Weekly mortgage activity bounced back, with government-insured business leading the way. Meanwhile, jumbo mortgage rates dove further below conforming rates.
In the week ended July 24, the U.S. Mortgage Market Index from OpenClose and Mortgage Daily was 142.
With a 30 percent week-over-week increase, inquiries for loans insured by the Federal Housing Administration had the biggest gain. FHA business was up more than a quarter from the week ended July 25, 2014. FHA share jumped to 24.3 percent from 20.9 percent a week earlier and 16.0 percent a year earlier.
Refinance activity climbed 23 percent from the week ended July 17 and was up three percent from the same week last year. Refinance share leapt to 56.2 percent from 50.8 percent in the previous report and 45.6 percent in the year-earlier report. The most-recent share included a 36.3 percent rate-term share and 19.9 percent cashout share.
Next up were inquiries for jumbo mortgages, which rose by a fifth from the last report but slipped three percent from the same week in 2014. Jumbo share increased to 11.9 percent from 11.1 percent and was also wider than 10.2 percent this week in 2015.
Interest rates on jumbo loans were 22 basis points less than on conforming loans. The jumbo-conforming spread widened from a negative 20 BPS in the last report and a negative 12 BPS one year prior.
After that were inquiries for adjustable-rate mortgages, which rose 13 percent from a week prior and soared 36 percent from a year prior. ARMs accounted for 10.2 percent of all activity, up from 10.0 percent seven days prior. A year prior, ARM share was just 6.3 percent.
A nine percent increase was clocked for purchase financing, though the category was down by more than a fifth from one year previous.
The weakest week-over-week gain was with inquiries for conventional mortgages, which were up seven percent. Compared to a year prior, conventional business has tumbled a quarter — the worst year-over-year performance of any category.
Mortgage activity ascended as interest rates descended.
Average 30-year fixed rates fell five BPS from the last report to 4.04 percent.
Long-term fixed rates have retreated 45 BPS from the same week last year.
Rates on 15-year mortgages were 83 BPS better than 30-year rates. The spread diminished from 84 BPS seven days previous and 96 BPS twelve months previous.
A Mortgage Daily analysis of Treasury market activity suggests that fixed rates might be around seven BPS better in the next report.