Mortgage bankers nudged up their annual forecast for loan originations thanks to a third-quarter bump in expected refinancings.
During the period from July 1 through Sept. 30, residential loan originations — including purchase financing and refinancing — is expected to total $363 billion.
Business is then expected to fall to $283 billion in the final quarter of this year and bottom out at $273 billion in the first quarter of next year.
The predictions were made Friday in the MBA Mortgage Finance Forecast from the Mortgage Bankers Association.
MBA raised the third-quarter forecast from $344 billion expected last month.
The trade group has refinances accounting for $127 billion of third-quarter volume, more than the $108 billion projection in July. Fourth-quarter refinance expectations were left at $98 billion.
MBA sees purchase mortgage transactions falling from $236 billion this quarter to $185 billion in the fourth quarter — the same as it did a month earlier.
Full-year 2015 originations are now expected to reach $1.371 trillion versus the $1.352 trillion in the last report. No change was made to the 2016 forecast of $1.264 trillion.
Refinances are expected to fall from $0.570 trillion this year to $0.379 trillion in 2016. The 2015 outlook was raised from $0.551 trillion.
Refinance share is predicted to be 42 percent this year and 30 percent in 2016.
Purchase production is projected to push forward from $0.801 trillion in 2015 to $0.885 trillion the following year.
