A Profile of 2016 Mortgage Borrowers
Technical Report Series
A Profile of 2016 Mortgage Borrowers: Statistics from the National Survey of Mortgage Originations Technical Report 6.0
April 18, 2018
This document was prepared by Robert B. Avery, Mary F. Bilinski, Audrey Clement, Tim Critchfield, Samuel Frumkin, Ian H. Keith, Ismail E. Mohamed, Forrest W. Pafenberg, Saty Patrabansh, and Jay D. Schultz.
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table of Contents 1.
Introduction .................................................................................................................... 1
2.
Comparing the 2016 NSMO with 2016 Home Mortgage Disclosure Act Data ........... 2
3.
Profile of 2016 Mortgage Borrowers .............................................................................. 3
4.
Borrower Knowledge of the Mortgage Process .............................................................. 4
5.
Selecting a Mortgage: Mortgage Broker versus Mortgage Lender ............................. 16
6.
During the Application Process .................................................................................... 23
7.
Closing on a Mortgage ................................................................................................. 27
8.
Satisfaction with Mortgage Terms, Mortgage Process, and Information ..................... 31
9.
Opinions on Homeownership and Financial Responsibility......................................... 34
10.
Recent Changes in Neighborhood Housing .................................................................. 37
11.
Expectations on Neighborhood House Prices and Neighborhood Desirability ............ 40
12.
Financial Expectations .................................................................................................. 42
Appendix. About the National Mortgage Database Project................................................... A-1
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
1. Introduction This is the fourth Technical Report on the responses received to the National Survey of Mortgage Originations (NSMO or survey), which is jointly administered by the Federal Housing Finance Agency (FHFA) and the Consumer Financial Protection Bureau (CFPB). 1 The survey collects information from a representative sample of recent mortgage borrowers about their experiences in choosing and taking out a mortgage. It is designed to provide researchers, policy makers, and other interested parties with comprehensive data about the consumer experience when getting a mortgage. The NSMO is a recurring quarterly mail survey of new mortgage borrowers using a sample drawn from the National Mortgage Database (NMDB®). 2 The NMDB® is a representative 1-in20 sample of closed-end first-lien mortgages reported to Experian, one of the three national credit repositories. From the second quarter of 2016 to the second quarter of 2017, NSMO sent surveys to 23,724 borrowers with mortgages originated in 2016, representing an average sampling rate of 1-in-320. Of the solicited surveys, 6,285 usable responses were received, making the effective response rate for 2016 originations 26.5 percent. 3 A total of 7.6 million closed-end first-lien mortgages were originated in 2016, which means that one average useable survey response is representative of 1,207 mortgages. 4 The NSMO is a voluntary survey, and the questions included in the survey focus on topics such as mortgage shopping behavior, mortgage closing experiences, and other information not readily available from other sources. In completing this survey, borrowers provide information about a range of topics, such as expectations about house price appreciation, critical household financial events, and life events such as unemployment, large medical expenses, or divorce. 1
Reports for 2013, 2014 and 2015 mortgages and other NMDB® documents are available at https://www.fhfa.gov/PolicyProgramsResearch/Programs/Pages/National-Mortgage-Database.aspx and https://www.consumerfinance.gov/data-research/research-reports/technical-reports-national-survey-of-mortgageborrowers-and-national-mortgage-database/. 2 The National Mortgage Database project is a multi-year project being jointly undertaken by the Federal Housing Finance Agency (FHFA) and the Consumer Financial Protection Bureau (CFPB). The project is designed to provide a source of information about the U.S. mortgage market based on a 5 percent sample of residential mortgages. The NMDB® will enable FHFA to meet the statutory requirements of section 1324(c) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended by the Housing and Economic Recovery Act of 2008, to conduct a monthly mortgage market survey. For CFPB, the NMDB® project will support policymaking and research efforts and help identify and understand emerging mortgage and housing market trends. For further information on the NMDB®, see National Mortgage Database Technical Report 1.2. For additional background, also see the Appendix of this Report. 3 There are several ways by which calculations based on the NSMO raw survey responses may not be representative of the population as a whole. Consequently, survey responses must be appropriately weighted. Commonly, in survey sampling, some individuals chosen for the sample are unwilling or unable to participate in the survey. Nonresponse bias (either complete nonresponse to the survey or nonresponse to selected items within the survey) is the bias that results when respondents differ in meaningful ways from non-respondents. To address this nonresponse bias, the NSMO uses weighting to adjust for differential response to the survey. In addition, to address missing information on individual questions within the survey, the NSMO uses statistical methods to impute missing data. The imputation technique makes multiple estimates of missing data to allow for an estimate of the uncertainty attributable to this type of nonresponse. See National Survey of Mortgage Borrowers Technical Report 2.3 for more details. 4 The weighted percentages reported in this technical document represent the respondents who took out a mortgage in 2016. The words “respondent” and “borrower” are used interchangeably throughout the document.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
This Report presents the results from the 6,285 responses to the survey and provides an overview of the mortgage market and borrowers’ experiences in 2016. Section two compares the 2016 NSMO with 2016 Home Mortgage Disclosure Act (HMDA) data. Section three contains information about the overall profile of survey respondents in 2016, including their demographic characteristics and the kind of mortgages they obtained. Sections four through seven describe how the 2016 borrowers shopped for their mortgages and the application and closing processes. Section eight presents information about borrowers’ mortgage outcomes and measures of their satisfaction in the mortgage application and closing process. Section nine discusses borrowers’ opinions on financial responsibility, and section ten examines borrowers’ opinions on the neighborhood where they obtained their mortgage. Sections eleven and twelve discuss borrowers’ expectations for house prices, neighborhood desirability, and their own financial circumstances over the next couple of years. The Appendix to this Report provides details on the overall NMDB® project, as well as the sampling and data preparation procedures for the NSMO.
2. Comparing the 2016 NSMO with 2016 Home Mortgage Disclosure Act Data This section provides a comparison of the 2016 NSMO survey responses with the 2016 HMDA data. This comparison is useful because HMDA data are generally accepted as including close to the total of all first-lien mortgages originated in the United States. As a result, this comparison provides a useful benchmark to validate the overall statistical methodology of NSMO. As shown in Table 1, estimates derived from the NSMO data show that there were approximately 7.1 million first-lien mortgage loans associated with owner-occupied homes in 2016. The NSMO estimates for both the loan count and the market dollar estimates are similar to the HMDA estimates. The average loan size for owner-occupied homes in the NSMO was slightly lower than in HMDA – $244,411 compared with $255,263. Table 1. Comparison of Mortgage Originations, 2016 (Count and Dollar Volume) Mortgage Originations
National Survey of Mortgage Originations (NSMO) Home Mortgage Disclosure Act (HMDA) Volume (Billion Dollars) Count (Thousands)1 Volume (Billion Dollars)1 Count (Thousands)1 Owner-occupied 7,092 1,733 6,916 1,765 Purchase 3,596 866 3,545 896 Refinance 3,496 867 3,371 870 Not owner-occupied 493 105 794 190 Source: National Survey of Mortgage Originations, 2016 and Home Mortgage Disclosure Act, 2016 Notes: The owner-occupied count total from the NSMO does not equal the sum of purchase and refinance counts from the NSMO due to rounding.
The estimate of mortgage loans associated with non-owner-occupied properties from the NSMO data is lower than the estimate from HMDA. HMDA estimates 794,088 such mortgages, 61 percent greater than the number estimated from the NSMO. The NSMO data suggest $105 billion in mortgage originations in 2016 associated with non-owner-occupied properties, while HMDA suggests $190 billion. One explanation for this difference is that HMDA reporting covers some larger mortgages made to business partnerships for non-owner-occupied properties that are not reported to the credit bureaus and, thus, are not represented in the NSMO.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
3. Profile of 2016 Mortgage Borrowers Tables 2 through 5 present characteristics of NSMO respondents who acquired a mortgage in 2016. These tables show the distributions of loan and property characteristics for several demographic groups. Table 2 presents loan type, and Table 3 presents loan size and mortgage term to maturity. Table 4 presents credit score, and Table 5 presents property type. The bottom row of each table shows the percentage distribution of each loan or property characteristic. Table 6 presents information about the household life events experienced by survey respondents over the last couple of years. Loan Type and Loan Size
Table 2 reflects that a slight majority of 2016 mortgage loans reported in the survey were used to purchase a property. Fifty-one percent of survey respondents reported they purchased a home, and 49 percent reported they refinanced 5 an existing mortgage. Owner-occupants represented 94 percent of mortgage borrowers, with 47 percent of borrowers having purchased a home that they occupied and 46 percent having refinanced an existing mortgage for a home they occupied. The remaining 6 percent of borrowers were non-occupant investors (owners of seasonal homes, homes for relatives, and rental or investment homes are categorized as investors). Table 3 reflects that of the 51 percent of respondents who purchased a home, 36 percent were first-time homeowners, 56 percent were repeat homeowners, and the remaining 8 percent were non-occupant investors. Of the 49 percent of respondents who refinanced an existing mortgage, 38 percent refinanced a mortgage for the borrower’s primary residence and borrowed additional money, 56 percent refinanced a mortgage for the borrower’s primary residence without extracting equity, and the remaining 5 percent refinanced a mortgage for a non-owner-occupied investment. About half of all respondents (52 percent) were 45 years old or younger, and 63 percent of home-purchase borrowers were 45 years old or younger. About three-quarters of respondents (73 percent) reported that they were non-Hispanic white, 10 percent reported they were Hispanic white, 8 percent indicated they were Asian, and 6 percent stated that they were Black or African American. Three percent of respondents indicated that they were American Indian or Alaska Native, Native Hawaiian or Pacific Islander, or of more than one race. Three-quarters of the respondents who took out a mortgage in 2016 were in households with two adults living together, with 68 percent reporting they were married and 8 percent reporting they were living with a partner. The percentage of married couples was somewhat higher for refinancers than for home purchasers, and the percentage of borrowers with a partner was higher for home purchases than for refinancers. Almost 25 percent of borrowers indicated that they were single—13 percent single females and 11 percent single males. Overall, 87 percent of households included at least one full-time worker. This percentage was higher for homebuyers 5
In this report, refinances include all non-purchase mortgages, 94 percent of which are traditional refinances or modifications, 3 percent are loans on a mortgage-free property, 3 percent are permanent financing of a construction loan, and 1 percent are mortgages for a change in borrowers.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
(90 percent) than those who refinanced (84 percent). Eighteen percent of borrowers reported that they were on active duty or were veterans of the U.S. military. 6 About 17 percent of respondents reported household income in 2016 of less than $50,000 compared to 53 percent of all households in the United States based on the 2013 Survey of Consumer Finances (SCF). 7 Credit Score and Property Type
Table 4 reflects that 60 percent of survey respondents had a credit score of 720 or higher, 34 percent had a credit score between 620 and 719, and 6 percent had a credit score below 620. Sixty percent of homebuyer respondents had a credit score of 720 or higher, similar to respondents who refinanced. Nineteen percent of homebuyer respondents had a credit score below 680, similar to respondents who refinanced (18 percent). Survey respondents were asked to describe their property type. As shown in Table 5, singlefamily properties were the primary property type used to collateralize the respondent’s mortgage. Eighty-four percent of respondents reported that their property was a single-family detached home, 6 percent townhouses, 5 percent condominiums, 3 percent 2-, 3- and 4-unit dwellings, and 2 percent manufactured homes. Life Events
Many respondents reported that they had experienced one or more life events over the last couple of years. The results are reflected in Table 6. Eight percent of respondents indicated that they had divorced or separated, 13 percent indicated they had married or had a new partner, 8 percent reported experiencing a disability or major illness, 2 percent reported that a disaster had affected their home, 2 percent reported that a disaster had affected their job, 30 percent indicated that they moved up to 50 miles from their previous residence, and 15 percent indicated that they moved 50 miles or more from their previous residence.
4. Borrower Knowledge of the Mortgage Process The survey asked borrowers about their knowledge and familiarity with mortgage terminology and the mortgage process, and about their ability to explain the mortgage process. Borrowers’ knowledge about the mortgage process differed significantly based on demographic characteristics and whether the consumer was shopping for a home and a mortgage at the same time. First-time homebuyers differed significantly from repeat homebuyers in their knowledge about mortgages. The extent of mortgage knowledge also differed for repeat borrowers depending on whether they were refinancing or purchasing a home. 6
The question about military and veteran status was revised in the fifteenth wave of NSMO to match the revised question in the American Community Survey (ACS). Only 6,109 responses up to the fourteenth wave of NSMO were used to calculate this share. 7 See National Mortgage Database Technical Report 3.1 for additional comparison of household income in the 2013 SCF to reported income for borrowers with a 2013 origination captured in the NSMO. For more about the Survey of Consumer Finances including results from the 2013 SCF, see http://www.federalreserve.gov/econresdata/scf/scfindex.htm.
