Data from secondary mortgage giant Freddie Mac indicate that the current quarter will be a peak for originations.
Freddie forecasts $400 billion in home loan production for the second-quarter 2015.
Business is then expected to slow to $330 billion in the third quarter.
Originations are forecasted to continue diminishing for the following two quarters, falling to $270 billion in the final quarter of this year.
The report from the Freddie Mac Office of the Chief Economist,
June 2015 Economic and Housing Market Outlook, was unchanged from the prior month’s outlook.
If the second-quarter 2015 finishes as projected, it will be more loan production than estimated or forecast for any other quarter this year, last year or in 2016.
Using Freddie’s estimated refinance share, refinance production is expected to fall from $180 billion in the current quarter to $116 billion in the third quarter.
That leaves purchase financing slipping from the second quarter’s $220 billion to $215 billion three months later.
Loan originators are expected to produce $1.350 trillion in new loans for all of this year. Next year’s total production is projected to be $1.275 trillion.
Refinance share is forecasted to thin from 43 percent for all 12 months of this year to 30 percent one year after.
That would put refinance production at $0.581 trillion for 2015 volume and $0.381 trillion for next year.
Purchase production is projected to climb from $0.770 trillion this year to $0.893 trillion in 2016.
Mortgages insured by the Federal Housing Administration or guaranteed by the Department of Veterans Affairs are expected to account for a fifth of this year’s and next year’s total mortgage originations.
