Interest Rates Inch Up while Credit Eases

As of May 8, 2015, mortgage applications for the week declined 3.5% from the prior week, based on research from a survey by the Mortgage Bankers Association.

The refinance portion of mortgage transaction also declined to 51% of all applications, which is down from 52% the prior week. This is the lowest percentage dating back to May 2014.

However, interest rates for 30-year, fixed-rate jumbo mortgages increased to 3.99% from 3.91%. The numbers are interesting considering that credit easing has occurred over the last 12 months. There are much more portfolio products on the market but it has been controlled by a lack of inventory and borrower creditworthiness.

With flexible income documentation loans and non-QM products. and even the rate "stated income" loan by a specific few, activity in the mortgage market has not spiraled out of control and some would have expected. Usually with a slight rate increase borrowers would submit their application in hopes of rates falling and then strategically locking in the lower rate.