Freddie Mac’s Qtrly. Forecast & SBA’s Mortgage Income Verification
MCLEAN, Va., July 15, 2021 (GLOBE NEWSWIRE) — According to Freddie Mac’s (OTCQB: FMCC) Quarterly Forecast, the low mortgage rates that have supported the housing market throughout the pandemic are expected to increase later in the year, but just gradually. Therefore, Freddie Mac predicts that the market will remain strong through 2021.
“As the economy continues to mend, the housing market remains strong even as certain obstacles have begun to slow sales across the country,” per Freddie Mac “Despite the housing market’s recent highs, there are indications of softening demand in recent home purchase mortgage applications data. We expect refinance activity to soften as higher mortgage rates dampen activity. Overall, we forecast total originations to be $3.9 trillion in 2021 before declining to $2.6 trillion in 2022.”
According to Freddie Mac’s Forecast:
- The average 30-year fixed-rate mortgage (FRM) is expected to be 3.1 percent in 2021 and 3.7 percent in 2022. In 2020, the 30-year FRM averaged 3.1 percent.
- House price growth is expected to be 12.1 percent in 2021, slowing to 5.3 percent in 2022. Growth was 11.3 percent in 2020.
- Home sales are expected to reach 6.9 million in 2021, remaining flat in 2022. Sales were 6.5 million in 2020.
- Purchase originations are expected to increase to $1.8 trillion in 2021 and $1.9 trillion in 2022. This is up from $1.5 trillion in 2020.
- Refinance originations are expected to soften, declining from $2.2 trillion in 2021 to $713 billion in 2022. This is down from $2.6 trillion in 2020.
- Overall, annual mortgage origination levels are expected to be $3.9 trillion in 2021 and $2.6 trillion 2022. These levels were $4.1 trillion in 2020.
SBA’s – Verifying Income for Mortgage Lenders
Small business owners, entertainers and entrepreneurs applying for a mortgage or business loan are often required to provide proof of income to their lending institutions.
Lenders are requiring a letter signed by a Certified Public Accountant to confirm the borrower’s income has been acquired legitimately and is likely to remain at a certain level in the future. Before a CPA can provide that letter, documentation, must be compiled. This can slow your loan approval to an abrupt halt. RTW strongly recommends that you obtain this letter before you start your loan application.
If you are a small business owner, an entertainer or entrepreneur looking to start the loan process, or your loan has been put on “hold” for verification of income, please call us. We can help you through this process. Contact us at (855) 205-8486 or schedule an appointment at https://calendly.com/rtw-calendar