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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: J. P. who wrote (11951)	7/31/2003 1:01:13 PM
From: fatty	Read Replies (1) \| Respond to of 306849

Mortgage applications shrink as interest rates continue rise By Bloomberg News, 7/31/2003 WASHINGTON -- Applications for US mortgages fell last week to the lowest this year as a rise in mortgage rates slowed the pace of refinancing, an industry report showed. The Mortgage Bankers Association of America's index of applications for refinancing and home purchases slumped 24.3 percent, to 972.4 from 1284.3. It was the biggest weekly drop since October 1998. The index has fallen by almost half since reaching a record of 1856.7 in the last week of May. The Washington-based group's refinancing index plunged 32.9 percent to 4145.8. Franklin Raines, chief executive of Fannie Mae, said the percentage of homeowners for whom it would be profitable to refinance has been cut to 39 percent today from 90 percent in June because of the surge in mortgage rates. "That's an enormous change," Raines told reporters at Fannie Mae headquarters in Washington. Fannie Mae, the largest source of US home-loan financing, has reduced its forecast for US mortgage originations this year to $3.4 trillion from $3.7 trillion, he said. The average rate on a 30-year fixed mortgage rose to 5.87 percent last week from 5.72 percent. Last week's rate was the highest since the second week of December. The rate reached a record low of 4.99 percent in the week ended June 13. Any boost to consumer spending from refinancing will probably fade next year, economists said. This story ran on page C4 of the Boston Globe on 7/31/2003.