Author: AlexShreeve

Mortgage Rate Lock Activity Falls as Rates Top 7% for First Time Since November 2022; Signs of Credit Tightening Persist

JACKSONVILLE, Fla. – August 14, 2023 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through July 2023 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE, the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“While they moved around a bit in July, there was no escaping the fact that conforming 30-year rates topped 7% in July for the first time since they spiked last fall,” said Andy Walden, vice president of enterprise research and strategy at Black Knight. “On both a practical and psychological level, that put further downward pressure on mortgage demand. Purchase loans continue to dominate the origination pipeline, but current housing market dynamics are just not conducive to boosting homebuyer origination volumes.”

The month’s pipeline data showed rate lock activity fell for the second consecutive month, dropping 7% overall. Purchase locks, which accounted for 88% of all July activity, fell 7.4% from June. Longer term, purchase lock counts are down 27% year over year and 35% off 2019 pre-pandemic, levels. Cash-out refinances also declined (-5.4%) and are hovering close to 60% below where they were in July 2022 when interest rates averaged in the mid- to high 5% range. Rate/term refis increased by a modest 1.9% in July, but remained down more than 31% year over year from an extremely low ceiling; July 2022 itself had marked a 93% year-over-year decline. Locks on such products will likely remain constrained for some time to come; just 3% of existing mortgage holders have first-lien rates at or above today’s levels.

“With home prices hitting new peaks across many parts of the country, and no end in sight to the for-sale inventory shortage, the housing market continues to reheat,” Walden continued. “It’s worth noting, however, that – in a ‘normal’ year – June typically marks the calendar peak of home prices on a non-adjusted basis, so you would normally expect to see a decreasing trend through year’s end and into February. That said, this year, and this market, have been anything but normal. Rising rates may be tamping demand for homes at such record high prices, as evidenced by rate lock activity, but they’ve still yet to overcome an even greater deficit of supply. As a result, the purchase market is in a stalemate.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Mortgage Locks Edge Lower in June While Credit Availability Continues to Tighten

JACKSONVILLE, Fla. – July 12, 2023 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through June 2023 month-end. Leveraging daily rate lock data from the Black Knight Optimal Blue PPE, the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“As May gave way to June, we saw banks lose some of their appetite for jumbo loans,” said Andy Walden, vice president of enterprise research and strategy at Black Knight. “While the OBMMI 30-year conforming index rose 6 basis points over the month, the jumbo rate index was up by three times that level. Purchase loans continue to claim a larger share of a shrinking origination pipeline, as refinance opportunities remain scarce. Indeed, we saw the purchase lending share of June’s locks hit another all-time high. But keep in mind: It is a dominant share of a very constrained market.”

The month’s pipeline data showed rate lock activity fell across the board, edging lower by 1% overall on a month-to-month basis, with purchase locks down a scant 0.6%, cash-out refinances falling 1.4% and rate/term refinance locks off by almost 17%. Purchase locks accounted for 88.4% of locks in June, the highest share on record. Even so, purchase lock counts were down 31% year over year and 29% compared with pre-pandemic levels in 2019.

“As we noted in our most recent Mortgage Monitor report, the housing market has been reheating as we approach the traditional tail end of the homebuying season,” Walden said. “What’s clear is that continued economic uncertainty, tightening credit and affordability concerns have all helped to skew the market toward higher-credit borrowers. In fact, the average credit score among purchase locks hit a record high in June. Likewise, the average purchase price rising for the seventh straight month, while the average loan amount remained flat, suggests lower loan-to-value ratios as well.” Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Mortgage Locks Saw Modest Rise in May, But Remain Suppressed on Elevated Rates, Lack of Inventory

JACKSONVILLE, Fla. – June 12, 2022 – Today Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through May 2023 month-end. Leveraging daily rate lock data from the Black Knight Optimal Blue PPE, the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“While May was an improvement over April, mortgage lending remains constrained, to say the least,” said Andy Walden, vice president of enterprise research and strategy at Black Knight. “Indeed, while rate locks on purchase loans rose from April, they also dipped to their lowest level yet relative to 2018/2019 averages as rates rose late in the month. Mind you, purchase loans have been making up the lion’s share of origination activity for much of the last year, making this a likely harbinger of both slowing home sales as well as purchase mortgage origination volumes on the horizon.”

The month’s pipeline data showed locks increased 14% overall on a month-to-month basis, with purchase locks up almost 15%, cash-out refinances rising 7% and rate/term refinance locks climbing 13%. The bulk of that increase can be attributed to May having two more business days than April. Adjusting for that, daily volume was up a more modest 4% month over month. Purchase locks accounted for 88% of locks in May, the highest share on record. Even so, purchase lock counts were down 37% year over year and 29% compared with pre-pandemic levels in 2019.

“Despite the many headwinds – and we all know them well by now: rates, affordability, prices and inventory – this remains the most purchase-dominant market we’ve seen in decades,” Walden continued. “Nearly nine out of every 10 mortgages originated today is a purchase loan. At the same time, the level of economic uncertainty in the market has resulted izn historically wide spreads between 10-year Treasury yields and 30-year mortgage rates, and that uncertainty seems to be trickling down to tightening credit standards across the board. Uncertainty breeds a fear of risk, and that is likely driving the rises we’ve seen in down payments and credit scores among recent originations. The credit box is certainly tightening, but it’s far from the only challenge facing prospective homebuyers.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume. 

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Lock Volumes Fall Despite Marginally Lower Rates as Reluctant Buyers Face Continuing Inventory Shortage

JACKSONVILLE, Fla. – May 8, 2023 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through April 2023 month-end. Leveraging daily rate lock data from the Black Knight Optimal Blue PPE, the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Despite the fact that mortgage rates on average were lower in April, rate lock volumes took a hit,” said Andy Walden, vice president of enterprise research and strategy at Black Knight. “From March to April, volumes were down 22%, even though the average rate in April was 17 basis points lower than that of March. While half the decline can be explained by the fact that there were three fewer business days in April than in March, we clearly saw additional cooling in rate lock volumes this month.”

The month’s pipeline data showed locks down across the board, with purchase locks down 22%, cash-out refinance locks declining 21% and rate/term refinance locks down 28%. Purchase locks accounted for more than 87% of locks in April, the highest share on record. Even so, purchase lock counts were down 45% year over year and 38% below April 2019.

