Harris Lawrence Schechtman

According to the Mortgage Bankers Association's Weekly Applications Survey, average mortgage rates fell again last week. Rates were down across all loan categories including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. The sharp drop brought rates for conforming and FHA loans to their lowest level since last spring and caused a spike in refinance activity. In fact, the Refinance Index increased 16 percent last week and pushed total mortgage application demand 9.3 percent above week-before levels. Michael Fratantoni, the MBA's chief economist, told CNBC that much of the demand was generated by jumbo borrowers, which are those with loan balances greater than $417,000. “Jumbo borrowers are benefiting from fierce competition for these loans,” Fratantoni said. “The 30-year fixed rate for jumbo loans dropped to its lowest level since April 2013 and is now 15 basis points below the rate for conforming loans.” The MBA's weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications.