2011 Residential Lending– The Fewest Number in 16 Years (written by Ted on September 24, 2012)

RISMedia, in referencing a Philadelphia Inquirer article from September 23, 2012, reported on 2011 residential lending data available through the Home Mortgage Disclosure Act (HMDA). The total number of residential loans completed in 2011 was the lowest in 16 years. Not only were there fewer loans made, but qualifying for a loan was much more difficult. They also incorporated other related information in the article.

Some of the findings in the article included:

  • 7.1 million residential loans were made in 2011, generated from 11.7 million loan applications (that’s a 39.3 percent fall-through rate)
  • The number of lenders nationwide fell from 8,900 in 2006 to 7,600 and change in 2011—a drop of 14.6 percent
  • Investors on the secondary market purchased 2.9 million of those loans, or 40.1 percent
  • The number of loans for home purchases were down 5 percent in 2011 vs. 2010, while refi loan numbers fell 13 percent in the same period
  • Loans backed by FHA guarantees made up 31 percent of home purchases in 2011, compared to just 3 percent both 2005 and 2006, 7 percent in 2007, 37 percent in 2009 and 36 percent in 2010
  • From creation in 1934, the FHA grew to 2.9 million mortgages in place by 1954, and had incurred a total 5,712 claims on defaulted loans in that 20-year period
  • Presently, the FHA has 7.5 million loans in place and is seeing 12,000 claims per month
  • The number of VA loans made up 8 percent of all purchase lending in 2011, up 3 percent in 2007 and to approximately 7 percent in both 2009 and 2010

HMDA, passed in 1975, requires lenders to report public loan information for summary to the U.S. government (now part of the CFPB). Their data includes loan applications, originations, loan purchases and sales, loan denials and other related information from banks, savings and loans, credit unions and mortgage companies. The data are aggregated by Metropolitan Statistical Area (MSA), nationwide, and a modified version by lending institution (modified to protect borrower privacy). Other related data collected include loan type, (Conventional, FHA or VA), loan disposition (bought and sold), purpose of the loan (purchase, refinance or home improvement), location (MSA, county, state and census tract), and loan pricing (APR). Demographic data reported includes race, ethnicity, sex and income.

The tables included in the national aggregated data are available by clicking here. For example in this vast array of data, the percent of minorities (including Hispanics) that were denied an application to refinance based on their debt-to-income ratio was 20 percent in 2011 compared to 15 percent in 2006. For the same group, while collateral was the reason for denying a refinance loan to 15 of applicants in 2006, the percentage jumped to 24 percent in 2011.

In addition, data also are collected for the seven largest mortgage insurance companies.

The full article can read at RISMedia or Philly. In addition, HMDA information, including raw data, are available at FFIEC.

There are more likely data here than almost anyone can digest—but take a look if you have an interest.


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