According to the Mortgage Bankers’ Association’s Builder Application Survey, mortgage applications for purchases decreased 8% for the month of October. An unsurprising result, given the fact that TRID’s implementation date was October 3.
"On top of normal seasonal slowdown, the October decline in mortgage applications to builder affiliates was likely amplified by some applications being pulled forward into September ahead of the implementation of the Know Before You Owe Rule on October 3," Lynn Fisher, MBA's vice president of research and economics, said in a release. "Despite the decrease, our estimate of new single-family housing sales for October was up more than 7% from a year ago."
Originators, however, prepared for the slight slowdown in applications, especially following September’s impressive numbers.
The week just prior to TRID implementation saw a major spike in applications.
Mortgage applications increased 25.5% for the week ending October 2, as clients flocked to the market to get ahead of the more arduous and time-consuming regulations.
And despite the slight hit to applications in October, originators are already expecting November to show more positive application numbers as clients get ahead of a predicted Fed rate hike in December.
“I’m sure it will have some short-term impact on business,” Rob Levy, branch manager at HomeStreet Bank, recently told Paydayloans247. “There is always a little panic in the market when rates go up.”
That spike in business will likely give way to softer application stats in the following months, however.
Applications took a hit in the wake of TRID, but it’s the year-over-year stats that reveal just how alive-and-well the mortgage industry is.