U.S. residential loan originations increase

The total dollar volume of loans originated in the second quarter was nearly $540 billion, up 14 percent from the previous quarter and up 29 percent from a year ago. Refinance originations represented nearly $307 billion in the second quarter, 56.7 percent of total loan origination dollar volume, and purchase loan originations represented nearly $234 billion, 43.3 percent of total origination dollar volume. As a share of total loan origination dollar volume, purchase originations reached a recent peak of 51.3 percent in the third quarter of 2014.

Of the more than 1.9 million loan originations in the second quarter, 737,824 were purchase loan originations, up 9 percent from a year ago. There were 1,212,443 refinance originations in the second quarter, an increase of 9 percent from the previous quarter and up 32 percent from a year ago.

“The rise in loan originations particularly the sharp rise in FHA purchase originations indicates the FHA premium reduction at the end of January really is having a big impact, pushing people off the fence to purchase,” said Daren Blomquist, vice president at RealtyTrac. “The average loan amount for FHA purchase loans increased from $187,718 in the first quarter of 2011 to $197,315 in the second quarter of 2015 (a 16 quarter high), as the lower FHA premium gave those buyers more buying power.”

Conventional, jumbo, FHA, HELOC and FHA loans all see gains in the second quarter

There were a total of 1,203,722 conventional and jumbo loan originations in the second quarter, representing 61.7 percent of all loan originations. Conventional and jumbo loan originations increased 18 percent from the previous quarter and increased 17 percent from a year ago. Conventional and jumbo purchase loan originations in the second quarter increased 3 percent from a year ago while conventional refinance originations increased 3 percent from the previous quarter and increased 30 percent from a year ago. The average value of homes purchased using conventional and jumbo loans increased 10 percent from a year ago.

There were a total of 326,143 Federal Housing Administration loan originations — typically low down payment loans utilized by first-time homebuyers in the second quarter. FHA loan originations increased 50 percent from the previous quarter and were up 46 percent from a year ago. FHA loan originations represented 16.7 percent of all loan originations in the second quarter, up from a 13.6 percent share in the previous quarter and a 14.1 percent share a year ago to the highest share since the second quarter of 2010. FHA purchase loan originations in the second quarter spiked 73 percent from the previous quarter and were up 36 percent from a year ago, while FHA refinance loan originations were up 32 percent from the previous quarter and were up 58 percent from a year ago. The average value of homes purchased using an FHA loan increased 1 percent from the previous quarter and was up 13 percent from a year ago.

There were a total of 118,807 Veterans Administration loans originated in the second quarter, representing 6.1 percent of all loan originations. VA loan originations in the second quarter were up 12 percent from the previous quarter and up 39 percent from a year ago. VA purchase loan originations in the second quarter increased 45 percent from the previous quarter and were up 11 percent from a year ago, while VA refinance originations decreased 7 percent from the previous quarter but were up 83 percent from a year ago.

There were a total of 118,807 Home Equity Lines of Credit originated in the second quarter, representing 14.4 percent of all loan originations. HELOC originations were up 20 percent from the previous quarter and up 22 percent from a year ago. HELOC purchase originations were up 21 percent from the previous quarter and up 78 percent from a year ago while HELOC refinance originations were up 20 percent from the previous quarter and up 20 percent from a year ago.

RealtyTrac analyzed recorded mortgage and deed of trust data for single-family homes, condos and townhomes for this report. Each recorded mortgage or deed of trust was counted as a separate loan origination. Dollar volume was calculated by multiplying the total number of loan originations by the average loan amount for those loan originations.

For more information, visit http://www.realtytrac.com/news/company-news/q2-2015-loan-origination-report.