Prospective mortgage borrowers were busier last week initiating the loan process even though refinance share was cut to its thinnest level in seven years.
An industry gauge for future business, the Market Composite Index, rose a seasonally adjusted 2 percent in the week ended Feb. 3 from a week earlier.
The index, which reportedly covers more than three-quarters of all U.S. retail residential loan applications, increased 6 percent on an unadjusted basis.
The Mortgage Bankers Association reported the index Wednesday.
MBA’s data had applications for refinances moving up 2 percent from the week ended Jan.
27. Refinance activity accounted for 47.9 percent of overall volume — the lowest share since June 2009. Refinance share was 49.4 percent in last week’s report and 61.2 percent in the year-previous report.
A seasonally adjusted 2 percent week-over-week rise was recorded for
purchase financing. Foregoing seasonal factors, purchase-money applications jumped 9 percent from the prior week and were up 4 percent from a year prior.
At 11.9 percent, applications for mortgages insured by the Federal Housing Administration made up a smaller share than 12.1 percent in the previous report and and 12.3 percent the same week in the previous year.
Applications for loans guaranteed by the Department of Veterans Affairs accounted for 12.7 percent of all applications. VA share widened from 12.4 percent in the prior report
and 11.1 percent from a year prior.
Jumbo interest rates were 8 basis points less than conforming rates. The jumbo-conforming spread widened from a negative 7 BPS the previous week but was far thinner than a negative 15 BPS one year previous.
Out of all applications submitted by prospective borrowers, adjustable-rate mortgages made up 6.9 percent.
ARM share widened from 6.4 percent a week earlier and a year earlier.
