Mortgage rates eased this week, prompting a surge in refinance and jumbo activity. But government-insured business was lower.
At 246, the U.S. Mortgage Market Index from Optimal Blue and Mortgage Daily for the week ended April 5 was up 16 percent from the previous week. Compared to the same week in the previous year, business was up by half.
Activity reflects the average number of rate locks per Optimal Blue user.
The biggest boost this week came from jumbo rate locks, which leapt 28 percent from the week ended March 29. Jumbo business was 90 percent higher than a year earlier — also the largest increase among all categories.
Around 8.6 percent of the latest activity was for jumbo rate locks, increasing from a jumbo share of 7.8 percent in the prior report and 6.8 percent in the same week during the prior year.
Jumbo mortgages were priced more competitively this week; the jumbo-conforming spread slipped to 23 basis points from 27 BPS a week earlier and 52 BPS in the week ended April 6, 2012.
Refinance rate locks shot up by a quarter from last week and were nearly two-thirds better than the same week in 2012.
Refinance share rose to 42.3 percent from 39.4 percent and was 38.7 percent in the year-earlier report. This week’s share was comprised of a 33.0 percent rate-term share and a 9.3 percent cashout share.
A 21 percent rise from seven days prior made conventional loans the third-best performing category. Conventional business was up more than two thirds from a year ago.
Rate locks for purchase financing were up 11 percent for the week and 41 percent higher than a year earlier.
Adjustable-rate mortgage activity increased 9 percent from the previous report. But ARM business was down 11 percent from the same week last year.
ARM share, meanwhile, drifted down to 4.3 percent from last week’s 4.7 percent and 7.3 percent a year ago.
The only loan type to see a drop in activity this week was Federal Housing Administration, with rate locks for FHA-insured mortgages off 1 percent from the previous report. But FHA business was up 3 percent from a year previous.
FHAÂ share fell to 17.9 percent from the prior week’s 21.1 percent. FHA share was 26.0 percent at the same point in 2012.
At 3.873 percent, the 30-year fixed-rate mortgage averaged 5 BPS less than last week and was 43 BPS lower than this week last year.
The rate discount for a 15-year mortgage was 82 BPS compared to 30-year loans, the same as last week. But 15-year mortgages have become more competitive compared to a year prior, when the spread was 76Â BPS.
