Today, the Federal Financial Institutions Examination Council (FFIEC) published the 2014 Home Mortgage Disclosure Act (HMDA) data showing that more people took out a mortgage to purchase a home in 2014 than in 2013 and that fewer people refinanced their mortgages. As part of our work to educate consumers to make informed financial decisions, we at the Consumer Financial Protection Bureau (CFPB) – along with the other members of the FFIEC – are committed to making HMDA data clear and available to you.
The Home Mortgage Disclosure Act helps protect consumers by providing public data about the mortgage market. Consumers, public officials, community groups, researchers, developers, journalists, and mortgage professionals can use these data to better understand mortgage trends at a national and local level. In addition, bringing transparency to the mortgage market can lead to the greater likelihood that similarly situated consumers receive similar loan terms.
The 2014 data include information on 9.9 million home loan applications. Of those, nearly 6.0 million resulted in new mortgages being taken out in 2014. Here are some of the nationwide trends that we found particularly interesting:
More people took out mortgages to purchase a home in 2014 than in 2013. Most consumers take out a mortgage when they buy a home. In 2014, consumers took out 2.8 million first-lien mortgages to purchase owner-occupied homes – a 4.6 percent increase from the previous year.
Fewer people refinanced their mortgages. Overall, refinance volume dropped by 55 percent. Millions of consumers had already refinanced their mortgages in 2012 or 2013 to take advantage of historically low interest rates. Consumers who already had low interest rates on their mortgages often had little or no incentive to refinance in 2014.
Credit unions and independent mortgage companies gained market share. Consumers have many different types of lenders to choose from when selecting a mortgage. Historically, large banks and their affiliated mortgage companies have dominated the market, but since the financial crisis, an increasing number of consumers get their mortgage from a credit union or independent mortgage company. From 2010 to 2014, the market share of credit unions increased from 3.7% to 6.4%, and that of independent mortgage companies rose from 34.7% to 47.2%. Meanwhile, small banks have stayed steady at around 8% of the market, and the market share of large banks and their affiliated mortgage companies declined from 53.8% to 38.3% over the same time period.
Concerns that large numbers of lenders would exit the market have not borne out. Since implementing our Ability-to-Repay rule, we are seeing some very encouraging signs. Contrary to what some had feared, there's no evidence based on the HMDA data that large numbers of lenders are leaving the market. While 1.8% fewer lenders reported HMDA data in 2014, this reflects a trend of continued consolidation in the industry, with a little less than 2.8% of the HMDA reporters in 2013 merging into other companies by the end of 2014. After accounting for consolidations, the number of lenders that reported making mortgages actually increased in 2014, including the number of community banks and credit unions.
You can check out more trends from this year's HMDA data in the Federal Reserve Board's annual article , look for your state or county using our online maps and charts, or explore the data yourself using the CFPB's online HMDA data tools or the FFIEC's website.