Fannie Lowers Home Sale and Origination Expectations For 2022/23

Fannie Mae’s Economic and Strategic Research (ESR) Group has downwardly revised its full-year 2022 real GDP expectations, along with anticipated home sales and mortgage originations, according to the group’s latest forecast. They now expect full-year real GDP to grow at a reduced rate of 1.3%, a 0.8% decrease from their previous prediction, citing inflation, rising interest rates, and “a slowdown of global economic growth.” The forecast also predicts that Q2 2022 will see growth rebound to 1.6%, a reaction to Q1’s economic contraction of 1.4%. “Financial conditions have tightened significantly, and the economy is slowing faster than previously expected as markets adjust to the Federal Reserve’s tightening guidance,” said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. Mortgage…

Commercial/Multifamily Originations Up YOY But Decline From Q4

Commercial and multifamily mortgage loan originations rose 72% YOY in Q1 2022, though they were down 39% from Q4 2021 due to seasonality trends, according to the Mortgage Bankers Association’s (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations. “The strong momentum in commercial and multifamily borrowing and lending at the end of 2021 carried into the first quarter,” said Jamie Woodwell, MBA’s Vice President of Commercial Real Estate Research.  “The continued growth in lending activity is the result of the ongoing strong demand for certain property types like industrial and multifamily, as well as renewed interest in other property types that saw more dramatic declines during the early stages of the pandemic, such as hotel and retail.” Demand for hotel…

IMB Profits Dropped In Q4

Independent mortgage banks (IMBs) and mortgage subsidiaries of chartered banks made $1,099 on each originated loan in Q4 2021, dropping from Q3’s $2,594, according to the Mortgage Bankers Association’s (MBA) Quarterly Mortgage Bankers Performance Report. More than three-fourths (76%) of firms analyzed made a net profit in Q4, especially firms with servicing operations. Those benefited from slower prepayments and low delinquencies which boosted their MSR valuations. But it’s a decrease from Q3’s rate of 92%. Plus, if no firms in the study had servicing operations, only 58% would have made a net profit last quarter. “Production margins tightened substantially in the fourth quarter of 2021. After a two-year run of above-average profitability, pre-tax net production income per loan reached its…

Lending Dropped For Third Straight Quarter In Q4 2021

Mortgage lending dropped at its fastest pace in almost three years in Q4 2021, down for the third quarter in a row and the largest decrease since late 2018, according to ATTOM’s Q4 2021 U.S. Residential Property Mortgage Origination Report. The report found that 3.27 million mortgages were originated in Q4 2021, or $1.06 trillion worth of mortgages. This is down 11% from Q3 2021 and 13% from Q4 2020. All three categories of conventional loans– purchase, refi, and home equity– saw quarterly declines, with only purchases remaining up year-over-year (YOY). Refis were down 11% from Q3 2021 and 23% YOY, with 1.81 million home loans refinanced. Q4 was the third straight quarter of refi declines. The dollar volume of…

Commercial/Multifamily Originations Booming And Expected To Grow In 2022

Commercial and multifamily mortgage loan originations jumped in 2021 and are expected to continue booming in 2022, the Mortgage Bankers Association (MBA) reported at its 2022 Commercial/Multifamily Finance Convention and Expo. Originations rose 79% YOY in Q4 2021 and 44% from Q3. A preliminary measure of commercial and multifamily mortgage bankers’ originations volumes found 2021 activity to be 67% higher than 2020’s. “The fourth quarter of 2021 was a record end to a record year of borrowing and lending backed by commercial and multifamily properties,” said Jamie Woodwell, MBA’s Vice President of Commercial Real Estate Research.  “Part of the growth from 2020 was a bounce-back from the worst of the recession. However, rebounding property fundamentals and strong valuations, record sales…

2021 Finishes Strong, But Inflationary Concerns Weaken 2022 Projections

The Fannie Mae Economic and Strategic Research (ESR) Group boosted its expectation for full-year 2021 economic growth to 5.5% in its December commentary, up 0.7% from November’s projection. The group cited “stronger-than-anticipated consumer spending and inventory investment data” as the reason for its revised projection. Total home sales are now expected to increase 7.1% in 2021 rather than 5.3%. Total mortgage originations are expected to be $4.5 trillion, up from $4.4 trillion. But it also revised its 2022 expectations, downgrading its 2022 growth forecast from 3.7% to 3.2%. Though recent data appears strong, the group noted it “likely reflects a pull-forward of activity from the first half of 2022 and is unlikely to be sustained.” Inflation is the primary reason…

Lending Fell In Q2, Q3 For The First Time Since 2000

Mortgage lending declined in both Q2 and Q3 2021, the first consecutive decline in two years and the first time since 2000 that lending fell in Q2 and Q3, according to ATTOM’s Q3 2021 U.S. Residential Property Mortgage Origination Report. The report showed that 3.59 million mortgages secured by residential property originated in Q3, up 3% YOY but down 8% from Q2. It is the largest quarterly drop in more than a year, and a surprise considering the second and third quarters are usually peak buying season. Lenders overall issued $1.15 trillion in mortgages in Q3, up 11% YOY but down 6% from Q2, the first quarterly drop since early 2020. Both refinance and purchase lending fell, with refinancing taking…

nCino Acquires SimpleNexus For $1.2B

Fintech company nCino, Inc. is expanding its mortgage market reach by acquiring SimpleNexus for $1.2 billion in stocks and cash. SimpleNexus, a digital mortgage platform, was involved in more than one in seven mortgage originations in the US during the first nine months of 2021. It provides services for more than 300 mortgage companies and 41,000 loan originators across the country. “Just as nCino has transformed the process for commercial, small business and retail lending, treasury management and account opening, SimpleNexus has streamlined the many stages of the homeownership process into a single, seamless journey,” said Pierre Naudé, Chief Executive Officer of nCino. “Their innovative solution and deep subject matter expertise in consumer front-end technology will extend our capabilities to…