What happens next Where's my refund? Best CD rates this month Shop and save 🤑
BUSINESS
Federal Reserve System

Home purchase mortgages rose in 2013

Paul Davidson
USA TODAY
home purchase mortgages increased last year. (AP Photo,Michael Dwyer)

Mortgage originations fell sharply in 2013 as higher interest rates crimped refinancing, but home purchase loans increased for the second straight year, federal regulators said Monday.

The number of mortgage originations in 2013 declined by 11% to 8.7 million, according to the report by the Federal Financial Institutions Examination Council. The group, which includes the Federal Reserve and Federal Deposit Insurance Corporation, received data on mortgage lending from 7,190 financial institutions covered by the Home Mortgage Disclosure act.

The number of refinanced mortgages tumbled 23%, likely because mortgage rates jumped, the report said. Average rates for 30-year fixed-rate mortgages rose about a percentage point to 4.46% last year.

Mortgages for the purchase of one- to four-family homes grew 13%, in line with the increase in 2012, though the total was low by historical standards, according to the report. Home purchase originations decreased each year from 2005 to 2011, a period that included the housing crash.

In 2012 and 2013,home purchase loans increase fastest, by a total 42%, for Asian borrowers and most slowly, 12%, for blacks. They also jumped 50% for high income borrowers and just 7% for low and moderate income borrowers.

About 38% of home purchase loans were backed by the government last year, down from 45% in 2012 and a peak of 54% in 2009. The decline reflects a drop in loans guaranteed by the Federal Housing Administration, likely because of insurance premiums that have risen since 2010, the report said.

Featured Weekly Ad