Monday, May 11, 2009

FHA Purchase Mortgages: Market Where the Sun Shines

Click on Chart for Larger View and More Statistics

The chart above reflects monthly FHA endorsements of purchase money mortgages. HUD endorses most mortgages for FHA insurance thirty to sixty days after closing.

Originations of FHA purchase mortgages show a steady increase during the first quarter of 2009. In the first quarter of 2009, 182,535 FHA purchase mortgages were endoresed by HUD. This was a 77 percent increase over the same period in 2008. In March 2009, FHA purchase mortgage originations were nearly 60,000. This represents a 43 percent increase over March 2008 when there were roughly 41,800 endorsements of FHA purchase mortgages.

Note that the peak of FHA purchase originations during the third and fourth quarters of 2008. This peak occurred as a result of legislation that made all seller assisted down payment assistance mortgages ineligible for FHA insurance. Many seller assisted down payment transactions were rushed though the September 30 deadline. The trend trend line of new FHA purchase mortgages indicates that FHA purchase mortgages in 2009 are likely to outpace FHA purchase originations in 2008.

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