Industry NewsMortgage

Mortgage brokers say one-third of clients failed to close in August

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A new survey of mortgage brokers reveals that one in three prospective home buyers who had signed purchase and sale agreements in August ended up cancelling. August was a turbulent month for mortgage lenders, as many investors stopped buying securities backed by home loans because of fears of rising delinquencies and defaults. Not all of the cancellations reported in the survey of 1,744 mortgage brokers by Campbell Communications Inc. were the result of problems funding loans. Some deals fell through because buyers could not get approved for a loan or withdrew their offer. In other cases the lender did not honor a loan commitment, went bankrupt or stopped funding loans. Interest-rate changes killed some deals, and sellers backed out of others. Detailed breakdowns of the reasons purchase agreements were cancelled are available only to those who purchase the survey from Campbell Communications. But survey designer Thomas Popik of Geosegment Systems did say mortgage broke...