Although there was little change in overall new mortgage activity this week, a nice increase was posted for jumbo transactions. Adjustable-rate mortgage volume was also higher — nearly doubling from a year ago — as a bigger share of prospective borrowers turned to ARM products. Rates could be lower in the next report.
Landing at 192, the U.S. Mortgage Market Index from LoanSifter and Mortgage Daily for the week ended Aug. 9 was off 3 percent from a week earlier. The index, which reflects the average number of pricing inquiries per LoanSifter user, was down 17 percent from a year earlier.
Conventional business took the biggest hit, falling 4 percent from the week ended Aug. 2 and down 23 percent from the same week in 2012.
Inquiries for refinances were off 3 percent for the week. The 46 percent decline from the week ended Aug. 10, 2012, for refinances was the worst year-over-year performance of any category.
Refinance share was unchanged from last week at 49.0 percent but sank from nearly three-quarters this week last year. The most-recent week’s share reflected a 35.8 percent rate-term share and a 13.2 percent cashout share.
Purchase financing activity slipped 2 percent from the prior report but has shot up 64 percent from the year-earlier period.
A less than 1 percent gain over the previous week was recorded for Federal Housing Administration inquiries. But FHA business has fallen a quarter over the past year.
FHA share rose to 15.3 percent from 14.8 percent but wasn’t as wide as the 16.8 percent share of a year earlier.
ARM activity was up 7 percent and has nearly doubled over the past year — the best year-over-year improvement of any category. ARM share rose to 10.1 percent from 9.2 percent and stood at only 4.2 percent one year prior.
With a 9 percent week-over-week gain, inquiries for jumbo mortgages put in the best performance of the week. Jumbo business was up 55 percent from the same week in 2012.
Jumbo share inched up to 8.3 percent from 7.4 percent and was nearly double the 4.4 percent level 12 months prior.
Jumbo loans were priced 29 basis points higher than conforming mortgages, not much different than the 28-basis-point spread in the prior report but a lot better than the 52-basis-point spread a year earlier.
Conforming 30-year fixed-rate mortgages averaged 4.640 percent, slightly less than 4.659 percent last week. Thirty year rates have increased, however, 85 BPS over the past year.
Consumers inquiring about 15-year loans were quoted rates that were 90 BPS better than on 30-year mortgages. The spread was off from 91 BPS in the prior report but better than 64 BPS one year prior.
Treasury market activity this week suggests that mortgage rates could be around 5 BPS better in the next Mortgage Market Index report.
Treasury Department data indicate that the yield on the 10-year Treasury note averaged 2.62 percent during the week encompassed by the latest index, while the 10-year yield closed at 2.57 percent Friday.