Editor’s Note: The Mortgage Mix is RISMedia’s weekly highlight reel of need-to-know mortgage-industry happenings. Watch for it each Friday.
- The latest Weekly Mortgage Applications Survey from the Mortgage Bankers Association found that mortgage applications decreased by 3.7% for the week ending August 26, 2022 compared to the previous week’s 1.2% drop.
- Mortgage rates have jumped by two points since the beginning of 2022, as reported by
- At the same time, according to data from ATTOM, residential mortgage lending in Q2 declined at its fastest pace in eight years.
- Residential property mortgages also experienced their fifth quarterly decline in Q2 2022 (2.39 million mortgages, down 13% from Q1 2022 and 40% from Q2 2021).
- Lenders issued just under 1 million residential refinance mortgages in Q2 2022—the smallest count since the second quarter of 2019.
- Fannie Mae predicts that fixed mortgage rates will fall by 2023, with a projected average of 4.5%.
- Adjustable-rate loans accounted for more than 12% of mortgage applications in both June and July, the largest share since 2007 and double the percentage from January 2022, according to Zillow data.
- Mortgage lenders began to file for bankruptcy this summer. Sprout Mortgage, which specialized in non-qualified mortgages (eligible for government backing), shuttered its business in July 2022. First Guaranty Mortgage Corp cites rising interest rates as the cause of decreased lending volume.
- Large mortgage lenders have started offering incentives to keep their marketshare in the face of rising interest rates.
- As reported by the Financial Times, Rocket Mortgage has promised to waive closing, appraisal and different refinancing charges in the event that a buyer acquires a new mortgage or interest rates drop within three years after July 2022. United Wholesale Mortgage will decrease interest rates on its mortgage merchandise by 50 to 100 foundation factors to assist brokers with winning extra enterprise.
- Bank of America will be offering no down payment, zero closing cost mortgages to first-time homebuyers in select cities including Detroit, Los Angeles and Miami. This program is designed to increase homeownership among Black and Hispanic communities in these cities.
- According to NAR Chief Economist Lawrence Yun, “The ongoing sales decline reflects the impact of the mortgage rate peak of 6% in early June. Home sales may soon stabilize since mortgage rates have fallen to near 5%, thereby giving an additional boost of purchasing power to homebuyers.”
While mortgage rates or applications haven’t caught up yet, the swing of power to borrowers versus lenders could produce an uptick for applicants and a downward turn for rates.