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Respondent Age 35 Years or Younger 36 to 45 46 to 55 56 to 65 Older than 65 Respondent Race/Ethnicity Non-Hispanic White Hispanic and Non-White Hispanic White Asian Black All Other Races4 Respondent Education High School or Less Some School High School Some College Technical School Partial College College Degree Postgraduate Household Income Less than $50,000 Less than $35,000 $35,000 to $49,999 $50,000 to $99,999 $50,000 to $74,999 $75,000 to $99,999 $100,000 to $174,999 $175,000 or More Household Type Couple Married With Partner Single Male Female Military Active Duty or Veteran Active Duty Veteran No Military Service Basic Training Never Served
Characteristics
49.0 15.4 7.5 0.0 0.0 16.5 24.4 29.0 21.6 21.3 23.8 20.9 22.9 20.6 16.3 25.5 13.2 20.9 16.7 29.5 28.5 30.1 22.4 24.3 20.4 12.6 9.5 17.2 14.5 41.1 22.8 24.7 21.3 10.0 22.6 8.4 20.2 15.1 20.6
73.6 49.8 42.4 36.9 38.7 51.2 51.9 57.9 47.5 48.7 51.2 48.8 52.1 48.3 49.2 56.2 46.8 53.4 51.7 57.4 56.2 57.9 54.3 55.9 52.6 46.5 47.1 50.5 48.1 71.6 53.8 52.8 54.7 43.3 55.9 41.7 52.8 48.0 53.2
2
First-Time
All
5 30.1 30.3 30.1 28.4 28.4 28.4
29.0 29.2 27.1 28.1 25.0 30.8
25.8 24.0 26.6 29.6 29.9 29.3 29.8 28.2
25.0 26.7 24.7 29.4 24.8 30.9 28.3 30.5
30.5 24.3 26.3 21.3 25.3 24.1
21.7 31.6 30.6 32.1 31.5
1.0 1.0 1.0 1.4 1.3 1.4
1.5 1.5 1.2 0.8 0.9 0.7
0.3 0.9 0.0 0.4 0.3 0.5 1.7 3.9
0.9 1.0 0.8 0.8 1.6 0.6 1.5 1.8
1.7 0.2 0.4 0.1 0.3 0.0
0.9 0.7 1.9 1.9 2.1
Purchase1 Repeat Seasonal
Table 2. Loan Type, by Demographic and Property Characteristics
(Percentage Distribution)
0.6 0.0 0.7 0.7 0.9 0.6
0.6 0.6 0.9 0.7 0.7 0.7
0.6 0.9 0.5 0.6 0.6 0.7 0.6 0.7
0.7 0.0 0.8 0.9 0.7 0.9 0.4 0.6
0.6 0.8 1.1 0.0 1.0 1.5
0.1 0.6 0.4 0.6 2.7
Relative
1.6 2.1 1.5 2.1 2.3 2.0
2.2 2.3 1.3 1.4 1.6 1.2
1.1 2.0 0.7 1.2 0.9 1.6 1.8 4.8
1.3 1.6 1.3 1.8 3.5 1.2 2.2 2.1
1.9 2.1 1.2 4.4 0.8 1.8
1.8 1.5 2.1 2.4 2.4
Investment
56.7 44.1 58.3 47.2 52.0 46.8
49.5 51.9 28.4 46.2 47.2 45.3
42.6 43.8 42.1 45.7 44.1 47.4 53.5 52.9
51.2 47.9 51.7 50.8 43.8 53.2 46.6 48.3
48.8 48.1 42.1 52.5 51.3 48.8
26.4 50.2 57.6 63.1 61.3
All
Loan Type
21.9 17.9 22.4 18.0 21.4 17.7
18.5 19.1 12.6 19.2 18.8 19.5
17.2 15.7 17.9 21.1 20.3 21.9 19.0 13.9
21.0 17.3 21.6 20.4 17.4 21.5 18.3 16.4
19.0 17.5 17.4 16.5 18.0 19.4
9.8 17.2 22.6 25.1 26.5
Cashout3
32.8 24.2 33.8 26.5 29.6 26.3
28.6 30.2 14.8 24.0 24.9 23.2
24.3 26.5 23.3 22.9 22.2 23.7 31.8 33.2
26.8 30.0 26.3 29.0 25.7 30.1 25.8 28.5
27.3 27.9 21.5 32.8 31.9 26.9
15.5 31.0 31.9 33.7 30.9
0.3 0.0 0.3 0.7 0.2 0.7
0.6 0.7 0.2 0.4 0.6 0.3
0.1 0.1 0.1 0.2 0.0 0.4 0.7 1.7
0.7 0.0 0.8 0.4 0.2 0.4 0.6 0.7
0.6 0.4 0.8 0.2 0.2 0.2
0.1 0.4 1.1 0.8 0.7
Refinance1 Regular Seasonal
1.5 1.6 0.8 2.4 2.5 2.2
0.9 1.3 0.7 1.4 1.4 1.3 1.7 3.5
2.4 0.6 2.7 0.9 0.5 1.0 1.8 2.2
1.6 2.1 1.9 2.9 1.2 2.3
0.9 1.5 1.8 3.0 2.4
Investment
75.3 67.6 7.7 24.6 11.2 13.4
16.9 5.5 11.4 37.3 18.9 18.4 29.4 16.4
11.2 1.6 9.6 25.6 6.4 19.1 36.3 27.0
73.1 26.9 9.5 8.1 6.2 3.2
26.7 25.0 22.1 16.1 10.1
0.3 1.5 17.9 0.0 2.0 2.0 0.3 1.4 15.9 0.2 1.8 79.1 0.0 0.9 5.1 0.3 1.9 74.0 (Continued on the next page)
0.2 0.3 0.0 0.3 0.4 0.2
0.1 0.2 0.1 0.2 0.2 0.1 0.2 0.7
0.2 0.0 0.3 0.2 0.0 0.2 0.2 0.4
0.3 0.2 0.6 0.1 0.0 0.0
0.1 0.0 0.2 0.5 0.7
Relative
Share of All Loans
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
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2
Loan Type 2
Refinance Regular Seasonal
Share of All Loans
All Relative Investment All Relative Investment Cashout3 First-Time1 Employment Full-Time 53.1 20.6 28.7 1.3 0.5 2.0 46.9 17.5 27.1 0.6 0.2 1.5 86.6 Couple, Both 52.3 20.6 27.2 1.6 0.4 2.5 47.7 17.5 28.0 0.8 0.2 1.3 39.1 Couple, One 51.3 16.5 31.4 1.3 0.5 1.7 48.7 17.7 28.8 0.4 0.3 1.5 28.5 Single 57.4 26.9 27.7 1.0 0.5 1.3 42.6 17.1 22.9 0.4 0.2 2.1 19.1 Not Full-Time 39.8 5.5 29.3 1.3 1.8 2.0 60.2 26.3 29.7 0.7 0.4 3.0 13.4 Couple, Neither 38.5 3.1 29.1 2.0 2.0 2.2 61.5 26.3 31.2 0.9 0.4 2.7 7.8 Single 41.7 8.9 29.6 0.2 1.4 1.7 58.3 26.3 27.7 0.4 0.5 3.4 5.6 Credit Score 2 Lower than 620 43.6 22.0 21.6 0.0 0.0 0.0 56.4 26.1 28.6 0.0 0.0 1.7 6.1 620 to 679 53.5 24.4 27.9 0.6 0.3 0.3 46.5 22.2 22.8 0.4 0.0 1.2 18.6 620 to 639 51.1 27.3 23.0 0.6 0.0 0.3 48.9 28.5 20.2 0.0 0.2 0.0 4.6 640 to 659 54.1 27.1 26.1 0.7 0.2 0.0 45.9 20.6 23.8 0.3 0.0 1.3 6.9 660 to 679 54.4 19.9 32.8 0.5 0.6 0.6 45.6 19.7 23.6 0.7 0.0 1.7 7.1 680 to 719 53.3 23.5 27.8 0.7 0.7 0.7 46.7 19.1 25.1 0.8 0.3 1.4 15.0 680 to 699 54.0 23.2 28.4 1.2 0.7 0.4 46.0 19.3 24.3 1.1 0.6 0.7 7.4 700 to 719 52.7 23.8 27.2 0.2 0.7 0.9 47.3 18.8 25.9 0.4 0.0 2.2 7.6 720 or Higher 51.0 15.3 30.1 1.9 0.8 3.0 49.0 16.7 29.4 0.7 0.3 2.0 60.3 720 to 739 51.0 23.2 24.4 1.1 0.1 2.2 49.0 17.5 28.4 0.4 0.3 2.5 9.9 740 or Higher 51.0 13.7 31.2 2.0 0.9 3.2 49.0 16.5 29.6 0.7 0.3 1.9 50.4 Loan Type Purchase 1 100.0 36.2 56.1 2.6 1.2 3.8 0.0 0.0 0.0 0.0 0.0 0.0 51.3 First-Time Homeowner2 100.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 18.6 Repeat Homeowner 100.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 28.8 Seasonal Home 100.0 0.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.3 Relative Home 100.0 0.0 0.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.6 Investment Home 100.0 0.0 0.0 0.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 2.0 Refinance 1 0.0 0.0 0.0 0.0 0.0 0.0 100.0 38.3 56.4 1.2 0.5 3.6 48.7 Homeowner Cashout3 0.0 0.0 0.0 0.0 0.0 0.0 100.0 100.0 0.0 0.0 0.0 0.0 18.6 Homeowner Regular 0.0 0.0 0.0 0.0 0.0 0.0 100.0 0.0 100.0 0.0 0.0 0.0 27.5 Seasonal Home 0.0 0.0 0.0 0.0 0.0 0.0 100.0 0.0 0.0 100.0 0.0 0.0 0.6 Relative Home 0.0 0.0 0.0 0.0 0.0 0.0 100.0 0.0 0.0 0.0 100.0 0.0 0.2 Investment Home 0.0 0.0 0.0 0.0 0.0 0.0 100.0 0.0 0.0 0.0 0.0 100.0 1.7 Property Type Single-family Detached House 49.5 18.0 29.0 1.0 0.3 1.2 50.5 19.7 28.6 0.6 0.2 1.4 84.1 Townhouse, Row House, or Villa 63.2 22.9 31.7 3.5 1.6 3.4 36.8 9.6 24.4 1.3 0.2 1.3 6.1 Mobile or Manufactured Home 55.7 21.3 26.6 3.5 2.6 1.6 44.3 22.6 20.9 0.4 0.5 0.0 2.0 Two-to-Four Unit Dwelling 57.0 16.3 21.4 1.3 4.3 13.7 43.0 17.5 17.0 0.5 0.0 8.0 2.9 Condo, Apartment House, or Co-op 61.1 25.4 25.3 3.5 1.7 5.2 38.9 11.2 21.7 0.2 1.0 4.8 4.7 Other 84.7 0.0 50.5 3.0 6.2 25.0 15.3 0.0 7.9 0.0 0.0 7.4 0.3 All Respondents 51.3 18.6 28.8 1.3 0.6 2.0 48.7 18.6 27.5 0.6 0.2 1.7 100.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score, loan size, mortgage term to maturity, and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the prior mortgage amount or if a mortgage is for a previously mortgage-free property, the mortgage is classified as a cashout refinance. 4. The "all other races" category includes respondents who reported being American Indian/Alaska Native or Native Hawaiian/Pacific Islander and respondents who reported multiple race categories.
Characteristics Purchase Repeat Seasonal
Table 2. Loan Type, by Demographic and Property Characteristics (Continued)
(Percentage Distribution)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
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Respondent Age 35 Years or Younger 36 to 45 46 to 55 56 to 65 Older than 65 Respondent Race/Ethnicity Non-Hispanic White Hispanic and Non-White Hispanic White Asian Black All Other Races2 Respondent Education High School or Less Some School High School Some College Technical School Partial College College Degree Postgraduate Household Income Less than $50,000 Less than $35,000 $35,000 to $49,999 $50,000 to $99,999 $50,000 to $74,999 $75,000 to $99,999 $100,000 to $174,999 $175,000 or More Household Type Couple Married With Partner Single Male Female Military Active Duty or Veteran Active Duty Veteran No Military Service Basic Training Never Served
Characteristics
31.9 23.8 29.7 36.1 38.5 32.0 27.3 31.5 12.4 40.5 27.5 50.8 53.7 50.3 39.7 46.8 37.3 27.7 18.0 64.1 68.4 62.0 38.8 45.5 32.0 15.2 5.7 26.7 25.7 35.9 43.0 39.0 46.4 32.8 25.4 33.7 30.3 31.2 30.2
2.4 1.5 2.3 0.3 2.0 1.6 6.6 4.9 6.8 2.4 2.8 2.3 1.6 0.9 6.9 10.8 5.0 1.5 1.5 1.4 1.0 0.9
7 1.8 1.8 1.8 3.2 2.8 3.5 2.2 0.0 2.5 2.2 3.2 2.1
42.4 50.6 41.3 41.4 45.3 41.2
42.3 42.4 41.4 39.6 41.4 38.0
26.7 20.0 29.9 48.6 45.9 51.4 49.4 27.2
33.4 28.1 34.3 42.5 39.9 43.4 44.4 40.4
42.5 39.3 44.6 31.1 39.2 44.3
43.8 41.9 41.9 39.4 38.2
Loan Size1 $50,000 to $150,001 to $150,000 $300,000
1.8 1.5 1.2 3.3 5.1
$50,000 or Less
22.6 24.0 22.5 26.1 20.4 26.5
29.2 30.1 20.8 14.2 16.7 12.1
2.3 0.8 3.0 11.1 7.1 15.2 34.4 66.2
9.2 13.3 8.6 15.4 10.5 17.0 26.3 40.7
23.1 31.9 21.6 56.2 18.3 26.6
22.5 32.9 27.1 21.2 18.1
More than $300,000
2.9 0.8 3.1 3.0 3.9 3.0
2.8 3.0 1.0 3.0 2.9 3.2
3.8 4.0 3.7 2.6 2.6 2.6 2.8 3.1
4.4 3.1 4.6 3.0 4.0 2.6 2.5 2.9
3.3 2.0 1.8 2.0 2.3 1.8
0.8 2.0 3.0 6.1 5.6
Less than 15 Years
11.1 6.3 11.7 15.2 15.4 15.2
15.1 16.0 6.6 12.1 14.0 10.5
9.4 10.4 8.9 12.2 11.5 13.0 16.5 20.3
14.2 15.6 14.0 11.9 11.7 12.0 13.7 17.5
14.7 13.5 12.0 16.5 10.8 15.3
8.4 15.3 17.9 17.8 14.2
8.9 7.1 9.1 7.0 6.4 7.0
7.4 7.7 4.2 7.2 7.7 6.7
8.0 11.9 6.1 7.1 7.0 7.3 8.3 5.4
9.6 6.2 10.2 7.6 7.0 7.8 7.6 5.8
7.6 6.7 5.4 6.5 10.3 4.1
4.4 8.1 9.3 9.0 6.2
77.1 85.7 76.1 74.8 74.3 74.8
74.7 73.2 88.2 77.7 75.4 79.5
78.8 73.7 81.3 78.0 79.0 77.1 72.4 71.2
71.8 75.1 71.2 77.5 77.4 77.5 76.2 73.8
74.5 77.9 80.8 75.1 76.6 78.8
86.4 74.6 69.8 67.0 74.0
Mortgage Term to Maturity1 15 15 to 30 30 Years Years Years or More
Table 3. Loan Size and Mortgage Term to Maturity, by Demographic, Loan, and Property Characteristics
(Percentage Distribution)
17.9 2.0 15.9 79.1 5.1 74.0
75.3 67.6 7.7 24.6 11.2 13.4
16.9 5.5 11.4 37.3 18.9 18.4 29.4 16.4
11.2 1.6 9.6 25.6 6.4 19.1 36.3 27.0
73.1 26.9 9.5 8.1 6.2 3.2
26.7 25.0 22.1 16.1 10.1
74.1 63.3 10.8 25.8 11.5 14.3
18.9 6.0 12.9 39.4 20.6 18.8 26.6 15.0
10.6 1.6 9.0 24.5 7.0 17.4 37.7 27.2
72.8 27.2 10.7 7.5 5.9 3.2
38.3 24.3 18.2 11.6 7.6
Share of Purchases
76.6 72.1 4.5 23.4 10.9 12.5
14.8 4.9 9.9 35.0 17.1 17.9 32.3 17.8
11.7 1.5 10.2 26.7 5.8 20.9 34.8 26.8
73.3 26.7 8.2 8.8 6.5 3.2
14.5 25.8 26.1 20.9 12.7
Share of Refinances
15.1 20.8 2.1 1.8 12.9 19.1 81.4 76.7 4.8 5.5 76.6 71.2 (Continued on the next page)
Share of All Loans
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
1
Loan Size $50,000 to $150,001 to $150,000 $300,000
More than $300,000
Less than 15 Years
1
Mortgage Term to Maturity 15 15 to 30 30 Years or Years Years More
Share of All Loans
Share of Purchases
Share of Refinances
Employment Full-Time 1.6 29.1 42.4 27.0 2.5 14.3 7.2 76.1 86.6 89.5 83.5 Couple, Both 1.6 24.1 42.4 32.0 2.4 14.4 7.2 76.0 39.1 39.8 38.3 Couple, One 1.6 27.5 43.1 27.8 2.9 15.9 7.3 74.0 28.5 28.4 28.5 Single 1.6 41.7 41.2 15.5 2.1 11.8 6.8 79.3 19.1 21.3 16.7 Not Full-Time 5.6 41.7 36.9 15.8 5.5 14.5 8.5 71.5 13.4 10.4 16.5 Couple, Neither 3.4 37.5 39.0 20.1 5.1 15.4 8.4 71.1 7.8 5.8 9.8 Single 8.7 47.6 34.0 9.7 6.1 13.2 8.5 72.1 5.6 4.5 6.7 Credit Score 1 Lower than 620 4.7 37.8 43.0 14.5 3.3 7.0 11.1 78.6 6.1 5.2 7.1 620 to 679 2.7 35.1 42.8 19.3 1.4 8.1 6.1 84.3 18.6 19.3 17.8 620 to 639 3.5 39.2 44.7 12.7 2.1 11.1 4.6 82.2 4.6 4.6 4.6 640 to 659 1.7 34.7 43.4 20.1 1.4 6.5 5.6 86.4 6.9 7.3 6.5 660 to 679 3.1 32.9 41.0 22.9 1.0 7.7 7.7 83.7 7.1 7.5 6.6 680 to 719 1.8 34.2 42.8 21.2 1.5 12.8 6.8 78.8 15.0 15.6 14.4 680 to 699 2.0 31.3 44.2 22.5 1.4 11.9 6.9 79.8 7.4 7.8 7.0 700 to 719 1.5 37.0 41.4 20.0 1.6 13.7 6.7 77.9 7.6 7.8 7.4 720 or Higher 1.8 27.8 40.8 29.5 3.7 17.4 7.5 71.5 60.3 59.9 60.7 720 to 739 1.8 32.1 41.6 24.5 2.0 12.3 6.6 79.1 9.9 9.8 10.0 740 or Higher 1.8 27.0 40.7 30.5 4.0 18.4 7.6 70.0 50.4 50.0 50.8 Loan Type 3 Purchase 2.4 31.4 42.3 24.0 1.3 6.0 2.1 90.5 51.3 100.0 0.0 First-Time Homeowner1 1.9 38.2 42.4 17.4 0.4 3.7 1.7 94.2 18.6 36.2 0.0 Repeat Homeowner 1.7 25.6 43.3 29.4 1.4 6.4 2.1 90.0 28.8 56.1 0.0 Seasonal Home 11.0 29.9 43.3 15.8 3.3 14.8 6.5 75.4 1.3 2.6 0.0 Relative Home 14.2 46.4 36.5 3.0 3.8 15.1 3.8 77.4 0.6 1.2 0.0 Investment Home 5.8 47.7 27.8 18.7 6.5 12.9 2.8 77.8 2.0 3.8 0.0 3 Refinance 1.9 30.1 40.9 27.1 4.6 23.1 12.8 59.5 48.7 0.0 100.0 Homeowner Cashout4 1.8 31.0 41.7 25.6 4.3 20.9 10.7 64.1 18.6 0.0 38.3 Homeowner Regular 1.9 29.3 40.0 28.8 4.8 24.6 14.6 56.0 27.5 0.0 56.4 Seasonal Home 4.8 12.5 51.6 31.2 8.4 23.1 9.2 59.3 0.6 0.0 1.2 Relative Home 3.3 30.5 66.2 0.0 0.0 21.2 30.1 48.7 0.2 0.0 0.5 Investment Home 2.6 38.3 41.0 18.1 4.2 23.9 5.6 66.3 1.7 0.0 3.6 Property Type Single-family Detached House 1.6 29.6 42.9 25.9 2.9 14.4 7.4 75.3 84.1 81.1 87.2 Townhouse, Row House, or Villa 0.9 31.0 43.2 25.0 1.2 14.3 5.4 79.2 6.1 7.5 4.6 Mobile or Manufactured Home 20.3 59.2 18.6 1.9 11.0 15.2 23.2 50.6 2.0 2.2 1.8 Two-to-Four Unit Dwelling 2.1 32.1 34.9 31.0 1.9 7.1 2.2 88.8 2.9 3.2 2.5 Condo, Apartment House, or Co-op 3.1 37.9 32.7 26.4 0.9 14.7 4.7 79.7 4.7 5.6 3.8 Other 58.5 26.9 11.3 3.3 40.8 45.7 6.2 7.3 0.3 0.4 0.1 All Respondents 2.2 30.7 41.6 25.5 2.9 14.3 7.3 75.4 100.0 100.0 100.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Credit score, loan size, mortgage term to maturity, and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 2. The "all other races" category includes respondents who reported being American Indian/Alaska Native or Native Hawaiian/Pacific Islander and respondents who reported multiple race categories. 3. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 4. If a refinance mortgage amount is higher than the prior mortgage amount or if a mortgage is for a previously mortgage-free property, the mortgage is classified as a cashout refinance.
