Lenders Reported 38 percent More Loans in 2012; 54 percent More Refinances

Information collected in 2012 through the Home Mortgage Disclosure Act (HMDA) was released today by the Federal Financial Institutions Examination Council (FFIEC).  Included is detailed information on originations and denials resulting from 15.3 million applications for home loans made through 7,400 covered banks, savings associations, credit unions, and mortgage companies.  The data also covers purchases and sales of loans, originations and other actions related to applications.

Loan level data includes the disposition of loan applications, loan amount, type, purpose, property type, location, applicant characteristics (race, gender, income), and pricing related data.  Other information includes census tract data and whether the loan is a first or second lien or unsecured.

The number of institutions reporting in 2012 decreased 3 percent from the number in 2011.  This represented a continuing downward trend resulting from mergers, acquisitions, and failures of financial institutions.  In 2006 HMDA covered just over 8,900 lenders.

Of the 15.3 million home loan applications covered in the report, 9.8 million resulted in loan originations.  There were also 3.2 million loan purchases for a total of nearly 18.5 million actions.  Also covered in the report are 477,000 mortgage preapproval requests related to home purchases.  The total number of originated loans reported increased by about 2.7 million or 38 percent from 2011.  This resulted in part from a 54 percent increase in refinancing while home purchase lending increased by 13 percent. 

As the financial crises resulted in a tightened private lending market borrowers relied more heavily on government backed mortgages.  The FHA share of first mortgage lending increased from about 5 percent in 2006 to a peak of 37 percent in 2009.  In 2012 the FHA's role had diminished to a 27 percent share, 4 percentage points below that of 2011.  VA guaranteed loans also increased during this period from about 2 percent in 2006 to nearly 8 percent in 2011.  The number of VA loans increased by about 11 percent from 2011 to 2012, but its market share remained unchanged at about 8 percent. 

Conventional lending accounted for 85 percent of all refinancing in 2012 while FHA and VA loans accounted for 9 percent and 6 percent respectively.  The number of conventional loans used for refinancing increased by 51 percent from 2011 to 2012 while those backed by FHA or the VA increased 78 percent and 90 percent.

Lenders report through HMDA on loan pricing and this includes their pricing information for loans classified as "higher priced," that is loans with annual percentages rates (APRs) more than 1.5 percentage points above the average prime offer rates for first liens and 3.5 percentage points above for junior liens.  A small minority of first lien loans made in 2012 had APRs that exceeded the loan price reporting thresholds. For conventional first lien loans used to purchase site-built dwellings; about 3.2 percent exceeded the reporting threshold compared to 3.9 percent in 2011. About 4.2 percent of comparable FHA loans were also priced in excess.  However, for loans used to purchase manufactured housing about 82 percent exceeded the reporting threshold.

The lending institutions covered by the HMDA regulations are those regulated by the Federal Deposit Insurance Corporation, the Federal Reserve, National Credit Union Administration, Office of Comptroller of the Currency, the Consumer Financial Protection Bureau, and the Department of Housing and Urban Development.  Financial institution disclosure statements, individual institutions' LAR data, and MSA and nationwide aggregate reports are available at http://www.ffiec.gov/hmda.

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