Over the past three months, customer demand for agency mortgages was stronger, according to a survey of bank executives. There was little change in credit standards.
The Federal Reserve Board released on Monday its
July 2017 Senior Loan Officer Opinion Survey on Bank Lending Practices.
Participating in the survey this go around were 76 domestic banks and 22 U.S. branches and agencies of foreign banks. Banks with at least $20 billion in domestic assets were classified as “large.”
Residential Lending
Banks were asked about how credit standards and demand have changed since April on single-family loans used to purchase a home.
On home loans that are eligible for government-sponsored enterprise programs, 11 percent of large banks said credit standards had eased from three months earlier. Demand for GSE loans rose at a quarter of smaller banks and 16 percent of large banks. Demand was down, though, at 13 percent of large banks.
Credit standards on government mortgages were mostly unchanged from April at all banks. Demand, however, increased at 14 percent of banks.
Demand for non-jumbo mortgages that meet Qualified Mortgage standards increased at 12 percent of small banks, while 11 percent
of large banks indicated weakened demand.
QM jumbo demand rose at 24 percent of banks, but 13 percent of big banks noted a decline.
For loans classified as non-QM jumbo,
14 percent of smaller banks noted that requirements had softened. Demand was greater for these loans at 19 percent of big banks.
Demand at 11 percent of larger banks was modestly weaker for non-QM non-jumbo mortgages.
On home-equity lines of credit, demand strengthened at 15 percent of banks and fell at 15 percent of large banks.
Commercial Real Estate Lending
On non-farm commercial mortgages, 14 percent of large banks noted that credit standards have tightened.
Demand for loans in this category rose at 12 percent of banks. A fifth of large banks saw demand weaken, though.
Nearly a fifth of banks indicated multifamily credit standards have tightened. Eighteen percent of banks said demand had grown stronger for apartment loans, while 38 percent of large banks reported softer demand.
Standards on construction-and-land-development loans were somewhat more restrictive at 17 percent of banks.
Demand eased for C&D loans at 33 percent of large banks, while it strengthened at 16 percent of other banks.
