The rejection rate increased notably for mortgage refinance applications in 2018, indicating tightening credit, according to the October 2018 Survey of Consumer Expectations (SCE) Credit Access Survey released by the Federal Reserve Bank of New York.
The survey revealed that the October rejection rate on mortgage refinance applications reached 34.3%, its highest reading since the start of the Credit Access Survey in October 2013, the NY Fed said. Except for mortgage loans and mortgage refinance applications, rejection rates declined in October from their June readings for all credit types.
Additionally, application rates increased in October for all loan types from their June readings, except mortgage loans. Mortgage loan application rates decreased from 7.1% in June to 6.7%. For 2018 overall, mortgage and mortgage refinance application rates were lower compared to 2017.
The NY Fed said the lower share of respondents who applied for a mortgage or mortgage refinance during the past year was consistent with an expected decline in demand due to higher mortgage interest rates.
The survey, which provides information on consumers' experiences with and expectations about credit demand and credit access, is fielded every four months, most recently in June.