HMDA Data: Loans to Low-Income Borrowers Rose in 2017

HMDA Data Loans to Low Income Borrowers Rose in 2017

A change in Regulation C saw fewer financial institutions reporting Home Mortgage Financial Disclosure Act (HMDA) data in 2017 according to the Federal Financial Institutions Examination Council (FFIEC).

The council recently released the data on mortgage lending transactions covered by HMDA for financial institutions. They included data from banks, savings associations, credit unions, and mortgage companies. The FFIEC data covered lending activity submitted by financial institutions on or before April 18, 2018.

Data revealed that home loans to low- and middle-income borrowers saw a slight uptick for new properties, rising from 26.2 percent to 26.3 percent in 2017. Refinance loans to this group of borrowers also saw an increase from 16.9 percent in 2016 to 22.9 percent in 2017.

In terms of borrower diversity, the report said that the share of home purchase loans for family properties made to black borrowers rose from 6 percent in 2016 to 6.4 percent in 2017. For Hispanic borrowers, this number remained unchanged at 8.8 percent and for Asian borrowers, it rose from 5.5 percent to 5.8 percent.

For refinance loans, the share of loans made to black borrowers increased to 6 percent from 5 percent in the earlier year. The share for Hispanic borrowers also increased from 6.2 percent to 6.8 percent. However, the share of refinance loans to Asian borrowers declined from 5.5 percent to 4 percent during the period.

The data reported information on 12.1 million home loan applications of which 7.3 million resulted in loan originations and 2.1 million in purchase loans for more than 14.1 million actions. The report revealed that the total number of originated loans of all types and purposes also decreased 12.4 percent or more than 1 million during the period. Refinance originations decreased by more than 33 percent. However, home purchase lending increased by more than 4 percent.

The report indicated that the decline in reporting HMDA data by 13 percent to 5,852 financial institutions was due to “Regulation C changes requiring HMDA collection and reporting from depository institutions only if, in each of the two preceding calendar years, they originated at least 25 home purchase loans, including refinancings of home purchase loans, that are not excluded under 12 CFR.”


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The Housing Market Gets Hotter in the West

Housing Market Gets Hotter in the West

A study of 16,000 U.S. zip codes by found that, overwhelmingly, the ZIP codes seeing the fastest movement of homes are in the West.

Nationally, the report stated, houses are generally on the market for an average of 78 days. But in the 20 markets where homes sold fastest in Q1, they sold after an average 21 days on the market; in the top three ZIP codes, in fact, barely past three weeks.

While 12 different states made up the top 20 ZIP codes in the country, California had the most, with seven areas overall. Three—San Ramon, San Diego, and San Jose—were in the top 10. Colorado, which placed the overall hottest zip code in Colorado Springs’ 80922, had two markets in the top 10. The other was Littleton.

Fort Worth, Texas, tied with San Ramon for second place on the list. Homes there sold in an average 16 days during the quarter. Colorado Springs saw homes closing in an average 15 days.

But those were not the fastest moving markets of the quarter. Homes in San Ramon moved in 14 days and in Littleton, just 11. These latter ZIP codes were not ranked first and second because of prices and demand. Littleton’s homes sold for a median price of $432,000 in Q1, almost $150,000 higher than those in Colorado Springs. But demand was higher, the report stated, in Colorado Springs.

“Colorado ZIPs continue their hot streak highlighting the meteoric rise of Denver and its neighboring metros over the past decade,” the report stated. That reflects “a pattern that other markets hope to replicate. In fact, we speculated as to whether Salt Lake City, Utah is the ‘New Denver’ earlier this year and now we see Salt Lake City breaking into the top 20 ZIPs.”

Salt Lake, in fact, finished 20th on the list. Homes there moved in an average 21 days during the quarter.

The only ZIP codes outside the West and Midwest to break the top 20 were Melrose, Massachusetts; Rochester, New York; and Montclair, New Jersey. Homes in those markets moved, on average, between 19 and 26 days on the market, according to the report.

The largest surprise, the report stated, was Overland Park, a suburb of Kansas City, which finished tenth overall. Homes moved an average 25 days after being put on the market in the first quarter.

“The Kansas City metropolitan area itself has been hot this spring,” the report stated. “Overland Park is leading the pack in a new set of boiling hot neighborhoods in the Midwest.”

The median price for a home in the top 20 markets was $377,000, the report stated. That’s about one-and-a-half times the national median during Q1.


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Millennials Face Tough Choices This Home Buying Season

Millennials Face Tough Choices This Home Buying Season

As entry-level homes become scarcer, more expensive, and of a worse quality, millennials, one of the largest group of homebuyers looking at these homes, face the most obstacles and most often have to put their plans to purchase a home on hold or make compromises on the homes they buy, according to a recent study by Trulia.

The study found that 87 percent of millennials were encountering obstacles that were delaying their home buying plans, more than any other age group.

These findings come after Trulia commissioned an online survey of more than 2,000 Americans ages 18 and older, to understand the hard decisions faced by home shoppers. Almost 9 in 10 or 86 percent of the millennials surveyed said that they planned to buy a home and of these, 35 percent were planning to purchase a home within the next year, and 57 percent planned to buy their own abode in the next two years.

