Falling interest rates ignited a 34% jump in applications for home mortgages last week, according to the Mortgage Bankers Association of America.

Despite the boom, activity has no reached the levels seen during the refinance frenzy of January and February.

Banks, in fact, appear to be handling the pickup with far less difficulty than earlier in the year.

Lenders More Accessible

Calls made by the American Banker to the application lines of five major lenders this week were answered quickly at three, and responses were informative. By contrast, customer service representatives at most companies were all but unreachable in January.

The recent pickup, seen primarily in refinancing applications, stems from rates that have fallen to their lowest levels in 20 years. The average rate on 30-year fixed mortgages fell to 8.21% last week from 8.43% the previous week, according to HSH Associates, a rate-tracking firm in Butler, N.J.

Rates this week are virtually unchanged.

An index of application volume released on Thursday by the Mortgage Bankers Association rose to 232.3 for the week ended July 10 - up 34% from the previous week and 137% from the level a year earlier. The base of 100 reflects applications in March 1990.

Despite the recent gains, the index is 33% below January's high of 345.2.

In the phone test, quick replies for application requests came from New York's Chemical Bank, Minneapolis' TCF Mortgage Corp., and California's Countrywide Funding. A TCF rep came to the phone immediately, and the other two got to a caller within three minutes.

But there were snags elsewhere. A phone operator at NationsBanc Mortgage took some basic information and promised that a loan officer would call back within 24 hours. The caller was still waiting three days later.

Elsewhere, the Des Moines branch of Norwest Mortgage took two days to return a message left with its "Express Department."

Mortgage executives say service response is generally better than during the January crunch because the volume simply isn't as strong this time around. Many lenders also have hired more service people since the beginning of the year.

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