Hello, LOs!
I remember back in the halcyon days of...January, when economists and mortgage industry observers said rates were going to be well over 3% by now. Several told me they predicted about 3.5% by the end of the end of the second quarter. It could still happen, but right now it looks like rates will hover around the 3% mark for at least a few more weeks (especially given the dismal jobs report).
Which brings me to today's topic – refis. A broker-owner out in Northern California told me that refi volume for his LOs was down about 25-30% in the last two months. A retail LO in Clearwater, Florida, told me her refi business is also down, but only slightly. And up here in Long Island, refis have tapered off marginally, but some clients who thought they'd missed the window have locked their rate after a few targeted email blasts, one LO said. Others have also reported a resurgence from the recent weeks of sub-3% rates.
The publicly traded mortgage companies have similarly shown mixed results in terms of originations in Q1. Rocket Mortgage's overall volume fell, as did loanDepot's. While Rocket doesn't break out how much purchase volume it does vs. refi volume, LD does. The lender originated $8 billion in purchase loans in Q1 and $33.6 billion in refis. They actually did more refi business and less purchase business than they had in Q4.
Homepoint is another interesting case. In fact, 80% of the wholesale lender's originations in Q1 were refis, way higher than the 71% originated in Q4.
So, LOs, fill me in: how is the refi market in your area right now? Fading? A recent uptick with rates? Never really dropped? And what are you doing to try and convince clients who would benefit from a 50 bps rate shave or better? You can reach me anonymously at jkleimann@housingwire.com.
In tomorrow's LL edition, we'll look at UWM's earnings report (it will be out shortly after the close of trading on the NYSE today). And if you haven't already, make sure to check out Georgia Kromrei's deep dive into the CFPB's handling of the QM rules and the top agency official who has said she "hates" them.
James Kleimann
Managing Editor, HousingWire
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