Mortgage applications fall 5 percent in one week

The Mortgage Bankers Association's Weekly Mortgage Applications Survey for the week ending January 20 found mortgage applications dropped 5 percent from the week prior.

The refinance index decreased 5.2 percent from the week before, while the purchase index decreased 5.4 percent. The refinancing share of mortgage activity for the week dropped to 81.3 percent of total applications, from 82.2 percent. The adjustable-rate mortgage portion of the activity declined to 5.3 percent from 5.6 percent a week prior.

As more consumers are becoming wary of mortgage lenders, President Barack Obama recently announced he will create a mortgage crisis unit with federal and state officials to investigate shoddy lending practices by lenders. In the State of the Union address, the president said the unit will come to the aid of struggling homeowners and work to create higher standards for lenders, Bloomberg reported.

"This new unit will hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans," Obama said in the speech.

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