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Ongoing declines in mortgage interest rates helped spur a pickup in refinance volumes at Fannie Mae and Freddie Mac in August, even as interest in the government's Home Affordable Refinance Program continues to wane. According to a report released this week by the Federal Housing Finance Agency, total refinance volumes at Fannie and Freddie came to a little more than 131,000 in August, up more than 11 thousand from July as mortgage rates slipped slightly. While overall refinancing activity increased, however, the number of refinances completed through HARP fell again to a combined 14,000—accounting for about 11 percent of total volume compared to July's 13 percent.
Despite declining volumes, a handful of states continue to see a large portion of HARP refinances as a share of total activity. Year-to-date through August, HARP refinances represented 34 percent of total refinances in Georgia, double the national share of 17 percent. HARP refinances are also popular in Florida, where they account for 32 percent of total volume.
Mortgage applications surged in the latest weekly index, led by a spike in refinancing activity, according to the Mortgage Bankers Association. The group's Weekly Mortgage Applications Survey shows mortgage application volumes jumped a seasonally adjusted 11.6 percent for the week ending October 17th. The surge in the headline index stemmed from a substantial jump in the refinance application component, which was up 23 percent week-over-week to hit its highest level since November 2013. With that increase, the refinance share of mortgage activity climbed 6 percentage points to 65 percent, its highest so far this year. On the other side, the market for home purchase loans showed less encouraging trends, with applications slipping 5 percent and falling 9 percent short of last year.
