Fannie Mae’s projection for quarterly residential originations by all mortgage lenders was increased by $27 billion. But mortgage loans outstanding are expected to contract by more than $100 billion over the next three months.
Fourth-quarter production by home lenders was forecasted to reach $450 billion in the Washington, D.C.-based company’s December housing forecast. Projected volume is higher than the $426 billion closed by U.S. lenders during the third quarter.
Last month, Fannie had U.S. originations falling to $423 billion from the third quarter’s $428 billion.
This month’s projection had refinance share at 75 percent of fourth-quarter originations, up from 69 percent three months earlier. In the first quarter of next year, the share is expected to fall to 63 percent.
Full-year 2010 production is projected at $1.527 trillion, lower than $1.917 trillion last year. Next year’s business will slide further — to $1.132 trillion — then nudge up to $1.197 trillion in 2012.
Residential loans outstanding are forecasted to fall to $10.564 trillion this quarter from $10.612 trillion during the prior three months. In the first quarter of 2011, Fannie has the total outstanding tumbling to $10.454 trillion.
Of the current period’s total, $9.593 trillion is first liens, down from $9.637 trillion the previous three months.
