In the purchase market, the share of loans with credit scores ranging from 620 to 699 rose from 10.75% in the second quarter to 12.00% in the third quarter.
Although the GSEs have for several months seen declines in the share of investor and second-home mortgage purchases, it remains to be seen whether lenders will continue to deliver these loans into the non-agency market now that the caps have been withdrawn. (Includes two data charts.)
Sales to Fannie Mae and Freddie Mac saw larger concentrations of higher-risk mortgages, in both the purchase and refinance sectors. But high-FICO loans continue to account for most GSE business. (Includes two data charts.)
Banks reported a 10% drop in retail originations through their mortgage banking operations in the second quarter. Loan sales also declined and likely continued to in the third quarter. (Includes two data charts.)
Veteran loan broker Michael Foote called it, “Good marketing more than anything, but they’ll just stack the loans and then sell them as soon as the new loans can be delivered…
While banks and foreign investors have increased their holdings of agency MBS in recent quarters, the Federal Reserve continued to buy over half of net new issuance during the second quarter. (Includes three data charts.)
Fannie Mae and Freddie Mac posted significant gains in single-family business in the second quarter, but Ginnie was relatively flat and the non-agency servicing market continued to shrink. (Includes two data charts.)
The decline in mortgage origination from the first to the second quarter hit nonbanks harder, but the industry still accounted for 70% of production by the top 100 lenders. (Includes two data charts.)