Coming out of the holiday week, new mortgage business was modestly higher. Another week of lower interest rates helped lift refinance activity.
The U.S. Mortgage Market Index from LoanSifter and Mortgage Daily was 168 for the week ended Jan. 31, 2014. The index is a reflection of average per-user pricing inquiries at LoanSifter.
Activity improved 7 percent from a week earlier but was off 39 percent from a year earlier. The prior-year numbers have been revised to reflect figures from the same data provider.
Leading the rise this week were refinances, with inquiries climbing 11 percent from the week ended Jan. 24. Refinance business has fallen 58 percent from the same week in 2013.
The refinance share of business widened to 50.3 percent from 48.7 percent but was less than 72.6 percent a year earlier. The most recent share reflected a 35.4 percent rate-term share and a 14.9 percent cashout share.
The next biggest mover was the adjustable-rate mortgage category, which rose 9 percent for the week and has more than doubled compared to the week ended Feb. 1, 2013.
ARM share was 12.7 percent, broadening from 12.5 percent in the previous report and much fatter than 3.8 percent in the year-earlier report.
After that were inquiries for jumbo mortgages, which increased 8 percent on a week-over-week basis and 16 percent on a year-over-year basis. Jumbo share was 9.6 percent, up from 9.5 percent the prior week and 5.0 percent a year ago.
Jumbo interest rates were 10 basis points higher than conforming rates, improving from the previous week’s 13-basis-point spread and much better then the 34-basis-point spread in place a year prior.
Conventional loan inquiries followed, with a 7 percent rise from last week. Conventional business has plummeted 45 percent from 12 months earlier.
Inquiries for Federal Housing Administration-insured loans rose 5 percent. But FHA activity has fallen 46 percent from one year prior. FHA share slipped to 15.5 percent from 15.8 percent and was 17.5 percent in the year-earlier period.
The worst performance was delivered by the purchase category, with inquiries up just 4 percent over the prior seven days. Still, purchase business was up 10 percent from a year earlier.
Thirty-year fixed rates averaged 4.652 percent, down from 4.690 percent seven days ago. Twelve months prior, 30-year rates were 3.808 percent.
Average 30-year rates have been lower each week since the week ended Dec. 27, 2013, when they average 4.826 percent.
The discount for 15-year rates was 96 BPS, not quite as good as the 97-basis-point spread in the previous report but far better than the 68 BPS in the same week last year.
Mortgage rates are set to fall around 6 BPS in the next Mortgage Market Index report based on an analysis of Treasury market activity.
The yield on the 10-year Treasury note average 2.73 percent during the week covered by the latest index, while the 10-year yield closed at 2.67 percent Friday, according to Treasury Department data.
