Mortgage demand drops as bank failures hit jumbo loan rates

Mortgage demand from homebuyers has been erratic to say the least during the usually busy spring housing market. That is likely because today’s buyers are hypersensitive to mortgage rates, which have been fluctuating widely week to week but which are still considerably higher than they were a year ago. Now, several bank failures are starting to make it more difficult even for wealthier buyers.

Mortgage applications to purchase a home dropped 2% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Demand was 32% lower than…