Housing Bubble
Mortgage Bankers Fund Record $729 Billion in Quarter 3
WASHINGTON, /PRNewswire-FirstCall/ -- Residential originators funded a record-breaking $729 billion in home mortgages in the third quarter, according to National Mortgage News, a Thomson Media company.
It appears, based on the current run-rate, that mortgage bankers will wind up funding just shy of $2.5 trillion in home mortgages this year. Last year, the industry funded $2.066 trillion, according to National Mortgage News and its affiliate, the Quarterly Data Report.
Exclusive survey data compiled by National Mortgage News/Quarterly Data Report shows (NMN/QDR) that through the first nine months of the year, at least two firms -- Wells Fargo Home Mortgage, Des Moines, and Washington Mutual, Seattle -- have already broken the $200 billion mark in fundings.
It appears that Countrywide Home Loans, Calabasas, could also break the $200 billion mark by year-end.
It is no secret that historically low interest rates continue to drive the production business to new heights. According to NMN/QDR, refis accounted for 64% of all loans produced in the third quarter.
Also aiding the market is a strong demand for housing and the belief by many consumers that they are better off investing in housing -- be it a primary residence or a second "investment" home -- than putting their money in the stock market.
Until rates began falling again late this past summer, few in the industry thought they would see another quarter like the fourth quarter of 2001 when mortgage bankers produced a record $618 billion in loans.
In the first and second quarters of this year production totaled $572 billion and $522 billion, respectively. Next year, the industry is estimated to produce between $1.5 trillion and $1.7 trillion. If these estimates are correct, then 2003 will be the third best year ever for the industry, tying with 1998, when the industry produced $1.5 trillion.
In the third quarter, Wells Fargo ranked first among all mortgage bankers, producing $89 billion in home loans, followed by WaMu ($74.9 billion); Countrywide ($63.6 billion); Chase Home Finance, Edison ($35.5 billion); and ABN Amro Mortgage, Ann Arbor ($31.9 billion).
Among the top five, Countrywide had the highest growth rate, 95%. Wells Fargo, using three channels of production (retail, wholesale, and correspondent) had the highest market share, 12.2%. Washington Mutual was second with 10.27%.
The top 30 residential funders in the quarter together originated $522.4 billion in loans, a 46% increase from the same quarter last year. The top 100 produced $608 billion.
The National Mortgage News offers progressive coverage of events, trends and major industry players.
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