US sees reduction in real estate loans

September 29, 2008 by OPPE News

America is seeing a slowdown in applications for real estate-related loans, a mortgage providers’ group has said.

The Mortgage Bankers Association (MBA) said less people were applying for loans to buy homes for sale.

The group said the market composite index, a measure of how many people are applying for mortgages, stood at 591.4 for the week ending September 19.

MBA officials said this was a decrease of 10.6 per cent on a seasonally adjusted basis from 661.7 a week earlier.

The group added:

“On an unadjusted basis, the Index decreased 11.1 percent compared with the previous week and was down 9.3 percent compared with the same week one year earlier.”

The news came as the American government continued working on a multi-billion dollar bailout plan for financial markets in order to stabilise the country’s economy.

America is still seeing sharp increases in the number of foreclosed homes after banks started taking back properties from people who failed to keep up with repayments.