A quarterly increase in home lending was led by a jump in jumbo originations. At the other end of the loan cycle, delinquency declined.
In the first three months of this year, mortgage origination firms closed 1.48 million new residential loans.
Home lending entities improved on their performance compared to the final quarter of
last year, with business volume picking up by more than 2 percent on a quarter-over-quarter basis.
Those were some of the findings reported in the TransUnion Industry Insights Report.
Compared to the same three-month period during 2014, the production of home loans based on units was up nearly 40 percent.
Strengthening activity was attributed to falling interest rates and
large-balance loan business.
“Year-over-year growth (by loan count) was attributed to strong growth in prime-plus and super-prime originations, increasing 42.8 percent and 56.0 percent, respectively,” the report stated. “Much of this loan growth could be attributed to jumbo loan counts, with originations for this group jumping from 46,270 in Q1 2014 to 62,666 in Q1 2015.”
Even on near-prime borrowers, business was up 22 percent from the first-quarter 2014, while a 13 percent increase was recorded for subprime volume.
But even with the gains, overall lending was 1.1 million units short of the pre-recession high reached in the third-quarter 2007.
The average loan amount was $188,237 in the second-quarter 2015, climbing from $187,175 three months earlier and $186,999 a year earlier.
Average balances were $327,483 in California, higher than any other large state. At $148,672, Texas had the smallest average.
Delinquency of at least 60 days on mortgages finished the second quarter at 2.72 percent.
The rate was down from
2.95 percent reported for the first quarter of this year.
In the same three-month period last year, delinquency was a downwardly revised 3.42 percent.
The report indicated that millennials led the overall decline in mortgage delinquency — falling to 1.7 percent in the second quarter of this year from 2.32 percent a year earlier.
Over the past three years, the rate of overall mortgage delinquency has “has contracted by half.”
“This is the lowest mortgage delinquency level we’ve seen in several years — down from a peak of nearly 7 percent in early 2010,” TransUnion Vice President and Head of Mortgage Group Joe Mellman said in the report. “This is largely due to foreclosures and other seriously delinquent accounts continuing to work their way through the foreclosure process, as well as a reflection of the high credit quality of recent originations.”
Sixty-day delinquency among the largest states was highest in Florida, where it was 4.54 percent. California’s 1.8 percent was lowest.
As of the second-quarter 2015, there were 52.8 million mortgages outstanding, more than the 52.7 million outstanding at the same point in 2014.
