NAMB releases new trend data on 2007 mortgage markets: Conservative trend continues as market correctsMortgagePress.comNAMB, sub-prime, survey, Wholesale Access, David Olson, George Hanzimanolis, traditonal loans
The National Association Mortgage Brokers released new trend
data that shows Mortgage Brokers continue to close fewer
non-traditional (sub-prime) loans than in 2006. The data is part of
an ongoing survey of Mortgage Brokers nationwide that is conducted
by NAMB's research partner Wholesale Access Mortgage Research and
Consulting Inc. The latest update confirms that the trend toward
more traditional loans continues to be the norm in 2007 as the
market corrects from a decade-long housing expansion.
"This data shows that brokers are anticipating and meeting the
changing needs of their customers," said NAMB President George
Hanzimanolis, CRMS. "The shift in the market toward more
traditional loan products is yet another reason we have cautioned
Congress not to overreact to existing concerns and allow the market
Prime loans continue to make up the majority of all loans
originated by Mortgage Brokers, according to the study. Though
their share of the marketplace dipped slightly in April to roughly
56 percentdown from 61 percent in Marchprime loans were still by
far the most widely used class of mortgages. In April, only 11
percent of all loans offered were sub-prime.
In 2006, 13 percent of all loans offered were sub-prime loans,
designed for homebuyers with credit scores below 620.
"This ongoing study further puts sub-prime mortgage issues in
perspective," said Hanzimanolis. "For all the attention that these
loans have received in the media, we're talking about a smalland
shrinkingportion of the home-buying market."
Researchers expect the monthly data to fluctuate throughout the
year, as brokers adjust their loan offerings and the federal
government continues to addresses concerns about the market.
"There will be some volatility, but as the year progresses, the
trend will be toward lower risk loans," said David Olson of
Wholesale Access. "New legislation will make it more difficult to
offer higher risk loans."
The survey responses came from more than 200 brokers and were
analyzed to compare types of loan products offered, adjustable
versus fixed-rate offerings and combined loan-to-value ratios.
For more information, visit www.namb.org.