Mortgage Applications Plunge
At the end of the second week in March (March 14), the volume of mortgage applications plunged by almost 3 percent. This is according to a survey conducted on weekly applications by the Mortgage Bankers Association. The index fell from 671.7 to 652 that same week.
In addition to these, refinance volume also fell by 4.6 percent and the purchase volume by 1 percent. These refinance applications actually accounted for almost 50 percent of the total mortgage applications. This is also the first time in 2008 when weekly purchase applications were higher that refinance applications.
Mortgage applications peaked during the 2003 housing boom, resulting to an index of 1,856.7. An index of 652 can be translated to mortgage activity that is 6.52 times higher than the very first index data obtained in 1990. This index survey paints a picture of the mortgage lending activities of commercial banks, thrifts and mortgage bankers. It basically covers about 50 percent of the total residential mortgage originations every week.
Surprisingly, volume applications dropped the same time that the fixed-rate mortgage rates plunged from 6.37 percent to 5.98 percent. Interest rates, on the other hand, are still swinging.
Clearly, a drop in mortgage application can mean that buyer confidence is not good. With the foreclosure crisis still consuming most of the legislators, many people are hopeful that the end of this problem will soon come. Some experts are saying that about 20 million Americans will be affected by the housing market crisis and this grim prediction is certainly making investors and buyers even more hesitant when it comes to shelling out money.
If you are a buyer or investors looking to enjoy great savings, you should consider buying foreclosed properties. For more information on foreclosure investing, please check out Foreclosed Properties Data.
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