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FHA Biz Off and Headed Lower, Delinquency Worse

Monthly business dipped slightly at the Federal Housing Administration and is likely to fall further. Residential loan performance, meanwhile, deteriorated.

At the end of last year, FHA insurance was in force on 8,457,200 residential loans with an unpaid principal balance of  $1.2573 trillion as of Dec. 31, 2016.

The metrics were according to a Mortgage Daily analysis of monthly operational data reported by the Department of Housing and Urban Development.

FHA’s residential book of business included 7,842,834 single-family loans for $1.1127 trillion, 575,436 home-equity conversion mortgages for $0.1436 trillion and 38,930 Title I loans for $0.0010 trillion.

There were 114,772 residential loans endorsed by FHA for $23.552 billion during the final month of last year.
Business dipped from 115,419 loans for $23.682 billion the prior month and 93,182 loans for $18.305 billion a year prior.

From Jan. 1, 2016, through year-end 2016, FHA endorsed 1,346,497 residential loans for $269.419 billion, more than the 1,319,163 mortgages endorsed for $261.449 billion in 2015.

Last year’s endorsements included
1,294,373 single-family loans for $254.421 billion, 48,735 HECMs for $14.923 billion and 3,389 Title I loans for $0.075 billion.

Residential loans endorsed since FHA began its fiscal-year 2017 on Oct. 1, 2016, amounted to 350,749 units for $71.935 billion.

Single-family refinance share was 34.4 percent in December 2016, slightly thinner than 35.7 percent the previous month.

Business likely tumbled in January 2017 based on new single-family and HECM applications, which sank to 109,338 in the most-recent month from 137,850 in November.

Delinquency of at least 30-days on FHA’s single-family book was 11.73 percent as of year-end 2016, deteriorating from 11.32 percent a month earlier but retreating from 12.17 percent a year earlier. The December 2016 rate reflected a 1.46 percent foreclosure rate and an 0.87 percent bankruptcy rate.

Endorsements for FHA’s commercial real estate business, which are reported a month earlier than its residential business, came to eight loans for $0.039 billion in the first month of this year. CRE activity plunged from 171 loans for $2.304 billion in the final month of last year and 67 units for $0.851 billion in the first month of last year.

FHA has endorsed 393 CRE loans for $4.933 billion so far in fiscal-year 2017 including $4.056 billion in multifamily loans and $0.877 billion in resident-care loans.

FHA concluded January 2017 with insurance in force on 14,308 CRE loans for $110.060 billion — including $78.325 billion in multifamily loans, $25.282 billion in resident-care loans and $6.454 billion in hospital loans.

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