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Mortgage Applications Drop - Real Estate Issues
Thursday, March 13, 2008
Reports came out this week from the Mortgage Bankers Association that a 1.9% decrease in mortgage application took place last week. The Mortgage Bankers Associations loan application index fell from 684.9 to 671.7 the previous week.
The number of refinance applications dropped 4.7% while the purchase loan volume increased 1.6%. Refinance applications accounted for 50% of total applications. The mortgage refinance volume has continuously declined since the beginning of the year when it accounted for 73% of total loan applications.
During the peak of the housing boom just one year ago the index was at its highest with 1,856.7. A change was expected because of the change in the real estate marketing but a change this big was not expected. .
This information shows us a picture of mortgage lending activity among mortgage companies, lenders, and commercial banks. It covers about 50% of all residential mortgage originations each week.
With this information you can be sure that even people with good credit are waiting to buy houses or having a hard time getting financing to buy houses. The major issue is with investor assurance that mortgages are good investments. Now that so many people are loosing their house to foreclosure, investors are scared that if they buy a mortgage that is will also fall into delinquency status. If that happens the investor who purchased the mortgage can loose a large some of money.
If you are looking to purchase a house you better pay attention to the lending world. Just because you have good credit doesn’t mean you are going to be able to get financing.