In the USA, the demand for mortgages is collapsing due to the rise in rates which is holding people back from requesting loans from banks. According to the seasonally adjusted index of Mortgage Bankers Association demand fell by 2.7% compared to the previous week.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) increased to 7.24% from 7.13%, with points increasing to 0.66 from 0. 65 (including disbursement commission) for loans with a 20% drop.
Mortgage applications to purchase a home fell 1% for the week and 15% less than the same week a year ago. «Purchase inquiries declined as homebuyers delayed their purchasing decisions due to affordability challenges and low supply“said Joel Kan, deputy chief economist of theMBA.
Home loan refinancing applications, which are more sensitive to weekly movements in interest rates, fell 6% on the week and were 3% higher than the same week a year ago.
PHOTO: SHUTTERSTOCK