Characteristics $50,000 or Less
Table 3. Loan Size and Mortgage Term to Maturity, by Demographic, Loan, Property Characteristics (Continued)
(Percentage Distribution)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
8
Respondent Age 35 Years or Younger 36 to 45 46 to 55 56 to 65 Older than 65 Respondent Race/Ethnicity Non-Hispanic White Hispanic and Non-White Hispanic White Asian Black All Other Races2 Respondent Education High School or Less Some School High School Some College Technical School Partial College College Degree Postgraduate Household Income Less than $50,000 Less than $35,000 $35,000 to $49,999 $50,000 to $99,999 $50,000 to $74,999 $75,000 to $99,999 $100,000 to $174,999 $175,000 or More Household Type Couple Married With Partner Single Male Female Military Active Duty or Veteran Active Duty Veteran No Military Service Basic Training Never Served
Characteristics All 19.1 18.2 21.6 16.3 15.1 17.3 21.9 27.1 9.2 30.5 22.5 25.9 33.4 24.7 25.3 22.7 26.2 16.8 11.6 24.4 22.6 25.3 22.0 23.4 20.5 16.1 9.3 18.7 18.3 22.9 18.1 17.5 18.6 27.7 36.2 26.6 16.4 26.4 15.7
Lower than 620 5.1 4.5 8.8 6.9 5.7 5.1 8.9 9.1 4.9 15.2 6.3 9.2 11.4 8.9 9.4 10.5 9.0 4.7 3.8 10.5 9.6 11.0 6.5 6.9 6.1 5.1 2.7
9 5.4 5.2 7.1 8.3 8.2 8.3 9.0 5.2 9.5 5.5 8.0 5.4
7.6 17.3 6.4 3.9 7.5 3.6
4.8 4.7 5.6 4.1 3.5 4.5
6.6 5.7 7.0 5.4 5.6 5.2 4.3 1.1
7.2 8.8 7.0 6.4 2.6 7.6 3.9 2.8
3.8 6.7 9.7 2.7 7.5 6.3
5.8 4.8 3.9 3.6 3.9
9.4 10.1 9.3 6.2 8.8 6.0
6.8 6.7 7.8 7.1 6.9 7.2
9.0 6.7 10.2 8.6 9.3 7.9 5.4 3.5
8.9 8.2 9.0 9.8 10.8 9.4 6.3 4.1
6.6 7.7 7.6 2.8 14.9 6.5
6.9 7.6 7.9 6.0 4.3
620 to 679 620 to 639 640 to 659
10.7 8.8 10.9 6.3 10.1 6.1
7.1 6.9 9.5 7.0 7.0 6.9
8.8 10.2 8.1 7.9 8.5 7.3 6.4 4.7
9.8 16.5 8.7 9.1 9.2 9.1 6.6 4.7
6.9 7.5 9.7 3.8 8.1 9.7
6.3 5.8 9.8 6.6 7.0
660 to 679
Table 4. Credit Score, by Demographic, Loan, and Property Characteristics
(Percentage Distribution)
16.3 15.5 16.4 14.7 17.6 14.5
15.0 14.8 16.8 15.0 16.0 14.0
17.2 17.0 17.2 16.7 15.9 17.6 14.4 10.0
18.0 21.1 17.5 19.2 19.7 19.0 13.9 11.3
14.7 15.7 19.2 10.5 17.4 15.6
15.0 16.3 15.1 15.0 11.4
All
7.4 7.6 7.4 7.4 9.6 7.3
7.6 7.3 10.1 6.8 5.8 7.6
6.9 7.1 6.9 8.5 7.3 9.8 7.7 4.8
9.4 12.8 8.9 9.7 8.4 10.1 6.3 6.0
7.4 7.4 9.3 4.5 7.4 9.4
6.8 9.1 7.8 6.1 6.1
680 to 719 680 to 699
1
Credit Score
8.9 8.0 9.1 7.3 8.0 7.3
7.4 7.5 6.7 8.2 10.2 6.5
10.2 9.9 10.3 8.2 8.6 7.8 6.7 5.1
8.6 8.2 8.7 9.5 11.3 8.9 7.6 5.3
7.3 8.3 9.9 6.0 10.0 6.1
8.2 7.2 7.4 9.0 5.3
700 to 719
47.0 43.1 47.5 63.3 48.0 64.4
60.9 61.7 53.2 58.7 58.3 59.0
47.9 50.8 46.5 54.8 53.8 55.8 64.4 78.1
46.9 34.1 49.0 46.1 47.2 45.7 64.7 73.4
62.8 53.4 44.6 75.4 36.9 55.7
60.8 60.9 54.5 61.7 67.7
All
7.7 7.1 7.7 10.3 9.5 10.3
9.9 9.9 10.7 9.8 10.4 9.2
12.6 14.2 11.8 9.1 9.7 8.4 9.9 9.0
11.0 8.7 11.4 9.3 10.3 9.0 9.7 10.3
10.0 9.6 9.9 10.1 10.1 6.4
13.5 8.7 9.2 8.6 7.0
75.3 67.6 7.7 24.6 11.2 13.4
16.9 5.5 11.4 37.3 18.9 18.4 29.4 16.4
11.2 1.6 9.6 25.6 6.4 19.1 36.3 27.0
73.1 26.9 9.5 8.1 6.2 3.2
26.7 25.0 22.1 16.1 10.1
Share of All Loans
39.3 17.9 36.0 2.0 39.8 15.9 53.1 79.1 38.6 5.1 54.1 74.0 (Continued on the next page)
50.9 51.9 42.5 48.9 47.9 49.7
35.3 36.5 34.7 45.7 44.1 47.4 54.6 69.2
35.9 25.5 37.6 36.8 36.9 36.8 55.0 63.1
52.8 43.9 34.8 65.3 26.8 49.3
47.3 52.2 45.4 53.1 60.7
720 or Higher 720 to 739 740 or Higher
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
620 to 679 620 to 639 640 to 659
680 to 719 680 to 699
1
Credit Score 720 or Higher 720 to 739 740 or Higher
Share of All Loans
All 660 to 679 All 700 to 719 All Employment Full-Time 5.9 18.5 4.5 7.1 6.9 15.6 7.7 7.8 60.0 10.3 49.7 86.6 Couple, Both 5.4 19.0 5.1 7.2 6.8 15.8 8.6 7.2 59.7 10.1 49.6 39.1 Couple, One 5.2 18.2 4.2 6.6 7.4 15.1 7.0 8.1 61.4 10.3 51.1 28.5 Single 8.0 18.0 3.9 7.5 6.6 15.7 6.9 8.8 58.3 10.6 47.8 19.1 Not Full-Time 7.0 18.9 5.0 5.8 8.1 11.5 5.6 5.9 62.6 7.3 55.3 13.4 Couple, Neither 5.5 19.2 5.4 5.8 8.0 10.8 5.0 5.8 64.6 7.5 57.0 7.8 Single 9.2 18.5 4.4 5.8 8.3 12.4 6.4 6.1 59.8 7.0 52.8 5.6 1 Credit Score Lower than 620 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.1 620 to 679 0.0 100.0 24.7 37.1 38.1 0.0 0.0 0.0 0.0 0.0 0.0 18.6 620 to 639 0.0 100.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 4.6 640 to 659 0.0 100.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.9 660 to 679 0.0 100.0 0.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 7.1 680 to 719 0.0 0.0 0.0 0.0 0.0 100.0 49.4 50.6 0.0 0.0 0.0 15.0 680 to 699 0.0 0.0 0.0 0.0 0.0 100.0 100.0 0.0 0.0 0.0 0.0 7.4 700 to 719 0.0 0.0 0.0 0.0 0.0 100.0 0.0 100.0 0.0 0.0 0.0 7.6 720 or Higher 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 16.4 83.6 60.3 720 to 739 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 100.0 0.0 9.9 740 or Higher 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 0.0 100.0 50.4 Loan Type Purchase 3 5.2 19.3 4.6 7.3 7.5 15.6 7.8 7.8 59.9 9.8 50.0 51.3 1 First-Time Homeowner 7.3 24.3 6.7 10.0 7.6 19.0 9.3 9.7 49.5 12.3 37.1 18.6 Repeat Homeowner 4.6 18.0 3.7 6.3 8.1 14.5 7.3 7.2 62.9 8.4 54.5 28.8 Seasonal Home 0.0 8.3 2.1 3.6 2.5 8.2 6.9 1.4 83.5 8.0 75.5 1.3 Relative Home 0.0 8.1 0.0 1.9 6.2 16.3 8.1 8.2 75.6 1.1 74.5 0.6 Investment Home 0.0 2.9 0.6 0.0 2.3 5.0 1.6 3.4 92.1 10.9 81.3 2.0 Refinance 3 7.1 17.8 4.6 6.5 6.6 14.4 7.0 7.4 60.7 10.0 50.8 48.7 Homeowner Cashout4 8.6 22.1 7.0 7.6 7.5 15.3 7.7 7.7 53.9 9.3 44.6 18.6 Homeowner Regular 6.4 15.4 3.4 6.0 6.1 13.7 6.6 7.2 64.5 10.2 54.2 27.5 Seasonal Home 0.0 11.5 0.0 3.4 8.1 19.7 14.5 5.2 68.8 6.0 62.8 0.6 Relative Home 0.0 3.3 3.3 0.0 0.0 17.7 17.7 0.0 79.0 11.0 68.1 0.2 Investment Home 6.1 12.4 0.0 5.3 7.1 12.5 3.0 9.5 69.0 14.1 54.9 1.7 Property Type Single-family Detached House 6.2 19.9 4.8 7.6 7.5 15.4 7.5 7.9 58.5 9.8 48.8 84.1 Townhouse, Row House, or Villa 5.3 13.3 3.8 3.8 5.7 13.6 7.5 6.1 67.8 11.5 56.2 6.1 Mobile or Manufactured Home 16.5 22.0 8.8 5.1 8.1 13.9 10.0 3.9 47.6 8.4 39.2 2.0 Two-to-Four Unit Dwelling 4.3 8.9 1.5 4.4 3.0 17.2 6.8 10.4 69.6 9.1 60.5 2.9 Condo, Apartment House, or Co-op 1.4 7.8 2.4 0.9 4.6 10.5 6.3 4.3 80.3 9.6 70.7 4.7 Other 15.2 7.1 0.0 7.1 0.0 0.0 0.0 0.0 77.7 27.5 50.2 0.3 All Respondents 6.1 18.6 4.6 6.9 7.1 15.0 7.4 7.6 60.3 9.9 50.4 100.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Credit score, loan size, mortgage term to maturity, and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 2. The "all other races" category includes respondents who reported being American Indian/Alaska Native or Native Hawaiian/Pacific Islander and respondents who reported multiple race categories. 3. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 4. If a refinance mortgage amount is higher than the prior mortgage amount or if a mortgage is for a previously mortgage-free property, the mortgage is classified as a cashout refinance.
Characteristics Lower than 620
Table 4. Credit Score, by Demographic, Loan, and Property Characteristics (Continued)
(Percentage Distribution)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
10
Respondent Age 35 Years or Younger 36 to 45 46 to 55 56 to 65 Older than 65 Respondent Race/Ethnicity Non-Hispanic White Hispanic and Non-White Hispanic White Asian Black All Other Races1 Respondent Education High School or Less Some School High School Some College Technical School Partial College College Degree Postgraduate Household Income Less than $50,000 Less than $35,000 $35,000 to $49,999 $50,000 to $99,999 $50,000 to $74,999 $75,000 to $99,999 $100,000 to $174,999 $175,000 or More Household Type Couple Married With Partner Single Male Female Military Active Duty or Veteran Active Duty Veteran No Military Service Basic Training Never Served
Characteristics Townhouse 6.9 5.7 5.7 5.5 6.7 5.4 8.0 6.2 11.5 8.0 4.8 5.0 5.1 5.0 4.1 5.4 3.7 6.6 7.7 6.1 5.8 6.3 5.6 4.7 6.5 6.4 6.7 4.9 4.7 6.0 9.8 6.4 12.7 4.6 1.8 4.9 6.4 2.0 6.7
Single-Family 82.5 86.9 86.1 83.3 77.8 84.7 82.3 84.8 77.1 84.8 83.8 82.8 85.9 82.3 87.2 85.5 87.8 83.8 82.0 81.1 77.9 82.7 84.1 84.1 84.1 86.3 83.0 86.9 87.5 81.7 75.6 78.6 73.0 87.9 89.7 87.6 83.2 90.3 82.7
Table 5. Property Type, by Demographic and Loan Characteristics
(Percentage Distribution)
11 2.6 0.8 2.8 1.9 2.5 1.9
2.0 1.9 3.1 2.0 2.7 1.5
5.0 7.7 3.7 2.7 3.0 2.4 0.5 0.1
5.9 3.3 6.3 2.5 3.0 2.3 1.5 0.6
2.4 1.0 1.5 0.5 0.5 1.7
1.7 1.4 1.6 2.7 4.4
Manufactured
1.7 1.8 1.6 3.1 2.9 3.1
2.5 2.3 4.4 3.8 3.6 4.0
2.9 3.0 2.8 3.0 3.4 2.7 2.1 3.7
2.1 1.2 2.3 3.1 4.0 2.8 2.6 3.3
2.9 2.7 2.9 2.0 2.9 3.4
3.5 1.9 2.0 3.3 4.6
Two-to-Four Unit
Property Type
3.1 6.0 2.8 5.0 2.0 5.2
3.4 3.3 4.8 8.7 8.6 8.7
4.7 5.4 4.4 4.4 4.6 4.1 4.3 6.4
4.0 3.9 4.0 2.9 1.8 3.3 5.1 6.2
4.3 5.9 4.7 9.1 3.8 6.0
5.3 3.6 4.4 5.2 6.1
Condo
75.3 67.6 7.7 24.6 11.2 13.4
16.9 5.5 11.4 37.3 18.9 18.4 29.4 16.4
11.2 1.6 9.6 25.6 6.4 19.1 36.3 27.0
73.1 26.9 9.5 8.1 6.2 3.2
26.7 25.0 22.1 16.1 10.1
0.2 17.9 0.0 2.0 0.2 15.9 0.3 79.1 0.3 5.1 0.3 74.0 (Continued on the next page)
0.3 0.3 0.0 0.1 0.1 0.1
0.1 0.2 0.1 0.2 0.2 0.2 0.5 0.2
0.2 0.6 0.1 0.2 0.4 0.1 0.4 0.3
0.4 0.0 0.0 0.0 0.0 0.4
0.2 0.5 0.3 0.0 0.4
Other
Share of All Loans
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Townhouse
Property Type Manufactured Two-to-Four Unit
Condo
Other
Share of All Loans
Employment Full-Time 84.5 6.0 1.7 2.8 4.7 0.2 86.6 Couple, Both 86.9 5.6 1.5 2.2 3.5 0.4 39.1 Couple, One 87.5 3.9 2.1 2.9 3.4 0.1 28.5 Single 75.1 10.1 1.6 3.8 9.2 0.2 19.1 Not Full-Time 81.2 6.5 4.0 3.4 4.8 0.1 13.4 Couple, Neither 84.2 4.9 4.2 3.1 3.4 0.2 7.8 Single 77.1 8.7 3.6 3.8 6.8 0.0 5.6 Credit Score 2 Lower than 620 85.6 5.3 5.4 2.0 1.1 0.7 6.1 620 to 679 89.8 4.4 2.4 1.4 2.0 0.1 18.6 620 to 639 87.8 5.0 3.8 0.9 2.4 0.0 4.6 640 to 659 92.5 3.3 1.5 1.8 0.6 0.3 6.9 660 to 679 88.5 4.9 2.3 1.2 3.0 0.0 7.1 680 to 719 86.0 5.5 1.9 3.3 3.3 0.0 15.0 680 to 699 84.5 6.2 2.7 2.6 4.0 0.0 7.4 700 to 719 87.5 4.9 1.0 3.9 2.6 0.0 7.6 720 or Higher 81.6 6.8 1.6 3.3 6.3 0.3 60.3 720 to 739 83.2 7.1 1.7 2.6 4.6 0.8 9.9 740 or Higher 81.3 6.8 1.6 3.4 6.6 0.3 50.4 Loan Type 3 Purchase 81.1 7.5 2.2 3.2 5.6 0.4 51.3 First-Time Homeowner2 81.2 7.5 2.3 2.5 6.5 0.0 18.6 Repeat Homeowner 84.7 6.7 1.9 2.1 4.2 0.5 28.8 Seasonal Home 62.9 16.1 5.3 2.7 12.4 0.6 1.3 Relative Home 41.8 15.4 8.2 19.4 12.6 2.6 0.6 Investment Home 52.2 10.5 1.7 19.9 12.4 3.4 2.0 3 Refinance 87.2 4.6 1.8 2.5 3.8 0.1 48.7 4 Homeowner Cashout 88.9 3.1 2.4 2.7 2.8 0.0 18.6 Homeowner Regular 87.5 5.4 1.5 1.8 3.7 0.1 27.5 Seasonal Home 81.3 13.5 1.3 2.6 1.4 0.0 0.6 Relative Home 72.4 5.3 3.8 0.0 18.4 0.0 0.2 Investment Home 67.8 4.6 0.0 13.3 13.2 1.2 1.7 Property Type Single-family Detached House 100.0 0.0 0.0 0.0 0.0 0.0 84.1 Townhouse, Row House, or Villa 0.0 100.0 0.0 0.0 0.0 0.0 6.1 Mobile or Manufactured Home 0.0 0.0 100.0 0.0 0.0 0.0 2.0 Two-to-Four Unit Dwelling 0.0 0.0 0.0 100.0 0.0 0.0 2.9 Condo, Apartment House, or Co-op 0.0 0.0 0.0 0.0 100.0 0.0 4.7 Other 0.0 0.0 0.0 0.0 0.0 100.0 0.3 All Respondents 84.1 6.1 2.0 2.9 4.7 0.3 100.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. The "all other races" category includes respondents who reported being American Indian/Alaska Native or Native Hawaiian/Pacific Islander and respondents who reported multiple race categories. 2. Credit score, loan size, mortgage term to maturity, and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 4. If a refinance mortgage amount is higher than the prior mortgage amount or if a mortgage is for a previously mortgage-free property, the mortgage is classified as a cashout refinance.
