Mortgage Rates Surge Above 7%, Dampening Demand and Homebuyer Activity.

Mortgage demand has dropped by 4.6% as the average rate on the 30-year fixed mortgage crossed over 7%, the highest level since early March. The rise in rates is due to concerns among investors over the Federal Reserve's interest rates and the battle over raising the debt ceiling. Mortgage applications to purchase a home dropped 4% for the week and were 30% lower than the same week a year ago. Applications to refinance a home loan decreased 5% from the previous week and were 44% lower than the same week one year ago.