For many, the economic crisis of 2008 is still an upsetting reminder of the importance of a healthy housing market for the national economy’s well-being. Mortgage statistics are the centerpiece of this picture, fluctuating in synchronization with the population’s wealth.
Ever since the “oil boom” in 2010, mortgage figures were sound despite the skyrocketing real estate prices, but what about now?
Where do we stand on the path to a mortgage-free American Dream? Will it be affected by COVID-19 like the rest of the economy? Here are some essential mortgage figures to help you figure this out.
10 Fundamental Mortgage Statistics and Trends
- 69% of the new house sales in 2019 were paid with conventional mortgages.
- 70% to 90% of US mortgages have a 30-year fixed-interest loan.
- Only 12.1% of all originated mortgages were insured by the Federal Housing Administration in 2018.
- The Mortgage Bankers Association (MBA) increased its refinancing volume to $1.23 trillion.
- The coronavirus outbreak resulted in a record low of 3.29% interest on the average 30-year fixed mortgage rate.
- Default risks for energy-efficient homes are about 32% lower.
- The median value Americans pay per month in housing fees is $1,709.
- The average family with children under 18 spends 32% of their total expenditures on housing.
- The collective US mortgage outstanding debt reached $16.01 trillion in 2019.
- New York, Florida, and New Jersey have the highest rates of mortgage fraud.
Mortgage Lending Statistics and Tendencies in the US
In this section, we’ll be looking at mortgage lending trends and practices in the United States.
1. 69% of the new house sales in 2019 were paid with conventional mortgages.
(Statista, Super Money)
Approximately 681,000 new housing units were sold across the US in 2019. Break-out stats based on the type of financing show that only 6% of these were paid in cash.
Some 17.2%, or 117,000 housing units, were insured by the FHA, and 7.8% were VA guaranteed. Out of the total number of homes purchased in 2018, as much as 78% were paid by a mortgage.
2. Almost two-thirds of American homeowners are bound by a mortgage, industry statistics reveal.
(Statista, FHFA)
The median sales prices of new homes increased by almost 50% when compared to prices from a decade ago, reaching $326,400 in 2018, whereas the average weekly wage has increased by 18%.
Following the data from a research paper on accelerating home prices published by the Federal Housing Finance Agency (FHFA), housing units in California, Florida, and New England had the most constant acceleration in prices over the last 40 years. This is mainly the reason why the baby boomer generation counts twice as many homeowners as millennials.
3. 70% to 90% of US mortgages have a 30-year fixed-interest loan, mortgage loan statistics reveal.
(Calculator Net, Freddie Mac)
The most common homeownership loans in the US are those that allow fixed-rate reimbursement over 30 years. As per data from Freddie Mac in 2016, only 6% of homebuyers were choosing 15-year fixed-rate mortgages, and only 2% went for adjustable-rate mortgages (ARMs).
4. Only 12.1% of all originated mortgages were insured by the Federal Housing Administration in 2018.
(USA Today)
As a consequence of tightening the eligibility criteria, the FHA approval rate had dropped by 1.4 percentage points since 2017, when 13.5% were approved by the FHA.
5. In the case of mortgage originations, statistics mark Wells Fargo as one of the largest mortgage lenders in 2019.
(Housing Wire, US News, Super Money)
Participating with some $60 billion in mortgage originations in Q4 of 2019, Wells Fargo was marked as the biggest player in the US mortgage industry in the category of bank lenders. Wells Fargo received $247 billion in mortgage applications for the Q2–Q4 period in 2019, with some 50% of the originations in Q4 aimed at housing refinancing, as mortgage origination statistics reveal.
Chase, on the other hand, originated $33.3 billion in mortgages in Q4 2019, followed by Bank of America home mortgage numbers, at $22.11 billion.
Besides banks, the largest mortgage lenders are Quicken Loans and Loan Depot.
6. The Mortgage Bankers Association (MBA) increased its refinancing volume to $1.23 trillion, US mortgage statistics in 2020 reveal.
(The Washington Post, Politico, LA Times)
Interest in home ownership exploded in March 2020 with the historically low mortgage rates induced by the coronavirus crisis. The portion of homes accessible at $2,500 a month has increased by 2 percentage points since March 2019.
With applications for housing refinancing increasing by 79% in this period, and the number of home loan applications rising by 10.3% since 2019, the MBA decided to increase the anticipated refinancing volume to $1.23 trillion, which is a 37% increase compared to 2019.
7. The coronavirus outbreak resulted in a record low of 3.29% interest on the average 30-year fixed mortgage rate, trends in 2020 show.
(LA Times, The Washington Post)
US investors shifting money into the US Treasury and other fixed-income securities amid the coronavirus crisis has led to the lowest percentage for a 30-year fixed mortgage since 1971—when rates were first tracked.