“After seeing purchase rate locks pull to within 15% of pre-pandemic levels in mid-January and again in mid-March on easing rates, we’ve seen that deficit eclipse 30% again in recent weeks,” Walden continued. “The cause is likely multifaceted. In addition to fewer business days in April than in March, another component may be potential homebuyers waiting on the sidelines for more favorable rates before locking. We saw a similar phenomenon on the rate dips in March. Inventory challenges are surely playing a role as well. New listing volumes remain well below pre-pandemic levels and active for-sale inventory fell for the sixth consecutive month on a seasonally adjusted basis. Lock volumes will be worth watching closely in coming weeks to see if this trend continues.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Rate Lock Volumes Jump 43% in March on Seasonal Tailwinds, Falling Rates and Lower FHA Insurance Premiums

JACKSONVILLE, Fla. – April 10, 2023 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through March 2023 month-end. Leveraging daily rate lock data from the Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“This continues to be an incredibly rate-sensitive housing market, and March’s rate lock activity perfectly illustrates this dynamic,” said Andy Walden, vice president of enterprise research at Black Knight. “Early in the month, when rates started their climb back toward 7% – reaching 6.8% in the process – we saw pronounced downward pressure on originations. In the wake of uncertainty in the banking sector and investors’ flight to the safe haven of U.S. Treasuries, rates came down roughly a quarter of a point. The result? Another quick surge in originations, particularly in the purchase market.”

The month’s pipeline data showed overall rate lock dollar volume up 43% over February, with purchase locks rising 44%, cash-out refinances up 31% and even rate/term refis, which had been hovering near historic lows, up 36%. Despite the rebound, refinance locks fell to just 13% of the month’s activity, a new low for this cycle, due to the disproportionate rise in purchase locks.

“It is not unusual for rate locks to surge in March ahead of the spring homebuying season, although this year’s rise outpaced what we typically see on a seasonal basis,” Walden continued. “A cooling market lacking the multiple bids and all-cash offers of the recent past has made sellers more receptive to FHA offers. That, combined with a recent reduction in FHA mortgage insurance premiums and a mid-month increase in the FHA-to-conforming spread, made FHA loans comparatively more attractive. FHA share increased to more than 20% of the pipeline in March, up from 18% at the beginning of the year and 12% a year ago.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Loan Demand Dips and Borrowers Shift Toward Jumbos, ARMs as Rate Rise Resumes

JACKSONVILLE, Fla. – March. 13, 2023 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through February 2023 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Mortgage rates ticked up again in February after a brief respite, showing once again just how rate sensitive the market continues to be,” said Kevin McMahon, president of Optimal Blue, a division of Black Knight. “Conforming rates dipped below 6% early in the month but finished it up 52 basis points from January. Even though the number of rate locks was down month over month, dollar volume increased due to a rate environment that favored jumbo and ARM loans over GSE products. Essentially, though, the story remains the same – one of a market facing significant interest rate-driven headwinds. As Black Knight reported last week in our latest Mortgage Monitor, there were clear signs of buyside demand when rates neared 6% – it just quickly pulled back when rates began to climb again.”

The month’s pipeline data showed overall rate lock dollar volume up 2% over January, with purchase locks rising 4% while cash-out refinances fell 11% and rate/term refis remained near historic lows. Combined, refinance locks made up just 14% of the month’s activity, returning to the low point in this cycle, first reached in October. Five of the largest 20 MSAs by lock volume saw pullbacks, with former hotspot Austin experiencing a double-digit decline month over month.

“As rates resumed their upward trajectory in February, borrowers responded predictably, moving toward more rate-favorable offerings,” McMahon continued. “That included a shift to jumbos, ARMs and other nonconforming products in the month. With refinance activity basically at a floor, all eyes are on the purchase market. And yet such lock volumes remain more than 40% down from last year’s level, with the triple-threat of rate, affordability and inventory challenges still looming large for the foreseeable future.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Rate Locks Rise in January on Rate Relief and Seasonal Tailwinds, Breaking 9-Month Decline

JACKSONVILLE, Fla. – Feb. 13, 2023 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through January 2023 month-end. Leveraging daily rate lock data from the Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used product, pricing and eligibility engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Mortgage rates declined in January, continuing a trend that began in early November 2022,” said Kevin McMahon, president of Optimal Blue, a division of Black Knight. “Conforming rates dropped 36 basis points from where they were at the start of the year, and we saw that rates associated with those FHA/VA/jumbo locks all came down in kind. Triggered by this pullback, rate lock volumes rose for the first time since March 2022, driven by declining interest rates and seasonal tailwinds, snapping a nine-month streak of declines.”

The month’s pipeline data showed overall rate lock dollar volume up 32% month over month, with increases seen across the board; purchase (+32%), rate/term (+37%) and cash-out (+25%) lock volumes were all up proportionally. Combined, refinance locks made up 15% of the month’s activity, still historically low and indicative of the very small amount of refinance incentive in today’s market. On a geographical level, the largest 20 MSAs by lock volume all saw double-digit growth, with Chicago, Nashville and Charlotte producing 50% month-over-month gains from December.

“While this month’s Originations Market Monitor certainly brings welcome news, it’s important to remember that we would have expected to see a seasonal rebound in January, regardless,” McMahon continued. “Mortgage originations continue to face significant rate, affordability and inventory headwinds, and lock volumes are still down more than 60% from the comparable period last year. With rates picking back up in early February, it will be interesting to see whether the rebound in lock activity will hold.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Rate Locks Hit Record Low For Second Consecutive Month; Rate and Affordability Pressures Amplify Seasonal Downturn

JACKSONVILLE, Fla. – Jan 9, 2023 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through October month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Mortgage rates declined through the first half of December but reversed course as the Fed doubled down on their stance of additional tightening in 2023,” said Kevin McMahon, president of Optimal Blue, a division of Black Knight. “The spread between mortgage rates and the 10-year Treasury yield narrowed another 22 basis points during the month to 264 basis points, which is 40 basis points off the recent high, but is still up 81 basis points for the year.”

The month’s pipeline data showed overall rate lock dollar volume down 19.4% month over month, the lowest level in the five years Optimal Blue has been tracking the metric. The decline was driven by a 20.5% drop in purchase locks, reflecting the strong impact of seasonality and affordability pressures. Refinance activity continued to fall by double digits, with cash-outs now down 87% and rate/term refinances down 93% from December 2021. Combined, refinance activity made up 16% of the month’s lock activity.

When excluding the impact of record home price changes on volumes by looking at the raw number of lock counts, the data shows the number of purchase locks in December down 47% year-over-year and down 33% compared to pre-pandemic levels in 2019, with overall rate lock counts down nearly 70% from last year’s levels.

