Demand for residential loans at the nation’s banks has weakened over the past three months. Meanwhile, credit standards on most residential products were mostly unchanged.
On single-family loans that meet government-sponsored enterprise qualifications, credit standards have eased at a 10th of banks from three months earlier.
Thirty-eight percent of smaller banks that make GSE loans reported that demand for such loans has diminished over the past three months.
Those were some of the findings from the January 2018 Senior Loan Officer Opinion Survey on Bank Lending Practices from the Federal Reserve Board.
The report reflects survey responses from 71 domestic banks and 23 U.S. branches and agencies of foreign banks about how lending conditions during the most-recent three months have changed from the preceding three months. Banks classified as “large” have previously been described as financial institutions with at least $20.5 billion in domestic assets.
Credit standards have remained basically unchanged at banks that make government mortgages. At the same time, demand for government product had decreased at a fifth of all banks.
Also experiencing mostly no changes in credit standards were QM non-jumbo, non-GSE eligible loans; QM jumbo loans; and non-QM non-jumbo mortgages. More than a fifth of smaller banks indicated that credit standards have eased on
non-QM jumbo loans.
Demand for QM non-jumbo, non-GSE eligible loans; QM jumbo loans; and non-QM jumbo loans was weaker at roughly a fifth of all banks. On non-QM non-jumbo, demand was weaker at 17 percent of banks.
Credit conditions for home-equity lines of credit were stable versus the previous three-month period. HELOC demand, though was weaker at nearly a quarter of smaller banks but stronger at 14 percent of large banks.
Most banks noted little change in commercial mortgage standards. But demand was up at 14 percent of banks and down at 11 percent.
Nearly a quarter of smaller banks indicated credit tightening on multifamily loans. Although apartment loan demand was stronger at 15 percent of banks, it was weaker at a fifth.
On construction-and-land development loans, around 15 percent of banks noted tightening in credit standards.
While demand for C&D loans weakened at nearly of fifth of all banks, demand strengthened at 14 percent of large banks.
