Good News on the Mortgage Front
There's good news on the mortgage front. The Mortgage Bankers Association reported this morning that applications for home loans picked up last week after seven straight weeks of declines. The industry group's market composite index increased by 0.2% over the preceding week. With the exception of the previous reading, it remains at the lowest level in more than two years and is off by 47% from its May high.
In an upbeat sign for the housing market, last week's increase was entirely a function of purchase-money mortgage applications -- that is, home loans related to the purchase of a home as opposed to the refinancing of an existing mortgage. According to the MBA's data, which covers an estimated 75% of the mortgage market, the purchase-money index grew by 1% on a sequential basis and is 8% higher than the same week last year.
Meanwhile, activity in the refinance market remained the same, with neither growth nor deterioration in the related index. Thanks to higher interest rates, the demand to refinance has dropped considerably over the past two months and is roughly 55% lower than it was at the beginning of May.
Despite the relatively good news, shares of the nation's biggest homebuilders are nevertheless down today. At the time of writing, D.R. Horton is off by 2.4%, PulteGroup by 1.7%, and Toll Brothers by 1.7%. As my colleague John Divine touched on yesterday, much of the fear in this regard stems from fears that the Federal Reserve will soon reduce its support for the economy, which will likely send long-term interest rates -- and, with them, the price of homes -- higher.
Dividend stocks can make you rich. It's as simple as that. While they don't garner the notoriety of high-flying growth stocks, they're also less likely to crash and burn. And over the long term, the compounding effect of the quarterly payouts, as well as their growth, adds up faster than most investors imagine. With this in mind, our analysts sat down to identify the absolute best of the best when it comes to rock-solid dividend stocks, drawing up a list in this free report of nine that fit the bill. To discover the identities of these companies before the rest of the market catches on, you can download this valuable free report by simply clicking here now.
The article Good News on the Mortgage Front originally appeared on Fool.com.
John Maxfield has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.