“Using Black Knight’s McDash mortgage performance data to provide comparative history, December saw the fewest purchase locks in a single month since early 2014, and the fewest overall rate locks on record dating back to January 2000 when Black Knight began reporting origination metrics,” McMahon continued. “The number of mortgage holders locking in a rate to refinance their existing mortgage also set a new record low for the fourth consecutive month.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Purchase Locks Fall 22% in November Despite Lower Rates; Seasonal Slowdown Amplified by Affordability, Inventory Pressures

JACKSONVILLE, Fla. – Dec. 12, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through October month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Mortgage rates pulled back slightly in November based on what the market perceived as good inflation news,” said Scott Happ, president of Optimal Blue, a division of Black Knight. “The spread between mortgage rates and the 10-year Treasury yield narrowed by 13 basis points during the month to 283 basis points in a sign that investors and lenders may be seeking to accelerate the impact of falling rates. But, despite the improvement in rates, lock activity remained subdued.”

The month’s pipeline data showed overall rate lock dollar volume down 21.5% month over month, remaining at the lowest level since February 2019. The across-the-board decline was driven by a 22% drop in purchase locks, reflecting the strong impact of seasonality, the long Thanksgiving holiday weekend, and the lack of housing inventory. Refinance activity continued to fall by double digits, with cash-outs now down 86% and rate/term down 93% from November 2021. Combined, refinance activity made up 15% of the month’s lock activity, a near-record low share. When excluding the impact of record home price growth on volumes over the last several years by looking at the raw number lock counts, the data shows them down 48% year over year and 27% compared to pre-pandemic levels in 2019.

“While we would normally expect some seasonal pullback in activity in November, we are also seeing exceptionally strong headwinds in purchase activity from continued affordability challenges and a refinance market that has dwindled to all but nonexistent levels,” Happ continued. “Stalled inventory and rates nearly twice what they were a year ago are combining to negate the benefits of recent home price and rate declines from an affordability perspective.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Credit Scores Fall, Increased Demand for ARMs, Affordability Challenges Continue as Interest Rates Top 7% in October

JACKSONVILLE, Fla. – Nov. 14, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through October month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“With interest rates now at their highest level in 20 years, the refi market is rapidly approaching a bottom,” said Scott Happ, president of Optimal Blue, a division of Black Knight. “Indeed, our most recent Mortgage Monitor report showed that the number of borrowers with rate incentive to refinance has hit an all-time low of around 130K, and the vast majority of those are at least 14 years into a 30-year mortgage, with little incentive to restart the clock.”

The month’s pipeline data showed overall rate lock dollar volume down 14.3% month over month and at the lowest level since February 2019. The decline was broad-based but driven by a 25.1% decline in cash-out refinance locks. With tappable equity near all-time highs earlier in the year, cash-outs had shown some early resilience even as rates began to rise. They’re now down 83.6% from October 2021. Rate/term refinance activity fell an additional 15.7% after holding steady in September and is down 92.6% year over year. All in all, refinance locks made up just 14% of the month’s activity.

Purchase lending faced continued downward pressure from affordability constraints, with rising rates offsetting recent pullbacks in home prices. By dollar volume, such locks were down 13% from September and 39% from October 2021. When looking specifically at the number of purchase locks to exclude the impact of record home price growth over the last several years, we see it was down 37% year over year and 26% compared to pre-pandemic levels in 2019.

“Affordability remains the overarching concern in the mortgage origination market right now,” Happ continued. “Despite home prices continuing to pull back in a growing number of markets across the country, the current rate environment means affordability remains a thorny challenge. It’s therefore not very surprising to see a resurgence of somewhat lower-rate loan products like ARMs. Affordability, rates and home values all factor into falling purchase prices and loan sizes and all are generating headwinds over and above the normal seasonal downturn.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Cash-Outs Plunge in September; Purchase Locks Decline on Higher Rates, Record-Low Affordability

JACKSONVILLE, Fla. – Oct. 10, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through August month-end. Leveraging daily rate lock data from the Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Interest rate and affordability challenges have fundamentally changed the mortgage origination market for the remainder of 2022 – and the foreseeable future,” said Scott Happ, president of Optimal Blue, a division of Black Knight. “Interest rates are now at their highest level in 15 years, while affordability is at 37-year lows. Given these realities, it’s not particularly surprising that rate locks are falling sharply. Keep in mind, however, that all this is coinciding with the already traditionally slower purchasing months.”

The month’s pipeline data showed overall rate lock dollar volume down 9.9% month over month and at the lowest level since December 2019. The decline was broad-based but largely driven by a 26.2% decline in cash-out refinance locks. With tappable equity near all-time highs, cash-outs had shown some early resilience even as rates began to rise. They’re now down 78.2% from September 2021. In contrast, rate/term refinance activity appeared to have found a floor, holding steady at -0.1% from August, down 93.3% year over year. This aligns with Black Knight data that shows roughly 90% of all active first-lien mortgages have current rates below 5%, putting the population of rate/term refinance candidates at an all-time low. As a result, the refi share of the market hit a new low of 16% in September.

“Interest rates jumped almost a full percentage point in September, with affordability headwinds already high,” Happ continued. “Home prices are pulling back in a growing number of markets, but across the country, affordability remains a challenge. This is likely one reason why non-conforming loans gained market share and we saw an increase of the average loan amount. The decline in purchase lock volumes bears this out as well. Purchase lock counts – which exclude the impact of soaring home values on dollar volume – show we’re down more than 10% from 2019 levels, marking the third consecutive month that the number of purchase locks has fallen below pre-pandemic norms.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Lock Volume Drops Sharply on Rising Rates as August Production Hits Four-Year Low

JACKSONVILLE, Fla. – Sep. 12, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through August month-end. Leveraging daily rate lock data from the Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Mortgage originators continue to feel the effects of interest rate and affordability challenges,” said Scott Happ, president of Optimal Blue, a division of Black Knight. “Facing headwinds of higher rates and a move into the traditionally slower purchasing months, rate lock volumes fell nearly 9% overall in August to their lowest level since December 2019. Purchase lock counts, which exclude the impact of soaring home values on volume, are off 30% from last year. That count is now down more than 16% from 2019, marking the second consecutive month the number of purchase locks have fallen below pre-pandemic levels, as well as the lowest August count in more than four years.”

The month’s pipeline data showed overall rate lock dollar volume down 8.9% month over month, led by a 13.9% decline in rate/term refinance locks, which are now down 94.5% since last year. Cash-out refinance activity fell another 8.9% from July – a 72.2% year-over-year decline. The refi share of the market held at 18%, the lowest share on record dating back to January 2018. Government loan products continued to gain market share as FHA lock activity increased at the expense of both conventional and non-conforming loan volumes, a trend also likely reflected in another decline in the average loan amount – from $344K to $340K. The overall average credit score in August held steady at 722.

