[ad_1]
Mortgage origination data from Black Knight showed that rate/term refinance lending activity posted a staggering 90% year-over-year decline in May, while cash-out refinance locks plunged 42.2% from a year ago. This brings the high-quality refinance candidate population to approximately 472,000 – the smallest this population has been since at least 2000.
“We’ve seen rate/term refinance activity essentially evaporate, and cash-out activity is now suffering as well,” Happ said.
The combined decline in refinance locks pushed the refi share of the market down to just 18%, the lowest point Optimal Blue has recorded since at least January 2018. Meanwhile, purchase lock volumes are holding up despite a 2.3% drop from the previous month. Purchase volumes are now driving 82% of all origination activity, according to Happ.
“Lenders are now more reliant on the purchase market for origination volumes than they have been in 20 years,” he said. “Meanwhile, the trifecta of low inventory, high prices and climbing rates that have created the least affordable housing market in 16 years continues to create headwinds for precisely that segment.”
Average credit scores were also down in May, led by another steep decline in cash-out refi credit scores, which fell below 700 on average, down 20 basis points from the past quarter and 33 points from last year.
[ad_2]
Source link
