Academic journal article ABA Banking Journal

Loans to First-Time Homebuyers Increase

Academic journal article ABA Banking Journal

Loans to First-Time Homebuyers Increase

Article excerpt

Another piece of evidence that the residential real estate market is improving is that the percentage of first-time homebuyers increased from 9% in 2011 to 11% in 2012, according to new data from ABA.

The 20th annual ABA Real Estate Lending Survey, completed in February, had 261 banks nationwide participate, with roughly 85% having assets under $1 billion. Three-quarters of the respondents were stock-owned institutions and 25% were mutual or mutual holding companies. A little over 65% were commercial banks, while 33% were savings institutions.

Although foreclosure rates remain little changed at 0.98% among survey respondents, the average delinquency rate for single-family mortgage loans did come down from 2.11% in 2011 to 1.78% in 2012--another sign of improvement in the housing market, along with the decline in demand for mortgage loan workouts and other modifications.

In the commercial market, the delinquency rate was 3.31% for commercial real estate loans secured by nonfarm, nonresidential properties. Commercial real estate loan demand, while trending higher, is still constrained by the number of credit-worthy projects. …

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