U.S. mortgage applications climb 1.2 percent

WASHINGTON, Jan. 12 (Xinhua) -- The volume of U.S. mortgage applications climbed 1.2 percent last week, compared to the week prior, according to the Mortgage Bankers Association's index.

The average interest rate for 30-year fixed-rate mortgages dropped last week to 6.42 percent from 6.58 percent, prompting some buyers to take advantage of the somewhat lower rate, according to a release issued by the Mortgage Bankers Association Wednesday.

Mortgage rates are separate from U.S. interest rates, which are set by the Federal Reserve, although interest rates often impact mortgage rates.

But despite a small decrease in mortgage rates, the current rate is considerably higher than it was during the same period a year ago. At that time, the average contract rate for 30-year fixed rate mortgages stood at 3.52 percent.