As loan originators stepped up the weekly pace of mortgage applications, refinance share thinned to a level not seen since the financial crisis.
In the seven days that concluded on April 7, the Market Composite Index rose a seasonally adjusted 2 percent from one week previous.
But without any seasonal adjustments, the index — which is a measure of retail residential loan application volume — increased by 3 percent.
The index is derived from the Weekly Mortgage Applications Survey from the Mortgage Bankers Association, which reportedly reflects more than three-quarters of all applications.
MBA said that new applications for refinances maintained the same pace as in the week ended March 31.
Refinance share came in at 41.6 percent, which was the most narrow share since September 2008 during the depths of the financial crisis. Refinance share was 42.6 percent a week earlier and 54.9 percent a year earlier.
Applications for loans to finance a home purchase were up 3 percent from the last report on a seasonally adjusted basis. Foregoing seasonal factors, purchase activity jumped 5 percent and rose 3 percent from the week ended April 8, 2016.
The trade group reported that applications for mortgages insured by the Federal Housing Administration represented 10.7 percent of total volume. FHA share was more narrow than 11.1 percent the prior week and 10.8 percent a year prior.
Another 11.3 percent of applications during the latest seven-day period were for loans guaranteed by the Department of Veterans Affairs. But unlike FHA activity, VA share widened from 11.1 percent the previous week, though the share thinned from 11.9 percent the same week in 2016.
The jumbo-conforming spread was cut to a negative 4 basis points from the negative 10 BPS the prior week. The spread was also thinner than the year-prior period, when jumbo interest rates were 8 BPS less than conforming rates.
Adjustable-rate mortgage applications accounted for 8.5 percent of the most-recent week’s activity, the same as in the last report. ARM share was
just 5.0 percent twelve months prior.
