Business picked up from the Christmas week but was still anemic. Refinance and adjustable-rate loan inquiries turned in the strongest week-over-week performance, while purchase financing continues to sag compared to a year ago.
At 183, the U.S. Mortgage Market Index from Mortech Inc. and Mortgage Daily for the week ended Friday was 40 percent higher than in the previous report. The index, however, slipped 1 percent from the same week in 2011.
Refinance business was 41 percent higher than last week and 37 percent better than a year ago. Total refinance share was 67 percent, about the same as last week but fatter than 51 percent in the week ended Jan. 5, 2011. This week’s share reflected a rate-term share of 54 percent and a cashout share of 14 percent.
Also up 41 percent from last week were inquiries for adjustable-rate mortgages. ARM share inched up to 5.12 percent from 5.06 percent in the previous report.
Inquiries for mortgages insured by the Federal Housing Administration were up 35 percent from last week and accounted for 11.22 percent of all inquiries. Conventional inquiries were 40 percent higher.
The average loan size in this week’s report was $224,267, jumping from the previous week’s $194,385.
Conforming 30-year rates slipped to 4.05 percent from 4.09 percent and were 82 basis points better than this week last year.
Jumbo borrowers, those whose loans exceed $417,000, paid a 75-basis-point premium over conforming borrowers, improving from the 80-basis-point spread a week earlier. The jumbo-conforming spread was 86 BPS a year earlier.
Borrowers inquiring about a 15-year loan were quoted a rate that was 67 BPS better than 30-year borrowers, a little better discount than 66 BPS last week and 70 BPS at this point in 2011.
Mortgage rates are unlikely to be much different in next Friday’s report based on an analysis of Treasury market activity. The yield on the 10-year Treasury note averaged 1.99 percent this week, while the yield closed today at 1.98 percent, according to data released by the Department of the Treasury.