This morning the Mortgage Bankers Association (MBA), in its Weekly Mortgage Applications Survey for the week ending July 18, announced that mortgage loan application volume dropped 6.2 % when compared to the week prior.
The MBA’s report also indicated that the number of people applying to refinance their existing mortgage was down 5.6 from the previous week while those applying for a mortgage to purchase a home dipped 6.3 week-over-week. FHA loans, which for months have been the star of the MBA report posting large week to week gains, also saw a pull-back of 7.7 %.
“The combination of restrictive credit and climbing mortgage rates continue to hamper consumers, resulting in disappointing mortgage activity,” said Bob Walters, Chief Economist for Quicken Loans, the nation’s largest online lender and one of the leading direct FHA lenders. “While it is true that homes are more affordable now, without liquidity and available credit, it makes little difference. Mortgage activity will not accelerate appreciatively until more people, especially those that are qualified, can secure financing.”
“However, there are bright spots. Consumers are finding considerable luck securing financing with FHA loans and are beginning to use them at levels that seemed unimaginable only a couple years ago. And while loan activity dipped slightly on this program last week, FHA loans will continue to gain in popularity as they are opening credit to a much larger pool of consumers.”
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