Notably, at the beginning of March 2020, it hit 3.29%. In comparison, the 30-year fixed mortgage rate this period last year was 4.31%, as residential mortgage statistics show.
During this period, the 15-year fixed-rate average lowered to 2.77%, and the adjustable-rate average fell to 3.01%, a significant drop from the previous year’s 3.84%.
8. Default risks for energy-efficient homes are about 32% lower.
(IMT)
Even though you need to invest more money in order to make your home energy efficient, there are a number of benefits that come with it. By using renewable energy sources, such as solar power, you will save some money in the long run. Plus, energy-efficient mortgages offer some incentives, such as lower interest rates, to eligible borrowers.
Average Mortgage Payment Statistics Across the US
The majority of mortgage owners spend around 20% of their income on mortgage payments and additional housing costs. Read on!
9. The median value Americans pay per month in housing fees is $1,709.
(Bank of America)
The average American pays this amount per month for housing, according to the Bureau of Labor Statistics. Furthermore, the average person in the US spends 34.62% of their income on housing. Of course, this amount could be spent on renting a home or paying a mortgage.
10. Mortgage statistics show that loans lower than $70,000 have a denial rate of 52%.
(Forbes)
Loan origination statistics for 2017 show that the observed denial rate (ODR) of 11% is not really applicable for all credit scores, and differs greatly from the real denial rate (RDR) of 32%. As per estimates published in a Forbes article, RDR jumps to 52% for those who borrow less than $70,000.
These loans are frequent in the non-government channel, which by default has higher denial rates. Furthermore, these loans are less attractive for lenders because of the overall low profits from interest rates.
11. According to the national mortgage statistics from 2017, mortgage payments and additional housing costs together represented 20% of the income for 46% of mortgage owners in the US.
(BLS)
In 2017, the largest share of the overall number of mortgage owners spent less than 20% of their income on housing costs, whereas 26.2% paid anywhere from 20% to 29% of their annual income. Around 27.3% of mortgage owners spent more than 30% of their income on housing costs.
In 2018, the housing expenditures for the average mortgage holder—like property taxes, mortgage interest, home equity loans, and home insurance—went down by 3.9%.
12. US mortgage industry statistics indicate that for a successful mortgage application, the average payment should not exceed 30% of the borrower’s monthly income.
(Forbes)
Following data from a 2017 study conducted by the Housing Finance Policy Center, the strongest applicant profiles were those who made a down payment of at least 22% of the sum and had a credit score of 700 or more.
Other criteria defining a high profile among lenders were the loan-to-value ratio, which should ideally be less than 78%, and the ratio of income to monthly payment, which should be lower than 30%.
13. Mortgage rate statistics show that the average family with children under 18 spends 32% of their total expenditures on housing.
(BLS)
Following the BLS figures for 2015, housing payments among families with children under 18 ranged from 27.5% to 36.3% of their total expenditures, depending on the children’s age. Families with children younger than 6 years spend 36.3%, and those with children over 18 spend 27.5%.
Single parents with children under 18, on the other hand, spend at least a third (36.8%) of their total expenditures on housing.
Mortgage Debt Statistics
Here, we’ll be looking at mortgage debt throughout the United States and how it affects people.
14. The collective US mortgage outstanding debt reached $16.01 trillion in 2019.
(Housing Wire, Statista, Super Money)
Federal Reserve data shows that the collective US mortgage outstanding debt—including home, farm, multifamily, and commercial mortgage debt—reached $15.8 trillion in September 2019, with the biggest increase since 2016 happening between Q2 and Q3 in 2019 (1.2%).
Homeownership debt represented the biggest share of this ($11.1 trillion), followed by the commercial mortgage debt of $3 trillion. The multifamily loan debt reached $1.6 trillion by September 2019, and farms owed $254.1 billion.
The average mortgage balance in 2019 was estimated at $202,284.
15. In the case of a default mortgage, statistics for the 2019–2020 period show an 8% decline in foreclosure activities.
(Attom Data)
At the beginning of 2020, one in every 2,777 properties in the US received a foreclosure filing, totaling 49,106. Compared to December 2019, these figures are 13% lower, and they’re 8% lower than the previous year.
In contrast to this, some 15 US states reported an increase in foreclosures for that period, including the District of Columbia (56% increase), North Carolina (31%), Michigan (18%), Hawaii (16%), and Connecticut (5%).
16. Delaware, Illinois, and New Jersey had the worst US mortgage foreclosure statistics at the beginning of 2020.
(Attom Data)
One in every 1,210 housing units in Delaware at the beginning of 2020 had foreclosure filings, which is the worst national foreclosure figure for this period.
Illinois was next, with a foreclosure rate of one in every 1,396 housing units, followed by New Jersey, Maryland, and North Carolina with foreclosure rates of one in 1,421; one in 1,722; and one in 1,827, respectively.
