Mortgage Daily

Published On: January 21, 2010

Government data on mortgage lending indicate that loan originations and government share were higher last year, while the number of mortgage bankers and the share of higher-priced loans were down.

The report, based on data from 2009 mortgage lending activity, was released Monday by the Federal Financial Institutions Examination Council. The council was established in 1979 and consists of six voting members including the Comptroller of the Currency, the Federal Deposit Insurance Corp. chairman, a Federal Reserve Board governor, the director of the Office of Thrift Supervision, the chairman of the National Credit Union Administration and the chairman of the State Liaison Committee.

HMDA data were collected from 8,124 banks, savings associations, credit unions and mortgage companies that are subject to the Home Mortgage Disclosure Act. The count dropped from 8,388 a year earlier mainly due to a 13 percent drop in the number of reporting mortgage companies.

Nearly 15.0 million applications were reflected in the latest report, more than 14.2 million during 2008. Information on 210,000 requests for pre-approvals that did not result in a loan was also included.

Of the applications taken last year, almost 9.0 million resulted in closed loans — up nearly a quarter from 7.2 million a year prior. The increase was largely a result of a more than two-thirds jump in refinances. In addition, 4.3 million loan purchases were tracked, up sharply from 2.9 million.

The share of last year’s loans that were insured by the Federal Housing Administration shot up to 37 percent from just over a one-fourth. FHA share was only 7 percent in 2007.

The Department of Veterans Affairs guaranteed 7 percent of all mortgages last year, rising from 5 percent in 2008.

Higher priced loans, based on originations prior Oct. 1, 2009, represented about 6 percent of all lending, a big drop from 12 percent a year earlier. The share peaked at 29 percent in 2006.

The criteria for determining whether a loan is high-priced changed on Oct. 1, 2009. The fourth-quarter 2009 share of high-priced loans was 4 percent.

“The overall incidence of higher-priced lending reported in the 2009 HMDA data for all racial and ethnic groups was lower than reported in 2008,” FFIEC said.

The report indicated that denial rates were higher for blacks and Hispanic whites than non-Hispanic whites and Asians.

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