Even with the housing market stabilizing and a settlement between megaservicers and state AGs on the horizon, the mortgage industry shouldn't expect an increase in originations next year, according to a new forecast from Keefe, Bruyette & Woods.

KBW director of research Frederick Cannon on Friday said he expects the note rate on the 10-year Treasury to rise next year, predicting that the Federal Reserve will not purchase enough MBS to keep mortgage rates from rising to 4.7% by the fourth quarter of 2012.

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