Despite a sharp decline in residential loan originations over the past year, the final month of 2013 saw an uptick. The mortgage market continued to wean itself off of government support.
During December of last year, 347,000 home loans were originated.
Business slowed from 344,000 loans the previous month and plummeted from 823,000 the same month in 2012.
The statistics were reported Wednesday by Black Knight.
“Origination volume is the lowest since 2008, with prepayment speeds signaling more drops in refinance related originations,” the report said. “Increased cash purchases are supporting property sales, which are still up vs. 2012.”
Refinances have sharply retreated as the number of loans that are refinancible diminishes. Market conditions have left borrowers less motivated to refinance through the Home Affordable Refinance Program and traditional programs.
Last year, 7.723 million loans were HARP-eligible, down from 8.359 million in 2012.
Home-equity originations turned higher last year for the first time since 2006. Performance on newer home-equity lines of credit has been “pristine” as HELOC originations are concentrated on “super-prime” borrowers.
American borrowers are slowly being weaned off of government-backed mortgages, with the government-backed share falling to 83 percent last year from 84 percent in 2012.
In 2009, 91 percent of loans were government-backed.
At the same time, the share of business that is investor properties climbed to 9.0 percent in 2013 from 7.0 percent the prior year and has soared from 3.2 percent in 2009.
The rate of 90-day delinquency, including foreclosures, fell to 4.92 percent in January from 5.03 percent at the end of 2013 and 6.48 percent at the same point in 2013.
