Mortgage Applications Drop Again

Despite massive government intervention to subsidize the buying of homes with generous tax credits, applications for mortgages keep dropping. This now includes refinance applications.

All this comes while interest rates are at near record lows.

It seems that despite large government actions, ordinary people remain loathe to buy homes.

The Los Angeles Times reports:

Despite the lowest mortgage rates since May, applications for loans to finance home purchases fell again last week, the Mortgage Bankers Assn. said Wednesday.

The seasonally adjusted total of applications for purchase loans decreased 4.7% in the week that ended Friday compared with the week before, marking the sixth straight weekly decline.

Refinance applications fell 1.4% last week.

Rates for traditional 30-year, fixed-rate mortgages dropped below 5% in mid-September, helping trigger a mini-boom in mortgage applications, particularly for refinance loans.

But recently, fewer people across the country have applied for mortgages even though the mortgage bankers' survey shows rates have continued to decline.