As per the latest data available, number of applications for mortgages has increased by 4.9 per cent during the past week. This has happened since more and more borrowers are refinancing on lowest possible rates.

The Mortgage Bankers Association gas said that in May 2009, the loan activity increased by 82.4 per cent, which is the highest since January 2009. It also showed that the refinancing applications have also gone up by 5.7 per cent.

But, the loans taken to buy homes went up by a marginal figure of 1 per cent.

The good news is the refinancing which has been the highest since May 2009 and which makes up for almost 82.4 per cent of the total loan activity.

Home loans have not gone up since there is still a high level of unemployment. This has hurt the purchase activity that is 41.5 per cent lesser than the one in April. End of the tax credit provided by the home buyers has also been one of the main reasons.

As more and more investors seek safety of Treasury Bonds, rates will fall even more.