For the week ending on March 28, the volume of mortgage applications dropped by 28.7 percent. This significant tumble was observed in a weekly survey conducted by the Mortgage Bankers Association. The previous week saw a jump in mortgage application volume by 41.1 percent.
The volume of refinance mortgages actually fell by 38.1 percent, which could attribute to the overall drop in mortgage application volume. Purchase mortgage application declined by 11.8 percent.
The mortgage volume index was recorded at 688.3. This means that the number of mortgage applications was 6.883 higher compared to the first MBA data gathered in 1990. This index peaked in May 2003 when it recorded an activity of 1,856.7.
This survey offers a good snapshot of lending activities among commercial banks, thrifts and mortgage bankers. It can be mentioned that the drop in the number of mortgage applications is actually not surprising considering the increase in mortgage rates for the 30- and 15-year fixed-rate home loans.
Interest rates for the 30-year mortgage went up to 5.75 percent while rates for the 15-year mortgage rose to 5.27 percent. Last week, rates were at 5.74 percent and 5.23 percent respectively.
Clearly, home buyers are waiting for mortgage rates to drop before making a decision to buy a home. With the fears of recession looming, it is normal for consumers to be very cautious in their decisions to invest. On the other hand, these buyers and investors can always consider foreclosure homes as good investments especially with their lower-than-market asking prices.
Many buyers have enjoyed the savings that these foreclosed properties have offered. In addition, the current large foreclosures supply guarantees more choices. These re-possessed homes can be bought from foreclosure auctions organized by the local counties. If you are looking for the hottest deals, you should utilize foreclosure listings offered by professional realtors such as Foreclosure Listings Nationwide.
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