Characteristics Single-Family
Table 5. Property Type, by Demographic and Loan Characteristics (Continued)
(Percentage Distribution)
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Divorced or Separated
Married or Had a Partner
Addition to Household
Left Household
Disability or Illness
Disaster to Home
Disaster to Work or Job
Moved Less than 50 Miles
Moved 50 Miles or More
Loan Type Purchase 1 8.3 18.4 3.1 18.0 6.0 6.5 1.2 1.7 48.0 23.0 First-Time Homeowner2 6.4 29.4 3.2 20.5 2.6 5.3 0.6 1.7 53.4 20.5 Repeat Homeowner 10.2 12.4 3.1 17.7 7.3 7.1 1.5 1.8 50.0 26.7 Non-Occupant Owner 3.0 9.8 2.8 8.5 13.6 7.2 2.1 0.3 8.3 8.5 1 Refinance 7.4 7.7 4.4 13.5 8.9 9.8 2.3 1.9 10.2 5.6 Homeowner Cashout3 9.7 7.7 5.1 13.9 10.2 11.9 2.4 2.0 8.6 3.7 Homeowner Regular 5.7 7.6 3.9 13.7 7.9 8.5 1.9 1.7 11.0 6.3 Non-Occupant Owner 8.3 7.8 4.4 9.7 9.5 9.5 4.3 2.9 14.3 11.8 Loan Size $50,000 or Less 4.5 8.9 8.5 2.8 4.1 11.9 4.3 2.5 17.4 10.2 $50,001 to $150,000 9.7 12.2 5.3 12.1 7.2 9.9 1.8 1.6 27.1 9.9 $150,001 to $300,000 8.2 13.8 3.4 16.2 8.1 8.1 1.9 2.3 30.3 16.1 More than $300,000 5.2 13.6 1.9 20.9 7.0 5.6 1.1 1.0 32.8 17.9 Credit Score 2 Lower than 620 9.5 9.7 4.5 10.8 9.3 15.1 2.5 1.1 24.6 10.4 620 to 679 9.7 17.5 4.6 14.9 9.0 10.8 1.8 2.5 28.7 13.1 680 to 719 8.8 13.8 4.1 16.9 8.5 8.6 1.4 2.2 32.0 13.3 720 or Higher 6.9 12.0 3.3 16.4 6.5 6.4 1.7 1.5 29.9 15.7 Respondent Age 35 Years or Younger 5.1 27.5 2.8 28.9 2.0 3.9 1.6 1.3 47.0 19.2 36 to 45 10.1 11.1 1.8 19.8 6.8 5.7 1.3 1.7 30.6 12.9 46 to 55 10.8 8.8 3.1 7.8 12.4 7.5 1.8 2.1 22.1 12.8 56 to 65 7.8 5.1 6.0 5.6 12.8 13.7 2.1 2.8 18.4 10.9 Older than 65 3.2 2.8 8.8 5.5 4.0 17.7 2.1 0.9 15.6 15.8 Respondent Race/Ethnicity Non-Hispanic White 8.0 13.0 3.8 15.6 7.9 8.1 1.9 1.7 30.8 14.6 Hispanic and Non-White 7.3 13.6 3.5 16.5 6.2 8.1 1.3 2.0 26.6 14.3 Respondent Education High School or Less 7.9 8.2 6.7 11.6 7.8 13.1 1.0 2.3 24.3 8.1 Some College 9.2 12.2 4.4 14.2 7.6 11.4 2.3 2.2 26.1 11.6 College Degree 7.6 15.5 3.1 16.5 6.8 6.4 1.4 1.2 32.2 15.5 Postgraduate 6.9 13.0 2.8 18.2 7.9 5.3 2.0 1.9 31.8 18.6 Household Income Less than $50,000 11.6 10.4 7.5 12.6 4.8 13.8 1.9 2.7 29.2 12.1 $50,000 to $99,999 9.0 13.4 4.4 16.6 6.7 9.3 1.9 1.9 31.8 13.6 $100,000 to $174,999 7.0 14.2 2.3 15.3 9.5 6.1 1.6 1.3 27.9 14.9 $175,000 or More 2.9 13.6 1.0 18.4 8.1 3.3 1.5 1.5 28.2 18.5 Household Type Couple 3.1 16.4 2.4 18.9 7.6 8.5 2.0 2.1 29.7 15.3 Single 22.3 3.3 7.7 6.5 6.8 6.9 1.0 0.9 29.5 12.3 All Respondents 7.8 13.2 3.7 15.8 7.4 8.1 1.7 1.8 29.6 14.5 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Death in Household
Table 6. Household Life Events, by Loan and Demographic Characteristics
(Percent Who Experienced Each Event in the Last Couple of Years)
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Mortgage Features
The survey asked respondents to assess their prior knowledge about getting a mortgage and familiarity with basic mortgage loan terms. The results are reflected in Table 7. At most, 12 percent of respondents reported that they were not previously familiar with different mortgage features: the mortgage process (12 percent), the types of mortgages available (11 percent), down payment (9 percent), income requirements (8 percent), interest rate levels (6 percent), or the type of credit history that was expected (3 percent). First-time homebuyers were less likely to indicate that they were previously familiar with the process of taking out a mortgage, the types of mortgages, or interest rates available compared to borrowers who had bought a home previously and to those who refinanced. First-time homebuyers were also more likely to indicate that they were not previously familiar with the income, credit history, down payment, or closing costs required for a mortgage. Generally, younger borrowers and borrowers with lower credit scores or income reported that they had less prior information about the process and qualification requirements for obtaining a mortgage. For example, 25 percent of borrowers 35 years old or younger indicated that they were not familiar with the process of taking out a mortgage. Eighteen percent of households with less than $50,000 in income indicated they were not familiar with the down payment required to purchase a house, and 20 percent indicated they were not familiar with the amount of money needed at closing. Twenty percent of borrowers with credit scores below 620 reported that they were not familiar with the types of mortgages available. The share of borrowers who reported they were not previously familiar with a mortgage feature generally declined as loan amount, education, credit score, and income increased. The number of persons who reported they were unfamiliar with the process was also comparatively higher among Hispanics, non-white borrowers, and single-headed households. Mortgage Process
The percentage of borrowers concerned about qualifying for a mortgage also declined as loan amount, education, credit score, and income increased. For example, 12 percent of non-Hispanic white borrowers reported that they were very concerned with qualifying compared to 26 percent of Hispanic or non-white borrowers. The differences in the percentages of borrowers concerned about qualifying for a mortgage was most noticeable based on credit score: 35 percent of those with scores below 620 were very concerned about qualifying, while 9 percent of borrowers with scores of at least 720 reported that they were very concerned. More than 69 percent of borrowers who refinanced their mortgage or looked for an investment property indicated that they had a firm idea about the type of mortgage they wanted. In contrast, only 30 percent of first-time homebuyers indicated that they had a firm idea of the mortgage they wanted, 18 percent of first-time homebuyers indicated they had little idea of what type of mortgage they wanted, and 52 percent reported they had some idea. The percentage of borrowers who indicated they had a firm idea about the type of mortgage they wanted increased with age and credit score.
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Interest Rates Available
Prior Knowledge (Percent Not at All Familiar with Each Feature) Mortgage Process of Down Income Credit Types Taking Out Payment to Needed to History or Available Qualify Qualify Score Mortgage
Money Needed at Closing
Concerned About Qualifying (Percentage Distribution) Very Somewhat Not at All
Idea About the Mortgage Wanted (Percentage Distribution) Firm Idea Some Idea Little Idea
Loan Type Purchase 1 10.4 15.1 18.5 9.3 10.4 3.3 16.3 19.5 33.4 47.1 50.1 40.1 9.8 First-Time Homeowner2 21.0 26.1 39.4 16.8 19.4 5.7 29.7 26.9 42.7 30.4 29.6 52.4 18.0 Repeat Homeowner 4.2 8.7 6.7 5.1 5.1 1.6 8.7 16.2 29.0 54.8 60.7 33.9 5.3 Non-Occupant Owner 5.5 10.0 6.4 4.3 6.3 4.4 8.5 8.5 22.1 69.3 69.4 26.5 4.1 Refinance 1 2.2 7.5 4.3 8.6 6.4 1.7 8.2 12.3 24.8 62.9 69.1 28.5 2.5 Homeowner Cashout3 2.5 8.0 3.9 9.8 6.6 1.4 7.7 15.3 28.8 55.9 68.5 29.2 2.3 Homeowner Regular 2.1 7.2 4.7 7.7 6.4 1.7 8.6 10.9 22.0 67.0 68.6 28.7 2.7 Non-Occupant Owner 1.0 6.3 1.8 9.1 4.9 3.2 8.4 5.7 24.3 69.9 77.4 20.5 2.1 Loan Size $50,000 or Less 13.2 20.8 15.5 11.9 14.0 5.9 13.7 17.6 34.9 47.6 46.7 44.1 9.2 $50,001 to $150,000 8.9 15.8 16.2 12.4 12.1 3.8 15.6 20.1 31.6 48.3 55.5 36.3 8.3 $150,001 to $300,000 6.0 10.6 10.1 8.8 7.5 2.1 12.4 15.1 29.5 55.4 59.3 34.8 5.9 More than $300,000 3.4 6.6 8.1 4.8 5.1 1.5 8.4 12.4 25.4 62.2 65.1 30.8 4.0 Credit Score 2 Lower than 620 12.6 19.6 16.8 12.5 10.7 3.4 20.1 35.4 40.2 24.4 44.9 45.3 9.7 620 to 679 11.4 14.7 15.4 14.4 12.0 3.8 17.6 30.0 39.3 30.7 49.4 40.8 9.8 680 to 719 6.7 13.2 12.4 8.9 9.5 2.5 15.4 19.7 37.3 43.0 57.2 35.4 7.4 720 or Higher 4.1 9.1 9.7 6.9 6.9 2.1 9.2 8.8 23.0 68.3 64.4 31.1 4.5 Respondent Age 35 Years or Younger 12.5 17.2 24.6 10.7 12.6 3.2 20.6 18.7 33.2 48.0 44.3 44.1 11.6 36 to 45 5.2 9.3 7.4 7.0 7.1 2.1 9.4 16.1 29.4 54.5 58.9 35.5 5.6 46 to 55 3.7 9.0 5.9 7.3 5.8 1.4 9.1 17.9 26.9 55.2 64.4 32.1 3.5 56 to 65 3.3 8.7 6.3 8.7 6.6 2.6 7.7 12.2 26.7 61.1 70.7 25.6 3.6 Older than 65 3.9 10.7 8.5 13.2 9.8 4.2 12.5 10.3 27.5 62.3 71.0 25.1 3.8 Respondent Race/Ethnicity Non-Hispanic White 5.6 10.2 10.7 7.9 7.6 2.4 11.6 12.4 27.7 59.9 60.6 33.6 5.8 Hispanic and Non-White 8.4 14.8 14.0 11.7 10.7 2.9 14.5 25.7 33.3 41.0 55.9 36.8 7.3 Respondent Education High School or Less 10.2 19.4 16.6 15.5 11.2 3.3 16.2 26.7 33.7 39.7 52.3 38.4 9.3 Some College 7.7 13.5 12.0 12.6 9.7 3.5 14.9 20.0 33.1 46.9 57.2 36.5 6.2 College Degree 5.7 9.9 11.2 7.1 7.7 2.1 11.1 13.8 27.8 58.4 59.6 34.4 6.0 Postgraduate 4.6 8.2 9.6 5.3 7.1 1.8 10.1 10.8 25.5 63.7 63.8 30.8 5.3 Household Income Less than $50,000 14.0 21.1 21.1 18.1 15.8 5.5 20.3 29.6 36.9 33.5 48.2 41.2 10.7 $50,000 to $99,999 6.8 13.0 13.4 10.4 9.8 2.9 14.7 19.0 32.6 48.4 57.0 35.8 7.2 $100,000 to $174,999 4.2 7.7 7.2 5.0 4.8 1.3 8.6 10.8 26.0 63.2 61.4 34.0 4.6 $175,000 or More 1.4 4.4 5.4 3.0 4.1 1.0 5.6 4.4 19.4 76.2 72.5 25.1 2.4 Household Type Couple 5.4 10.2 10.1 7.7 7.4 2.1 11.0 15.5 27.7 56.8 61.1 33.7 5.2 Single 9.4 14.8 16.2 12.7 11.8 4.0 16.6 17.7 33.8 48.5 54.1 36.6 9.4 All Respondents 6.4 11.4 11.6 8.9 8.4 2.5 12.4 16.0 29.2 54.8 59.3 34.4 6.2 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Table 7. Prior Mortgage Knowledge, Idea about Mortage Wanted, and Concern about Qualifying, by Loan and Demographic Characteristics
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Ability to Explain Mortgage Process
Table 8 reflects that by the end of the process of obtaining a mortgage, 55 percent of first-time homebuyers and 48 percent of those who refinanced a mortgage felt they were somewhat able to explain the process of taking out a mortgage. Forty percent of first-time homebuyers and 47 percent of those who refinanced felt very confident in their ability to explain the mortgage process. For borrowers with $175,000 or more in income, more than 6 out of 10 were very confident in their ability to explain the process of taking out a mortgage, and fewer than 4 out of 10 borrowers with less than $50,000 in income were very confident in their ability to explain the process. Eight percent of households with incomes less than $50,000 and 9 percent of households in which the respondent had a high school education or less were not confident about their ability to explain the process of taking out a mortgage. Forty-six percent of all respondents reported they would have a difficult time explaining the difference between a prime and a subprime loan. The share of borrowers who were not confident in their ability to explain prime versus subprime loans exceeded half of respondents among first-time homebuyers, borrowers 35 years old or younger, borrowers taking out loans of $150,000 or less, borrowers with household income of less than $100,000, and borrowers with some college or less education. Overall, more than one-quarter of borrowers reported that they could not explain amortization or the difference between the interest rate and the Annual Percentage Rate (APR) on a loan. The percentages of respondents who reported that they were not able to explain these mortgage details were highest among borrowers with a high school diploma or less education, first-time homebuyers, those taking out loans of $50,000 or less, those with household incomes below $50,000, and single households.
5. Selecting a Mortgage: Mortgage Broker versus Mortgage Lender The survey asked borrowers about how they chose their mortgage originator, the number of lenders they considered, and important factors in choosing the lender and the mortgage product. Borrowers reported that they consider many features when selecting a mortgage. Table 9 reflects that about 61 percent of all respondents and 67 percent of respondents who refinanced went to a lender for their mortgage rather than to a mortgage broker. For the smallest loan sizes of $50,000 or less, 88 percent of borrowers went to the lender directly. First-time homebuyers were somewhat more likely than other borrowers to use a broker, and the percentage of them who used a broker increased with loan size. Borrowers initiated contact with the lender or broker 69 percent of the time, lenders initiated contact 13 percent of the time, and a third party initiated contact for 18 percent of respondents. Lenders initiated contact for 19 percent of respondents who refinanced compared to 7 percent of homebuyers. The share of loans for which a third party initiated contact was nearly five times higher for home purchase loans than for refinances (29 percent and 6 percent, respectively). Eight percent of all respondents used housing counselors or completed courses on home ownership, and the share who received housing counseling was higher for first-time homebuyers (23 percent), those with household income less than $50,000 (18 percent), those 35 years old or younger (13 percent), and those with credit scores lower than 620 (10 percent).
