Mortgage applications slide
Mortgage Bankers Association says demand for home loans waned last week, even as 30-year rate eased closer to 5%.
NEW YORK (CNNMoney.com) -- Mortgage applications fell last week for the third week in a row, even as interest rates edged lower, an industry group said Wednesday.
The Mortgage Bankers Association (MBA) said its index of mortgage application volume fell 12.3% in the week ended Oct. 23 from the prior week.
The drop in activity came as a popular tax credit for first-time homebuyers faced an uncertain future. The credit, which can be worth up to $8,000 for eligible buyers, is set to expire at the end of next month.
The MBA said refinancing applications also fell, by 16.2% from the previous week. The purchase index, a measure of applications at mortgage lenders, declined 5.2% last week.
Meanwhile, interest rates on the widely-used 30-year fixed mortgage eased to 5.04% from 5.07%, according to the MBA.
The MBA report also showed the average rate for 15-year fixed-rate mortgages rose to 4.53% from 4.51%.
Rates for one-year adjustable rate mortgages, or ARMs, slid to 6.79% from 6.86%.
Government figures are expected to show Wednesday that sales of newly built homes rose at an annual rate of 440,000 units in September. That would be an increase of 2.6% versus the previous month.
On Tuesday, the S&P Case-Shiller home price index showed home prices rose for the fourth month in a row during August. Prices were down 11.3% versus August 2008, but that drop was less severe than the 11.9% year-over-year drop economists had forecast.