There was a decline in consumer applications for credit over the past 12 months, and an increase in rejection rates in 2018, compared with 2017.

That was expected given the decline in demand due to higher mortgage interest rates, the share of respondents who applied for a mortgage refinance during the past year was lower in 2018 than in 2017, according to the October 2018 SCE Credit Access Survey from the Federal Reserve. The survey provides information on consumers' experiences with and expectations about credit demand and credit access.

Rejection rates reported during 2018 rose for credit card applications and credit card limit extension requests, and also increased notably for mortgage refinance applications.

Another development is that there was no appreciable change in borrower-initiated account closings between 2017 and 2018, there was a sharp increase in the proportion of respondents who reported that a lender closed one of their accounts, most commonly a credit or store retail card, during the past 12 months. In October, 7.2 percent of those surveyed reported such a lender-initiated event, compared with 5.7 percent in October 2017 and 4.2 percent in October 2016. In fact, the 2018 figure is the highest rate reported since the start of our survey in 2013.

Looking ahead, the proportion of respondents who reported that they are somewhat or very likely to apply for credit over the next 12 months remained stable overall, with the exception of mortgage refinances for which fewer respondents expect to apply, when compared with expectations reported in 2017, and even more so compared with 2016.