U.S. [tag]mortgage applications[/tag] rose for a second consecutive week as demand for home purchase loans hit its highest in two months, an industry trade group said on Wednesday. The [tag]Mortgage Bankers Association[/tag] said its seasonally adjusted index of mortgage application activity , which includes both refinancing and purchasing loans, for the week ended Sept. 8 increased 3.2 percent to 584.2 from the previous week’s 566.3, its highest since mid-May.

Dean Maki, chief U.S. economist at Barclays Capital in New York, said the indexes tend to volatile but if the trend continues it will be good news for the [tag]U.S. housing market[/tag]. “One never wants to make too much out of one week’s data,” he said. “If this index were to consistently move above 400 it could be an early sign of stabilization in home sales, but it is too early to draw any conclusions from one week.” Borrowing costs on [tag]30-year fixed-rate mortgages[/tag], excluding fees, averaged 6.32 percent, edging up 0.01 percentage point from the previous week. Interest rates were above year-ago levels of 5.72 percent, but below a four-year high of 6.86 percent touched in June.

click here for article