“Interest rates rose again in August after retreating slightly in July,” Happ explained. “This continues to have profound effects on home affordability, which returned to near 35-year lows to close out the month. As we reported last month, home prices have begun to pull back in some of the hotter home markets, particularly those on the West Coast. Likewise, we’ve observed declines in both the average purchase price and average amount financed in each of the past 5 months, with each now down 9% since March. We will keep a close eye on this trend as the market moves into the traditionally slower purchasing months ahead.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Mortgage Production Continues to Decline With Purchase Demand Now Falling Below Pre-Pandemic Levels

JACKSONVILLE, Fla. – Aug. 8, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through July month-end. Leveraging daily rate lock data from the Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Mortgage originators continue to experience strong headwinds,” said Scott Happ, president of Optimal Blue, a division of Black Knight. “Rate lock activity has been down four straight months, with declines across all loan purpose types. Purchase mortgages, which currently account for 82% of all lock activity, fell 14.3% by volume from June and are now down 22% from last year. The purchase lock count, which excludes the impact of soaring home values on volume, is off 25.8% from last year. That count is now down 11% from 2019, marking the first month the number of purchase locks has fallen below pre-pandemic levels, as affordability challenges continue to cool the housing market.”

The month’s pipeline data showed overall rate locks down 14.4% month over month, led by a 16.9% decline in rate/term refinance locks, which are now down 93.6% since last year. Cash-out refinance activity fell another 14.1% from June – a 67.2% year-over-year decline. The refi share of the market held at just 18%, the lowest point on record since at least January 2018, when Optimal Blue began tracking the metric. Government loan products gained market share as FHA lock activity increased at the expense of non-conforming loan volumes, a trend also likely reflected in another decline in the average loan amount – from $351,000 to $344,000. The overall average credit score in July was 722, with scores on cash-out refinances edging modestly lower to 692 – the lowest since Optimal Blue began tracking the metric in 2013.

“Although 30-year interest rates actually pulled back slightly in July, the originations market is still reacting to previous increases and continuing affordability challenges,” Happ continued. “As we reported in our recent Mortgage Monitor report, home prices have begun to pull back in some of the hotter home markets, particularly those on the West Coast. With the end of the traditional homebuying season approaching, we will be watching this trend closely.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Lock Volume Drops Sharply on Rising Rates as August Production Hits Four-Year Low

JACKSONVILLE, Fla. – July 11, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through May month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“This continues to be a challenging environment for mortgage originators,” said Scott Happ, president of Optimal Blue, a division of Black Knight. “Rate lock activity was down for the third consecutive month in June, with declines seen across all loan purpose types. Purchase mortgages – which currently account for 82% of all lock activity – fell 11% by volume from May and are now down nearly 16% from the same time last year. However, when we look at purchase lock counts to exclude the impact of soaring home values on volume, we see the number of purchase mortgages is off some 21% from last year’s levels.”

The month’s pipeline data showed overall rate locks down 11.1% month-over-month, led by a 13.2% decline in cash-out refinance locks, which are now down 42.2% since last June. Rate/term refinance activity fell another 9.1% from May to mark a 90.4% year-over-year decline. The refi share of the market held at just 18%, the lowest point on record since at least January 2018, when Optimal Blue began tracking the metric. Purchase lock volumes were down 10.8% from May and down 15.6% year-over-year. Government loan products gained market share as FHA and VA lock activity continued to increase at the expense of agency volumes, a trend also likely reflected in another decline in the average loan amount – from $359,000 to $351,000. The overall average credit score in June was 723, with scores on cash-out refinances falling to 693 – the lowest it has been since Optimal Blue began tracking the metric in 2013.

“The month’s data illustrates just how interest rate-dependent the originations market has become,” Happ continued. “With 30-year rates hovering below 6% – still historically low – we’ve seen the rate/term refi market dwindle to next to nothing, with increasing downward pressure on cash-out activity. Purchase volumes are driving 82% of all origination activity and those volumes are on the decline as well – in the heart of the traditional homebuying season. Eventually, equilibrium will return; but, as of June, the market seems to be having trouble adjusting to a rate environment anywhere above the historically low levels reached during the pandemic.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Despite a Plateau in Rates, Mortgage Production Fell Again in May, With Rate Locks Down Across All Loan Purposes

JACKSONVILLE, Fla. – June 13, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through May month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“At the start of May, it seemed mortgage interest rates would continue their upward climb and, indeed, rates did rise above 5.5% before pulling back some 20 basis points,” said Scott Happ, president of Optimal Blue, a division of Black Knight. “Ultimately, our OBMMI daily interest rate tracker showed 30-year conforming offerings finishing the month at 5.34%, down 7 basis points from last month. Still, despite this plateau in rates, rate lock volume continued to slide in May, with declines seen across all loan purposes.”

The month’s pipeline data showed overall rate locks down 4.8% month-over-month, with rate/term refinance lending activity down another 23.6% from April to mark an 89.9% year-over-year decline. Cash-out refinance locks also fell (-11.9%) and are now down 42.2% since last year. The combined decline in refinance locks pushed the refi share of the market down to just 18%, the lowest point on record since at least January 2018, when Optimal Blue began tracking the metric. Purchase lock volumes were down 2.3% from April and were flat year-over-year. However, when looking at lock counts to exclude the impact of home price appreciation on volumes, purchase locks were down 8.5% year-over-year in May. Government loan products gained market share as FHA and VA lock activity increased at the expense of agency volumes, a trend also likely reflected in the decline seen in the average loan amount from $362,000 to $359,000. Average credit scores also fell in May, led by another steep drop in cash-out refinance scores, which are now below 700 on average, down 20 points in the last three months and 33 points year-over-year.

“The month’s data shows a market struggling under the weight of significantly higher rates than Americans have enjoyed for the better part of the last three years,” Happ continued. “We’ve seen rate/term refinance activity essentially evaporate and cash-out activity is now suffering as well. While there is volume pressure across the board due to rising rates, purchase volumes are holding up the best and are now driving 82% of all origination activity. Lenders are now more reliant on the purchase market for origination volumes than they have been in 20 years. Meanwhile, the trifecta of low inventory, high prices and climbing rates that has created the least affordable housing market in 16 years continues to create headwinds for precisely that segment.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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With Mortgage Interest Rates at Highest Point Since Great Recession, Rate Lock Activity Fell Across the Board in April

JACKSONVILLE, Fla. – May 9, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through April month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Mortgage interest rates continued their steep ascent in April, with our OBMMI daily interest rate tracker showing 30-year conforming offerings finishing the month at 5.42%,” said Scott Happ, president, Optimal Blue, a division of Black Knight. “To put that in perspective, in the last few weeks, we’ve blown through the recent peak seen in 2018 and are now hovering at or near the highest interest rates we’ve seen since the Great Recession.”

