UCs should expect mortgages to slide through 2022

The latest forecast from the Mortgage Bankers Association shows that the decline in loan origination continues to be more moderate than expected, but the trend is clearly downward until 2022.

The August 18 MBA forecast revised total fixtures for the third quarter up 4.5% to $ 862 billion. But the revised amount is still down 20% from the previous year and 18% from the second quarter.

MBA data shows creations peaked at $ 1.26 trillion in the fourth quarter of 2020 and have declined quarterly since then. Her forecast shows that trend will continue until the first quarter of 2022, when she expects creations to hit a low of $ 516 billion. It shows next year’s peak at $ 623 billion in the second quarter and drops to $ 602 billion in the fourth quarter, the end of its current quarterly forecast horizon.

Refinancing remains the main factor behind revisions. MBA raised them again, this time by almost 11% for the third quarter. The expected volume of $ 445 billion is 32% lower than a year ago and 25% lower than in the second quarter.

The MBA forecast for July 21 predicted refits to fall below 50% of the value of creations in the third quarter. Instead, MBA now estimates they’re around 52%, up from 56% in the second quarter and 61% a year ago.

MBA has tweaked its purchasing forecast slightly this year, and the Aug. 18 report lowers it 1.4% to $ 417 billion for the third quarter. Creations are only slightly lower than a year ago and 9% lower than in the second quarter.

For the year, MBA adjustments increased total originations by 1% to $ 3.61 trillion, which is still 5.7% lower than in 2020. Refinancing mountings are expected to fall 17% to $ 3.61 trillion. $ 1.98 trillion in 2021, while purchases are expected to rise 14% to $ 1.63 trillion.

Joel Kan, the MBA’s assistant vice president of economic and industrial forecasting, said in a report on Wednesday that refinancing was down from a year ago, even though interest rates during the week ending on August 13 were 7 basis points lower than the previous year.

“The number of eligible homeowners who may qualify for refinancing is now smaller,” Kan said.

FHA loans, which are generally popular with first-time buyers, are expected to fall 21% to $ 276 billion this year.

Kan said the average loan size remains near record highs.

“This is a continuing sign that selling prices are still high, driven by fierce competition leading to accelerating home price growth,” Kan said.

ATTOM, a real estate database curator in Irvine, Calif., Released a report Thursday showing the median down payment, amount borrowed and the ratio of down payment to median home price in the second quarter.

More than half of down payments on financed residential purchases were $ 25,000 or more in the second quarter, up 35.1% from a median of $ 18,500 in the first quarter.

The median down payment of $ 25,000 represented 7.4% of median sales in the second quarter, down from 6.1% in the first quarter and 5% a year earlier.

ATTOM’s report also found that first-quarter to second-quarter purchasing origins increased in 197 of the 218 metropolitan areas it tracked.

Among the 53 metropolitan areas with more than one million people, the largest gains were Virginia Beach, Va. (Up 103.9%); Raleigh, North Carolina (up 61.8%); Oklahoma City (+ 60.2%); Birmingham, Alabama (up 59.7%) and Richmond, Virginia (up 58.4%).

Among the major metros, the largest decreases were recorded in Atlanta (-43%), St. Louis (-19.7%); Salt Lake City (down 16.8%); Memphis (-3.3%) and Pittsburgh (-3.1%).

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