New data set examines home buying trends in 2020
The Federal Financial Institutions Examination Council (FFIEC) announced the availability of data on 2020 mortgage transactions at 4,475 U.S. financial institutions (banks, savings associations, credit unions and mortgage companies) reported under the Home Mortgage Disclosure Act (HMDA).
For 2020, the number of reporting institutions decreased by approximately 18.8% from the previous year to 4,475. One of the reasons for this change is that in 2020, the Bureau has published a final rule amending Regulation C to increase the threshold for collecting and reporting data on closed-end mortgages from 25 to 100 loans, effective July 1, 2020.
The 2020 data includes information on 22.7 million mortgage applications. Of these, 20.4 million were closed, 1.7 million were open, and for another 563,000 registrations, in accordance with partial exemptions of the Economic Growth, Regulatory Relaxation and Consumer Protection Act (EGRRCPA), the financial institutions did not indicate whether the files were closed or open.
Loans for the purchase of a home
From 2019 to 2020, the share of home purchase loans for prime, one to four family, home-built, owner-occupied properties granted to low- and moderate-income borrowers (those whose income is less than 80% of the area median income) increased slightly from 28.6% to 30.4%, and the share of refinancing loans granted to low- and moderate-income borrowers for prime properties rank, one to four families, built on site and occupied by their owner decreased from 23.8% to 19.3%.
In terms of the race and ethnicity of borrowers, the share of home purchase loans for prime, one to four family, owner-occupied, one-to-four-family properties that go to black borrowers fell from 7.0% in 2019 to 7.3% in 2020, the share given to Hispanic-white borrowers decreased slightly from 9.2% to 9.1%, and those made to Asian borrowers decreased by 5, 7% to 5.5%.
The Refi share
From 2019 to 2020, the share of refinancing loans for senior, one to four family, owner-occupied, first-tier properties granted to black borrowers decreased from 5.3% to 4.3%, the share given to Hispanic-white borrowers fell from 6.2% to 5.3%, and the share given to Asian borrowers fell from 5.4% to 6.7%.
In 2020, black and Hispanic-white applicants saw turndown rates for loans to purchase conventional, first-preference homes, for one to four families, built on-site and owner-occupied, of 17.2%. and 11.2%, respectively, while the refusal rates for Asians and non-Hispanic white applicants were 9.1% and 6.1%, respectively.
The Federal Housing Administration (FHA) insured share of prime home purchase loans for on-site, owner-occupied properties declined slightly from 20.2% in 2019 to 19. 5% in 2020. The Department of Veterans Affairs The business guaranteed (VA) share of these loans decreased slightly to reach 10.4% in 2020. The overall share of these home purchase loans, including FHA, VA, Rural Housing Service and Farm Service Agency loans, was 32.9% in 2020, up from 33.4% in 2019.
The share of FHA-insured refinancing loans for senior, 1-4 family, built-in-place, owner-occupied properties declined to 6.6% in 2020 from 12.0% in 2019, while the VA guaranteed share of these refinancing loans increased from 13.5% in 2019 to 11.9% in 2020.
The share of mortgages granted by independent, non-depository mortgage companies has increased in recent years. In 2020, this group of lenders accounted for 60.7% of first mortgage loans, for one to four families, built on site and occupied by their owner, compared to 56.4% in 2019. Independent mortgage companies also have generated 63.3% of first mortgage loans. lien, refinance loans for one to four families, built on site and owner occupied, an increase from 58.1% in 2019.
HMDA data also identifies loans covered by the Home Ownership and Equity Protection Act (HOEPA). Under HOEPA, certain types of mortgages with interest rates or the total number of points and fees above specified levels are subject to certain requirements, such as additional consumer information, and are also subject to various restrictions on loan conditions. For 2020, 6,682 HOEPA-covered loan arrangements were reported: 2,915 home purchase loans for properties with one to four families; 369 home improvement loans for properties of one to four families; and 3,398 refinancing loans for properties of one to four families.