Higher Rates Reinvigorate the ARM Loan Share

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Posted To: MND NewsWire

It is still a tiny share, but Ellie Mae says, in its November Origination Insight Report that the percentage of adjustable rate mortgages (ARMS) originated in November was the highest since the company first tracked the data in 2011, 8.9 percent. Not surprisingly the increase in ARMs is directly correlated to the average 30-year rate, which jumped to 5.15 percent in November from 5.01 percent in October. The FHA rate climbed even higher, from 5.05 percent to 5.19 percent while conventional rates increased 14 basis points to 5.17 percent and VA rates rose from 4.83 to 4.99. “As interest rates continue to rise, we are seeing the percentage of Adjustable Rate Mortgages rise in lockstep, and this month they’ve risen to the highest percentage we’ve seen since we began tracking data,” said Jonathan…(read more)

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