Conventional loans surged +12% for the week ending January 28.
Conventional Loans Picked Up Mortgage Activity Week Ending January 28
The Mortgage Bankers Association’s (MBA) Market Composite Index that measures new loan activity jumped +12% for the week ending January 28. Compared to the same week one year ago, volumes were -37% lower.
The Purchase Index rose +4% from the previous week. The Refinance Index, after falling for the last four consecutive weeks, jumped +18% spurred by a +22% increase in conventional applications. Refinance numbers were still down -50% from one year ago.
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Applications by Loan Type
- Conventional – 82%
- FHA – 7.7%
- VA – 9.1%
- USDA – 0.4%
The share of refi activity accounted for 57.3% of all applications. Adjustable-rate mortgages represented a 4.5% share of total volume.
Cash-out refinances increased +14%. Joe Mellman, senior vice president and mortgage business leader with TransUnion, said, “With the pool of consumers who would benefit from a refinance shrinking and interest rates starting to rise, mortgage lenders will now look to implement diversified growth strategies.”
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Average Loan Sizes and Interest Rates Up
As home prices rise, average purchase loan sizes rise.
The average purchase loan size came in at $441,400, +1.8% more than $433,500 the week prior.
The contract interest rate for 30-year fixed mortgages with conforming balances increased by 6 basis points to 3.78%, up from 3.72% the week before. The average 30-year jumbo fixed-rate with balances exceeding $647,200 hit 3.59% from 3.56% the week before. The 15-year fixed climbed just one basis point to 3.01% while the 5-year adjustable rate dropped 9-basis points to 3.09%.
Thanks to National Mortgage News.