The most common obstacles faced by 98 percent of the millennials who planned to purchase a home in the next year were rising home prices, saving enough for a down payment and poor credit history.

Millennials, the study indicated, also had unique problems that were not faced by the previous generations with 17 percent citing not having a stable job and 15 percent who said that student debt had hindered their home buying decisions. These obstacles were prompting millennials to seriously consider trade-offs in both their desired homes and neighborhoods, Trulia said.

In fact, 84 percent said they were willing to give up one or more desired home feature compared with 78 percent Gen Xers and 65 percent of boomers. Eighty-nine percent of millennial buyers said that they would be willing to give up one or more neighborhood features compared with 81 percent boomers.

Some of the home features that millennials were more willing to trade off on than the older generations in their quest to buy a home included garage, recently updated kitchen, storage space, yard, a bedroom, and a bathroom.

Financial concerns topped the list of homebuyer obstacles with 34 percent saying that saving enough for a down payment, 33 percent citing rising home prices and 21 percent saying poor credit history was their top financial obstacles to purchasing a home, the study found.


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Spring Hits the Housing Market as Weekly Mortgage Applications Rise 4.9%

  • Despite flat interest rates, mortgage refinance and purchase applications strengthened last week.
  • Mortgage applications to purchase a home were 10 percent higher than a year ago, signaling that the spring market may be hitting its stride.
  • Buyers have been sidelined by incredibly short supply and by high prices.

A rise in the thermometer across much of the country last week may have been just the remedy for an ailing mortgage market. Mortgage applications increased 4.9 percent from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted weekly reading.

Mortgage refinance and purchase applications strengthened, despite the fact that interest rates have been stuck in place for weeks. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) remained unchanged at 4.66 percent, with points unchanged at 0.46 (including the origination fee) for 80 percent loan-to-value ratio loans.

“Rates were roughly flat compared to last week, as the downward pressure of geopolitical uncertainty offset the upward pressure of higher inflation and Fed minutes that signaled greater certainty of rate hikes this year,” said Joel Kan, an MBA economist.

Applications to refinance a home loan, which are most rate-sensitive, increased 4 percent for the week but were still nearly 10 percent lower than a year ago, when interest rates were lower. Mortgage rates jumped to start this year and are expected to continue to rise. The pause in that increase may have more borrowers willing to jump in and get whatever savings they can.

“Bonds [which mortgage rates loosely follow] haven’t exhibited much inspiration for more than a month,” wrote Matthew Graham, chief operating officer at Mortgage News Daily. “Although rates have descended modestly since late February, it’s just as fair to label that movement as “flat” in the context of typical rate movement. For example, most borrowers would still be quoted the same “note rate,” with the only difference being slight changes in upfront fees/points.”

Mortgage applications to purchase a home jumped 6 percent for the week and were 10 percent higher than a year ago. That is the strongest reading since January, signaling that the spring market may finally be hitting its stride. Buyers have been sidelined by incredibly short supply and by high prices.

Single-family home construction is recovering at a weak pace, as builders continue to face high costs for land, labor and materials. They are also having trouble finding buildable, desirable land near metropolitan areas, where so many young buyers want to be. The latest read on housing starts showed multifamily construction outpacing single-family, suggesting more confidence in renter demand than buyer demand.

“As single family starts lag, for-sale inventory remains limited. March data shows inventory is 8 percent lower and prices are 8 percent higher than last year,” said Danielle Hale, chief economist at

If mortgage interest rates re-accelerate, fewer buyers will be able to compete in today’s market, especially since there is less supply of lower-priced homes. Demand is strong, but as costs rise and buyers are forced to look at cheaper homes, their choices diminish.


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What to Expect in the Homebuying Season

Homebuyers will need to be on their toes this home buying season if they are to snag their dream abode if the typical time taken to sell a home in 2017 is any indication. According to a report by Zillow, homes sold faster than ever in 2017, with a typical median-priced house flying off the market in 81 days. And this has been the case for the past three years, the report said citing data that indicated homes sold slightly faster at 80 days in 2016.

In 2017, the fastest-selling market was San Jose, California, with the typical home sold in 41 days. Homes in Miami, on the other hand, took 110 days to sell in both years, the report indicated.

What do these numbers indicate for 2018? “As demand has outpaced supply in the housing market over the past three years, buying a home has become an exercise in speed and agility,” said Aaron Terrazas, Senior Economist at Zillow. “This is shaping up to be another competitive home shopping season for buyers, who may have to linger on the market until they find the right home but then sprint across the finish line once they do. Being prepared—working with a great agent, getting financing pre-approved—can help a buyer make a stand-out offer.”

According to an earlier Zillow report on Group Consumer Housing trends, a typical buyer spends around four months searching for a home and makes two offers before successfully closing on a home. But the latest data indicates that homes sold in lesser time than that in 2016 and 2017, making it imperative for homebuyers to be ready to move quickly when they find a home they want to purchase, the report said.

The report also indicated that homes sold the fastest in June, when the typical U.S. home sold in 73 days flat. In San Jose, the report said, homes sold fastest last year in October within just 39 days of being listed.



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