HELOCs

Among the nonperforming assets 44.01% are either in foreclosure or referred for foreclosure; 19.32% are in default; 7.17% are liquidated and 1.75% are in bankruptcy.

The top five depositories have a combined HELOC volume of more than $91 billion at the end of Q1 2023.

The transaction is the second of its kind in the past six months and comes as the mortgage leaders take steps to develop document standardization that would ease electronic closings and trading of the home equity loans.

The loans increased their share to more than 20% of home lending volume in the fourth quarter, compared to just 7% a year earlier.

The top five had more than $85 billion in HELOC volume in Q3.

Lenders are seeking to capture homeowner interest amid higher living costs, but home values have collectively fallen from their record-high last summer.

The latest quarterly numbers from TransUnion show both closed end products and HELOCs rose over the course of the past year as mortgage originations fell.

Investor whims and secondary market conditions make any pivot away from fixed-term products a riskier proposition for nonbanks, mortgage advisory group Stratmor said.

The company has incurred a combined $91.8 million in expenses in the past two quarters related to its massive cost-cutting plan, which included the layoff of thousands of professionals.

Both bank and nonbanks are starting in — or returning to — this segment as they look to make up for declining originations. But there are a few key issues to consider before taking on the new line of business.