Fannie as Bearish as MBA on Production Forecast

The first two months of the year have been weak in terms of loan applications and a new forecast from Fannie Mae suggests that 2010 will result in just $1.32 trillion in residential loans being funded this year. If Fannie's forecast becomes reality, that means loan volume will be down 31% this year compared to 2009. Fannie's forecast is slightly more bearish than a recent one issued by the Mortgage Bankers Association that sees production coming in at $1.33 trillion this year. Freddie Mac, by comparison, looks like a wide-eyed optimist at $1.6 trillion. Fannie's new forecast did not include any market commentary. Lenders interviewed by National Mortgage News over the past few weeks have noted a decline in loan applications in January and February, but said March is shaping up to be a decent month. "We were down by 39% in January and February," said Glenn Stearns of Stearns Lending, Irvine, Calif., "but March will be a good month for us." According to the Quarterly Data Report, Stearns Lending, a national lender, ranks 13th among all wholesale funders.