Even though a decline was recorded for weekly mortgage applications, the share that were for refinances was the widest it’s been in nearly a year. Jumbo rates suggest investors seek more jumbo product.
In the seven days that finished on Dec.
8, the Market Composite Index retreated by a more than a seasonally adjusted 2 percent from the preceding week.
The week-over-week decline for the index, a measure of retail residential loan application volume, was greater at 4 percent without any seasonal adjustments.
The findings were extracted from the
Weekly Mortgage Applications Survey reported Wednesday by the Mortgage Bankers Association.
According to the report, there was a 3 percent decline from the week ended Dec. 1 for refinance applications. At 52.4 percent, refinance share was wider than its been
since the week ended Jan. 13 when it was 53.0 percent. Still, the share was more narrow than 57.2 percent in the same week during 2016.
MBA said applications for loans to finance home purchases diminished by a seasonally adjusted 1 percent. The decrease was 6 percent when seasonal factors are not considered — though a one-tenth improvement was clocked versus the week ended Dec. 9, 2016.
The report indicated that applications for mortgages insured by the Federal Housing Administration represented 11.8 percent of total applications. FHA share thickened from 11.1 percent in last week’s report and 11.6 percent the same-seven days last year.
But unlike FHA share, VA share was more narrow at 10.3 percent compared to 10.7 percent in the prior seven-day period
and 11.9 percent one year prior.
Adjustable-rate mortgage applications accounted for 5.6 percent of the latest activity, less than
5.7 percent a week earlier and 6.2 percent a year earlier.
Based on the trade group’s data, interest rates on jumbo mortgages were 9 basis points less than conforming rates, ballooning from just 3 BPS the previous week. The latest spread suggests that investors are demanding more jumbo product. The year-earlier report had jumbo rates a basis point more than conforming rates.
