Today, in the Calculated Risk Real Estate Newsletter: Mortgage Originations by Credit Score and Age
A brief excerpt: The NY Fed released the Q1 Quarterly Report on Household Debt and Credit this morning. Here are a couple of charts from the report.
The first graph shows mortgage originations by credit score (this includes both purchase and refinance). Look at the difference in credit scores in the recent period compared to the during the bubble years (2003 through 2006). Recently there have been almost no originations for borrowers with credit scores below 620, and few below 660. A significant majority of recent originations have been to borrowers with credit score above 760.
Solid underwriting is a key reason I’ve argued Don’t Compare the Current Housing Boom to the Bubble and Bust, Look instead at the 1978 to 1982 period for lessons.
From the NY Fed:Mortgage originations, measured as appearances of new mortgages on consumer credit reports and which include refinances, were at $859 billion in 2022Q1. This represented a decrease from the high volumes seen during 2021, but still was $197 billion higher than the volume seen in 2020Q1, just before the pandemic hit.
The median credit score of newly originated mortgages declined again, to 776, down from a series high in 2021Q1 of 788. Yet, credit scores on newly originated mortgages remain very high and reflect continuing high lending standards.There is much more in the article. You can subscribe at https://calculatedrisk.substack.com/