Seven large mortgage lenders have reported their customers continued the feeding frenzy of refinancing in July.
All seven institutions showed marked increases in loan production in July over the level in the corresponding month last year.
Even the smallest gain was a hefty 54% at Standard Federal Bank of Troy, Mich., while American Residential Mortgage Corporation of La Jolla, Calif., showed an exceptionally strong 110% rise.
An Unusual Gain
Standard Federal reported $319 million in originations in July, up from $207 million the year before. Year-to-date origination at the thrift were up to $2.19 billion, from $1.88 billion in the first seven months of 1992.
The gain was unusual for a thrift because most S&Ls have been reluctant to write fixed-rate mortgages demanded by consumers. Standard's originations grew partly because of the strong local appetite for adjustable-rate loans, according to Joseph Krul, chief financial officer.
Keeping ARMs on Its Books
Perhaps because of lower housing costs in the Midwest, 17% of all mortgages booked by
Standard Federal of Troy, Mich., are 10-year adjustables.
"Our loan portfolio is growing, said Mr. Krul, who says that the portfolio increased by $700 million in the first six months of this year.
Mr. Krul says that loans originated by Standard Federal now make up a higher percentage of its portfolio, replacing mortgage-backed securities that have been prepaid.
Like most other thrifts, Standard is selling almost 100% of its production of 30-year, fixed-rate loans into the secondary market while keeping most of the ARMs on its own books.
Others Join Uptrend
Plaza Home Mortgage, of Santa Ana, Calif., currently the 18th-largest mortgage originator, showed total mortgage production of $638 million July, versus $355 million in the corresponding period last year. The year-to-date total is $4.04 billion, up from $3.17 billion last year.
American Residential Mortgage announced total origination of $707 million as well as a year-to-date total of $4.20 billion.
North American Mortgage Company, the publicly traded mortgage giant based in Santa Rosa Calif., experienced a jump to $1.32 billion in total fundings in July, up 73% from last July.
The company has originated $8.38 billion so far this year, up from $5.86 billion in the equivalent period last year. Refinancings comprise 68% of North American Mortgage's July volume, up from 60% last July.
Countrywide Credit Industries of Pasadena, Calif., the nation's largest mortgage lender, saw its total production in July hit $4.3 billion, a 67% increase from last July's $2.6 billion figure. The company had a total origination of $25.4 billion for the first seven months of this year.
Margaretten Financial, of Perth Amboy, N.J., also weighed in with a large increase, reporting $833 million in total production in July, up 72% from last year. Margaretten's total production year-to-date is $5.62 billion, up from $3.88 billion in the first seven months of last year.
Fleet Mortgage Group, of Columbia, S.C., had total origination of $2.2 billion in July, up 59% from last year's period.