LPS: 2012 Strongest Year for Originations Since 2007

On an annual basis, 2012 was the strongest year for originations since 2007, according to ""Lender Processing Services'"":http://www.lpsvcs.com/Pages/default.aspx (LPS) December Mortgage Monitor.

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The report, based on data for nearly 40 million loans, shows approximately 8.6 million loans were originated last year, a 34 percent increase over 2011.

""Though still a long way off from the historic level of originations that preceded the mortgage crisis, 2012 was the strongest full year of originations we've seen since [COLUMN_BREAK]

2007,"" said Herb Blecher, SVP of LPS Applied Analytics. ""And, while the majority of these new loans were government-backed--84 percent in 2012 as compared to just over 50 percent at the peak--the trend over the last four years does suggest a slowly resurgent non-agency lending market.""

LPS also noted that high loan-to-value (LTV) originations (most likely made under the Home Affordable Refinance Program, or HARP) remained elevated throughout the year, though there was a slight fizzle in the final months. High LTV originations have averaged about 160,000 since March, when the expanded ""HARP 2.0"" was unveiled. There are still an additional 2.6 million borrowers who are potentially eligible to refinance under the program's current requirements.

In addition, LPS estimates nearly 20 percent of active mortgages at the end of 2012 met broad-based refinance criteria. Given the level of price appreciation seen throughout the year (LPS noted prices were up 5.8 percent year-to-date as of November), nearly four million additional borrowers have risen above the conforming thresholds for a traditional refinance. Another 3.4 million are on the cusp of qualifying, LPS said.