Mortgage loans to top $3 trillion
By MortgageDaily.com staff
5/16/2003

An industry report predicts mortgage loans will exceed $3 trillion this year.

The Mortgage Bankers Association of America's (MBAA) forecast, released Thursday, revised April's forecast, which contained a more modest yet still recording-breaking $2.6 trillion prediction for the year. In January, the forecast for 2003 totaled a modest $1.7 trillion.

Refinancings are expected to contribute 65 percent of all originations, the report said.

MBAA economist Doug Duncan cited continued low interest rates and the Fed's concern over deflation as factors in the revised estimates. Also, Duncan said, mortgage spreads are tightening relative to Treasuries.

He added that rates have dropped to such a low point that some consumers who refinanced six months ago could benefit economically from refinancing again.

"Absent any signs of inflation or a resurgence in the economy, rates should remain low enough to continue the current refinance wave to the point where we should hit $3 trillion for the year," he said.

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