As expected, new home-lending activity bounced back from the holiday week. Refinance and adjustable-rate business were the biggest beneficiaries, while jumbo activity took the biggest hit.
Mortgage Daily’s U.S. Mortgage Market Index, a forecasting tool for originations based on average per-user rate-lock volume by OpenClose clients, was 129 in the week ended Dec. 2.
The index, which is not adjusted for seasonal factors, ascended 21 percent versus the previous week. The increase reflects the prior week’s subdued activity from the Thanksgiving holiday.
Compared to the same week last year, however, new business was down 6 percent.
Rate locks for refinances shot up 44 percent from the week ended Nov. 25. Refinances were 1 percent stronger than the downwardly revised level for this week in 2015.
Refinance share fattened to 37.4 percent from 31.4 percent and was also wider than the downwardly revised 34.9 percent a year previous. The latest refinance share was comprised of a 17.5 percent rate-term share and a 19.9 percent cashout share.
A 42 percent week-over-week increase was recorded for adjustable-rate mortgage rate locks. But ARM activity slowed 8 percent from the week ended Dec. 4, 2015. ARM share widened to 11.6 percent from 9.9 percent but was slightly more narrow than 11.9 percent twelve months ago.
Next up were rate locks for conventional mortgages, with the Conventional MMI rising 17 percent to 80.
The Government MMI was up 29 percent to 49. Government share increased to 38.1 percent from 35.8 percent. The most-recent share consisted of a 27.2 percent FHA share and a 10.9 percent VA share.
Purchase-money rate locks rose 11 percent, leaving the Purchase MMI at 81. But purchase financing activity slowed 9 percent from the upwardly revised level one year ago.
The Jumbo MMI was the only index to experience a week-over-week decline, 18 percent to 6. Jumbo business has tumbled 46 percent from 12 months earlier. Jumbo share was cut to 4.4 percent from 6.5 percent a week earlier and 7.6 percent a year earlier. The jumbo-conforming spread widened to a negative 13 basis point from 7 BPS in the last report but has been slashed from a negative 21 BPS in the year-prior report.
