Financial institutions are reporting waning demand for government-sponsored enterprise loans and government-backed home loans. Also weakening was demand for home-secured credit lines.
The
October 2017 Senior Loan Officer Opinion Survey on Bank Lending Practices was released Monday by the Federal Reserve Board.
According to the Fed, the report reflects changes from three months earlier in credit standards and demand for a variety of consumer and commercial bank loans, among other things.
Participating in the trimonthly
survey were 72 domestic banks and 23 U.S. branches and agencies of foreign banks.
Residential Real Estate
Over a 10th of banks said credit standards on purchase-money mortgages eligible for acquisition by Fannie Mae and Freddie Mac had eased.
Demand for GSE mortgages dropped at over a quarter of banks, though it was up at 11 percent.
On government loans used to finance a home purchase, there was little change in lending requirements over the past three months. Demand for government mortgages dropped at over 18 percent of banks.
Very little change in standards was reported for purchase-money mortgages classified as QM non-jumbo, non-GSE eligible loans; QM jumbo mortgages; non-QM jumbo loans; and non-QM non-jumbo mortgages.
Demand was lower at a fifth of banks for QM non-jumbo, non-GSE eligible loans; QM jumbo mortgages; and non-QM jumbo loans. On non-QM non-jumbo loans, demand weakened at 16 percent of banks.
Standards on subprime mortgages were tighter at one of the four banks that makes them.
Meanwhile, demand was up at one bank for subprime loans.
On home-equity lines of credit, standards were unchanged at most banks.
But HELOC demand fell at 17 percent of banks.
Commercial Real Estate
For commercial mortgages and construction-and-land-development loans, standards have remained mostly the same.
Demand for commercial mortgages fell at 16 percent of banks. While C&D demand was stronger at 14 percent of banks, it weakened at 24 percent of banks.
But standards have tightened at nearly a quarter of banks for multifamily loans, with a third of smaller banks — those that the Fed defined as having less than $20.5 billion in domestic assets — reporting tightening.
At the same time, demand for apartment loans was down at a quarter of banks — with the share widening to a third at large banks.
