Interest rates on jumbo mortgages went from being less than their conforming counterparts to more last week. Still, new jumbo business accelerated.
An indication of upcoming residential loan originations, the U.S. Mortgage Market Index from Mortgage Daily and OpenClose, was 165 in the week ended May 5.
The index, which is based on average per-user rate locks by clients of OpenClose, improved by 9 percent from the preceding report. Activity fell, though, 17 percent from a year earlier.
Compared to the week ended April 28, 2017, rate locks for adjustable-rate mortgages soared 35 percent — the biggest week-over-week gain of any category. ARM activity was up 8 percent from the same week in 2016. ARM share fattened to 10.3 percent from 8.3 percent and additionally from 7.9 percent a year prior.
A 19 percent week-over-week gain was made with jumbo activity. However, the Jumbo MMI has plunged 34 percent from the week ended May 8, 2016, more than any other index. Jumbo share was slightly less narrow at 5.2 percent versus 4.8 percent in the last report but modestly thinner than the 6.6 percent twelve months sooner.
The week-over-week improvement
came despite that jumbo rates were 3 basis points more than conforming rates; jumbo rates have not been more than conforming rates since the week ended Dec 16, 2016. The spread was a negative 8 BPS a week earlier and a negative 3 BPS a year earlier.
Refinance business climbed 12 percent from the last report but sank 27 percent from the downwardly revised figure for 12 months ago. Refinance share widened to 28.0 percent from 27.1 percent but thinned from 31.9 percent the same week a year ago. Most recently, refinance share was made up of a 13.5 percent rate-term share and a 14.5 percent cashout share.
Rate locks for conventional loans drove the Conventional MMI up 9 percent to 105.
The Purchase MMI was 119, moving up 7 percent on a week-over-week basis. But the category retreated 13 percent from an upwardly revised level a year previous.
The Government MMI rose 7 percent from the last report to 61. Government share was more narrow at 36.7 percent than 37.2 percent a week previous. The latest share consisted of a 26.7 percent FHA share and a 10.0 percent VA share.
