The amount of people applying for mortgage loans fell slightly over the latest week. The Mortgage Bankers Association has notified news services that the index of mortgage activity has dropped 5.5 points to an index of 641.1 over the past week. This is most likely due to a decrease in home purchase activity, and possibly that an influx of new applications experienced in early August has peaked.
The Washington Post reports:
Applications, however, may have climbed earlier in August as a major lender hurt by turmoil in mortgage bond and other financial markets closed its doors, forcing borrowers to reapply elsewhere, said Jay Brinkmann, a vice president of research at the MBA.
“The drop in applications we see here may be an indication that those borrowers have now been taken care of,” he said.
The slight drop isn’t indicative if whether or not lenders will be willing to accept riskier loans due to a decrease in demand. This will most likely be a momentary deflux.
Interest rates, however, continue to rise according to the Post:
Fixed 30-year mortgage rates averaged 6.49 percent last week, excluding fees, up from 6.45 percent the prior week.
Source: The Washington Post