The worst metropolitan areas for foreclosure were Rockford, IL (one in every 848 housing units); Atlantic City, NJ (one in 1,008); and Fayetteville, NC (one in 1,089).
17. US mortgage debt statistics reveal a bank repossession rate drop of 25% since last year.
(Attom Data)
In January 2020, banks and other lenders repossessed 10,363 US properties, which is 15% fewer than December 2019, and approximately 25% fewer since January 2019.
Contrary to this national trend, Austin, TX; Pittsburgh, PA; Palm Bay, FL; and Raleigh, NC, saw an increase in bank appropriation rates by 61%, 54%, 36%, and 21%, respectively.
18. The outstanding mortgage debt of families with one to four members doubled between 2001 and 2019, mortgage loan statistics confirm.
(Statista)
The combined mortgage debt of these family residences reached approximately $11.17 trillion in 2019, following a constant increase since 2008.
The highest mortgage debt of mortgage-holding families in the last two decades reached a peak in 2007, amounting to $11.24 trillion for that year. Compared to 2001, when this residential mortgage debt was $5.6 trillion, there has been an increase by almost double that amount by the end of 2019.
19. Gen X-ers and millennials carry the greatest mortgage debt, US mortgage statistics reveal.
(Experian)
With an average mortgage debt of $222,211 in the first quarter of 2019, millennials have the second-highest mortgage balance increase (5%) among all generations.
The average Gen Z mortgage holder suffered a whopping 15% increase in their mortgage debt in the 2018–2019 period. Estimations show that, in numbers, this average mortgage debt reached $138,193 in 2019’s Q1.
The average Gen X mortgage holder, on the other hand, experienced a 2% increase in the same period, reaching a mean of $237,753.
20. New York, Florida, and New Jersey have the highest rates of mortgage fraud, statistics in the US confirm.
(Core Logic, Nerd Wallet)
As per 2019’s Mortgage Fraud Report by Core Logic, one in every 123 mortgage applications had indications for fraud at the beginning of 2019, as opposed to one in 109 in 2018.
With the exception of Jumbo loans for home purchases, in 2019, there was a decrease in the frequency of all fraud types regarding mortgages. As a note, jumbo loans are mortgages over $510,400, as fixed by the Federal Housing Finance Agency. What’s more, the mortgage application risk index fell by 11.4% between 2018 and 2019.
21. Mortgage discrimination statistics reveal that lenders earn 11% to 17% higher profits from purchasing the loans of minorities.
(Berkeley Education)
A study done by the University of California, Berkeley found that mortgage lenders charge 11% to 17% higher interest rates to African American and Latino borrowers than they do for Caucasian and Asian borrowers. This means that minority mortgage holders pay an additional $250–$500 million total annually over what Caucasians do.
Loan lenders claimed that algorithms are used to point out the clients who do less comparison shopping, which is coincidentally more common in minorities, according to US mortgage data.
Conclusion
Today’s home ownership statistics are influenced by governmental policies, purchase power, stock market trends, and other financial pillars—not to mention unpredictable global events, like the coronavirus pandemic.
Whatever the situation, whether or not you’ll get the chance to own your own piece of the American Dream—and benefit from the ups and downs of the mortgage industry—depends on your house market literacy. With this in mind, we hope your curiosity was triggered by these mortgage statistics up to 2022.
FAQ
How many mortgages are originated each year?
The number of mortgages originated fluctuates in accordance with the economic situation in the US. The average number of conventional mortgages that were issued to buy new properties from 2015 through 2019 was 423,400 per year, not including VA and FHA loans.
(Statista, Mortgage Calculator)
Who is the largest mortgage lender in the US?
Based on 2017’s official figures, the largest mortgage lender by home loan volume is Wells Fargo, with a volume of 312,000 ($94.67 billion). Of the nonbank companies, the largest mortgage lenders are Quicken Loans, with 396,000 originated home loans ($86 billion), and Loan Depot.
(Super Money, Mortgage Calculator)
What percentage of homeowners have a mortgage?
Approximately 63% of US homeowners currently have mortgages. Around 78% of new home purchases in 2018 were made with mortgages, according to mortgage statistics.
(Super Money)
Sources:
- Attom Data
- Bank of America
- Berkeley Education
- Bureau of Labor Statistics
- Bureau of Labor Statistics
- Bureau of Labor Statistics
- Calculator Net
- Core Logic
- Dave Ramsey
- Experian
- Federal Housing Finance Agency
- Freddie Mac
- Forbes
- Housing Wire
- Housing Wire
- IMT
- LA Times
- Million Acres
- Mortgage Calculator
- Nerd Wallet
- Politico
- Statista
- Statista
- Statista
- Statista
- Super Money
- The Washington Post
- USA Today
- US News
