St Casimirs Mortgage Minute

Do Loan Trends Show More Homebuyers Moving Off Fence?

Mortgage origination volume spiked in the first three months of this year, RealtyTrac reports. However, the 17 percent increase from January through March was driven primarily by refinance activity, while purchase loan originations were up only slightly. Refinance originations represented almost $256 billion of first-quarter originations, or 67.8 percent of the total dollar volume of $377 billion. Meanwhile, purchase loan originations represented $121 billion, or just 32.2 percent. Of the approximately 1.6 million loan originations in the first quarter, a total of 471,822 were purchase loan originations. That is down 25 percent from the previous quarter and up less than 1 percent from the first quarter of 2014. "A dip in interest rates early in the year combined with lowered mortgage insurance premiums for FHA loans breathed some life back into the refinancing market in the first quarter," said RealtyTrac Vice President Daren Blomquist. "The purchase loan market remained largely missing in action, despite tepid growth from a year ago. The prime buying season still remains ahead, providing some hope that first-time homebuyers and other traditional buyers relying on traditional financing will come out of the woodwork in greater numbers in the coming months."

From "Do Loan Trends Show More Homebuyers Moving Off Fence?"
Investor's Business Daily (05/15/15) Much, Marilyn