Mortgage application volume fell dramatically over the past two weeks, even when adjusted for the holidays. This was likely due to a rush on home loans at the beginning of December, before the Federal Reserve increased its funds rate for the first time in nearly a decade. All that demand being pulled forward made for a steep drop-off.
Total mortgage applications slid 27 percent on a seasonally adjusted basis for the week that ended Friday, compared with two weeks earlier, according to the Mortgage Bankers Association. The numbers for both weeks were adjusted for the Christmas and New Year holidays, when banks were closed.