US mortgage applications plunge in week to 9 October, says MBA

Applications for US home mortgages tumbled last week, data released on Wednesday showed.

The Mortgage Bankers Association (MBA) said its seasonally adjusted index of application activity, which covers home purchase demand and refinancing demand, plunged 27.6% in the week ended 9 October.

The seasonally adjusted sub-index of refinancing applications dropped 23%, while the index of loan requests for home purchases, a key indicator of home sales, plummeted 34% and is now 1% lower than it was in the corresponding period in 2014.

Meanwhile, fixed 30-year mortgage rates held steady at 3.99%.

"The prior week's results evidently pulled forward much of the volume that would have more naturally taken place into this week," said Michael Fratantoni, MBA's chief economist.

"Purchase volume for the week was below last year's pace, the first year over year decrease since February 2015, while refinance volume dropped sharply even with little change in mortgage rates."