News of the Fed's pledge to buy up more mortgage-backed securities and treasuries, sent mortgage rates sharply lower.

Home loans apps jumped 32.2 percent on a seasonally adjusted basis compared to one week earlier, 31.4 percent unadjusted, and were up 18 percent compared to the same week a year ago.

It was all about the refinances, which increased 41.5 percent from the week prior, though purchase activity and FHA lending saw mild gains as well.

The refinance share of mortgage activity increased to 78.5 percent of total applications, up from 72.9 percent a week earlier as rates plummeted.

The 30-year fixed-rate mortgage averaged 4.63 percent, down from 4.89 percent, its lowest point in survey history, which began back in 1990.

The 15-year fixed slipped to 4.48 percent, while the one-year ARM increased to 6.22 percent.

"Mortgage rates fell sharply to low levels not seen in six decades following the Federal Reserve's announcement on the Treasury bond and mortgage-backed securities purchase programs," said Orawin Velz, Associate Vice President of Economic Forecasting.

"The drop offered a sizable refinance incentive for most homeowners sparking a pickup in refinance activity."

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