The month’s pipeline data showed overall rate locks down 20.3% month-over-month, driven by a steep 50% drop in rate/term refinance lending activity. Cash-out refinance locks also fell, coming in 40% below March levels. The combined decline in refinance locks pushed the refi share of the market down to just 20%, the lowest point on record since at least January 2018, when Optimal Blue began tracking the metric. Government loan products gained market share as FHA and VA lock activity increased at the expense of agency volumes. Pull-through rates – the share of locks that result in funded loans – continued to fall on both purchase and refinance locks, with refi pull-through falling to just 62.7%.

“Seen in the light of such quick and sharp rises in 30-year rates, April’s declines in rate lock activity – though bracing – are hardly surprising,” Happ continued. “That’s particularly true of refinance locks when half of all mortgage holders have current first lien rates below 3.5%. That being said, while purchase locks were down somewhat from March, they remained flat from last April, reflecting consistent and resilient demand from homebuyers.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Driven by a Rise in Purchase Loans, Overall Rate Locks Up 19% in March Despite 70 Basis Point Rate Jump in the Month

JACKSONVILLE, Fla. – April 11, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through March month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Mortgage interest rates spiked in March, with 30-year offerings climbing 70 basis points over the course of the month,” said Scott Happ, president, Optimal Blue, a division of Black Knight. “In fact, our OBMMI daily interest rate tracker showed the average 30-year conforming rate reach as high as 4.93% late in the month before pulling back slightly to close out March at 4.79%. And yet, despite seeing the fastest one-month rise in rates in nearly 13 years, we saw purchase lock volumes increase by 31% from February – likely as prospective buyers moved to lock in their loans before rates climbed any higher.”

The month’s pipeline data showed overall rate locks up 19.1% from February, driven by a 31.5% surge in purchase lending activity. While cash-out refinance locks remained relatively flat (+1.6%), rate/term refinance activity continued to slide, with March marking the sixth consecutive monthly decline. The continued decline in rate/term refinance locks pushed the refi share of the market down to just 28%, the lowest point since November 2018. Non-conforming loan products continued to gain market share at the expense of agency volumes as the pace of home price growth has reached new record highs. Pull-through rates – the share of locks that result in funded loans – fell on both purchase and refinance locks, with refi pull-through falling to just 65.7%.

“As home prices continue to climb – even in the face of sharply rising interest rates – we’ve seen the average loan amount rise as well,” Happ continued. “The average loan rose by $8,000 to just under $362,000 in March, representing a more than 23% increase over February’s rise. In turn, non-conforming products – including both jumbos and loans with expanded guidelines – continued to take market share from conforming loans and accounted for a full 18% of the month’s lock activity. The FHA share of lock activity also rose on strong purchase lending demand.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Refinance Rate Locks Drop Across the Board in February as 30-Year Rates Climb Above 4% for First Time in Over Two Years

JACKSONVILLE, Fla. – March 14, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through February month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“As we noted back in November, the Federal Reserve’s unwinding of its bond buying program has been having a stronger impact on mortgage rates than Treasury yields,” said Scott Happ, president, Optimal Blue, a division of Black Knight. “Driven by Fed policy and exacerbated by global instability, we’ve seen the spread between 30-year conforming rates and 10-year Treasury yields climb more than 40 basis points in just three months, topping 2.25% in February. Our OBMMI daily interest rate tracker showed the average 30-year conforming rate top 4% in February for the first time in more than two years, closing out the month at 4.09%.”

The month’s pipeline data showed rate locks falling 5.4% from January, driven by declines in both cash-out and rate/term refinance locks, which saw month-over-month drops of 15.3% and 34.1%, respectively. Rate/term refinance lending activity was down for the fifth consecutive month – falling to the lowest level in three years – and is now more than 80% off 2021 levels. Cash-out locks – which have been somewhat buffered from rising rates by soaring home values – registered a 6.3% year-over-year decline in February. Nonconforming loan products continued to gain market share at the expense of agency volumes as the pace of home price growth has reaccelerated. Pull-through rates – the share of locks that result in funded loans – fell on both purchase and refinance locks, with refi pull-through falling to just 68.6%.

“While refinance activity took a hit in February due to sharp rises in conforming rates, purchase lending rose again on strong homebuyer demand,” Happ continued. “The 7.2% month-over-month increase in purchase locks pushed February purchase volumes up 5.6% from the same time last year. The average home loan amount continues to climb in the face of rising home prices and tightening affordability. Indeed, February’s $6,500 jump pushed that average to just under $354,000. In turn, nonconforming products – including both jumbos and loans with expanded guidelines – accounted for a full 17% of the month’s lock activity.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Purchase and Cash-Out Rate Locks Up in January on Rapid Rise in 30-Year Rates; Rate/Term Refinances Continue Freefall

JACKSONVILLE, Fla. – Feb. 14, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through January month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Amidst a backdrop of the Omicron variant, inflation concerns, Fed tapering and multiple rate hikes on the horizon, mortgage rates soared over the first weeks of 2022,” said Scott Happ, president, Optimal Blue, a division of Black Knight. “Our OBMMI daily interest rate tracker showed the average 30-year conforming rate at 3.77% at month’s end – the highest rates we’ve seen since March 2020, heading into the pandemic. Still, despite this increase – and in some ways, because of it – lock activity improved in January for the first time in four months. Of course, rate/term refinance activity continued to fall, but strong growth in both purchase and cash-out refi locks helped drive a nearly 10% month-over-month jump in overall lock activity.”

The month’s pipeline data showed overall rate locks up 9.5% from December, driven by 19.9% and 9.2% increases in purchase loan and cash-out locks, respectively. Continuing a long-running trend, rate/term refinance lending activity fell for the fifth consecutive month. Rate/term locks dropped another 16.5% – to the lowest level since May 2019 – marking an 80% year-over-year decline. Unsurprisingly, the refinance share of the month’s origination mix fell to 43%, the lowest percentage of the market since July 2019. Non-conforming loan products – primarily jumbo loans – continued to gain market share at the expense of agency volumes in the face of reaccelerating home price growth. All in, non-conforming loan products now account for 16% of the origination market, up from 9% this time last year.

