The report noted that three companies—JPMorgan Chase, SunTrust and Wells Fargo—reported significant declines in application volume. The first two companies were in the range of 10%, while Wells Fargo was down 19%. KBW said it was expecting lower application volume for the period, but the magnitude of those declines “has been worse than our expectations.”
The KBW analysts, Bose George, Jade Rahmani and Ryan O’Steen, said this decline in application volume will translate into lower originations for 1Q13 and that is their concern for the future in mortgage lending.
However, the Mortgage Bankers Association application survey has risen each of the past three weeks since the start of the year and in the last two weeks purchase application volume has been relatively strong.
A call to KBW to see if the MBA survey findings changes their view regarding 1Q13 volume has not yet been returned.
Still, the analysts said the results reported so far are a good sign of things to come from the companies that haven’t reported. They specifically cite lenders PHH, Flagstar and Nationstar, plus title insurers Fidelity National Financial and First American.