Mortgage Applications Continue Roller Coaster Ride

The implementation of new lending disclosure rules (TILA-RESPA) made for a spike in the prior week's mortgage activity and now a giant plunge in the following week's activity. The purchase index fell 34.0 percent in the October 9 week following the prior week's 27.0 percent surge. The refinancing index fell 23.0 percent following a gain of 24.0 percent. Distortions make this report impossible to read right now as an indicator for the underlying housing sector. A definite positive for the sector is low rates including 30-year fixed mortgages for conforming loan balances ($417,000 or less) where the average was unchanged in the week at 3.99 percent.