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Ability to Explain Mortgage Process (Percentage Distribution) Very Somewhat Not at All
Mortgage Knowledge (Percent Not at All Able to Explain Each Feature) Fixed Versus Prime Versus Interest Rate Amortization of Consequence of Adjustable Rate Subprime Versus APR Loan Not Paying
Loan Type Purchase 1 47.1 48.9 4.0 7.8 50.5 29.1 33.1 7.0 First-Time Homeowner2 39.8 54.5 5.6 10.9 63.4 37.2 45.9 10.0 Repeat Homeowner 49.7 47.6 2.7 5.6 43.8 24.7 26.3 4.8 Non-Occupant Owner 62.1 31.9 6.1 9.5 39.3 22.8 22.7 8.3 1 Refinance 47.4 48.4 4.2 4.9 41.3 24.1 26.6 6.2 Homeowner Cashout3 44.2 51.3 4.6 5.3 43.9 27.3 27.1 6.9 Homeowner Regular 48.8 47.1 4.1 4.6 40.1 22.3 27.3 5.7 Non-Occupant Owner 56.9 40.6 2.5 5.1 35.6 19.3 15.5 6.0 Loan Size $50,000 or Less 42.5 47.2 10.3 13.8 61.5 34.6 45.4 13.8 $50,001 to $150,000 41.7 53.3 5.0 8.0 51.3 29.8 36.6 7.2 $150,001 to $300,000 46.1 49.8 4.1 6.7 48.5 27.8 30.2 6.5 More than $300,000 56.2 41.2 2.6 3.4 34.2 20.3 20.2 5.3 Credit Score 2 Lower than 620 36.4 57.1 6.4 9.2 46.6 32.2 39.9 10.0 620 to 679 42.1 52.0 5.9 7.3 50.8 30.0 35.6 6.1 680 to 719 44.2 51.3 4.5 7.1 49.4 29.4 34.5 7.7 720 or Higher 50.7 46.1 3.2 5.7 43.6 24.4 26.0 6.1 Respondent Age 35 Years or Younger 44.4 52.3 3.4 7.7 58.0 33.0 38.7 7.4 36 to 45 48.7 47.5 3.8 5.8 44.3 26.4 27.2 6.6 46 to 55 49.3 46.6 4.1 5.8 42.6 24.7 26.9 6.2 56 to 65 49.1 46.7 4.2 5.5 38.1 22.4 25.0 4.6 Older than 65 44.1 49.4 6.6 7.3 38.7 21.3 28.0 8.5 Respondent Race/Ethnicity Non-Hispanic White 47.4 48.9 3.7 5.6 44.6 27.1 28.7 5.8 Hispanic and Non-White 46.9 47.9 5.2 8.6 49.8 25.4 33.2 8.8 Respondent Education High School or Less 35.5 55.7 8.8 12.4 56.0 33.3 44.7 12.2 Some College 42.1 53.1 4.8 6.8 50.7 27.4 34.3 6.4 College Degree 49.6 47.2 3.2 5.4 44.9 25.5 27.4 5.1 Postgraduate 53.8 43.4 2.8 4.9 39.0 24.8 23.0 6.4 Household Income Less than $50,000 33.0 58.8 8.2 13.7 60.4 37.0 46.3 11.8 $50,000 to $99,999 44.3 50.9 4.8 7.0 52.7 29.6 34.3 6.9 $100,000 to $174,999 50.2 47.4 2.4 3.4 39.8 22.8 24.9 5.2 $175,000 or More 63.4 35.2 1.4 2.8 27.2 16.2 12.3 2.8 Household Type Couple 49.0 47.1 3.9 5.8 44.6 24.8 28.5 6.0 Single 42.1 53.2 4.7 8.3 50.3 32.3 34.4 8.3 All Respondents 47.3 48.6 4.1 6.4 46.0 26.7 29.9 6.6 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Table 8. Knowledge about the Mortgage Process at the Time of Survey, by Loan and Demographic Characteristics
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table 9. Mortage Application Channel, First Contact, and Housing Counseling, by Loan and Demographic Characteristics Characteristics
Mortgage Application (Percent Who Applied) Directly Through Broker
Contact Initiated by (Percentage Distribution) Borrower Lender Third Party
Housing Counseling (Percent Who Received)
Loan Type Purchase 1 55.3 44.1 64.2 6.6 29.2 12.2 First-Time Homeowner2 51.6 47.8 59.6 5.9 34.5 22.5 Repeat Homeowner 56.7 42.7 66.2 6.8 27.0 6.7 Non-Occupant Owner 62.7 37.3 71.8 8.1 20.1 3.6 1 Refinance 67.0 32.9 74.8 19.3 5.9 3.9 Homeowner Cashout3 66.9 32.8 77.1 16.3 6.6 5.4 Homeowner Regular 67.2 32.7 72.5 22.0 5.5 3.1 Non-Occupant Owner 65.5 34.5 81.9 13.5 4.6 1.9 Loan Size $50,000 or Less 87.9 12.1 79.2 8.0 12.8 17.5 $50,001 to $150,000 66.9 32.9 70.3 12.6 17.1 10.5 $150,001 to $300,000 58.7 40.8 67.6 12.9 19.5 8.3 More than $300,000 55.4 44.3 70.4 13.2 16.4 4.3 Credit Score 2 Lower than 620 47.8 51.1 59.4 22.0 18.6 9.5 620 to 679 55.1 44.3 63.4 16.1 20.4 13.1 680 to 719 58.3 41.6 67.8 12.7 19.5 9.5 64.8 34.9 72.6 10.8 16.5 6.2 720 or Higher Respondent Age 35 Years or Younger 55.8 44.0 67.6 8.3 24.0 13.2 36 to 45 60.0 39.5 68.1 14.0 17.9 7.5 46 to 55 61.0 38.3 72.8 13.0 14.2 6.0 56 to 65 66.8 33.2 71.8 15.1 13.1 5.5 Older than 65 67.8 31.9 65.7 17.5 16.8 5.3 Respondent Race/Ethnicity Non-Hispanic White 63.0 36.7 71.9 11.2 16.9 6.3 Hispanic and Non-White 55.5 44.0 62.6 17.0 20.4 13.2 Respondent Education High School or Less 59.1 40.7 63.0 16.2 20.7 15.8 Some College 57.6 42.0 67.3 14.3 18.4 9.6 College Degree 61.8 37.9 71.1 11.6 17.3 7.1 Postgraduate 63.8 35.7 71.7 11.5 16.8 5.1 Household Income Less than $50,000 58.4 41.4 61.4 14.0 24.6 17.8 $50,000 to $99,999 61.3 38.1 68.3 12.7 19.0 9.8 $100,000 to $174,999 60.4 39.2 71.5 13.1 15.4 3.9 $175,000 or More 64.0 36.0 76.2 11.3 12.5 2.3 Household Type Couple 61.3 38.3 69.6 12.9 17.5 7.3 Single 59.9 39.8 68.8 12.5 18.7 10.9 All Respondents 61.0 38.7 69.4 12.8 17.8 8.2 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Number of Lenders Considered
The survey asked borrowers about the number of lenders they seriously considered when selecting a mortgage. As reflected in Table 10, almost half of all borrowers seriously considered applying to only one lender, more than one-third seriously considered two lenders, and 17 percent indicated that they seriously considered more than two lenders. About the same share of respondents who refinanced (49 percent) considered one lender as homebuyers (48 percent). The percentage of borrowers who considered only one lender was higher for borrowers reporting smaller loan size, lower credit score, less education, and lower household income and for older borrowers. Fifty percent of non-Hispanic white borrowers and 44 percent of non-white or Hispanic borrowers seriously considered only one lender. Overall, 72 percent of borrowers applied to one lender. Sixty-nine percent of homebuyers applied to one lender compared to 75 percent of respondents who refinanced. First-time purchasers were the least likely to apply to one lender at 64 percent. Twenty-seven percent of first-time purchasers applied to two lenders compared with 22 percent for borrowers as a whole. Borrowers aged 35 years old or younger reported applying to two lenders 23 percent of the time. Overall, 5 percent of borrowers applied to three lenders, and 1 percent applied to more than three lenders. The share of non-Hispanic white borrowers who applied to one lender was about 10 percentage points higher than the share for non-white or Hispanic borrowers (75 percent and 65 percent, respectively). Important Factors in Choosing the Lender
The survey asked borrowers about how important a variety of factors were in selecting a lender or broker. Tables 11 and 12 list the responses to these questions. Borrowers indicated that the lender’s reputation and having an established banking relationship with a lender were important considerations in choosing a lender or broker. The lender’s reputation was important to 71 percent of borrowers. A banking relationship was important to 55 percent of borrowers. Having a local office or branch nearby was important to 49 percent of borrowers. Borrowers also identified factors they considered unimportant when selecting a lender. For example, whether the lender spoke the borrower’s primary language was reported as not important by 89 percent of borrowers. Homebuyers were much more likely than borrowers who refinanced to report that a lender used previously was unimportant (76 percent and 48 percent, respectively), and homebuyers were less likely than those refinancing loans to say that an agent or home builder’s recommendation was unimportant (45 percent and 82 percent, respectively). As shown in Table 12, 60 percent of all borrowers refinancing a mortgage reported that using a lender with an established banking relationship was important. Sixty percent of first-time homebuyers and 58 percent of borrowers aged 35 years or younger found recommendations from a friend, relative, or co-worker important in selecting a lender or broker. Homebuyers (55 percent) were much more likely than those refinancing an existing mortgage (18 percent) to report that recommendations from a real estate agent or a home builder were important.
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Number of Lenders Seriously Considered (Percentage Distribution) 2 3 4
Number of Lenders Applied to (Percentage Distribution) 2 3 4
1 5 or More 1 5 or More Loan Type 1 Purchase 47.8 35.4 14.4 1.7 0.7 68.7 24.3 5.5 0.7 0.7 First-Time Homeowner2 45.7 36.0 16.2 1.8 0.4 63.8 26.6 7.2 1.0 1.4 Repeat Homeowner 49.1 35.0 13.6 1.7 0.6 71.3 22.9 4.7 0.6 0.5 Non-Occupant Owner 47.8 36.5 12.2 1.2 2.3 73.0 22.9 4.1 0.0 0.0 Refinance 1 49.3 33.5 13.8 1.8 1.6 75.1 20.1 3.8 0.5 0.6 Homeowner Cashout3 48.8 32.6 15.3 2.2 1.0 72.2 22.0 4.9 0.5 0.4 Homeowner Regular 50.1 33.8 12.7 1.5 1.9 76.8 18.9 3.1 0.5 0.7 Non-Occupant Owner 44.2 37.0 16.0 1.1 1.7 78.3 18.7 2.5 0.0 0.5 Loan Size $50,000 or Less 53.6 33.8 11.8 0.8 0.0 73.3 16.7 9.3 0.4 0.4 $50,001 to $150,000 52.9 33.1 11.6 1.3 1.2 71.6 22.2 4.8 0.7 0.8 $150,001 to $300,000 47.5 35.2 14.5 1.8 1.0 72.1 22.8 3.9 0.6 0.6 More than $300,000 44.4 35.3 16.9 2.2 1.3 71.5 21.8 5.4 0.6 0.8 Credit Score 2 Lower than 620 51.4 30.2 14.7 2.5 1.3 66.3 26.9 4.1 1.5 1.1 620 to 679 45.4 37.8 14.7 1.2 0.9 64.7 27.4 6.2 0.5 1.2 680 to 719 53.1 30.8 13.4 1.9 0.8 71.2 22.6 4.9 0.6 0.8 720 or Higher 48.0 34.9 14.1 1.8 1.2 74.7 20.1 4.2 0.5 0.4 Respondent Age 35 Years or Younger 48.9 34.3 13.9 1.4 1.4 70.7 22.8 5.4 0.8 0.4 36 to 45 46.2 36.5 14.9 1.1 1.2 71.2 21.6 5.4 0.4 1.3 46 to 55 45.5 35.0 16.3 2.0 1.2 71.1 23.2 4.4 0.8 0.5 56 to 65 51.6 32.8 11.9 3.0 0.7 75.0 21.1 3.2 0.5 0.3 Older than 65 54.4 31.7 11.7 1.7 0.6 72.7 22.0 4.1 0.5 0.8 Respondent Race/Ethnicity Non-Hispanic White 50.2 33.7 13.4 1.6 1.0 74.5 20.8 3.6 0.6 0.5 Hispanic and Non-White 43.7 36.8 16.0 2.2 1.3 64.5 26.1 7.5 0.7 1.2 Respondent Education High School or Less 58.3 29.4 11.0 1.1 0.2 69.4 23.3 5.9 0.7 0.7 Some College 51.8 33.9 12.5 0.9 0.9 72.3 22.8 3.7 0.5 0.6 College Degree 46.4 35.9 14.2 2.5 1.0 71.2 22.1 5.2 0.7 0.8 Postgraduate 44.1 35.4 16.8 1.9 1.8 73.2 21.4 4.4 0.6 0.5 Household Income Less than $50,000 52.9 30.1 14.1 1.5 1.4 66.9 23.0 7.7 0.9 1.5 $50,000 to $99,999 50.0 35.1 12.2 1.8 1.0 71.2 23.5 4.1 0.7 0.4 $100,000 to $174,999 46.9 35.2 14.9 2.0 1.1 73.0 21.7 4.1 0.4 0.7 $175,000 or More 43.5 36.6 17.2 1.5 1.1 76.1 19.3 3.8 0.5 0.3 Household Type Couple 48.0 34.8 14.3 1.8 1.2 72.4 22.0 4.5 0.6 0.5 Single 50.2 33.7 13.6 1.6 0.9 70.0 23.1 5.1 0.6 1.1 All Respondents 48.5 34.5 14.1 1.7 1.1 71.8 22.2 4.7 0.6 0.7 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Table 10. Number of Lenders Considered and Applied to, by Loan and Demographic Characteristics
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table 11. Importance of Decision Factors in Choosing the Lender
(Percentage Distribution) Factors
Important
All Mortgages Established banking relationship 54.8 Local office 48.8 Used previously 37.4 Lender is a personal friend 15.7 Lender operates online 39.4 Recommended by a friend/relative/co-worker 40.2 Recommended by an agent/home builder 37.0 Lender reputation 71.0 Spoke borrower's primary language (not English) 10.8 Purchases Established banking relationship 49.9 Local office 54.1 Used previously 23.8 Lender is a personal friend 16.1 Lender operates online 37.5 Recommended by a friend/relative/co-worker 47.8 Recommended by an agent/home builder 55.3 Lender reputation 72.0 Spoke borrower's primary language (not English) 11.0 Refinances Established banking relationship 60.0 Local office 43.2 Used previously 51.7 Lender is a personal friend 15.3 Lender operates online 41.5 Recommended by a friend/relative/co-worker 32.3 Recommended by an agent/home builder 17.7 Lender reputation 69.9 Spoke borrower's primary language (not English) 10.6 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses.
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Importance of Factors
Not Important 45.2 51.2 62.6 84.3 60.6 59.8 63.0 29.0 89.2 50.1 45.9 76.2 83.9 62.5 52.2 44.7 28.0 89.0 40.0 56.8 48.3 84.7 58.5 67.7 82.3 30.1 89.4
Recommended by Friend/Relative/Co-worker Important Not Important
Recommended by Agent/Home Builder Important Not Important
Loan Type 1 Purchase 49.9 50.1 47.8 52.2 55.3 44.7 First-Time Homeowner2 48.3 51.7 60.3 39.7 61.7 38.3 Repeat Homeowner 50.2 49.8 41.6 58.4 53.2 46.8 Non-Occupant Owner 55.5 44.5 33.4 66.6 40.6 59.4 1 Refinance 60.0 40.0 32.3 67.7 17.7 82.3 Homeowner Cashout3 60.3 39.7 31.4 68.6 15.8 84.2 Homeowner Regular 59.7 40.3 33.1 66.9 18.8 81.2 Non-Occupant Owner 60.1 39.9 29.9 70.1 18.5 81.5 Loan Size $50,000 or Less 64.6 35.4 26.4 73.6 23.7 76.3 $50,001 to $150,000 58.8 41.2 35.3 64.7 34.6 65.4 $150,001 to $300,000 53.3 46.7 41.8 58.2 39.3 60.7 More than $300,000 51.6 48.4 44.8 55.2 37.3 62.7 2 Credit Score Lower than 620 56.3 43.7 30.7 69.3 37.9 62.1 620 to 679 53.0 47.0 40.7 59.3 42.9 57.1 680 to 719 51.7 48.3 42.6 57.4 40.0 60.0 720 or Higher 56.0 44.0 40.5 59.5 34.3 65.7 Respondent Age 35 Years or Younger 53.3 46.7 57.6 42.4 51.9 48.1 36 to 45 54.0 46.0 43.9 56.1 38.5 61.5 46 to 55 55.3 44.7 34.9 65.1 31.5 68.5 56 to 65 56.4 43.6 25.4 74.6 25.3 74.7 Older than 65 57.1 42.9 20.5 79.5 24.5 75.5 Respondent Race/Ethnicity Non-Hispanic White 53.5 46.5 38.7 61.3 34.7 65.3 Hispanic and Non-White 58.3 41.7 44.3 55.7 43.4 56.6 Respondent Education High School or Less 58.1 41.9 35.1 64.9 37.6 62.4 Some College 55.2 44.8 37.5 62.5 36.9 63.1 College Degree 54.0 46.0 43.1 56.9 38.6 61.4 Postgraduate 54.2 45.8 41.1 58.9 34.7 65.3 Household Income Less than $50,000 58.7 41.3 38.1 61.9 44.6 55.4 $50,000 to $99,999 53.5 46.5 41.2 58.8 38.1 61.9 $100,000 to $174,999 54.9 45.1 40.5 59.5 34.0 66.0 $175,000 or More 53.6 46.4 39.6 60.4 32.1 67.9 Household Type Couple 54.8 45.2 39.3 60.7 36.5 63.5 Single 55.1 44.9 43.0 57.0 38.6 61.4 All Respondents 54.8 45.2 40.2 59.8 37.0 63.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Established Banking Relationship Important Not Important
Table 12. Importance of Decision Factors in Choosing the Lender, by Loan and Demographic Characteristics
(Percentage Distribution)
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Important Factors in Choosing the Mortgage
The survey asked how important a variety of mortgage terms or features were in selecting a mortgage. As shown in Table 13, a low interest rate was important to 98 percent of borrowers, a fixed-rate mortgage was important to 90 percent, and a low APR was important to 88 percent. Low closing fees were important to 84 percent of borrowers. Overall, 61 percent of respondents reported that a low down payment was important. As reflected in Table 14, borrowers with credit scores below 620 (82 percent), borrowers with at most a high school education (75 percent), borrowers with income below $50,000 (74 percent), and first-time homebuyers (71 percent) said that a low down payment was important in choosing the mortgage. A low monthly payment was important to 81 percent of all borrowers. A low monthly payment was important to at least 88 percent of borrowers with a high school education or less, those with credit scores below 680, and those with household income below $50,000.
