Mortgage applications survey finds that fewer consumers willing to incur housing-related debt

Mortgage applications down American prospective homebuyers were relatively thin on the ground in the previous week, as the Mortgage Bankers Association weekly survey found that mortgage applications dipped during the second week of June.

This caused most mortgage loan interest rates to fall, with the rate for 30-year fixed-rate loans falling to 4.81 percent from 4.83 percent from the week before. The average rate for 15-year fixed-rate mortgages, on the other hand, rose to 4.26 percent from its previous weekly level of 4.24.

Michael Fratantoni, the MBA’s vice president of research and economics, said that "purchase and refinance applications dropped this week, even after an adjustment for the Memorial Day holiday. Purchase applications are now 35 percent below their level of four weeks ago, as homebuyers have not yet returned to the market following the expiration of the homebuyer tax credit at the end of April."

Consumer advocacy blog Consumerist commented on the study’s findings, pointing out that the last time mortgage rates were this low, the Spice Girls were among the most popular musical acts in the world.