ATTOM: Mortgage Lending Rises in Q3 Amid Refinancing Surge

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ATTOM, Irvine, Calif., reported nearly 1. 7 million residential mortgages were issued during the third quarter, a 1.9% increase on both a quarterly and an annual basis.

The growth marked the second straight quarterly gain–a pattern not seen for more than three years, ATTOM’s third-quarter U.S. Residential Property Mortgage Origination Report said. But even as home-mortgage rates dropped close to 6% for a 30-year fixed loan by the end of the third quarter, the increase in business for lenders was far below a spike during the spring of 2024 and still left total mortgages off by nearly two-thirds from a high point hit in 2021.

“The latest trend resulted from improvements in refinance and home-equity lending as opposed to more buyers taking out loans,” the report said, noting that mortgage rollovers increased 6.9% quarterly to about 588,000 while home-equity packages went up 2.3% to roughly 297,000.

Those improvements more than made up for a 1.7% decrease in purchase loans, to 782,000, as the annual peak home-buying season wound down and supplies of properties for sale remained tight.

Measured monetarily, lenders issued roughly $550 billion worth of residential mortgages in the third quarter, ATTOM reported. That was up 2.9% from the second quarter and 6.6% from the third quarter of 2023.

“Mortgage lending rose again in the third quarter, but at a far slower pace than during the spring of this year when activity spiked nearly 25%,” ATTOM CEO Rob Barber said. “The latest increase, small as it was, likely came mainly from homeowners trading higher-rate loans they got in 2021 and 2022 for cheaper mortgages resulting from declining mortgage rates.” He noted the third-quarter rate dip was not as helpful for purchase lending because buyers kept facing elevated prices and low supplies of properties for sale.