As origination costs continue to climb due to regulations and the sheer cost of compliance, lenders are finding fewer borrowers knocking on their doors. According to the Mortgage Bankers Association's weekly survey, loan application volume fell nearly 20% in the past four months compared to the same period in 2012.

Unemployment rates are shrinking and the housing prices are slowly, but surely, recovering. So why are fewer would-be borrowers applying for loans? Part of the answer has nothing to do with the state of the housing supply or the mortgage industry: the growing burden of student loan debt.

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