U.S. mortgage bankers reduced their projection for this year’s loan originations as a result of lowered expectations for purchase financing in the second quarter.
Including both purchase and refinance originations, mortgage lenders are expected to close $226 billion in loans during the three months ended March 31.
Business is then expected to climb to $271 billion in the second quarter. The second-quarter projection was reduced from last month, when $285 billion was expected.
The latest prediction was made in the MBA Mortgage Finance Forecast for February from the Mortgage Bankers Association.
The trade group left its refinance forecast at $111 billion each for the first and second quarters.
While the first-quarter purchase outlook was kept at $115 billion, MBS reduced its second-quarter purchase forecast to $160 billion from $174 billion predicted last month.
From Jan. 1, 2014, through Dec. 31, 2014, MBA predicts that overall originations will amount to $1.102 trillion. This year’s forecast was trimmed from $1.116 trillion in the January outlook.
MBA left the 2015 projection at $1.229 trillion.
Refinance originations are expected to go from $0.440 trillion in 2014 to $0.433 trillion next year.
That puts this year’s expected refinance share at 40 percent and the 2015 share at 35 percent.
Purchase financing is expected to climb from $0.663 trillion to $0.796 trillion next year. MBA previously had this year’s purchase production at $0.677 trillion.
