New York: Mortgage applications in the US rose to an eight-month high as a drop in mortgage rates propelled gains in refinancing requests.
The Mortgage Bankers Association's index increased 8.8 per cent in the week ended June 25.
The Washington-based group's purchase gauge declined 3.3 per cent to the second-lowest level since 1997, while its refinancing gauge jumped 13 per cent to the highest reading since May 2009.
Home sales have dried up following an April 30 deadline to sign contracts and receive a tax credit worth as much as $8,000 (Dh29,378), indicating housing will subtract from economic growth in coming months.
Refinancing may keep climbing as Americans, facing a jobless rate around a 26-year high, take advantage of near record-low borrowing costs to reduce monthly payments.
The share of applicants seeking to refinance a loan rose to 76.8 per cent last week, the highest level since April 2009.
