Projections show a low year for reverse mortgage endorsements. The forward lending world, too, sees 2012 as having the lowest volume in five years, by dollar amounts.
Originations will fall to less than $1.1 trillion in 2012, according to a report by National Mortgage News, which cites statements made by the Mortgage Bankers Association’s Michael Fratantoni, VP of research. Fratantoni shared projections with attendees of the MBA’s secondary market conference held in New York City this week, according to the report.
National Mortgage News noted its own projection for 2012, placing the total 18% higher at $1.3 trillion. The report writes:
“Even as refinancings continue to dwindle—from $858 billion in 2011 to $682 billion this year and $357 billion in 2013—the MBA expects the purchase money market to improve.
It is now forecasting $682 billion in purchase loans this year, up from $404 billion in 2011, and $706 billion next.
But Fratantoni admitted that the association’s projections “depend entirely where (mortgage) rates go from here.”
Right now, rates are tracking 0.5% “below where we thought they would be,” which is one reason for the group’s optimism. “Interest rates are taking the European elections hard,” said chief economist Jay Brinkmann. “As long as we are a safe haven, that will keep rates down.”…
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Written by Elizabeth Ecker