The Mortgage Bankers Association reported Jan. 12, 2011, that applications...

The Mortgage Bankers Association reported Jan. 12, 2011, that applications to refinance mortgages had increased. (Undated) Credit: iStock

The number of applications for mortgages rose last week as lower rates lured borrowers to refinance.

The Mortgage Bankers Association said Wednesday its overall mortgage application index increased 2.2 percent from the previous week. The refinance index rose 4.9 percent, while the purchase index slipped 3.7 percent last week.

The refinance share of activity rose to 72.1 percent of all applications from 71 percent the previous week.

Rates on fixed mortgages edged down last week, but are still more than a half-point higher than they were in late October. They have risen as Treasury yields increased on rosier economic data and expectations that tax cuts will spur growth and spark higher inflation. Mortgage rates tend to track those yields.

The rate on the 30-year fixed mortgage fell last week to 4.78 from 4.82 percent a week earlier. The rate on the 15-year fixed loan, a popular refinancing option, dropped to 4.15 percent from 4.23 percent.

The Mortgage Bankers Association's survey covers more than 50 percent of all applications nationwide.

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