If you are planning to buy a house or a property, you would most likely need to take out a mortgage. Mortgage lenders and administrators are the entities that provide you with the funds you need to purchase your dream home. In this article, we will be discussing the statistics related to mortgage lenders and administrators and how they affect the housing market.
What are Mortgage Lenders and Administrators?
Mortgage lenders are financial institutions that provide funds to individuals or businesses that want to purchase real estate properties. These lenders include banks, credit unions, and mortgage companies. On the other hand, mortgage administrators are entities that manage and process mortgages on behalf of the lenders. They handle the collection of payments and other administrative tasks related to the mortgage.
The Mortgage Lending Market
The mortgage lending market has been growing steadily over the years. According to the Mortgage Bankers Association (MBA), the total mortgage debt outstanding in the United States reached $10.2 trillion in the first quarter of 2021. This represents an increase of 5.4% from the previous year.
The MBA also reported that the total number of mortgage applications increased by 5.1% in the first quarter of 2021 compared to the previous year. This indicates that there is still a high demand for mortgages despite the ongoing COVID-19 pandemic.
Mortgage Lending Rates
Mortgage lending rates are one of the key factors that affect the housing market. The interest rates on mortgages have been relatively low in recent years, which has made it easier for people to purchase homes. According to Freddie Mac, the average interest rate for a 30-year fixed mortgage was 2.96% in June 2021. This is significantly lower than the 4.07% average interest rate in June 2019.
The Role of Mortgage Administrators
Mortgage administrators play a critical role in the mortgage lending process. They are responsible for processing mortgage applications, verifying the borrower’s income and credit history, and managing the collection of payments. In the first quarter of 2021, the MBA reported that mortgage servicers collected $1.02 trillion in mortgage payments. This represents an increase of 6.1% from the previous year.
The Impact of COVID-19 on Mortgage Lenders and Administrators
The COVID-19 pandemic has had a significant impact on the mortgage lending industry. Many lenders and administrators have had to adjust their operations to accommodate remote work and social distancing guidelines. The pandemic has also led to a rise in delinquencies and foreclosures as people struggle to make their mortgage payments.
According to the MBA, the delinquency rate for mortgages on one- to four-unit residential properties increased to 6.38% in the first quarter of 2021. This is up from 6.00% in the fourth quarter of 2020. The MBA also reported that the foreclosure rate remained at 0.37% in the first quarter of 2021.
The Future of Mortgage Lending
The mortgage lending industry is expected to continue growing in the coming years. The MBA predicts that the total mortgage debt outstanding in the United States will reach $11.2 trillion by the end of 2021. This represents a 9.8% increase from the previous year.
The future of mortgage lending will also be influenced by technological advancements. Many lenders and administrators are investing in digital solutions that can streamline the mortgage lending process and make it more accessible to borrowers.
Conclusion
Mortgage lenders and administrators play a critical role in the housing market. The statistics related to mortgage lending show that the industry is growing steadily despite the ongoing COVID-19 pandemic. The low interest rates and the rise of digital solutions are expected to drive the growth of mortgage lending in the coming years.