US surged last week on lower rates

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Mortgage applications in the US surged last week as Americans returned from holiday breaks and took advantage of falling borrowing costs.

[WASHINGTON] Mortgage applications in the US surged last week as Americans returned from holiday breaks and took advantage of falling borrowing costs.

The Mortgage Bankers Association's index jumped 49.1 per cent in the period ended Jan 9 after an 11.1 per cent increase the prior week, figures from the Washington-based group showed today. It's not uncommon for the data around holidays such as Christmas and New Year's Day to be volatile.

The group's refinancing gauge advanced 66.4 per cent, while the purchase-applications measure increased 23.6 per cent.

Last week, the average contract rate on a 30-year fixed loan fell to 3.89 per cent, the lowest since mid-May 2013, from 4.01 per cent. The average on a 15-year mortgage fell to 3.16 per cent from 3.24 per cent.

The share of all applicants seeking to refinance last week increased to 70.5 per cent, the highest since May 2013, from the prior week's 64.8 per cent.

BLOOMBERG