President’s Day left fewer prospective borrowers inquiring about a new loan this week, though higher rates didn’t help. The decline was most evident with nonconforming inquiries. One positive sign is that upcoming mortgage rates are leaning a little bit lower.
The average number of loan inquiries per loan originator was down 13 percent from last week, according to the U.S. Mortgage Market Index from Mortech Inc. and Mortgage Daily for the week ended Feb. 24. The index fell to 210 from 242 for the week ended Feb. 17.
Activity was up 3 percent when compared to the same week last year.
Leading the decline were jumbo mortgages. Inquiries for loans in excess of $417,000 fell 20 percent compared to a week earlier. The jumbo share fell in the process to 17 percent from 21 percent.
Refinance business fell 16 percent, though refinances were 43 percent more active than the week ended Feb. 25, 2011. Refinance share fell to 68 percent from last week’s 70 percent. This week’s share reflected a cashout share of 14 percent and and 54 percent rate-term share.
Purchase inquiries were off just 7 percent compared to last week.
Conventional inquiries fell 14 percent, while Federal Housing Administration inquiries were off 7 percent. FHAÂ share climbed to 13.55 percent from 12.61 percent.
The share of activity that was adjustable-rate climbed to 4.71 percent from 4.13 percent, and ARM activity was off just 1 percent for the week.
The average 30-year fixed-rate mortgage was 4.10 percent in the latest report, jumping from 4.01 percent seven days earlier. The 30 year was 5.03 percent a year earlier.
Jumbo loan inquiries were priced at 64 BPS more than conforming inquiries, the same spread as the week ended Feb. 17.
Conforming borrowers willing to cut their terms to 15-years were given quotes 75 BPS better than 30-year borrowers, improving from 72 BPS in last week’s report.
It appears that mortgage rates could be around 3 BPS lower in next week’s Mortgage Market Index report. The yield on the 10-year Treasury note averaged 2.01 percent this week, while the 10-year yield closed at 1.98 percent today, according to data from the Department of the Treasury.
