MBA: Hundreds of Lenders Could Fail

A "couple of hundred" mortgage banking firms could fail in the next year or so as the industry works out its excess capacity, according to the chief economist for the Mortgage Bankers Association."It could be a significant" number of firms, said the MBA's Doug Duncan at a forecast conference hosted for the media. "There's a lot of capacity in the industry," he said. The trade group, though, does not think residential production will fall off the cliff this year. The MBA is forecasting that home lenders of all stripes will fund $2.4 trillion in loans this year -- 45% of it refinancings -- compared with $2.5 trillion in 2006. (The MBA's volume number for 2006 differs from that of the Quarterly Data Report, which found lenders funded about $3 trillion in 2006.) Over the past three months several mortgage firms have exited the business, either through merger or failure. (For a partial listing, see the Jan. 15 issue of National Mortgage News.) The MBA can be found online at http://www.mortgagebankers.org.