Although interest rates improved this past week, new mortgage activity slowed down. One bright spot, however, was jumbo business.
At 203, the U.S. Mortgage Market Index from LoanSifter/Optimal Blue and Mortgage Daily for the week ended March 27 was down 5 percent from the previous report.
The decline, however, appears to be seasonal; business traditionally slows in the last week of March heading into the week of Passover.
But compared to the same week last year the index — a reflection of average per-user product-and-pricing inquiries by customers of LoanSifter — was up 17 percent.
An 8 percent week-over-week decline was recorded for adjustable-rate mortgage business, making it the worst category of the week. ARM activity has subsided 23 percent from the week ended March 28, 2014 — also making it the worst performer on a year-over-year basis.
ARM share slipped to 9.1 percent from 9.4 percent and was down even more compared to 13.9 percent in the same week last year.
Refinance inquiries dropped 7 percent from the week ended March 20 but were up more than two-thirds from a year earlier — the strongest year-over-year gain. Refinance share dipped to 61.5 percent from 62.5 percent but was far wider than 43.1 percent at the same point in 2014. The latest share consisted of a 45.9 percent rate-term share and a 15.6 percent cashout share.
Conventional activity, which tends to track refinances, was off 6 percent for the week but 13 percent better than one year prior.
Inquiries for mortgages insured by the Federal Housing Administration were down 4 percent but have ascended 36 percent from the same week in 2014. FHA share widened to 18.9 percent from 18.7 percent and was also fatter than 16.3 percent a year previous.
Purchase financing business slipped 3 percent from seven days earlier and tumbled 21 percent from twelve months earlier.
The only category to improve from the previous report was jumbo, which inched up almost 1 percent. Jumbo inquiries climbed 27 percent from the year-earlier report. Jumbo share increased to 10.7 percent from 10.1 percent and was wider than 9.9 percent one year prior.
Jumbo interest rates were 5 basis points higher than conforming rates. The jumbo-conforming spread fell from 7 BPS in the last report but widened from 3 BPS at the same point in 2014.
Conforming 30-year fixed rates averaged 4.082 percent, down 4 BPS from a week earlier and 63 BPS better on a year-over-year basis.
Borrowers who opted for a shorter 15-year term were quoted rates that were 84 BPS better than their 30-year counterparts. The spread was 100 BPS in the same week last year.
Mortgage Daily’s analysis of Treasury Market activity indicates that fixed rates aren’t likely to be much different in the next Mortgage Market Index report.