6. During the Application Process The survey asked borrowers about what additional information, if any, a lender asked them to provide during the mortgage application process. The survey found that purchase-mortgage borrowers were more likely to be requested for additional information by a lender than refinance borrowers. Table 15 shows that 16 percent of all borrowers reported being asked to resolve problems that appeared on a credit report. The share of borrowers who reported lender requests to fix problems with their credit reports differed sharply by credit score: 39 percent of borrowers with credit score lower than 620 and 29 percent of borrowers with credit scores between 620 and 679 were asked by the lender to resolve a problem, compared to 19 percent of borrowers with scores between 680 and 719 and 9 percent of borrowers with scores 720 or greater. About 58 percent of respondents reported answering follow-up requests for more information, and 18 percent reported having to redo paperwork during the application process. The percent of borrowers who redid paperwork was fairly steady across groups defined by demographics and loan characteristics. In contrast, those borrowers who were asked follow-up questions varied more noticeably. Sixty-four percent of borrowers with loans of more than $300,000 had to answer follow-up requests, while 44 percent of borrowers with loans of $50,000 or less received such requests. The percentage of borrowers who responded to follow-up requests also rose with income and education, but the percentage fell with credit score. Purchasers were also more likely to have answered follow-up questions than those who refinanced. Seven percent of borrowers reported needing multiple appraisals. The percentage of borrowers who required multiple appraisals was somewhat higher for first-time homebuyers, borrowers with credit scores below 680, and Hispanic and non-White borrowers. About 24 percent of all borrowers had to delay their closing date. Delays were more common for purchase mortgages than for refinances. The percentage of respondents who reported that the closing date had been delayed ranged from 27 to 33 percent across homebuyers and 17 to 29 percent for borrowers who refinanced.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table 13. Importance of Decision Factors in Choosing the Mortgage
(Percentage Distribution) Factors
Important
All Mortgages Low interest rate 97.9 Low APR 87.5 Low closing fees 83.9 Low down payment 61.2 Low monthly payment 80.7 Fixed interest rate 89.9 Term less than 30 years 59.8 No mortgage insurance 54.8 Purchases Low interest rate 97.1 Low APR 87.3 Low closing fees 83.2 Low down payment 64.3 Low monthly payment 81.5 Fixed interest rate 89.7 Term less than 30 years 68.7 No mortgage insurance 50.0 Refinances Low interest rate 98.7 Low APR 87.8 Low closing fees 84.5 Low down payment 58.0 Low monthly payment 79.8 Fixed interest rate 90.1 Term less than 30 years 50.3 No mortgage insurance 59.9 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses.
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Importance of Factors
Not Important 2.1 12.5 16.1 38.8 19.3 10.1 40.2 45.2 2.9 12.7 16.8 35.7 18.5 10.3 31.3 50.0 1.3 12.2 15.5 42.0 20.2 9.9 49.7 40.1
Low Monthly Payment Important Not Important
No Mortgage Insurance Important Not Important
Loan Type 1 Purchase 64.3 35.7 81.5 18.5 50.0 50.0 First-Time Homeowner2 71.4 28.6 86.4 13.6 42.9 57.1 Repeat Homeowner 62.6 37.4 80.3 19.7 54.4 45.6 Non-Occupant Owner 42.8 57.2 67.1 32.9 51.1 48.9 1 Refinance 58.0 42.0 79.8 20.2 59.9 40.1 Homeowner Cashout3 57.9 42.1 80.1 19.9 60.4 39.6 Homeowner Regular 59.0 41.0 80.1 19.9 59.9 40.1 Non-Occupant Owner 48.4 51.6 74.0 26.0 56.5 43.5 Loan Size $50,000 or Less 61.1 38.9 77.8 22.2 47.3 52.7 $50,001 to $150,000 65.2 34.8 81.3 18.7 48.4 51.6 $150,001 to $300,000 62.9 37.1 81.5 18.5 55.8 44.2 More than $300,000 53.7 46.3 78.8 21.2 61.5 38.5 2 Credit Score Lower than 620 82.4 17.6 91.8 8.2 53.7 46.3 620 to 679 75.5 24.5 89.2 10.8 49.3 50.7 680 to 719 69.1 30.9 86.1 13.9 54.5 45.5 720 or Higher 52.7 47.3 75.5 24.5 56.7 43.3 Respondent Age 35 Years or Younger 65.2 34.8 84.1 15.9 50.1 49.9 36 to 45 61.9 38.1 79.8 20.2 57.6 42.4 46 to 55 62.1 37.9 78.1 21.9 57.9 42.1 56 to 65 57.5 42.5 80.2 19.8 53.6 46.4 Older than 65 53.2 46.8 80.0 20.0 55.3 44.7 Respondent Race/Ethnicity Non-Hispanic White 57.7 42.3 78.9 21.1 53.9 46.1 Hispanic and Non-White 70.7 29.3 85.5 14.5 57.4 42.6 Respondent Education High School or Less 74.7 25.3 88.1 11.9 53.7 46.3 Some College 67.5 32.5 85.7 14.3 53.6 46.4 College Degree 60.1 39.9 80.1 19.9 55.6 44.4 Postgraduate 51.3 48.7 73.5 26.5 55.3 44.7 Household Income Less than $50,000 73.7 26.3 88.3 11.7 49.6 50.4 $50,000 to $99,999 67.0 33.0 84.3 15.7 52.1 47.9 $100,000 to $174,999 57.1 42.9 78.7 21.3 59.2 40.8 $175,000 or More 42.5 57.5 67.9 32.1 58.4 41.6 Household Type Couple 60.7 39.3 80.2 19.8 54.7 45.3 Single 62.9 37.1 81.8 18.2 55.1 44.9 All Respondents 61.2 38.8 80.7 19.3 54.8 45.2 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Low Down Payment Important Not Important
Table 14. Importance of Decision Factors in Choosing the Mortgage, by Loan and Demographic Characteristics
(Percentage Distribution)
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table 15. Additional Steps Taken in the Mortgage Process, by Loan and Demographic Characteristics
(Percent Who Took Each Step) Characteristics
Resolved Credit Answered FollowReport Issues up Requests
Had Multiple Appraisals
Redid Paperwork Due to Delays
Delayed Closing Date
Loan Type Purchase 1 20.3 66.6 8.1 21.0 29.1 First-Time Homeowner2 25.4 68.6 10.4 24.1 31.1 Repeat Homeowner 18.8 64.6 6.9 18.9 27.3 Non-Occupant Owner 7.6 71.3 6.2 22.5 33.2 Refinance 1 11.7 48.1 5.3 15.1 18.2 Homeowner Cashout3 12.8 51.8 6.1 16.1 19.4 Homeowner Regular 10.8 44.2 4.8 14.1 16.5 Non-Occupant Owner 13.0 61.9 4.1 17.5 28.5 Loan Size $50,000 or Less 16.1 44.3 4.5 20.6 25.0 $50,001 to $150,000 17.5 54.2 7.6 19.2 25.6 $150,001 to $300,000 16.4 56.9 7.0 17.4 23.3 More than $300,000 14.1 63.8 5.5 17.7 22.4 Credit Score 2 Lower than 620 39.0 62.3 8.8 23.3 34.2 620 to 679 29.1 62.8 10.3 24.0 28.4 680 to 719 18.9 59.2 7.3 19.5 28.1 9.1 55.0 5.2 15.4 20.3 720 or Higher Respondent Age 35 Years or Younger 16.6 61.3 7.8 18.4 26.0 36 to 45 16.1 58.3 6.7 16.5 21.5 46 to 55 18.0 56.7 6.4 20.0 25.9 56 to 65 15.2 54.9 6.1 16.2 21.0 Older than 65 12.2 52.0 5.4 20.4 23.9 Respondent Race/Ethnicity Non-Hispanic White 14.7 56.7 6.3 17.4 22.9 Hispanic and Non-White 19.9 59.8 7.9 20.0 26.4 Respondent Education High School or Less 21.5 54.2 9.3 20.9 25.0 Some College 19.0 55.1 6.7 19.8 24.9 College Degree 13.7 56.9 6.3 16.3 23.0 Postgraduate 14.5 62.2 6.2 17.9 23.5 Household Income Less than $50,000 22.2 57.5 9.2 22.2 28.8 $50,000 to $99,999 17.3 55.8 7.5 18.7 24.4 $100,000 to $174,999 13.8 56.7 5.1 15.2 20.9 $175,000 or More 11.5 63.1 5.2 17.8 22.5 Household Type Couple 15.6 57.4 6.4 17.9 23.5 Single 17.6 58.2 7.7 18.8 24.8 All Respondents 16.1 57.6 6.7 18.1 23.8 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
7. Closing on a Mortgage The survey asked questions about the sources of information used by borrowers about their closing documents, funding sources of closing costs, finding a settlement agent, title insurance, and other features of the mortgage. Tables 16 to 18 reflect the responses. Source of Information on Closing Documents
Seventy-one percent of borrowers reported seeking information or input from the lender or broker on closing documents. Thirty percent of all borrowers and 64 percent of first-time homebuyers asked their real estate agent for input about their closing documents. Eight to 22 percent of borrowers sought input from the settlement agent, an attorney, the title agent, or a trusted friend, and 1 percent turned to a housing counselor for input on the mortgage closing. The percentage of borrowers seeking input on closing documents was uniformly higher for homebuyers than for refinancing borrowers. Closing Costs
The survey asked borrowers to report who paid any of the closing costs. Table 17 reflects that the borrower paid at least some of the closing costs on 62 percent of loans. In purchase transactions, 81 percent of borrowers paid all closing costs, and the lender and seller were less likely to have paid some of the closing costs (12 percent and 32 percent of loans, respectively). For refinances, the lender paid some or all of closing costs for 24 percent of the loans and the borrower paid some or all of the closing costs for 42 percent. Because closing costs were funded by multiple sources, the percentages do not add up to 100 percent. Closing costs were added to the mortgage amount on 38 percent of loans overall – 18 percent of purchases and 58 percent of refinances. Selecting Settlement Agent
The survey asked respondents about their search for a settlement agent and about the features present in the mortgage they obtained. Table 18 reflects the responses to these questions. Twothirds of respondents indicated that the lender recommended the settlement agent. More than one-fifth of borrowers overall indicated they selected an agent they had used previously, with slightly greater shares for non-occupant purchasers and those who refinanced. Ten percent of borrowers shopped around for a settlement agent to handle their closing, with the highest share for first-time homebuyers. Mortgage Features
Seventy-nine percent of borrowers reported that their mortgages included an escrow account for taxes or homeowner insurance, a higher percentage on purchases than on refinances. Three percent of borrowers reported loans that included a pre-payment penalty and 2 percent reported that their loan included a balloon payment feature.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table 16. Sources of Input About Closing Documents, by Loan and Demographic Characteristics Characteristics Lender or Broker
Sources of Input About Closing Documents (Percentage Who Sought Input from Each Source) Personal Real Estate Settlement Title Agent Trusted Attorney Agent Agent Friend
Housing Counselor
Loan Type Purchase 1 79.0 11.4 53.0 26.2 18.7 28.0 2.0 First-Time Homeowner2 80.6 12.8 63.9 22.8 20.3 46.5 3.1 Repeat Homeowner 79.1 10.5 48.1 27.6 17.4 17.0 1.1 Non-Occupant Owner 70.4 11.6 37.3 32.1 20.1 20.8 3.4 Refinance 1 63.3 3.6 4.7 17.3 8.8 11.2 0.4 Homeowner Cashout3 61.1 2.8 4.6 15.7 9.5 11.2 0.6 Homeowner Regular 64.8 3.5 4.8 17.7 7.9 11.4 0.3 Non-Occupant Owner 62.3 11.4 5.5 25.2 12.8 8.8 0.5 Loan Size $50,000 or Less 60.8 3.0 20.5 14.4 14.3 22.9 7.1 $50,001 to $150,000 69.2 7.3 30.0 16.5 15.5 20.8 1.2 $150,001 to $300,000 71.4 7.8 30.5 22.3 13.8 19.9 1.3 More than $300,000 74.6 8.1 28.1 28.4 12.0 18.2 0.7 Credit Score 2 Lower than 620 68.3 8.4 30.3 14.6 11.4 16.4 2.0 620 to 679 70.1 6.8 30.9 20.9 15.5 20.8 2.0 680 to 719 72.6 9.0 32.5 20.3 16.0 19.6 1.4 720 or Higher 71.7 7.5 28.3 23.3 13.1 19.9 0.9 Respondent Age 35 Years or Younger 78.0 9.0 47.0 20.8 15.0 38.3 2.0 36 to 45 70.9 7.0 28.0 22.9 14.7 19.0 1.4 46 to 55 68.5 8.4 23.5 21.8 13.7 12.1 0.7 56 to 65 66.0 7.1 17.5 21.1 12.8 8.3 0.8 Older than 65 69.4 4.6 19.5 23.4 10.8 7.9 0.8 Respondent Race/Ethnicity Non-Hispanic White 71.2 7.8 28.5 20.9 13.1 19.8 1.0 Hispanic and Non-White 71.6 7.2 32.4 24.4 16.0 19.7 2.0 Respondent Education High School or Less 64.2 7.7 26.4 17.3 15.1 17.2 3.0 Some College 70.0 6.1 29.4 20.0 14.5 16.6 1.2 College Degree 73.0 7.9 30.3 21.8 13.6 22.6 0.8 Postgraduate 73.2 8.7 29.9 25.7 13.2 20.2 1.1 Household Income Less than $50,000 68.1 7.6 34.4 17.8 16.9 23.9 2.8 $50,000 to $99,999 71.8 7.6 32.6 20.7 14.0 21.6 1.3 $100,000 to $174,999 72.9 7.0 25.6 22.1 12.1 17.2 0.5 $175,000 or More 70.7 8.9 24.4 28.4 13.6 16.2 0.7 Household Type Couple 71.9 7.2 28.8 22.5 13.6 17.9 1.1 Single 69.8 8.9 31.7 20.2 14.6 25.4 1.6 71.3 7.6 29.5 21.9 13.9 19.8 1.2 All Respondents Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table 17. Source of Funding for the Closing Costs, by Loan and Demographic Characteristics
(Percent Who Reported Each Source) Characteristics
By Borrower
Closing Costs Paid By By Lender Seller
By Adding to Mortgage
Loan Type Purchase 1 81.2 11.8 31.5 18.1 First-Time Homeowner2 79.8 12.3 39.1 13.8 Repeat Homeowner 81.6 11.5 28.1 20.3 Non-Occupant Owner 84.6 11.7 19.8 21.5 1 Refinance 41.6 24.4 0.0 58.4 3 Homeowner Cashout 31.4 19.2 0.0 72.0 Homeowner Regular 47.1 27.9 0.0 49.1 Non-Occupant Owner 56.8 24.7 0.0 58.3 Loan Size $50,000 or Less 57.3 21.3 16.9 43.5 $50,001 to $150,000 59.6 14.0 16.4 40.3 $150,001 to $300,000 61.7 17.4 18.0 36.9 More than $300,000 65.5 23.2 12.7 35.2 Credit Score 2 Lower than 620 55.8 19.7 14.0 42.0 620 to 679 56.3 15.8 20.7 41.4 680 to 719 54.8 17.6 18.7 41.5 720 or Higher 66.0 18.5 14.3 35.2 Respondent Age 35 Years or Younger 69.8 16.5 29.1 23.8 36 to 45 64.1 18.8 15.6 33.6 46 to 55 59.0 17.3 11.2 42.3 56 to 65 53.4 19.1 7.1 51.3 Older than 65 55.6 18.8 8.6 52.8 Respondent Race/Ethnicity Non-Hispanic White 61.8 17.5 16.2 39.3 Hispanic and Non-White 62.1 19.2 16.1 33.3 Respondent Education High School or Less 56.7 17.2 13.6 40.2 Some College 57.3 15.4 15.2 40.7 College Degree 62.1 19.0 18.0 37.1 Postgraduate 68.2 19.1 15.6 34.5 Household Income Less than $50,000 56.6 16.0 19.2 36.9 $50,000 to $99,999 61.8 15.9 19.7 40.1 $100,000 to $174,999 61.5 20.1 13.2 38.4 $175,000 or More 68.4 20.6 10.1 31.5 Household Type Couple 61.3 18.5 16.1 37.2 Single 63.8 16.2 16.3 39.2 All Respondents 61.9 17.9 16.2 37.7 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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Settlement Agent Selection (Percent Who Used Each Method) Lender Recommended Previous Agent
Shopped Around
Prepayment Penalty
Mortgage Features (Percent with Each Feature) Escrow Balloon Account Payment
Interest-Only Payment
Loan Type Purchase 1 66.2 19.0 11.5 2.6 82.5 1.9 4.9 First-Time Homeowner2 67.3 11.8 13.6 3.1 83.6 1.9 6.2 Repeat Homeowner 66.9 21.6 10.2 2.2 84.2 1.8 3.9 Non-Occupant Owner 56.3 34.1 11.1 2.9 65.2 2.6 5.5 1 Refinance 66.1 22.6 8.5 2.5 74.5 1.2 4.3 Homeowner Cashout3 65.3 22.6 8.5 2.3 75.3 1.1 4.2 Homeowner Regular 66.4 22.3 8.5 2.6 74.7 1.0 4.3 Non-Occupant Owner 68.0 26.0 8.7 2.3 65.9 2.7 4.0 Loan Size $50,000 or Less 63.7 24.7 8.4 4.0 57.0 5.6 9.8 $50,001 to $150,000 63.5 19.0 10.4 3.5 79.7 1.2 5.0 $150,001 to $300,000 68.8 20.7 9.5 2.0 82.1 1.2 4.0 More than $300,000 65.3 22.6 10.7 2.0 73.3 2.1 4.6 Credit Score 2 Lower than 620 66.9 18.0 9.6 2.4 87.7 1.9 4.9 620 to 679 67.8 18.2 11.7 3.0 83.4 1.3 5.0 680 to 719 68.3 20.8 8.9 3.3 83.8 1.2 6.0 720 or Higher 65.0 21.7 9.8 2.2 74.9 1.6 4.1 Respondent Age 35 Years or Younger 65.0 19.9 12.7 2.7 83.8 1.7 4.5 36 to 45 66.7 21.5 10.5 3.2 79.4 1.0 4.5 46 to 55 67.4 21.5 9.0 2.2 77.3 1.4 5.2 56 to 65 64.5 20.1 8.0 1.4 74.8 1.9 4.1 Older than 65 67.9 20.4 7.4 3.0 72.0 2.3 4.3 Respondent Race/Ethnicity Non-Hispanic White 66.5 21.1 9.1 2.0 79.7 1.4 4.3 Hispanic and Non-White 65.3 19.6 12.5 3.9 75.7 1.8 5.2 Respondent Education High School or Less 65.8 21.8 10.0 4.8 76.2 1.8 6.9 Some College 66.1 20.4 9.3 1.8 80.3 0.8 5.1 College Degree 65.7 20.0 10.1 2.6 79.6 1.8 4.2 Postgraduate 67.0 21.6 10.6 2.1 76.7 1.7 3.6 Household Income Less than $50,000 65.0 19.2 10.0 4.3 78.1 1.6 6.9 $50,000 to $99,999 66.2 20.8 10.4 2.2 82.2 1.3 4.7 $100,000 to $174,999 67.4 20.5 9.7 2.2 79.3 1.7 3.3 $175,000 or More 65.0 22.6 9.9 1.9 69.7 1.6 4.2 Household Type Couple 66.5 21.0 9.6 2.6 78.2 1.7 4.6 Single 65.2 19.7 11.3 2.2 80.0 1.0 4.4 All Respondents 66.2 20.7 10.0 2.5 78.6 1.5 4.6 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Table 18. Settlement Agent Selection and Mortgage Features, by Loan and Demographic Characteristics
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
8. Satisfaction with Mortgage Terms, Mortgage Process, and Information The survey asked borrowers about their satisfaction with the terms, interest rate, and closing costs on their most recent mortgages. The survey also asked borrowers about their satisfaction with the lender or broker used by the borrower, the application and closing process, and the mortgage disclosure documents provided to the borrower. Tables 19 to 21 reflect the responses to these questions. Satisfaction with Overall Mortgage Terms
Seventy-nine percent of respondents indicated that they were very satisfied with the general terms of their mortgage, and an additional 20 percent indicated that they were somewhat satisfied. Two percent of respondents indicated that they were not at all satisfied with their mortgage terms. There was little variation in reported satisfaction with mortgage terms across groups of borrowers. Satisfaction with Interest Rate
Seventy-three percent of respondents indicated that they were very satisfied that they received the lowest interest rate for which they could qualify, and 23 percent reported they were somewhat satisfied. Overall, 4 percent of borrowers reported that they were not satisfied that they received the lowest interest rate for which they could qualify. Borrowers older than 65 years (9 percent), non-occupant homebuyers (9 percent), and borrowers taking loans of $50,000 or less (9 percent) were slightly more likely to report being dissatisfied with their interest rate. Satisfaction with Closing Costs
Respondents were less likely to report that they were very satisfied that they received the lowest closing costs than to report satisfaction with overall terms and interest rates. Approximately 58 percent were very satisfied that they had received the lowest closing costs, and 34 percent were somewhat satisfied that they received the lowest closing costs. Nine percent were not satisfied that they had received the lowest closing costs. Borrowers older than 65 years (13 percent), borrowers with household income less than $50,000 (11 percent), and Hispanic or non-white borrowers (11 percent) were more likely to report being dissatisfied with their closing costs than other groups. Satisfaction with Lender or Broker
Table 20 reflects respondents’ overall satisfaction with the lender or broker used by the borrower, the mortgage application process, and the loan closing process. About 95 percent of all respondents indicated that they were very or somewhat satisfied with the lender or broker they used. Slightly more than three out of four respondents reported being very satisfied with their lender. Four percent reported being dissatisfied with their lender.
