Ahead of the Bell: Mortgage Applications |
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Wed, 22 Aug 2007 11:32
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WASHINGTON (AP) - Investors on Wednesday will get an update on home loan applications as mortgage industry turmoil continues and Wall Street presses the central bank to boost the struggling sector with an interest-rate cut.The Mortgage Bankers Association is due to report its weekly index of home-loan application volume at 7 a.m. EDT.The index, which mainly reflects large banks, not the nonbank lenders that have seen the biggest jumps in defaults and foreclosures, has risen two straight weeks.The larger banks may be picking up business from bankrupt lenders that once catered to borrowers with troubled credit records.For the week ending Aug. 10, mortgage application volume rose 3.4 percent on a seasonally adjusted basis to 678.7. A week earlier, the index rose 8.1 percent.Mortgage delinquencies and home foreclosures have soared this year, spurring layoffs at banks and mortgage lenders, such as Countrywide Financial Corp. and Capital One Financial Corp.The credit problems have spread in recent weeks to the broader mortgage market, making investors nervous about nearly all types of home loans.Numerous mortgage companies face financial problems, and many lenders are demanding higher rates for jumbo loans -- above $417,000 -- that can't be packaged into securities sold to investors by government-sponsored mortgage giants Fannie Mae and Freddie Mac.The MBA's index, which stood at 100 in March 1990, is derived from a survey of major mortgage lenders representing about half of the U.S. market and does not include loans originated by nonbank lenders. The index has fluctuated this year after sinking last summer to its lowest level since 2002.Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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Mortgage Applications drop slightly 