Most lenders have no plans to ease credit – Fannie

by Ryan Smith15 Jun 2016
Most mortgage lenders have no plans to ease credit standards right now, according to new data from Fannie Mae.

According to Fannie’s most recent lender sentiment survey, lenders had a generally positive attitude about the housing market heading into the third quarter, and mortgage lenders reported a moderate net easing of credit standards over the last three months. But most lenders expected to keep their credit standards unchanged in the next quarter. For GSE-eligible loans, only 4% of lenders expected to loosen credit within the next three months.

“Key survey sentiment indicators suggest that lenders remain cautiously optimistic in their market outlook,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “The outlook for purchase demand growth over the next three months returned to levels similar to last year, while the outlook for refinance demand and profit margin improved moderately versus last year’s levels. Additionally, the trend toward easing of credit standards appears to be tapering off, as the vast majority of lenders, around 90%, reported plans to keep their credit standards about the same. The survey was conducted before the recent May jobs report, and the weaker reported job gains might potentially temper this optimism.”
Other key findings included:
  • Net demand growth for non-GSE eligible purchase mortgages is down slightly year-over year
  • Net demand growth expectations for the next quarter fell slightly for non-GSE eligible loans but rose for government loans
  • Lenders reported a significant increase from Q1 in net demand for refis across all loan types



Is TILA-RESPA a good or bad thing long term?