As of the week ending June 13, 2008 mortgage application volume dropped 8.7% on a "seasonally" adjusted basis. On an "unadjusted" basis the index was down 9.6% from one week earlier and over 21% compared to this same week one year ago. This all comes when the industry is already "waist deep" in a slump!
Refinance applications really took a beating falling a ridiculous 15% for the week. Any guesses as to why? That's right mortgage rates have "skyrocketed" over the last 2.5 weeks. However, purchase applications rose 4.3% and FHA loans were up 4%.
Prior to the end of January refinance applications accounted for 75% of all application volume. However, that portion of mortgage related transactions now only accounted for 37.4%. On the same note the ARM portion of the index fell to just 9.7% of all mortgage activity.
Rates and the application volume are "at times" and "more often than not" tied directly to mortgage rates and as they have recently increased we have seen the "total" application volume decrease. All of this en light of a struggling national housing slump, increased inventory of homes and much tighter lending standards. Have you seen the movie "The Perfect Storm"? Well hopefully we end up better than the brave men aboard that vessel?
Brought to you by Professional Mortgage Group, Inc.
Your Columbia Missouri Mortgage Broker
Thursday, June 19, 2008
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