“With some $10 trillion in homeowner tappable equity in the market, it makes sense that we’d see cash-out refinance locks on the rise,” Happ continued. “The significant jump in purchase originations can likely be attributed in part to typical pent-up, post-holiday demand. It could also represent skittish homebuyers hoping to lock in a still historically low rate being spurred to action by the quick acceleration in 30-year offerings over the opening weeks of the month. Of course, inventory constraints continue to serve as headwinds on purchase origination, as does homeowner affordability in the face of rising rates and home prices. This bears out in the increase we’ve seen in the average loan amount, which rose yet another $6,400 in January to $347,300. The rate of those increases has been on the rise and trending higher in recent months as well, with January’s rise marking a 60% higher increase than December’s jump.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Rate Lock Activity Falls for Fourth Consecutive Month; Rate/Term Refis Fall to Lowest Level in Two Years

JACKSONVILLE, Fla. – Jan. 10, 2022 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through December month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“With the Federal Reserve speeding the tapering of its bond buying and indicating multiple rate hikes in 2022 to curb inflation, 30-year conforming rates sat above 3.3% for much of December,” said Scott Happ, president, Black Knight Secondary Marketing Technologies. “Indeed, our OBMMI daily interest rate tracker showed average rates at year’s end within just two basis points of the 2021 high of 3.37%. Likely in response to those rising rates – and the seasonal slowdown in home purchases – we saw locks decline across all product types in December, with total volume down 35% year-over-year.”

The month’s pipeline data showed overall rate locks down 18.3% from November, driven by a 22.5% drop in purchase loan locks. Despite the decline, purchase locks were up marginally on a year-over-year basis. Rate/term refinance lending activity continued to tumble, falling another 17% to hit the lowest level for such lending in two years. The drop in purchase lock volume increased the refinance share of the market to 48%, though it also coincided with average refinance credit scores that were 20 points lower than this time last year. This is not unfamiliar behavior as higher-credit borrowers tend to sit out rising rate environments, which brings down the overall average. Non-conforming loan products continued to gain market share at the expense of agency volumes in December as the average loan amount rose another $4,000 to finish the year at $341,000.

“Seen in the light of the normal seasonal slowdown in home sales as well as our current rate environment, December’s more than 20% drop in purchase loan locks isn’t all that surprising,” Happ continued. “Neither was the continued decline in rate/term refinance lending, though the size of the annual decline is noteworthy, if not sobering. While cash-out refi locks were also down for the month, they’re still up nearly 18% from the same month last year as the product remains somewhat insulated by borrowers taking advantage of soaring home equity levels.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Rate Locks Down 4.7% Overall in November; Rate/Term Refi Originations 65% Below Last Year’s Level

JACKSONVILLE, Fla. – Dec. 13, 2021 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through November 2021 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“While 30-year rates ended November relatively flat from where they were at the start of the month, there was some volatility in rate offerings throughout the month,” said Black Knight Secondary Marketing Technologies President Scott Happ. “Rates moved up and down within a roughly 21 basis point range throughout the month as the market digested news of both the Fed’s tapering announcement and the new Omicron variant. Indeed, our OBMMI daily interest rate tracker showed average offerings reaching as high as 3.36% in the week leading up to Thanksgiving before settling.”

The month’s pipeline data showed overall rate locks down 4.7% from October, driven by a 9.4% drop in rate/term origination activity. While this was the third consecutive monthly decline, rate/term refinance lending has actually fallen in eight of the 11 months of 2021 thus far and is now down 65% from last November’s level. The overall refinance share of the market mix remained at 45%, the lowest it’s been since June 2021. Locks declined across the board, with cash-out refinances down 2.5% and purchase loans down 3.9%. Despite the monthly decline, cash-out lock volumes are still up nearly 36% from this time last year and continue to be buoyed by ongoing home price growth.

“While the rate of home price growth has slowed, it is still historically quite robust,” Happ continued. “As a result, we continue to see non-conforming jumbo loan products gain market share at the expense of agency volumes. With higher conforming loan limits announced by the FHFA taking effect at the start of 2022, it will be interesting to see to what degree this trend persists. As it is, the average loan amount rose another $7,000 to reach $337,000 in November.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Origination Activity Down 6% in October as Locks on Rate/Term Refinance Mortgages Drop Another 23%

JACKSONVILLE, Fla. – Nov. 8, 2021 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through October 2021 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“The ongoing decline in rate/term refinance locks picked up pace in October as 30-year rates continue to rise,” said Black Knight Secondary Marketing Technologies President Scott Happ. “In fact, locks on rate/term refinance loans were down by more than 23% since last month and are now almost 63% off where they were this time last year. Back then, 30-year rate offerings hovered in the 2.8-2.9% range, whereas our OBMMI daily interest rate tracker showed October’s month-end conforming 30-year rate at 3.27%. Jumbo offerings, on the other hand, have risen more slowly over the past three months and ended October nearly 10 basis points below conforming rates.”

The month’s pipeline data showed overall rate locks were down 5.9% from September, driven by a 23.3% month-over-month drop in rate/term origination activity. The month’s decline puts rate/term refinance lending down 62.5% off last October’s level and has resulted in the overall refinance share of the market mix falling to just 45%, the lowest it’s been since June 2021. Locks on both cash-out refinance (-0.3%) and purchase loans (+0.4%) held relatively steady for the month. Despite the marginal decline, cash-out lock volumes are still up nearly 33% from this time last year. Average credit scores on both cash-out and rate/term refinances ticked down two points in October as higher credit borrowers tend to sit on the sidelines of a rising rate environment. Conforming loan products gained back market share, while government products lost ground.

“As Black Knight noted in our most recent Mortgage Monitor report, the dynamics of the refinance market are changing, with a sharp shift away from rate/term refis to cash-out lending,” Happ continued. “This shift tends to happen in any rising rate environment, never mind one in which American mortgage holders have more than $9 trillion in tappable equity available to them. While we did see cash-out locks tick down in October, the overall trend toward an equity-centric refi market remains strong and one we will continue to watch closely in the coming months.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Rate Lock Volume Falls 10% in September as Interest Rates Rise; Rate/Term Refinance Locks Drop Another 19%

JACKSONVILLE, Fla. – Oct. 11, 2021 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through September 2021 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“According to our OBMMI daily interest rate tracker, interest rates rose throughout much of September, with the average conforming 30-year offering climbing 16 basis points to hit 3.2% by month’s end,” said Black Knight Secondary Marketing Technologies President Scott Happ. “Climbing rates drove down rate lock volumes across the board in September, but the largest decline was seen – once again – in locks on rate/term refinance loans. That said, we did see pull-through rates trend higher on both purchase and refi loans, with refi pull-through seeing a sizeable uptick, likely also a result of that same rising rate environment.”

