As Interest Rates Rise, Mortgage Applications Drop!

Loan demand dropped last week as interest rates rose for the fourth straight week, the Mortgage Bankers Association reports. 

The index measuring mortgage application activity, which includes applications for refinancing and home purchases, fell 6.4 percent for the week ending Feb. 8.

Separated out, refinancing applications during the week dropped 5.5 percent while applications for home purchases, viewed as a leading indicator of home sales, fell 9.5 percent. 

The 30-year fixed-rate mortgage averaged 3.75 percent last week, up from 3.73 percent the previous week. The 30-year rate is at its highest level since September 2012, according to the MBA. 

Source: “U.S. Mortgage Applications Slumped Last Week as Rates Rose,” Reuters (2/13/13)