Black Knight Introduces Originations Market Monitor: March Report Shows Refinance Share Below 50% for First Time in 15 Months; Rate/Term Refi Lending Down 36% Year-to-Date

Rhea-AI Summary

Black Knight, Inc. (NYSE:BKI) has launched the Originations Market Monitor, a monthly report utilizing data from its Optimal Blue PPE to provide insights into mortgage origination activity. The inaugural report reveals a 2.5% increase in overall rate locks for March, with a significant 32% rise in purchase locks compared to February. In contrast, rate/term refinances plummeted over 26% in March and more than 35% since December 2020. This shift marks the first time since December 2019 that purchase loans outnumbered refinances in the mortgage market.

Positive

• Launch of the Originations Market Monitor provides timely data on mortgage origination activity.
• Overall rate locks up by 2.5% in March, indicating market activity.
• 32% increase in purchase locks compared to February, showing a strong demand.

Negative

• Rate/term refinance activity down more than 26% for March and over 35% since December 2020, indicating market shifts.
• Decline in high-credit borrowers may impact overall origination volumes.

JACKSONVILLE, Fla., April 14, 2021 /PRNewswire/ -- 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."

Moving forward, each month's report will provide high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume. Much more detail on March's origination activity can be found in the full Black Knight Originations Market Monitor Report.

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 serving their customers. For more information on Black Knight, please visit www.blackknightinc.com/.

For more information:
Michelle Kersch	Mitch Cohen
904.854.5043	704.890.8158
michelle.kersch@bkfs.com	mitch.cohen@bkfs.com

 

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SOURCE Black Knight, Inc.

FAQ

What is the Originations Market Monitor by Black Knight?

It is a monthly report providing insights into mortgage origination activity using data from Black Knight's Optimal Blue PPE.

How did the purchase and refinance locks change in March 2021 for BKI?

Purchase locks increased by 32% from February, while rate/term refinances dropped by over 26%.

What does the March report indicate about the mortgage market for BKI?

It marks the first time since December 2019 that purchase loans accounted for a majority share of monthly mortgage lending.

How has the interest rate affected the mortgage landscape according to BKI?

Sharp increases in interest rates have shifted the focus from refinancing to a purchase-heavy market.

What insights will future reports provide for BKI investors?

Future reports will include high-level origination metrics for the U.S. and top metropolitan areas.