Originations Could Top $1.4 Trillion

Thanks to the recent jump in refinancing activity, the Mortgage Bankers Association is now predicting a record $1.4 trillion in loan originations this year.The previous record was $1.02 trillion set in 1993, another strong year for refinancing. But David Lereah, the MBA chief economist, told attendees of the MBA Convention in Chicago that "this will be a lot bigger year than that. It will probably be closer to $1.5 trillion when all is said and done." Donald Lange, the new MBA president, was a little more restrained than that. Talking with reporters at a briefing at the MBA's annual convention here, he said forecasting has been made difficult by all the economic uncertainty. "But at the moment," he added, "all the elements are in place" for at least $1.4 billion in originations. Mr. Lange, who heads Weyerhaeuser Financial Investments, Inc., Torrance, Calif., said technological advances are enabling lenders to handle the increased volumes. "We're finally starting to get a lift from all the technological advances," he said. "We're now able to run a larger rabbit through the snake a lot more seemlessly." The industry leader also suggested that higher loan volumes have become the norm. "We seem to have reached the point where $800-$900 billion volumes are the new mean level," he said. The second largest year for originations was in 1992, when $890 billion in new loans was written.