Mortgage lending plummets in first quarter | News - The Title Report

Overall, lenders issued $892.4 billion worth of mortgages in the first quarter, down quarterly by 17 percent and annually by 27 percent. The biggest contributor to the downturn was a decrease in refinance deals. About 1.45 million residential loans were rolled over into new mortgages during the first quarter, down 22 percent from the fourth quarter and 46 percent from a year earlier.
The number of refinance mortgages decreased for the fourth straight quarter, and the annual drop was the largest since 2014, according to the report. The dollar volume of refinance loans was down 20 percent from the prior quarter and 42 percent annually, to $470.7 billion.
“The drop-off in Q1 refinancing activity is no surprise with mortgage rates rising as rapidly as they have,” ATTOM Executive Vice President of Market Intelligence Rick Sharga said in a release. “But many forecasts expected purchase loans to remain strong in 2022, and even increase in both the number of loans originated and the dollar volume of those loans. The weakness in purchase loan activity shows just how much of an impact the combination of escalating home prices and rising interest rates have had on borrower activity this year.”
Lenders issued 1.01 million mortgages to buyers in the first quarter, down 18 percent quarterly and 12 percent annually. The dollar value of loans taken out to buy residential properties dropped to $371.3 billion, down 16 percent from the fourth quarter and 1 percent year-over-year.  
Home-equity lending was the one category that increased, 6 percent quarterly and 28 percent annually, to 249,900. HELOC mortgages represented 9 percent of all first-quarter residential loans, up from 7 percent in the fourth quarter and 5 percent a year ago.
Overall lending activity was down at least 10 percent in 85 percent of the metros that ATTOM analyzed and by at least 20 percent in 42 percent. The largest quarterly decreases were in Huntsville, Ala. (down 62 percent); St. Louis (down 52.2 percent); Augusta, Ga. (down 40.8 percent); Montgomery, Ala. (down 37.4 percent) and Des Moines, Iowa (down 35.8 percent).
Aside from St. Louis, metro areas with a population of least 1 million that had the biggest decreases in loans from the fourth quarter to the first were San Jose, Calif. (down 34.1 percent); Boston (down 31.5 percent); Minneapolis (down 30.4 percent) and Rochester, N.Y. (down 29.6 percent).
The only metro areas with increases mortgages from the fourth to first quarter were Philadelphia (up 11.4 percent); Laredo, Texas (up 9 percent) and Sioux Falls, S.D. (up 7.6 percent). 
Refinancing activity decreased in the first quarter in 97 percent of the metros analyzed. Activity dropped at least 10 percent in 89 percent of the metro areas and by at least 20 percent in half of them. The largest quarterly decreases were in Huntsville, Ala. (down 58.1 percent); St. Louis (down 49.8 percent); Augusta, Ga. (down 47.5 percent); Anchorage, Alaska (down 45.1 percent) and San Jose, Calif. (down 41.9 percent).
Metro areas with the biggest increases in refinancing loans from the fourth quarter to the first quarter were Philadelphia (up 7.8 percent); Macon, Ga. (up 4.6 percent); Laredo, Texas (up 4.5 percent); Lexington, Ky. (up 3.9 percent) and Beaumont, Texas (up 3.2 percent).
Residential purchase-mortgage originations decreased in 95 percent of the metros analyzed. Loans issued to buyers dropped at least 10 percent in 78 percent of the metro areas and by at least 20 percent in a little over half.
The largest quarterly decreases were in Huntsville, Ala. (down 61.3 percent); St. Louis (down 55.3 percent); Utica, N.Y. (down 50.7 percent); Lafayette, Ind. (down 50 percent) and Duluth, Minn. (down 45.9 percent).
The largest increases included Lafayette, La. (up 16.7 percent); Laredo, Texas (up 16.5 percent); College Station, Texas (up 16.2 percent); Philadelphia (up 12.8 percent) and Warner Robins, Ga. (up 12.2 percent).
 

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