MBA Now Sees $3T in Originations

For the fourth time since October and the second time in less than two months, the Mortgage Bankers Association of America has upped its estimate for mortgage originations in 2003 -- to $3 trillion.That would easily best last year's record-setting production level by more than half a trillion dollars. MBA chief economist Doug Duncan estimates that two of every three loans will be in the form of refinancings. Only last month, Mr. Duncan forecast that refis would be drying up. But now the markets are expecting the Fed to lower rates to prevent deflation, loan rates are down to the lowest levels since the early 1950s, and refis are on the upswing again. "Absent any signs of inflation or a resurgence in the economy, rates should remain low enough to continue the current refinance wave to the point where we should hit $3 trillion for the year," Mr. Duncan said. The MBA is continuing to forecast that purchase origination mortgages will also set a record this year of more than $1 trillion.