The Number of Mortgage Applications Falls Steadily

Fewer people apply for mortgage loans in the US. The statistics show that this is becoming a permanent trend. The number of applications has experienced a steady fall since the middle of February 2014 with only one of six weeks marking a slight increase.

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The greatest drop occurred during the week ending March 14. In this week, the number of mortgage applications fell by 1.2%. At the same time, the number of sales in the property market dropped by 0.4% during February. Even though spring is expected to boost the activity in the real estate market and the home loan market respectively, so far both markets are sluggish and major stir-up is highly unlikely to occur at least in the coming few weeks.

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The reduction in the number of applications for home loans was predicted by leading mortgage market experts back in the end of 2013. The main factor behind this trend is the expected rise in the interest rates which is already starting to take place. Right now, the rate is fluctuating on a weekly basis, but it has continued to grow ever since this time last year when it hit a record low.

The indications that the Federal Reserve will reduce its bond purchases and the projections that there will be an increase the Federal Funds Rate are expected to place an upward pressure on the mortgage rates. This has a negative effect on prospect home buyers and especially on those who are not confident about their income and financial stability.

The stricter mortgage regulations which were introduced in January 2014 also contribute greatly to the decline in the number of applications. Now it is more difficult for many people to obtain a home loan. Besides, the high-risk loans which were available to home buyers with more limited means are no longer around.

The number of mortgage applications will most likely continue to decrease but at a lower rate.

Christian

Christian

Christian Calvin mortgage Christian is a contributing writer for Mortgage.info. He is a graduate from the University of Tennessee with a degree in Communications and a concentration in Broadcasting. Christian has served as vice-president for a privately-held company for more than 20 years. Additionally, he has also applied his writing and business knowledge to various websites with a focus on business and sports news . . . both of which are passions. Christian enjoys playing golf and spending time with his family and friends.

Contact: christian@mortgage.info
Christian

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