WASHINGTON–More big banks are getting out of the residential mortgage lending business.
Analysis by the Mortgage Bankers Association shows that while banks originated 74% of all mortgages in 2007, their share declined to 52% in 2014, the most recent data available from the MBA. That figure could go even lower.
Thin margins and increasing regulation have led many banks to exit mortgage lending, according to the MBA, which also noted there’s “essentially no private bond market to whom to sell mortgages.”
Similarly, Inside Mortgage Finance reported that of the top 10 originators in 2015, banks loaned 28.6% of all mortgages. That’s about half their share in 2012, when banks among the top 10 originators accounted for 54.4% of all mortgages.
Filling the vacuum have been community banks and credit unions, and, increasingly, lenders such as Quicken Loans, which earned some notoriety with its ad for its Rocket Mortgage during the Super Bowl.