The month’s pipeline data showed that overall rate locks were down 9.7% from August, driven by an 18.7% drop in rate/term origination activity. The month’s decline puts rate/term refinance lending down 57.2% year-over-year and drove the overall refinance share of the market mix back down below 50%. Locks on both cash-out refinance and purchase loans fell 6% in September, though the former are still up 21% over the last three months. Overall average credit scores remained static in September, though declines in scores on both cash-out and rate/term refinance loans could indicate higher credit borrowers starting to exit the market as rates rise. Both non-conforming and FHA/VA loan products gained market share in August, while all other products lost ground.

“We’ve noted the ‘psychological threshold’ of sub-3% rates in the past, with movement below that line triggering increased lending activity,” Happ continued.  “What we’re seeing now represents the other side of that coin in a certain sense. It remains to be seen how much higher rates will climb – and how quickly – and in turn, how borrowers will react. It will also be important to see how and to what degree historic equity stakes and modest increases to for-sale inventory will impact cash-out and purchase lending in the coming months.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Strong Equity Stakes Alone May Not Be Enough to Stave Off Foreclosure Starts, But Will Reduce Inflow of Distressed Properties Into Housing Market

JACKSONVILLE, Fla. – Oct. 4, 2021 – Today, the Data & Analytics division of Black Knight, Inc. (NYSE:BKI) released its latest Mortgage Monitor Report, based upon the company’s industry-leading mortgage, real estate and public records datasets. Given Black Knight’s recent analysis of the strong equity positions of borrowers in forbearance, even when adding 18 months of deferred payments to their debt loads, this month’s report explores the relationship between such equity positions and downstream foreclosure start rates and – ultimately – distressed liquidations. According to Black Knight Data & Analytics President Ben Graboske, the data suggests that the healthy stores of equity in the hands of homeowners currently in forbearance may not be sufficient on its own to ward off foreclosure activity.

“An analysis of our McDash loan-level mortgage performance dataset back to 2007 shows that holding equity in one’s home might not be a blanket backstop to foreclosure activity,” said Graboske. “Borrowers with limited equity were much more likely to be referred to foreclosure during the early stages of the Great Recession than those with strong equity positions. But foreclosure start rates on homeowners who were 120 or more days past due have been relatively similar regardless of equity stakes from 2010 on, with borrowers in the strongest positions only slightly less likely to be referred to foreclosure. So, while we may see some variation in foreclosure activity based on the equity levels of borrowers who are unable to return to making payments post-forbearance, those with strong equity won’t necessarily be immune to foreclosure referral.

“The same data also shows that borrowers with strong equity stakes are more than 40% less likely to face the involuntary liquidation of their homes than borrowers with weaker equity positions, limiting both potential losses on such mortgages and distressed inflow into the housing market. Still, even among borrowers with 40% equity stakes who are referred to foreclosure, some 30% in recent years have lost their home to foreclosure sale, short sale, deed in lieu, etc. What the data doesn’t tell us is why so many people who could avoid involuntary liquidation by selling through traditional channels simply do not end up doing so. Whether that’s due to lack of understanding of their equity positions or the foreclosure process in general is unclear. But given the large number of high equity homeowners currently struggling to make their payments, this represents a significant challenge for the industry: how to educate struggling homeowners on the post-forbearance, foreclosure and – if needed – home sale processes, to limit unneeded stress on homeowners and the market alike.”

However, the report also finds that the white-hot housing market, which has driven homeowner equity to record-breaking heights, is starting to show signs of cooling. According to the Black Knight HPI, annual home price growth slowed from an all-time-high of 19.4% in July to 19% in August, marking the first decline seen in the rate of annual appreciation in 15 months. Daily tracking data from the company’s Collateral Analytics group suggests further cooling in September as well. Any slowdown in appreciation will likely be welcomed by potential homebuyers, who have seen the monthly payment required to purchase the average priced home with a 20% down 30-year fixed rate mortgage increase by nearly 20% (+$210) over the first nine months of 2021.That brings the average monthly mortgage payment to its highest level since late 2007.

It now requires 21.6% of the median household income to make the monthly mortgage payment on the average home purchase, making housing the least affordable it’s been since 30-year rates rose to nearly 5% back in late 2018. Since the Great Recession, home price growth has begun to slow when such payment-to-income ratios hit approximately 20.5% or higher, but low inventory levels in recent months have led to record home price growth even with tightening affordability. Any further rate increases – such as those seen in the week following the Federal Reserve’s announcement on tapering – will only exacerbate the affordability side of the equation. For example, should home prices and incomes hold steady, but interest rates rise to 3.5%, the average monthly payment would rise by more than $100 and home affordability would hit a 12-year low. At 4%, the payment-to-income ratio would climb above its pre-Great Recession (1995-2003) average. If rates climb back to 5% as in late 2018, it would require $380 (+29%) more per month to buy the average-priced home than it does today, with affordability reaching the lowest levels on record outside of the 2004-2008 period.

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Rate Lock Volume Up 5.5% in July as Interest Rates Fall Back Below 3%; Refinance Activity Sees Largest Rise

JACKSONVILLE, Fla. – Aug.9, 2021 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through July 2021 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“The market’s uncertainty around rising Delta variant caseloads across the U.S. has helped push yields on the 10-year Treasury down to their lowest level since February,” said Black Knight Secondary Marketing Technologies President Scott Happ. “This has, in turn, put downward pressure on mortgage interest rates, with our OBMMI daily interest rate tracker showing July’s month-end conforming 30-year at 2.99%, 17 basis points lower than the month prior.”

The month’s pipeline data showed that overall rate locks were up 5.5% from June, with both rate/term and cash-out refinance locks seeing significant monthly growth, rising 24% and 20% respectively. The increase in activity was strong enough to push the refinance share of the market mix back up to 50% for the first time in five months. Conversely, locks on purchase loans pulled back in July, falling 7% from June as rising home prices and constrained for-sale inventory continue to put downward pressure on purchase lending volumes. Average credit scores were up as well in July as higher-credit borrowers, who historically tend to react more quickly and strongly to refinance opportunities, reentered the market.

“When the FHFA announced the repeal of its adverse market fee for refinances in mid-July on top of already falling 10-year Treasuries, we saw interest rates tick down below 3% within days,” Happ continued. “And while we didn’t see homeowners looking to refinance react as quickly or as strongly to such slight rate movements in the past few months, they certainly did so in July. The mid-month surge was pronounced, but short-lived, suggesting that crossing the 3% threshold was what borrowers were waiting for before acting, and when rates ticked back above that psychological line, they held back on the sidelines once again. Now that rates are again below 3%, a very early look at August lock data suggests more of the same in the month’s earliest days.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Rate Locks Rise After Two Consecutive Monthly Declines; Both Purchase and Cash-Out Refinance Lending Up in June

JACKSONVILLE, Fla. – July 12, 2021 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through June 2021 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“After an initial rise following the Fed’s policy meeting in mid-June, Black Knight’s OBMMI daily interest rate tracker shows rate offerings settling in the second half of the month and now sitting roughly equivalent to where they were at the same time in May,” said Black Knight Secondary Marketing Technologies President Scott Happ. “Following two consecutive months of declines – and during the typical seasonal peak for purchase lending, no less – overall locks climbed in June. Both purchase and cash-out refinances were up, but refis in which the homeowner improves their rate or term continued their downward slide, despite rates returning to levels last seen in early March. Such rate/term refis are now down 30% from that point and 60% since January.”

