Mortgage Debt Growth Highest in 36 Years

Fueled by record home sales and a red-hot home equity market, residential debt in the United States grew at a blistering pace in the third quarter, according to new figures released by Fannie Mae.According to Fannie Mae chief economist David Berson, residential debt grew at a 15.9% annualized rate in the third quarter, compared with 15% in the second quarter. "This was the fastest two-quarter increase since 1979," Mr. Berson said. According to figures compiled by National Mortgage News, there is now $8.1 trillion in outstanding home mortgages in the United States. (By comparison, at the end of 2002 consumers owed $6.3 trillion on their homes.) Meanwhile, Fannie is forecasting $2.1 trillion in production next year. NMN is forecasting $3 trillion in production for 2005, which means -- according to Fannie's numbers -- fundings could decline by 30% next year. Fannie Mae can be found online at http://www.fanniemae.com.