Mortgage Applications Surge 9.3%

Applications for FHA mortgages are on the rise, fueling a sharp increase in home-purchase loan applications, according to new data and analysis from the Mortgage Bankers Association. The seasonally adjusted Purchase Index surged 9.3 percent, as compared to the prior week, pushing the index to its highest level since May 7, 2010. Jay Brinkman, MBA's chief economist, suggested that many borrowers were rushing to submit applications before the FHA's new requirements kicked in on Oct. 4. The new rules include higher qualifying credit scores and down payments. Meanwhile, MBA's Refinance Index dropped 2.5 percent from the previous week. We'll have to see whether the application levels continue to rise now that the FHA deadline has passed. (A larger version of the chart is below.)