Mortgage Activity Drops 9.6% This Week

August 31, 2011

The number of people applying for a mortgage dropped 9.6 percent for the week ending Aug. 26 compared to a week earlier, mostly due to a big drop in refinancing activity, the Mortgage Bankers Association reports. 

Low interest rates have helped lift refinance activity in recent weeks but for the second straight week refinancings have started to slow, despite rates staying near 10-month lows. The Refinance Index alone dropped 12.2 percent this week from the previous week. 

Meanwhile, the Purchase Index -- a gauge for home buying -- dropped 1.3 percent this week, and was 8.2 percent lower than the same week one year ago. Overall, purchase volume remains near 15-year lows, says Mike Fratantoni, MBA’s vice president of research and economics. 

Source: “Mortgage Applications Decrease in Latest MBA Weekly Survey,” Mortgage Bankers Association (Aug. 31, 2011)

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