Mortgage purchase lending picked up in the second quarter, but Fannie Mae and Freddie Mac were notable exceptions.
Purchase originations increased 7.1% year over year to approximately 1.16 million loans, according to TransUnion's Q3 2026 Mortgage Credit Industry Insights Report. Yet Fannie- and Freddie-related purchase originations declined, while other loan categories tracked by the credit reporting company posted gains.
The divergence comes amid a broader recovery in mortgage activity. Total originations rose 12.8% to approximately 1.5 million loans, with refinancing accounting for a growing share of production.
Purchase Growth Bypasses Fannie And Freddie
TransUnion's detailed report shows purchase originations increased across the FHA, VA, USDA, jumbo, and other loan categories it tracks, even as the two government-sponsored enterprises recorded declines.
The report does not identify what drove the difference, but the figures offer a closer look at how unevenly the purchase recovery is playing out across loan products.
The findings also provide a benchmark as Fannie Mae and Freddie Mac expand the use of VantageScore 4.0, giving lenders another credit-scoring option for eligible loans.
As NMP previously reported, lenders have begun adjusting their credit-score policies in response to the broader changes.
Those developments occurred after the second-quarter origination period covered by TransUnion's report and cannot explain the declines recorded during that period.
Refinancing Picks Up Speed
Refinance originations increased approximately 40% year over year, lifting their share of total mortgage production to 21.5%, up from 17.4%.
Rate-and-term refinances led the increase, jumping nearly 60% to approximately 125,000 loans. Cash-out refinances rose 30% to approximately 194,000.
Home equity lending also gained ground, with HELOC originations increasing 20.3% year over year.
The findings add fresh data to NMP's recent reporting on the growing role of second-lien products as homeowners seek access to equity without giving up existing first-mortgage rates.
FHA Delinquencies Remain A Concern
While mortgage performance remained generally stable, FHA loans accounted for 47.2% of mortgages at least 60 days past due in the third quarter, the highest concentration in more than 20 years, according to TransUnion.
Performance among Fannie Mae, Freddie Mac, and jumbo loans remained stable.
“While overall mortgage performance remains relatively stable, the concentration of serious delinquency among FHA loans warrants monitoring,” said Satyan Merchant, TransUnion's senior vice president and automotive and mortgage business leader.
The latest figures show a mortgage market gaining production volume, with purchase growth concentrated outside Fannie- and Freddie-related loans and refinancing contributing an increasing share of originations.
