With home values plummeting and consumer confidence weakening by the month, the volume of mortgage loan originations in 2008 fell below $2 trillion for the first time in any year this decade. But National Mortgage News, a U.S. Banker affiliate, is projecting that volume will increase sharply this year as historically low interest rates draw buyers back into the market.

In 2008, dollar volume of loan originations declined by nearly 37 percent from a year earlier, to $1.75 trillion, according to National Mortgage News data. Among the top 25 lenders - which control 77 percent of the mortgage market-total origination volume fell 36 percent, to $1.35 trillion, from 2007.

In 2007, Countrywide topped the rankings in both mortgage originations and mortgage servicing. Bank of America Corp., which acquired Countrywide in July, is now the No. 1 player in servicing and Wells Fargo & Co. is tops in originations.

BofA's acquisition of Countrywide increased its share of the servicing market from 5.6 percent in 2007 to above 21 percent in 2008, or nearly $2.1 trillion. The acquisition also boosted its share of the origination market to 10.4 percent.

Wells, which originated nearly $235 billion of mortgage loans in 2008, saw its share of the market increase from 9.38 percent in 2007 to 13.41 percent in 2008. Its overall volume, though, declined by 14 percent from a year earlier.

Of the top 25 lenders, only six reported an increase in originations. That's likely to change in 2009, however. National Mortgage News predicts that the top five lenders alone will originate more than $2.9 trillion of home loans.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.