Mortgage activity moved higher this past week, and jumbo mortgage business was out front of the overall acceleration. Interest rates are set to slide.
The U.S. Mortgage Market Index from LoanSifter/Optimal Blue and Mortgage Daily ended the week Dec. 12 at 177.
Compared to a week earlier, the index — a representation of average per-user pricing inquiries by LoanSifter clients — was up 3 percent.
The index was 13 percent higher than the same week last year.
Out front of the week-over-week gain were inquiries for jumbo mortgages, which shot up 10 percent from the week ended Dec. 5. Jumbo activity has exploded from a year earlier — soaring 201 percent.
Jumbo business represented 11.1 percent of all activity in the latest report, increasing from a jumbo share of 10.4 in the previous report and 4.2 percent one year prior.
Jumbo mortgages were priced 8 basis points higher than conforming mortgages. The jumbo-conforming spread widened from 6 BPS seven days earlier but tumbled from 35 BPS 12 months earlier.
Refinance activity picked up, rising more than 4 percent over the past week and climbing 45 percent from the week ended Dec. 13, 2013.
Refinance share widened to 58.5 percent from 57.9 percent and was more than 45.7 percent in the same week last year. The most recent share consisted of a 41.9 percent rate-term share and a 16.5 percent cashout share.
A nearly 4 percent improvement was recorded for adjustable-rate mortgage inquiries. ARMÂ business leapt 97 percent from 12 months prior.
ARM share was 11.1 percent, about the same as in the prior report but fatter then just 6.4 percent in the year-prior report.
A more than 2 percent week-over-week gain was observed for conventional activity, while the year-over-year increase was 16 percent.
Inquiries for purchase financing rose nearly 2 percent but have retreated 13 percent from a year previous.
There was virtually no change from a week previous in Federal Housing Administration business, though FHAÂ inquiries subsided 29 percent from the same week in 2013. FHA share slipped to 13.9 percent from 14.3 percent and sank from 22.1 percent one year prior.
Conforming 30-year fixed rates were off by less than a basis point for the week to land at 4.273 percent. Twelve months earlier, 30-year rates averaged 4.891 percent.
Fifteen-year mortgage rates were 83 BPS better than 30-year rates. The spread narrowed from 88 BPS in the previous report and 116 BPS in the year-earlier report.
Fixed rates are likely to slide approximately 9 BPS in the next Mortgage Market Index report based on a Mortgage Daily analysis of Treasury market activity.
Data from the Department of the Treasury indicate that the yield on the 10-year Treasury note — which is tracked by fixed mortgage rates — averaged 2.19 percent for the week. The 10-year yield closed Friday at 2.10 percent.
