Perhaps in anticipation of loans becoming harder to secure due to stricter rules, mortgage applications surged last week, according to a leading trade association.
In its weekly market composite index, the Mortgage Bankers Association said applications rose 15.5 percent last week on a seasonally adjusted basis, 44 percent on an unadjusted basis.
Michael Fratantoni, vice president of MBA, said borrowers appear to be taking advantage of historically low interest rates, which may be fueled by economic instability.
"Ongoing turmoil in the financial markets, primarily due to the sovereign debt crisis in Europe, has brought mortgage rates back to their lowest levels of the year," said Fratanoni.
He also said refinancing activity climbed last week, representing 70 percent of all mortgage application volume.
Refinancing a mortgage can be a worthwhile option for homeowners who are struggling to make their monthly payments. However, the likelihood of a lender granting that request is reduced if the borrower has bad credit. A credit repair attorney may be able to rebuild credit by searching for unsubstantiated claims, which may explain why a consumer has been saddled with a low FICO score.