New Mortgage Applications Hit Highest Level Since May

The number of applications for mortgages to buy homes rose to its highest level in six months last week.

The Mortgage Bankers Association Purchase Index rose 14.4% from a week earlier, the association said. No adjustment was made for Veteran's Day, which occurred in the previous week.

The index is now at it's highest reading since the week ending May 7, 2010.

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"The increase in purchase applications last week aligns with other incoming data suggesting that consumers are feeling somewhat more confident with their financial situation," said Michael Fratantoni, the association's vice president of research and economics.

Total mortgage applications rose 2.1% from a week earlier on a seasonally adjusted basis. The Refinance Index dropped 1% from the previous week to its lowest since the end of June.

Refinance applications made up 78.6% of total applications, compared with 80.3% a week earlier.

The average contract interest rate for 30-year fixed-rate mortgages rose to 4.5% from 4.46%.