Refinances were out front of a weekly surge in new mortgage business that had overall activity at the highest level since October. Behind the surge were the lowest rates since May.
The U.S. Mortgage Market Index from LoanSifter/Optimal Blue and Mortgage Daily for the week ended Jan. 9 was 238. No seasonal adjustment is made to the index.
The last time the index — a measure of average per-user product-and-pricing inquiries by LoanSifter clients — was this
high was in the week ended Oct. 17, 2014, when it came in at 241.
Compared to the week that included New Years, the index was up 113 percent.
Even more significant was that business was also better than a year earlier, rising 45 percent from the week ended Jan. 10, 2014.
A 155 percent leap from the week ended Jan. 2, 2015, was recorded for refinances. That was the largest week-over-week improvement of any category. Refinances nearly doubled compared to the same week last year.
Refinance share widened to 65.4 percent from 54.9 percent in the prior report and 48.2 percent in the year-earlier report. The latest share was comprised of a 50.6 percent rate-term share and a 14.8 percent cashout share.
Next were inquires for jumbo mortgages, which shot up 140 percent from seven days prior and were nearly two-thirds stronger than 12 months prior. Jumbo share rose to 10.4 percent from 9.3 percent and was also wider than 9.2 percent one year previous.
Interest rates on jumbo mortgages were more than 12 basis
higher than on their conforming counterparts. The jumbo-conforming spread inched up from less than 12 BPS a week earlier but sank from 22 BPS a year earlier.
A 125 percent increase from the previous report was observed for conventional mortgages. Conventional business was up more than half from a year prior.
Inquiries for adjustable-rate mortgages increased 114 percent but were up just 4 percent from the same week in 2013. ARM share was little changed at 9.2 percent and stands thinner than 12.8 percent in the year-earlier report.
Federal Housing Administration activity was up 74 percent from the previous week but down less than 1 percent from 12 months previous. FHA share fell to 11.7 percent from 14.4 percent and was much more narrow than 17.0 percent in the same report last year.
The weakest
week-over-week and year-over-year performance came from purchase financing, which was up 64 percent for the week but off 3 percent for the year.
Activity was bolstered by a significant decline in interest rates, with 30-year conforming fixed rates averaging 4.108 percent versus 4.261 percent in the previous report and 4.770 percent in the year-earlier report.
Inquires for 15-year mortgages yielded rates that were 83 BPS less than on 30-year loans. The spread narrowed from 88 BPS the prior week and 98 BPS one year prior.
Rates are unlikely to be much different in the next report according to Mortgage Daily’s analysis of Treasury market activity.
The yield on the 10-year Treasury note, which is tracked by fixed mortgage rates, averaged 2.00 percent during the week covered by the Mortgage Market Index report based on Department of the Treasury data. The 10-year yield closed Friday at 1.98 percent.
