BenchMark finalizes results for CBA's 19th Annual Home Equity Lending StudyMortgagePress.comBenchMark Consulting International,Home Equity Lending Study
BenchMark Consulting International (BCI), an Atlanta-based
management consulting firm to the financial services industry, has
finalized the results of the 2005 Consumer Bankers Association's
(CBA's) Home Equity Lending Study. The study includes detailed
findings in home equity portfolio and booking activity, product
characteristics, pricing, marketing activities, sourcing channels,
underwriting attributes, portfolio management attributes and
delinquencies/charge-offs.
Conducted by CBA in conjunction with BCI, the 2005 report
included 39 participating home equity lenders, an increase of more
than 50 percent from last year's study. Surveys were submitted in
the third quarter of 2005 and data collection focused on the twelve
months prior to June 30.
Findings showed that while home equity growth is still on the
rise, respondents reported lower average growth percentages than in
previous years. According to Brian King, BCI's consumer lending and
mortgage banking practices manager, "While not as brisk as in the
previous two years, overall home equity portfolio growth continues
on a double-digit pace according to the data, and home equity line
growth is 25 percent."
Findings indicated that institutions' appetites for risk
continue to expand. Eighty-eight percent of this year's study
population originated C- or D-rated credits (defined as having a
FICO score of less than 630). Among respondents who originated
sub-prime credits, these credits represented an average of six
percent of new line accounts and 11 percent of new loan
accounts.
Supporting the branch-building trend of recent years, the study
indicated that retail branches continued to be the primary channel
of home equity lines and loans. The study also provides detail on
other channels, direct mail and Internet marketing, as well as
cross-sell activities.
For more information, visit www.cbanet.org.
