Mortgage Lenders on a Roller Coaster Ride

[May 30, 2007.]

The mortgage lending picture appears to vary from company to company, according to the latest statistics on home loans. While some lenders are experiencing an impressive start this year, others appear to be falling behind.

For instance, Accredited Home Lenders Holding Company experienced a decline in its fundings from about $4 billion in the fourth quarter of 2006 to $1.8 billion in the first quarter of 2007. Interestingly enough, WMC Mortgage saw a decline of more than $5 billion in its quarterly share. And New Century Financial Corp. opted to stop accepting new applications in March.

It should also be noted that Wells Fargo restated its mortgage production for 2006—the figure is now down by some $104 billion. Still, the lender is ranked number two in the nation overall and was the largest residential mortgage lender in the first quarter.

Countrywide Financial Corp. also had an impressive first quarter, reporting $115 billion in originations. Meanwhile, its servicing portfolio is second in the country at $1.352 trillion.

JPMorgan Chase & Co. overtook Washington Mutual, Inc. to become the third-largest lender, as far as residential loans are concerned. Meantime, JPMorgan's servicing portfolio grew to $546.1 billion during the quarter.

Rounding out the list of top residential originators are Bank of America Corp. at $43.1 billion and Citigroup Inc. at $39.6 billion.

The news on the housing front has not been encouraging lately. For instance, the number of foreclosures appears to be on the rise, indicating many homeowners are having difficulty making their monthly payments. In addition, rising gas prices and larger price tags for other goods mean that potential homebuyers may have less money available for purchasing houses.

In addition, in certain areas of the country there are more houses available than buyers to purchase them, causing a glut that may be difficult to recover from.

Julie Ann Amos
May 30th 2007
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