Mortgage Daily

Published On: December 26, 2012

Mortgage Market Index Falls as Jumbo Leads Holiday Decline

DALLAS — (Dec. 26, 2012) As the mortgage industry prepared to celebrate the holidays, new business declined. Jumbo activity took the biggest hit, though refinances weren’t far behind. Mortgage rates, meanwhile, moved higher.

The U.S. Mortgage Market Index from Optimal Blue and Mortgage Daily for the week ended Dec. 21 was 169. The index, which reflects the average number of rate locks per Optimal Blue user, descended from the previous week, when it came in at 192.

Compared to a year earlier, when the index was calculated based on pricing inquiries from another data source, business was down 12 percent.

Leading the latest decline were jumbo locks, which tumbled 21 percent from the week ended Dec. 14. Jumbo share fell to 7.9 percent from 8.8 percent.

Jumbo borrowers paid a 34-basis-point premium over conforming borrowers, improving from a jumbo-conforming spread of 38 BPS in the previous report.

Refinances took a 15 percent hit compared to the previous week and were down a third from the week ended Dec. 23, 2011 — though the year-earlier comparison is distorted because of the change in the data source. Refinance share diminished, falling to 52 percent from 54 percent a week earlier and 68 percent from a year earlier using the old data. Reflected in the most recent share was a 41 percent cashout share and an 11 percent cashout share.

Originators locked 14 percent fewer adjustable-rate mortgages than they did in the prior week. ARM activity was off 40 percent from the same week last year.

ARMs accounted for 3.5 percent of rate locks, slipping from 3.6 percent in the previous report.

Conventional business fell 13 percent for the week and was off 21 percent over the prior 12 months.

Next were purchase rate locks, which fell 8 percent for the week. While purchase activity was up nearly a third from a year earlier using data from the prior source, the increase is more reflective of using rate locks versus pricing inquires as the base metric than an actual year-over-year increase in purchase business.

Rate locks on mortgages insured by the Federal Housing Administration were 5 percent lower than the prior week, making FHA the best-performing category in the current report. FHA activity has increased 56 percent over the past year.

FHA share was 19 percent, up from 18 percent the previous week and 11 percent in the same week during the previous year.

Full Mortgage Market Index Report

Week Ended Dec. 21, 2012

National Average Loan Amount $229,957

Rate-Term Refinance Share 40.65%
Cashout Refinance Share 11.17%
Total Refinance Share 51.82%

Purchase Share 48.18%

FHA Share 19.41%

ARM Share 3.53%

Jumbo Share 7.92%

Mortgage Market Index 169.222

Conforming 30-Year Fixed-Rate Average 3.683%
Conforming 15-Year Fixed-Rate Average 2.960%
Jumbo 30-Year Fixed-Rate Average 4.024%

Mortgage Market Index 169for week ended Dec. 21

Historical data for the U.S. Mortgage Market Index is available at:

About Mortgage Daily
Founded in 1998 by 20-year mortgage industry veteran Sam Garcia, is a leading online source of mortgage news and mortgage statistics for the mortgage industry. In addition to the weekly Mortgage Market IndexMortgage Daily also publishes the quarterly Mortgage Employment IndexMortgage Litigation Index and Mortgage Fraud Index. The Dallas-based publication additionally provides a quarterly ranking of the biggest mortgage originators and mortgage servicers. Visit Mortgage Daily at

About Optimal Blue
Founded in 2002, Optimal Blue is a Web-based provider of managed-content, product eligibility and pricing engine (PPE) technology. Based in Plano, Texas, Optimal Blue has developed a comprehensive suite of products designed to give lenders the ability to automate the management and distribution of their products, pricing and secondary marketing activities, enabling originators to then source, manage, price, lock and sell loans in a way that is efficient, accurate and easy to use. Without having to be technology experts, Optimal Blue’s solutions allow clients to leverage superior technology and content for a competitive advantage. For more information, please visit

Holly Himelright


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