Mortgage applications fell 2.3 percent last week as interest rates ticked up slightly, the Mortgage Bankers Association reports in its seasonally adjusted application index. Broken out, applications for home purchases dropped 3 percent while applications for refinancing fell 2 percent.
"With rates little changed for the week, we saw a dip in application volume. It is important to note that purchase volume remains 7 percent above last year's level, and has been up on a year-over-year basis for six weeks now," says Mike Fratantoni, MBA's chief economist.
The 30-year fixed-rate mortgage rose slightly to 3.87 percent from 3.86 percent the prior week, MBA reports. Tight credit conditions persist, which are keeping many would-be buyers out due to regulations over appraisals as well as inconsistent incomes for self-employed individuals, Peter Carroll of Quicken Loans said at FSR’s Housing Policy Council forum this week. The appraisal process, for example, may keep some buyers out who don’t have a lot of money for a down payment, Carroll said.
“We are seeing a chronic tightening of appraised values that very frequently come in below the sales price and when you are talking about consumers with lower down-payment loans, that's going to pull a lot of people out of eligibility with these products," Carroll said.
Source: Daily Real Estate News | Weekly Mortgage Application Drop as Rates Tick Higher (CNBC.COM) April 15, 2015
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