The month’s pipeline data showed that overall rate locks were up 3.9% from May, with a 6% rise in purchase locks and a more pronounced 10% jump in cash-out refinance locks. The purchase lock rise also comes after two consecutive months of declines, with May’s drop primarily due to the foreshortened month. While the volume of purchase loan locks per day was down slightly from May, they rose for the month due to the three additional business days in June, putting purchase activity just 5% behind March’s record high. On the other hand, locks for rate/term refinances were down 4%, causing the refinance share of the market mix to drop again, accounting for just 43% of June’s origination activity.

“A recent Black Knight analysis found that borrower behavior and market make-up is changing in the face of continued, record-breaking home price appreciation,” Happ continued. “This tracks with the continued, growing jumbo share of lending in the market and the decline in the conforming share a result. Indeed, the conforming share of lending is down nearly 750 basis points from last year. With rates holding steady and purchase lending strong, additional growth in home prices may extend this trend further.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Despite Rates Holding Steady Near Historic Lows in May, Locks Down Across All Mortgage Products, Particularly Rate/Term Refinances

JACKSONVILLE, Fla. – June 14, 2021 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through May 2021 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Though interest rate offerings trended downward across all mortgage products in May, overall rate locks were still down across the board,” said Black Knight Secondary Marketing Technologies President Scott Happ. “The severity of shortages in for-sale inventory seems to be a key driver behind the 3.4% decline in purchase locks from April, but the dip in refinance locks seems to have more to do with borrower psychology. Certainly, February’s rise in rates drained some of the excitement in the market, but despite significant increases in refinance incentive since then, refinance activity simply hasn’t rebounded as expected.”

The month’s pipeline data showed that overall rate locks were down 4.7% from April, with a more pronounced 8.2% decline in rate/term refinance locks. The refinance share of the market mix dropped again in May, accounting for just 44% of the month’s origination activity. On an annual basis, only rate/term refinance lending is down from last April (-45%), whereas both cash-outs (+32%) and purchase loans (+43%) are up year-over-year.

“As interest rates declined from March through May, refinance incentive rose by 15%,” Happ continued. “This brought the number of high-quality refi candidates in the market to over 14 million as of the end of May, but rate lock volume has failed to keep pace. Refinance rate locks are instead down 27% over the same time frame, decelerating in what would otherwise be a time of expected acceleration.“

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Despite Rate Offerings Dropping for All Mortgage Products in the Month, April Saw Lowest Total Lock Volume in Nearly a Year

JACKSONVILLE, Fla. – May 17, 2021 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through April 2021 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“Despite interest rates trending downward in April across all mortgage products, the decreases did not seem to be enough to bring borrowers – particularly refi borrowers – back to the table,” said Black Knight Secondary Marketing Technologies President Scott Happ. “April saw the lowest  overall rate lock volume since May 2020, with rate/term refinance lending the lowest since January 2020 – before the 10-year Treasury yield fell below 1% for the first time ever, setting off a yearlong run of interest rates hitting 14 separate record lows in 2020.”

The report shows that overall rate locks were down across the board, falling 11.3% from March. While purchase locks saw a 6% month-over-month decline, sharper monthly drops were observed among both cash-out (-13%) and rate/term (-20%) refinances. The refinance share of the market mix dropped again in April, accounting for just 45% of the month’s origination activity. On an annual basis, only rate/term refinance lending is down from last April (-34%), whereas both cash-outs (+27%) and purchase loans (+114%) are up year-over-year.

“As volume has tightened, we’ve seen average credit scores decline across all products and purposes, and conventional loans lose share to government-backed mortgages,” Happ continued. “Neither are unexpected developments given that, when rates begin to rise, higher-credit borrowers tend to simply not engage. Right now, though, rates are still hovering in a historically comfortable place, with approximately 14.5M homeowners who could still likely qualify for and benefit from a refinance. It will be interesting – and telling – to see both how rates move in the coming weeks, and whether or not we see refi volumes increase as a result.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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Despite Rate Offerings Dropping for All Mortgage Products in the Month, April Saw Lowest Total Lock Volume in Nearly a Year

JACKSONVILLE, Fla. – April 14, 2021 – Today Black Knight, Inc. (NYSE:BKI) announced the launch of the Originations Market Monitor, a new monthly data report that leverages daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used loan product and pricing engine – to provide the industry’s earliest and most comprehensive view of origination activity. Each month, the Originations Market Monitor will publish a series of key indicators drawn from Optimal Blue PPE data as well as secondary market insight from Black Knight’s market-leading hedging platforms.

“Recent – and sharp – upward movements in interest rates have shifted the mortgage originations landscape very quickly,” said Black Knight Secondary Marketing Technologies President Scott Happ. “The wave of refinance activity of the last year and some months has suddenly given way to a purchase-heavy mix. The implications of this shift touch nearly every area of mortgage lending, which in turn has implications for the wider economy. In an environment like this, having access to the fullest, most current market data is essential. In recognition of this fact, Black Knight is launching the Originations Market Monitor to provide the public a high-level view of the kind of data our clients use daily to drive greater profitability and efficiencies.”

The inaugural report shows that while overall rate locks were up 2.5% for the month of March, there was a sharp divergence between purchase and refinance activity. Purchase locks were up 32% from February and nearly 70% since the start of 2021, with cash-out refis up a marginal 4.1% for the month. Refinances in which the borrower is securing a better rate or term for their mortgage fell drastically, down more than 26% for the month and more than 35% since December.

“It’s little wonder that rate/term refinance activity would be down in March – our OBMMI interest rate tracker shows the average conforming 30-year rate offering came in at 3.34% at month’s end, 60 BPS higher than at the end of February,” Happ continued. “The decline in rate/term lending has shifted the originations market mix to 52% purchase and 48% refi. This marks the first time – but almost certainly not the last – that purchase loans have made up a majority share of monthly mortgage lending since December 2019. We also saw credit scores pull back, a trend that’s likely to continue among refis as high-credit borrowers, who have been largely driving record volumes, exit the market.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

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