A recent decline in mortgage rates has driven up demand from borrowers who missed out on the last refinance opportunity, though home buyers were also busier.
The U.S Mortgage Market Index from OpenClose and Mortgage Daily was 131 in the week that concluded on Jan. 13. There are no seasonal adjustments.
It was the best showing for the index — a reflection of rate lock volume by OpenClose users — since the week that ended on Dec. 16, 2016, when it was 154.
Compared to the previous week, which included the New Year’s holiday, the index was 32 percent higher.
New business inched up less than a percent versus the same week a year ago.
Moving the most from the week ended Jan. 6 was the Jumbo MMI, which soared 124 percent to 12. Jumbo activity was up 9 percent from the same week in 2016. Jumbo share was 8.9 percent, widening from 5.2 percent in the last report and 8.3 percent in the year-earlier report.
Rates on jumbo mortgages were 9 basis points lower than conforming rates. The jumbo-conforming spread widened from a negative 4 BPS the prior week but was slashed from a negative 23 BPS a year prior.
Rate locks for refinances were up by half from a week earlier and 19 percent stronger than the downwardly revised level a year earlier. Refinance share thickened to 43.5 percent from 38.2 percent in the previous week and a downwardly revised 36.7 percent the same week the previous year. Most recently, refinance share consisted of a 24.1 percent rate-term share and a 19.4 percent cashout share.
Refinance business was jolted by two consecutive weeks of falling interest rates, with Freddie Mac reporting 30-year fixed rates have fallen from 4.32 percent in the week ended Dec. 29, 2016, to just 4.12 percent in the week ended Jan. 12.
A more than one-third jump from the prior report left the Government MMI at 49. Government share widened to 37.2 percent from 36.7 percent. This week’s share was made up of a 26.0 percent FHA share and 11.2 percent VA share.
Adjustable-rate mortgage business rose by a third from the last report. But ARM activity has subsided 23 percent from the week ended Jan. 15, 2016. ARM share was 7.7 percent, wider than 7.6 percent a week earlier but thinner than 10.1 percent a year earlier.
Conventional rate locks climbed 31 percent on a week-over-week basis, leaving the Conventional MMI at 82.
The weakest gain was with the Purchase MMI, which rose just a fifth from a week ago. Purchase activity has fallen 10 percent from the upwardly revised level this week in 2016.
