Mortgage bankers raised their projection for this year’s home-loan originations.
Last month, $995 billion in residential production was predicted for 2011 by the Mortgage Bankers Association.
This month’s outlook from the trade group has 2011 U.S. fundings reaching $1.031 trillion.
Originations, which were much higher in 2010 at $1.572 trillion, are expected to decline to $962 billion next year.
MBA forecasts that quarterly production will fall from the fourth quarter’s $462 to just $285 billion this quarter. But business will pick up in the second quarter to $296 billion then decline for the next three consecutive periods.
Refinance share, which came in at 78 percent in the fourth quarter, is expected to be 63 percent in the first three months of 2011 then drop to a fourth in the third quarter — where it will stay until the end of next year.
The share of borrowers whose loans are adjustable-rate will climb to 6 percent this quarter from 5 percent in the final three months of 2010 then settle at 7 percent through the end of 2012.
