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CoreLogic Estimates Mortgage Origination Dollars Increased 30 Percent in 2015

Molly Boesel    |    Mortgage Performance

It’s that time of year again. The annual Home Mortgage Disclosure Act (HMDA)1 data is expected in mid-September at which point the details on mortgage lending for 2015 will be made public. HMDA contains information for lenders and policy makers, including details on mortgage denial rates, borrower and applicant details, mortgage pricing and the level of mortgage originations. The headline figures from the HMDA data include the amount and number of first-lien mortgage originations2.

A year ago, in advance of the HMDA release, CoreLogic reported estimates of the 2014 mortgage origination dollars using public records deed information, with only a 4 percent difference compared with the amount reported in HMDA.

We updated the analysis for 2015, and show that mortgage originations rebounded last year. The accompanying chart shows a comparison of CoreLogic and HMDA purchase money, refinance and total origination dollar volumes from 2006 to 2014, as well as 2015 CoreLogic public record origination volume. We estimate that in 2015 the number of mortgage originations increased by 20 percent from 2014 to approximately seven million mortgages and the mortgage origination dollar volume rose 30 percent to about $1.7 trillion.

On average between 2006 through 2014 the CoreLogic estimate of mortgage origination dollar volume was 1 percent below the HMDA estimate. Therefore, the $1.7 trillion shown in the chart is a slightly lower level of what we expect the HMDA release to report for 2015. Some lenders are exempt from HMDA reporting, and many analysts estimate that lenders reporting under HMDA cover about 95 percent of the mortgage market; therefore, we estimate that total market originations—after accounting for under coverage—was probably closer to $1.8 trillion.

The increase in mortgage originations in 2015 compared with 2014 was due to an increase in both purchase-money loans and refinancing activity. According to CoreLogic data, the number of purchase money originations increased 13 percent and the dollar volume increased 18 percent. The number of purchase originations rose due to an increase in home sales and a decrease in cash sales, while strong home price appreciation and more leverage boosted the purchase origination dollar volume3. The number of refinance originations increased 29 percent and the refinance dollar volume increased 44 percent.

1 The Home Mortgage Disclosure Act (HMDA) requires many financial institutions to maintain, report, and publicly disclose information about mortgages. HMDA was originally enacted by Congress in 1975 and is implemented by Regulation C. The Dodd-Frank Act transferred HMDA rulemaking authority from the Federal Reserve Board to the Consumer Financial Protection Bureau (CFPB) on July 21, 2011.

2 The mortgage origination numbers in this post refer to first-lien originations.

3 CoreLogic MarketTrends shows home sales up 6 percent and cash share down three percentage points. The CoreLogic HPI shows national home prices rose 5.3 percent for the full year of 2015 compared with the full year 2014. Early in 2015, the FHA cut its mortgage-insurance premium by 50 basis points and the GSEs introduced 97-percent LTV conventional purchase products, boosting the use of higher leverage loans for purchase.

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