HOUSING CRASH 2.0? Mortgage applications plunge 58%. HOA defaults spike 500%. Fannie Mae triggers mortgage crackdown.

The U.S. mortgage market is in its biggest recession in U.S. history.

Applications to purchase a home are down 58% from the pandemic peak in 2021.

Today’s mortgage purchase index of 145 today is lower than at any point in the 2009-2012 housing bust.

And is now back the same level as 1995.

Not only that, mortgage applications are also down 15% from last year, indicating a further short-term weakening is occuring.

Roughly 70% of U.S. home purchases are financed with a mortgage.

So declining mortgage applications are going to be a big problem for sellers.

The U.S. mortgage market is in its biggest recession in U.S. history.

Applications to purchase a home are down 58% from the pandemic peak in 2021.

Today's mortgage purchase index of 145 today is lower than at any point in the 2009-2012 housing bust.

And is now back the same… pic.twitter.com/V6uR9viye2

— Nick Gerli (@nickgerli1) October 7, 2026

Pending sales data is looking pretty scary while the 10-year treasury and mortgage rates remain elevated

The delinquency rate (from historic lows) is screaming higher YoY

Delinquency is about flows and roll-rates so this is the number to watchhttps://t.co/snUnZFPyuO pic.twitter.com/MXwbIL696t

— Melody Wright (@m3_melody) October 7, 2026

Serious mortgage delinquencies jumped 19% year over year
ICE reported 574,000 U.S. mortgages at least 90 days past due in August, up 92,000, or 19%, from a year earlier. The overall delinquency rate was only 10 bps higher YoY, showing that the deterioration is concentrated deeper in the delinquency pipeline. Intercontinental Exchange

https://ir.theice.com/press/news-details/2026/ICE-First-Look-Mortgage-Performance-Remains-Stable-as-Foreclosure-Inventory-Growth-Slows-to-Nine-Month-Low/default.aspx

Foreclosure inventory exploded 41% year over year
ICE counted 298,000 properties in foreclosure pre-sale inventory in August, up 89,000 from a year earlier. Foreclosure starts were also up 29% YoY, to roughly 37,000.

FHA serious delinquencies jumped 227% YoY
MBA reported that the national mortgage delinquency rate was 4.37% in Q2, up 44 basis points from a year earlier. But the much more severe movement was in FHA loans: FHA serious delinquencies increased 227 basis points YoY.

https://www.mba.org/news-and-research/newsroom/news/2026/08/13/mortgage-delinquencies-decrease-slightly-in-the-second-quarter-of-2026?trk=article-ssr-frontend-pulse_little-text-block

God, give me the confidence of a boomer who thinks their home went up in value 63% in 7 years pic.twitter.com/jkQQlnmMx7

— Vlad (@VladTheInflator) October 8, 2026

Americans grow more pessimistic about their finances, New York Fed finds — expert warns of ‘tough choices’ ahead

Americans are increasingly worried about their financial outlook amid expectations that inflation could worsen in the year ahead, according to a New York Federal Reserve survey released Wednesday.

The central bank’s monthly Survey of Consumer Expectations found that consumers expect inflation to be even higher a year from now, while perceptions about their own financial standing deteriorated.

More households surveyed reported they were in a worse financial situation than a year ago and expected to be in a weaker financial state in the coming year, the New York Fed found. The New York Fed’s Survey of Consumer Expectations polls a rotating panel of approximately 1,300 household heads.

“This data is just further proof that Americans are worried about inflation getting worse before it gets better,” said Matt Schulz, chief credit analyst at LendingTree.

“Many Americans are already living on tight budgets and looking for ways to stretch their dollars further,” he said. “Their glum outlook on inflation likely means that many families expect to make some sacrifices and tough choices in the months to come.”