Title I Production Down 37%

Title One home improvement loan production is down 37% through the first five months of 1998, according to data compiled by the Department of Housing and Urban Development.Between January and May, Title One lenders originated $486 million in home improvement loans (single-family and multifamily), compared with $643.1 million during the same period in 1997. A further breakdown of the data shows that single-family Title One production totaled $427 million -- a 27% drop from last year. "I would attribute the decline to the continued growth of the 125% [high-LTV loan] market," said Peter Bell, executive director of the Home Improvement Lenders Association. "Because of the favorable rate environment, more people are refinancing their existing mortgage, instead of taking out a Title One loan for home renovations." Multifamily production -- which constitutes a smaller percentage of the overall Title One market -- nonetheless has been especially hard hit this year. HUD has insured $38.8 million worth of Title One loans for multifamily projects -- a 125% decline compared with the level for the first five months of 1997.