Mortgage Originations Recuperate

Mortgage originations grew 15.5% in number and 15.3% in value in the third quarter (3Q) of 2015, according to the Financial Institutions Commissioner’s Office (OCIF by its Spanish acronym). Growth was strongest in banks (25.8%) rather than in institutions that only generate mortgages (4.6%). Despite the rebound, originations are half of what they were in 2006.

Mortgage originations have increased from 5,821 in 3Q 2014 to 6,723 for the same period this year, which are the highest numbers since 2013.

Between July and September 2015, 902 more loans were originated than in the same period in 2014. This is the second-consecutive increase after experiencing seven third quarters in a downward trend. The value of these loans was set at $988.1 million, or 15.3% more than the $856.7 million for the same period in 2014.

For all of 2014, 23,551 mortgages were originated, which was 30.4% less than in 2013. Originations had already decreased 5.1% in 2013, when 33,761 mortgages were generated. Mortgages had increased 10.6% in 2012, after six years in a downward trend.

The average value of originated mortgages was $146,980, or 0.1% less than for the same period in 2014, when the average was $147,176.

Mortgage originations by commercial banks increased 25.8% and the value of those loans grew 23.1%. Meanwhile, in nondepository mortgage institutions (those only involved in generating mortgages), originations increased 4.6% and their value grew by 4.2%.

The level of defaults on mortgages, which was as high as 22% in 2011 and remained below 16% for most of 2014, fell to 13.2% in July of this year.

In July 2015, there were more than 18,950 properties in some stage of the foreclosure process. Up until July, 2,499 homes had been executed and that number is expected to reach 4,440 by the end of the year. This would be the highest figure in this process over the past three years.

Sin Comillas.com is a Spanish-language digital media website that specializes in business news in such areas as economics, banking, planning and tourism. Sin Comillas was founded in 2010 by economist and journalist Luisa García Pelatti.

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