Fewer Lenders Are Easing Their Credit Standards: Fannie

Fewer lenders eased their credit standards over the previous three months, according to Fannie Mae's Mortgage Lender Sentiment Survey for the first quarter.

Doubling down on this perception, the share of lenders who said they expect standards to ease during the next quarter also fell from the fourth quarter of 2015. And while overall lenders still reported the easing of credit standards, for the first time since the third quarter of 2014 lenders reported the tightening of standards for government loans.

Fannie Mae noted that there was also a significant decrease in the net share of lenders reporting increased purchase mortgage demand when compared with last year, though the share expecting an increase in the next quarter remained the same.

Conversely, there was a dramatic increase in the percentage of lenders who believe there will be increased refinance demand over the next quarter when compared with the end of 2015, even as there was a decline in refinance demand for the first quarter when compared year-over-year.

A larger number of lenders also said they expect to increase the percentage of their MSRs sold to a third party — in particular, midsize institutions expect a higher share of MSRs sold to a third party when compared with last year.