Loan originators were slightly less busy this week, with adjustable-rate activity taking the biggest hit. Also downshifting was jumbo and refinance business.
At 170, the U.S. Mortgage Market Index from LoanSifter/Optimal Blue and Mortgage Daily for the week ended June 13 was down nearly 4 percent from a week earlier.
Compared to a year earlier, the index — which is a reflection of average per-user pricing inquiries pulled by clients of LoanSifter — has plunged 46 percent.
Leading the week-over-week decline were inquiries for adjustable-rate mortgages, tumbling nearly 8 percent from the week ended June 6. ARM activity, however, was up nearly 8 percent from the same week in 2013. ARM share fell to 11.8 percent from 12.4 percent but has strengthened from just 6.0 percent in the year-earlier report.
The second-biggest loser in the latest report was the jumbo index, which was down 7.18 percent for the week but 10 percent stronger than in the week ended June 14, 2013. Jumbo inquiries accounted for 10.0 percent of all activity, thinning from 10.4 percent in the last report. But jumbo share stands about more than twice the 5.0 percent share one year prior.
Jumbo interest rates were 9 basis points lower than conforming rates, trimming the negative spread from 10 BPS in the previous report. The jumbo-conforming spread has inverted from a positive 30 BPS in the same week during 2013.
Inquiries for refinances slid 7.17 percent and have plummeted 61 percent compared to one year prior. Refinance share edged down to 45.2 percent from 46.8 percent and has diminished significantly from 63.3 percent in the year-earlier report. The most recent share consisted of a 30.3 percent rate-term share and a 14.9 percent cashout share.
Conventional business was down 3 percent for the week and off by more than half on a year-over-year basis.
Federal Housing Administration-insured inquiries fell 2 percent and have declined by 40 percent from 12 months earlier. FHA share edged up to 16.2 percent from 15.9 percent and was wider than 14.6 percent a year ago.
With a decline of less than 1 percent from last week, inquiries for purchase financing turned in the best week-over-week performance. Purchase activity was off 19 percent from one year prior.
Overall business weakened on rising interest rates. Thirty-year conforming fixed rates averaged 4.534 percent, up from 4.506 percent and worse than 4.222 percent in the same report last year.
The discount for a 15-year mortgage was 99 BPS. The spread widened from 98 BPS in the last report and 81 BPS a year prior.
It doesn’t look like mortgage rates will be much different in next week’s report based on Treasury market activity.
The 10-year Treasury note yield averaged 2.62 percent during the five trading days covered by the report, while the 10-year yield closed at 2.60 percent on Friday, according to Treasury Department data.
