As expected, new residential lending activity slowed during the holiday week, with purchase financing and refinancing activity both taking a similar hit. Jumbo business fared worst.
The U.S. Mortgage Market Index from OpenClose and Mortgage Daily, which provides insight into prospective home lending activity, was 129 in the week ended Oct. 14.
Compared to the previous week, the index — a reflection of average per-user rate locks by OpenClose clients for the seven days ended Thursday at midnight — tumbled a fifth.
But the decline was insignificant given that the index was not adjusted for Columbus Day.
The MMI was up, though, 9 percent from the same week last year.
Jumbo activity experienced the most-severe decline, with the Jumbo MMI sinking 38 percent from the week ended Oct. 7 to 12. Jumbo business was off 8 percent from the report 12 months ago. Jumbo share was cut to 8.9 percent from 11.5 percent a week earlier and 10.6 percent a year earlier.
Interest rates on jumbo mortgages were 11 basis points more than conforming rate. The jumbo-conforming spread widened from 8 BPS in the last report and swung from a negative 15 BPS in the same week in 2015.
Rate locks for adjustable-rate mortgages plunged 36 percent to 7. Compared to the week ended Oct. 16, 2015, ARM activity plummeted 46 percent. ARM share thinned to 5.5 percent from 6.9 percent and was even more reduced versus 11.2 percent one year ago.
The Refinance MMI retreated 22 percent to 50. But compared to the downwardly revised level one year previous, refinance business has improved by a quarter.
Refinance share was trimmed to 38.7 percent from 39.4 percent but has widened from the downwardly revised 33.7 percent this week last year. The most-recent share was comprised of a 24.8 percent rate-term share and a 13.9 percent cashout share.
Rate locks for conventional mortgages dropped 23 percent from a week ago, putting the Conventional MMI at 88.
A 19 percent week-over-week decline was recorded for purchase financing rate locks, while the category crept up 1 percent from the upwardly revised level 12 months earlier.
The Government MMI experienced the smallest decline from the prior week: 12 percent. Government share, though, widened to 32.2 percent from 29.3 percent. The latest share was made up of a 23.5 percent FHA share and an 8.8 percent VA share.
