Mortgage Demand Shows An 85% Jump at Glenfed
GLENDALE, Calif. - Glendale Federal Bank said Tuesday that average monthly mortgage loan applications have surged 85% in the past two months. The company attributed the jump to the success of its restructuring and heavy demand for refinancing.
The volume gains over the July-to-September period were registered in Glendale's California and Florida markets, according to Stephen J. Trafton, president and chief operating officer.
He said the company could not determine how many of these applications will result in loans.
Glendale, a unit of Glenfed Inc., is rebounding from very low volume levels relative to its competitors.
Home Loans Down Overall
However, mortgage lending volumes this year are way down for all the big California thrifts because of the recession.
Data gathered by Smith Barney, Harris Upham & Co. shows that for the first nine months of the year, Glenfed Inc.'s lending volumes were down 45%, while H.F. Ahmanson & Co. sustained a 42% decline, and Great Western Financial a 31% drop.
Ahmanson said Tuesday that its average monthly mortgage applications in October and November have risen 30% over the July-to-September period. Great Western said its mortgage applications are up but not dramatically.
Downsizing Effort
Glenfed has been preoccupied with its restructuring and cost-cutting drive, which included laying off of 25% of its work force. The company lost $231.7 million in the fiscal year ended June 30 and continues to reel from high levels of nonperforming loans.
As part of the restructuring, Glenfed reinstated the ability of branch officers to make mortgages, effectively increasing the number of lending officers to 300, from 100.
Refinancing accounted for 83% of Glendale's loan applications in November. And Glendale said it is receiving four times as many applications for fixed rate loans as for adjustable rate loans.
Glendale is more willing to write fixed-rate loans than some of its competitors. Its rates are competitive with the other large California thrifts.
Last week Glendale Federal announced a $1 billion single-family mortgage loan program with the Federal National Mortgage Association Glendale is the nation's fourth largest thrift, with $21.3 billion in assets.
The parent company's stock has sunk to $3.50 per share, after trading as high as $25.