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Terms Somewhat
Not at All
Very
Interest Rate Somewhat
Not at All
Very
Closing Costs Somewhat
Not at All Loan Type 1 Purchase 77.2 21.3 1.5 70.9 25.1 3.9 55.7 36.2 8.0 First-Time Homeowner2 72.5 26.1 1.4 66.6 30.1 3.2 56.8 35.1 8.1 Repeat Homeowner 80.1 18.4 1.5 75.1 21.1 3.8 56.1 36.5 7.4 Non-Occupant Owner 77.8 20.4 1.8 60.9 30.7 8.5 48.4 39.5 12.1 Refinance 1 80.0 18.2 1.7 75.3 20.0 4.7 59.5 31.5 9.1 Homeowner Cashout3 76.1 22.0 2.0 71.2 22.6 6.2 54.0 35.0 11.0 Homeowner Regular 83.1 15.2 1.7 78.6 17.7 3.7 64.3 28.2 7.5 Non-Occupant Owner 75.7 23.2 1.1 69.3 25.8 4.9 46.8 41.4 11.8 Loan Size $50,000 or Less 71.6 26.0 2.4 63.8 27.7 8.5 55.5 32.0 12.5 $50,001 to $150,000 79.2 18.7 2.1 74.3 21.3 4.4 60.8 30.2 9.0 $150,001 to $300,000 78.4 20.3 1.3 73.0 23.0 4.1 57.1 34.7 8.2 More than $300,000 78.5 19.9 1.6 72.5 23.3 4.2 54.6 37.2 8.1 Credit Score 2 Lower than 620 67.2 29.8 2.9 65.3 29.4 5.3 59.6 29.8 10.7 620 to 679 73.2 24.3 2.6 70.7 24.2 5.1 59.6 30.5 9.9 680 to 719 79.2 18.9 1.9 74.9 21.9 3.2 59.4 31.8 8.8 720 or Higher 81.2 17.7 1.1 74.1 21.7 4.2 56.2 35.9 7.8 Respondent Age 35 Years or Younger 77.6 21.5 0.9 71.2 26.4 2.5 57.2 37.1 5.7 36 to 45 78.8 20.4 0.9 74.6 22.4 3.0 58.9 34.7 6.3 46 to 55 77.0 20.4 2.6 73.3 21.6 5.1 55.7 33.1 11.1 56 to 65 81.1 16.9 2.0 75.8 18.8 5.4 58.5 31.5 9.9 Older than 65 79.7 17.5 2.7 69.1 21.9 9.0 57.5 29.1 13.4 Respondent Race/Ethnicity Non-Hispanic White 81.2 17.2 1.6 75.7 20.5 3.8 58.8 33.5 7.7 Hispanic and Non-White 71.3 27.0 1.7 65.9 28.6 5.6 54.2 35.1 10.7 Respondent Education High School or Less 75.9 21.5 2.6 71.0 23.1 5.9 59.9 29.7 10.4 Some College 76.9 21.6 1.5 72.6 23.1 4.3 60.0 31.0 9.0 College Degree 80.2 18.3 1.5 74.5 21.7 3.8 57.5 34.6 7.8 Postgraduate 79.0 19.4 1.6 72.4 23.3 4.3 54.3 37.5 8.2 Household Income Less than $50,000 74.3 23.0 2.7 70.5 24.2 5.3 61.3 27.9 10.7 $50,000 to $99,999 77.0 21.3 1.7 72.0 23.0 4.9 56.8 34.6 8.5 $100,000 to $174,999 81.0 17.6 1.4 74.7 21.6 3.6 56.9 35.1 8.0 $175,000 or More 82.1 17.3 0.6 74.9 22.1 3.1 56.3 36.4 7.3 Household Type Couple 79.3 19.1 1.5 74.0 22.1 3.9 57.9 33.9 8.2 Single 76.2 21.9 1.9 70.1 24.2 5.6 56.7 33.7 9.7 All Respondents 78.5 19.8 1.6 73.0 22.7 4.3 57.5 33.9 8.5 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics Very
Table 19. Satisfaction that Mortgage Was the Loan with the Best Features, by Loan and Demographic Characteristics
(Percentage Distribution)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
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Lender or Broker Somewhat
Not at All
Very
Application Somewhat
Not at All
Very
Closing Somewhat
Not at All Loan Type 1 Purchase 75.6 18.6 5.8 64.4 27.0 8.7 65.3 25.9 8.8 First-Time Homeowner2 72.2 21.7 6.1 62.3 29.7 8.0 62.9 29.0 8.1 Repeat Homeowner 77.7 17.1 5.2 66.9 24.4 8.7 67.9 23.5 8.6 Non-Occupant Owner 76.8 15.1 8.1 55.9 32.3 11.8 57.5 28.4 14.1 Refinance 1 77.7 19.6 2.7 67.6 26.8 5.6 70.4 23.6 6.0 Homeowner Cashout3 75.2 22.3 2.5 65.9 28.5 5.5 67.4 26.4 6.2 Homeowner Regular 80.3 17.0 2.7 70.0 24.9 5.1 73.6 20.9 5.5 Non-Occupant Owner 67.8 27.7 4.5 54.2 35.0 10.8 57.1 32.9 10.0 Loan Size $50,000 or Less 75.7 20.2 4.1 63.5 27.1 9.3 65.0 26.0 9.0 $50,001 to $150,000 77.6 17.4 5.0 66.5 25.7 7.8 69.6 23.3 7.0 $150,001 to $300,000 75.9 20.1 4.1 66.7 26.8 6.5 69.0 23.6 7.4 More than $300,000 76.7 19.5 3.8 64.1 28.5 7.4 63.7 28.3 8.0 Credit Score 2 Lower than 620 74.5 19.8 5.7 65.0 23.1 11.9 66.9 24.6 8.5 620 to 679 73.0 22.1 5.0 63.3 28.2 8.5 65.5 26.7 7.8 680 to 719 76.8 19.0 4.3 66.7 26.3 7.0 69.0 22.5 8.5 720 or Higher 77.9 18.1 3.9 66.7 27.0 6.3 68.2 24.8 7.0 Respondent Age 35 Years or Younger 74.6 21.0 4.3 63.8 29.7 6.5 64.7 28.0 7.3 36 to 45 76.7 19.3 3.9 68.7 24.6 6.7 68.8 24.5 6.7 46 to 55 76.8 18.8 4.4 63.7 27.7 8.6 67.0 24.2 8.8 56 to 65 78.9 16.5 4.6 69.0 25.0 5.9 71.2 22.0 6.8 Older than 65 77.6 18.0 4.4 64.7 26.5 8.9 69.6 22.4 8.0 Respondent Race/Ethnicity Non-Hispanic White 78.1 17.5 4.3 67.0 25.5 7.5 68.7 23.7 7.6 Hispanic and Non-White 72.5 23.3 4.2 63.2 30.6 6.2 65.3 27.5 7.2 Respondent Education High School or Less 75.9 20.8 3.3 68.0 23.6 8.3 70.6 23.4 6.0 Some College 75.7 19.6 4.7 65.9 26.5 7.6 68.9 23.6 7.5 College Degree 78.0 17.6 4.3 66.5 27.2 6.2 67.7 25.0 7.3 Postgraduate 75.9 19.9 4.2 64.3 28.2 7.5 65.6 26.1 8.3 Household Income Less than $50,000 74.5 20.7 4.8 64.5 27.3 8.3 68.2 24.2 7.5 $50,000 to $99,999 75.4 20.0 4.6 66.4 26.7 6.9 68.3 23.8 8.0 $100,000 to $174,999 79.5 17.3 3.2 68.4 26.0 5.6 69.1 24.7 6.2 $175,000 or More 76.3 18.6 5.1 61.9 28.6 9.5 63.8 27.6 8.6 Household Type Couple 76.7 19.3 4.0 66.2 26.6 7.2 67.8 24.6 7.6 Single 76.3 18.6 5.1 65.4 27.6 7.0 67.6 25.2 7.1 All Respondents 76.6 19.1 4.3 65.9 26.9 7.2 67.8 24.8 7.5 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics Very
Table 20. Satisfaction with the Mortgage Process, by Loan and Demographic Characteristics
(Percentage Distribution)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Satisfaction with Mortgage Application Process
Overall, 93 percent of respondents reported that they were very or somewhat satisfied with the mortgage application process. Sixty-six percent reported they were very satisfied, and an additional 27 percent were somewhat satisfied. Seven percent were not satisfied. Investors who purchased a house (12 percent), respondents with a credit score below 620 (12 percent), and investor refinancers (11 percent) were more likely to report that they were dissatisfied with the application process. Satisfaction with Mortgage Closing Process
Ninety-three percent of respondents reported that they were very or somewhat satisfied with the mortgage closing process. Sixty-eight percent reported that they were very satisfied, and 25 percent reported that they were somewhat satisfied. Eight percent of investors who purchased a house reported being dissatisfied with the closing process. Satisfaction with Mortgage Disclosure Documents
Table 21 reflects the overall satisfaction of borrowers with the information in mortgage disclosure documents, the timeliness of the mortgage disclosure documents, and their settlement agent. High percentages of respondents indicated they were very or somewhat satisfied with the disclosure information (96 percent), with their settlement agent (93 percent), and the timeliness of the mortgage disclosure process (92 percent). Borrowers with loans of $50,000 or less and investors were more likely to report that they were not satisfied with disclosures, timeliness, or the settlement agent than other borrowers.
9. Opinions on Homeownership and Financial Responsibility The survey asked borrowers whether they agreed or disagreed with statements about homeownership and financial responsibility. The results are reflected in Table 22. For example, 97 percent of all groups of respondents agreed that owning a home is a good financial investment. Late Payments and Credit Rating
Borrowers were asked if they thought that late payment of their mortgage would lower their credit ratings. More than 9 out of 10 respondents agreed that late payments would lower their credit ratings. This opinion was shared by most respondents, ranging from 94 percent for borrowers with incomes $175,000 and above to 89 percent for borrowers with household income less than $50,000. Thirteen percent of respondents agreed with the statement that lenders should not care about late payments, only whether loans are fully repaid. The share that agreed with this statement differed across groups, from 8 percent for investor refinancers to 23 percent of those with a credit score below 620.
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Disclosures Somewhat
Not at All
Very
Timeliness Somewhat
Not at All
Very
Settlement Agent Somewhat
Not at All Loan Type 1 Purchase 67.2 28.2 4.6 65.2 27.0 7.8 67.7 24.5 7.9 First-Time Homeowner2 64.4 31.4 4.1 61.8 31.0 7.2 64.5 27.3 8.2 Repeat Homeowner 69.8 25.7 4.6 67.8 24.3 7.9 70.4 22.3 7.2 Non-Occupant Owner 60.8 32.1 7.1 62.4 27.9 9.7 62.4 26.5 11.2 Refinance 1 69.7 26.8 3.5 69.0 25.1 5.9 70.2 22.4 7.4 Homeowner Cashout3 67.9 28.7 3.4 68.1 25.8 6.1 68.8 24.0 7.2 Homeowner Regular 72.1 24.6 3.2 71.0 23.7 5.2 72.4 20.3 7.3 Non-Occupant Owner 56.7 36.9 6.4 54.7 34.3 10.9 56.7 33.7 9.6 Loan Size $50,000 or Less 71.1 21.9 7.0 63.7 25.8 10.5 65.3 20.4 14.3 $50,001 to $150,000 70.3 26.1 3.7 68.1 25.1 6.9 69.8 21.8 8.4 $150,001 to $300,000 68.1 28.3 3.7 67.1 26.6 6.3 70.0 23.3 6.6 More than $300,000 66.4 28.7 4.9 66.2 26.4 7.4 66.3 25.9 7.8 Credit Score 2 Lower than 620 64.5 31.1 4.4 63.5 29.9 6.6 66.3 26.8 6.8 620 to 679 66.4 30.3 3.4 64.0 28.6 7.3 67.6 24.7 7.7 680 to 719 68.8 26.1 5.1 67.2 24.8 8.0 69.5 22.9 7.7 720 or Higher 69.3 26.7 4.0 68.3 25.2 6.4 69.4 22.9 7.7 Respondent Age 35 Years or Younger 66.1 30.2 3.7 64.9 28.9 6.3 66.5 27.0 6.5 36 to 45 69.6 26.1 4.3 68.6 24.0 7.4 68.6 23.7 7.7 46 to 55 67.0 28.7 4.3 65.7 27.2 7.0 68.0 23.9 8.1 56 to 65 71.9 24.5 3.6 70.4 24.1 5.5 73.1 19.1 7.9 Older than 65 69.0 26.5 4.6 66.8 24.2 9.0 71.3 19.6 9.2 Respondent Race/Ethnicity Non-Hispanic White 69.6 26.4 4.0 68.3 24.8 6.9 70.8 21.8 7.4 Hispanic and Non-White 65.1 30.6 4.3 63.8 29.5 6.6 63.8 27.9 8.4 Respondent Education High School or Less 69.3 26.5 4.2 64.4 28.8 6.7 70.0 21.3 8.7 Some College 68.9 27.3 3.8 66.4 26.1 7.5 69.1 23.5 7.4 College Degree 69.2 26.4 4.4 68.6 24.2 7.3 69.3 23.3 7.4 Postgraduate 66.5 29.8 3.7 66.8 27.4 5.8 67.7 24.6 7.7 Household Income Less than $50,000 68.1 27.9 4.0 65.0 27.2 7.8 67.1 24.3 8.6 $50,000 to $99,999 68.1 27.7 4.2 66.3 26.5 7.2 70.0 22.8 7.2 $100,000 to $174,999 70.2 26.0 3.8 69.5 25.2 5.4 69.4 23.9 6.7 $175,000 or More 66.0 29.6 4.3 66.6 25.5 7.9 67.4 23.3 9.3 Household Type Couple 68.9 27.1 4.0 67.3 25.9 6.8 69.0 23.3 7.7 Single 66.9 28.8 4.3 66.5 26.4 7.1 68.6 24.0 7.4 All Respondents 68.4 27.6 4.1 67.1 26.1 6.9 68.9 23.5 7.6 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics Very
Table 21. Satisfaction with Information During the Mortgage Process, by Loan and Demographic Characteristics
(Percentage Distribution)
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Mortgage Lenders Generally Treat Borrowers Well
Late Payments Will Lower Credit Rating
Lenders Should Not Care About Late Payments, Only Whether Loans Fully Repaid
It Is Okay to Default If It Is in the Borrower's Financial Interest
Loan Type Purchase 1 97.1 83.1 92.1 12.7 6.2 2 First-Time Homeowner 97.1 84.0 91.5 13.0 6.5 Repeat Homeowner 97.0 82.5 92.4 12.5 5.8 Non-Occupant Owner 98.3 83.4 92.4 12.3 8.2 1 Refinance 96.5 80.9 93.0 13.2 5.7 Homeowner Cashout3 97.2 80.2 92.9 12.9 5.7 Homeowner Regular 95.9 81.1 92.9 14.0 5.8 Non-Occupant Owner 97.4 83.6 93.6 7.5 4.7 Loan Size $50,000 or Less 97.3 85.0 90.6 19.7 8.2 $50,001 to $150,000 97.3 84.1 90.9 13.3 4.4 $150,001 to $300,000 97.2 82.4 92.9 12.0 6.3 More than $300,000 95.5 78.7 93.9 13.5 7.1 2 Credit Score Lower than 620 96.6 87.8 90.1 23.4 9.5 620 to 679 98.2 78.0 90.2 15.8 5.7 680 to 719 97.9 81.7 91.4 16.1 5.5 720 or Higher 96.1 82.8 93.7 10.2 5.8 Respondent Age 35 Years or Younger 97.0 82.7 93.7 10.7 7.0 36 to 45 96.5 81.2 93.3 12.8 7.7 46 to 55 96.9 79.9 90.3 13.7 4.5 56 to 65 96.3 84.6 92.7 13.3 5.0 Older than 65 97.5 83.0 91.8 17.1 3.9 Respondent Race/Ethnicity Non-Hispanic White 96.8 84.4 93.2 10.8 5.1 Hispanic and Non-White 96.8 75.7 90.5 18.7 8.3 Respondent Education High School or Less 97.8 86.4 89.7 18.2 5.8 Some College 97.5 84.6 91.0 15.2 4.3 College Degree 97.4 81.7 93.4 10.9 6.8 Postgraduate 95.0 78.3 93.8 11.3 6.5 Household Income Less than $50,000 97.9 82.8 88.7 17.0 5.8 $50,000 to $99,999 97.5 83.3 92.4 14.3 4.7 $100,000 to $174,999 96.5 81.3 93.9 10.1 6.6 $175,000 or More 94.6 79.6 94.2 10.8 8.0 Household Type Couple 96.6 81.7 92.2 12.9 6.0 Single 97.5 83.0 93.5 13.1 5.8 All Respondents 96.8 82.0 92.5 12.9 6.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Owning a Home Is a Good Financial Investment
Table 22. Opinions on Homeownership, Lenders, and Mortgage Payments, by Loan and Demographic Characteristics
(Percent Who Agreed with Each Statement)
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Mortgage Default and Borrower’s Financial Interest
An estimated 6 percent of respondents agreed with the statement that it is okay to default or stop paying if it is in the borrower’s financial interest. Borrowers older than 65 (4 percent) were least likely to agree with this statement. Ten percent of borrowers with a credit score below 620, 8 percent of Hispanic or non-white borrowers, 8 percent of investor homebuyers, and 8 percent of borrowers with mortgages of $50,000 or less reported that they agreed that it is okay to default when it is in the borrower’s financial interest.
10. Recent Changes in Neighborhood Housing The survey asked borrowers’ opinions about changes in the neighborhoods where homes were located for which they had most recently acquired a mortgage. The survey also asked borrowers for their opinions about changes to house prices and the overall desirability of living in the neighborhood. Tables 23 and 24 reflect respondents’ responses. Change in Number of Homes Available for Sale
Seventy-one percent of respondents indicated that the number of homes available for sale in their neighborhood experienced little or no change, while 25 percent reported that the number for sale had increased significantly (Table 23). About 4 percent of respondents reported the number of homes for sale declined significantly in their neighborhood. There was little variation across borrower groups in reporting either a significant increase or significant decrease in the number of homes for sale. Investor refinancers (7 percent), borrowers with incomes of $175,000 or more (6 percent), and borrowers with loans above $300,000 (6 percent) reported a decrease in available homes for sale, slightly more than other borrowers reported. Change in Number of Vacant Homes
Borrower groups varied in their descriptions of changes in the number of vacant homes in the neighborhood over the last two years. Overall, 4 percent of respondents indicated that the number of vacant homes increased significantly, 85 percent indicated that there was little or no change, and 10 percent reported that the number of vacant homes had declined significantly. About the same share of refinancing borrowers (5 percent) as homebuyers (4 percent) reported a significant increase in vacant homes in their neighborhood over the last two years. Borrowers with a credit score below 680 (8 percent) were slightly more likely to report a significant increase in vacant homes in their neighborhood than other borrowers. Respondents with incomes above $175,000 (2 percent) and borrowers with mortgages above $300,000 (2 percent) were less likely to report a significant increase in vacant homes. Change in Number of Homes for Rent
Overall, 7 percent of respondents reported a significant increase in rental housing in their neighborhood, 86 percent of borrowers reported little or no change, and 7 percent reported a significant decrease. Refinancing borrowers (8 percent) were slightly more likely to report a significant increase in the number of rental properties in their neighborhoods than homebuyers (6 percent). Borrowers with a credit score below 620 (11 percent) were more likely to report a
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Number of Vacant Homes Significantly Little or No Significantly Increase Change Decrease
Number of Homes for Rent Significantly Little or No Significantly Increase Change Decrease
Loan Type Purchase 1 22.7 73.0 4.3 4.1 86.3 9.7 5.9 87.0 7.2 First-Time Homeowner2 20.9 75.3 3.8 3.6 88.7 7.7 6.0 89.3 4.7 Repeat Homeowner 23.6 71.9 4.5 4.3 85.3 10.4 5.7 86.0 8.4 Non-Occupant Owner 24.9 69.8 5.3 4.9 81.7 13.4 6.3 83.5 10.2 Refinance 1 26.6 69.0 4.4 4.8 83.9 11.3 8.2 84.9 6.9 Homeowner Cashout3 26.4 69.5 4.2 5.3 83.8 10.9 7.4 86.2 6.4 Homeowner Regular 27.4 68.4 4.3 4.6 83.9 11.5 8.8 84.0 7.2 Non-Occupant Owner 20.5 72.4 7.0 3.4 85.2 11.4 7.2 84.6 8.3 Loan Size $50,000 or Less 17.9 80.8 1.3 8.8 84.7 6.5 5.8 86.9 7.3 $50,001 to $150,000 21.9 74.8 3.3 5.9 85.7 8.5 9.2 85.7 5.1 $150,001 to $300,000 26.0 69.6 4.4 4.8 84.7 10.6 6.5 86.3 7.2 More than $300,000 26.2 68.1 5.7 1.7 85.3 13.0 5.2 85.7 9.2 Credit Score 2 Lower than 620 28.2 67.8 4.0 7.6 83.0 9.4 10.6 81.2 8.3 620 to 679 27.4 68.8 3.8 7.7 80.5 11.8 7.5 83.3 9.2 680 to 719 27.6 68.8 3.6 5.4 84.0 10.5 7.2 85.5 7.3 720 or Higher 22.7 72.6 4.7 2.9 87.0 10.1 6.4 87.4 6.2 Respondent Age 35 Years or Younger 24.0 71.7 4.4 3.3 86.9 9.8 6.5 88.4 5.1 36 to 45 27.7 68.6 3.7 4.7 86.6 8.7 6.8 86.8 6.4 46 to 55 24.4 71.5 4.1 6.1 82.9 11.0 8.5 83.3 8.3 56 to 65 23.0 72.0 5.0 4.0 83.4 12.6 7.1 84.7 8.3 Older than 65 21.7 72.8 5.5 3.9 84.4 11.7 5.1 85.4 9.5 Respondent Race/Ethnicity Non-Hispanic White 23.0 72.9 4.2 3.9 86.6 9.5 6.1 87.1 6.7 Hispanic and Non-White 29.2 66.0 4.8 5.8 81.0 13.1 9.3 82.8 7.9 Respondent Education High School or Less 24.7 71.0 4.3 7.3 81.5 11.2 8.2 83.5 8.4 Some College 25.6 70.6 3.8 6.3 83.3 10.4 7.6 84.9 7.5 College Degree 26.1 69.6 4.3 3.7 85.0 11.3 7.2 86.3 6.6 Postgraduate 21.8 73.3 4.9 2.4 88.6 9.1 5.7 87.6 6.8 Household Income Less than $50,000 21.8 73.5 4.7 4.6 84.8 10.6 6.4 86.4 7.2 $50,000 to $99,999 25.8 71.2 2.9 5.9 84.5 9.7 8.2 85.5 6.4 $100,000 to $174,999 25.7 69.4 4.9 3.9 85.0 11.1 7.3 85.0 7.8 $175,000 or More 22.9 71.0 6.1 1.9 87.2 10.9 4.3 88.4 7.3 Household Type Couple 25.0 70.7 4.3 4.3 85.6 10.1 6.3 86.7 6.9 Single 23.5 72.2 4.4 4.8 83.7 11.5 8.9 83.6 7.5 All Respondents 24.6 71.0 4.3 4.4 85.1 10.4 7.0 86.0 7.1 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Number of Homes for Sale Significantly Little or No Significantly Increase Change Decrease
Table 23. Changes in Housing Availability in Neighborhood over Last Couple Years, by Loan and Demographic Characteristics
(Percentage Distribution)
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Significantly Increase
House Prices Little or No Change
Significantly Decrease
Overall Desireablity of Living There Significantly Little or No Significantly Increase Change Decrease
Loan Type Purchase 1 3.6 85.5 10.9 37.1 60.5 2.5 37.0 61.2 1.9 First-Time Homeowner2 3.4 90.1 6.4 34.2 63.8 2.1 32.9 64.8 2.3 Repeat Homeowner 3.2 83.8 12.9 38.2 59.1 2.7 39.2 59.3 1.5 Non-Occupant Owner 6.8 76.3 16.9 42.6 54.7 2.7 39.7 58.0 2.3 Refinance 1 5.0 78.4 16.6 54.2 41.5 4.4 41.2 56.4 2.4 Homeowner Cashout3 5.1 78.6 16.3 57.1 39.2 3.7 41.9 55.9 2.1 Homeowner Regular 5.1 78.6 16.3 52.3 42.9 4.8 41.0 56.4 2.6 Non-Occupant Owner 4.0 74.3 21.7 52.0 42.9 5.1 38.2 59.9 1.9 Loan Size $50,000 or Less 6.2 85.2 8.6 21.2 74.2 4.7 18.6 70.6 10.8 $50,001 to $150,000 6.0 83.2 10.9 33.1 61.8 5.1 27.4 69.4 3.2 $150,001 to $300,000 4.1 81.4 14.5 47.4 49.7 2.9 42.2 56.2 1.7 More than $300,000 2.4 81.5 16.1 58.9 39.1 2.0 49.7 49.6 0.7 Credit Score 2 Lower than 620 6.7 79.1 14.2 37.7 59.1 3.1 36.9 60.0 3.1 620 to 679 6.4 78.9 14.8 43.6 52.3 4.1 37.1 59.3 3.7 680 to 719 4.5 82.3 13.2 44.0 52.7 3.3 39.5 57.8 2.7 720 or Higher 3.4 83.3 13.4 47.0 49.7 3.3 39.7 58.9 1.4 Respondent Age 35 Years or Younger 2.9 86.3 10.9 43.5 54.6 1.9 37.9 59.8 2.3 36 to 45 4.3 83.0 12.7 46.4 50.5 3.0 40.0 57.9 2.0 46 to 55 6.3 78.7 15.0 44.4 51.7 3.9 37.1 61.0 1.9 56 to 65 4.8 80.0 15.2 47.4 47.7 4.9 39.1 59.0 2.0 Older than 65 2.8 79.3 17.9 46.6 48.5 4.9 43.7 53.7 2.6 Respondent Race/Ethnicity Non-Hispanic White 4.4 83.3 12.3 44.2 52.3 3.5 38.3 59.6 2.1 Hispanic and Non-White 3.9 78.8 17.3 48.6 48.2 3.2 41.1 56.8 2.1 Respondent Education High School or Less 6.7 80.2 13.1 37.3 57.0 5.7 29.5 66.5 4.1 Some College 5.4 79.7 14.9 41.2 54.5 4.3 37.2 59.7 3.1 College Degree 4.3 81.3 14.4 48.5 48.9 2.6 40.5 57.9 1.5 Postgraduate 2.2 86.2 11.6 48.4 48.9 2.7 42.6 56.1 1.2 Household Income Less than $50,000 5.4 83.1 11.5 31.5 63.7 4.8 29.9 66.3 3.8 $50,000 to $99,999 5.0 82.7 12.3 41.0 55.1 4.0 35.4 62.0 2.6 $100,000 to $174,999 3.8 80.3 15.9 53.0 44.4 2.7 44.5 54.2 1.3 $175,000 or More 2.4 82.8 14.8 56.1 41.9 1.9 47.0 52.3 0.7 Household Type Couple 4.3 81.9 13.8 46.6 50.3 3.1 40.0 58.0 2.0 Single 4.4 82.4 13.2 41.8 54.0 4.2 36.1 61.3 2.6 All Respondents 4.3 82.1 13.6 45.4 51.2 3.4 39.0 58.9 2.1 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Number of Foreclosures or Short Sales Significantly Little or No Significantly Increase Change Decrease
Table 24. Changes in Neighborhood Desireability over Last Couple Years, by Loan and Demographic Characteristics
(Percentage Distribution)
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significant increase in the number of rental properties in their neighborhoods than other borrower groups. Change in Number of Foreclosures and Short Sales
As reflected on Table 24, about 82 percent of respondents indicated that the number of foreclosures and short sales in their neighborhood had little or no change over the last couple of years. Four percent of respondents reported a significant increase, while 14 percent reported a significant decrease. About the same share of refinancing borrowers (5 percent) as homebuyers (4 percent) reported an increase in the number of foreclosures. Investor homebuyers (7 percent), borrowers with credit scores below 620 (7 percent), and borrowers with a high school education or less (7 percent) reported an increase in the number of foreclosures. Change in House Prices
Fifty-one percent of respondents reported that there was little or no change to house prices in their neighborhood over the last couple of years, while 45 percent reported a significant increase in prices and 3 percent reported a significant decline in house prices in their neighborhood. However, respondents who took out mortgages above $300,000 (59 percent), cashout refinancers (57 percent), and borrowers with incomes above $175,000 (56 percent) were more likely to report a significant increase in house price over the last couple years than were other respondents. Borrowers who purchased a home, including investors and first-time homebuyers, were about as likely to report a significant decline in house prices (3 percent) as respondents who refinanced a mortgage (4 percent). Change in Desirability of Neighborhood
Borrowers were asked if the overall desirability of living in their neighborhood had changed over the last couple of years. Over 59 percent of respondents indicated that there had been little or no change in desirability, 39 percent reported a significant increase in desirability, and 2 percent reported a significant decline. Borrowers with loans greater than $300,000 (50 percent) and borrowers with household income greater than $175,000 (47 percent) were far more likely to indicate that the desirability of their neighborhood had increased significantly.
11. Expectations on Neighborhood House Prices and Neighborhood Desirability Borrowers were asked what they think will happen to prices of homes in their neighborhood over the next couple of years. As shown in Table 25, 82 percent of all respondents expect house prices to increase, with 60 percent expecting that prices will increase a little and 21 percent expecting that prices will increase a lot. About 16 percent of respondents indicated that prices would remain about the same over the next couple of years, and about 2 percent of respondents expect prices to decrease. The percentage of borrowers who reportedly expect prices to increase generally rose with loan size and borrower income. The percentage of borrowers expecting home prices to remain about the same, and the percentage of borrowers expecting price declines
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Table 25. Expectations for House Prices in Neighborhood over Next Couple of Years, by Loan and Demographic Characteristics
(Percentage Distribution) Characteristics
Prices of Similar Homes in Neighborhood Will Increase Remain About Decrease a Little the Same a Little
Increase a Lot
Decrease a Lot
Loan Type Purchase 1 20.5 61.9 16.4 1.0 0.2 First-Time Homeowner2 20.0 59.9 18.7 1.1 0.3 Repeat Homeowner 20.8 63.3 15.0 0.9 0.1 Non-Occupant Owner 21.0 61.1 16.5 1.0 0.4 1 Refinance 22.1 58.6 16.4 2.3 0.6 Homeowner Cashout3 22.4 58.3 15.9 2.3 1.1 Homeowner Regular 22.4 58.1 16.9 2.4 0.2 Non-Occupant Owner 16.6 67.3 14.6 1.5 0.0 Loan Size $50,000 or Less 12.0 43.2 42.7 0.6 1.6 $50,001 to $150,000 15.6 57.6 23.9 2.4 0.5 $150,001 to $300,000 23.0 62.3 13.1 1.2 0.3 More than $300,000 26.1 61.8 10.5 1.5 0.1 Credit Score 2 Lower than 620 24.5 51.3 20.4 3.4 0.4 620 to 679 22.8 56.6 17.7 1.7 1.2 22.8 57.2 18.5 1.1 0.4 680 to 719 20.1 63.1 15.1 1.6 0.1 720 or Higher Respondent Age 35 Years or Younger 19.0 61.4 17.8 1.2 0.5 36 to 45 21.0 60.6 15.6 2.5 0.3 46 to 55 22.5 59.0 16.6 1.7 0.3 56 to 65 22.2 61.1 15.1 1.3 0.3 Older than 65 23.6 58.2 16.5 1.2 0.5 Respondent Race/Ethnicity Non-Hispanic White 19.1 62.1 17.0 1.6 0.3 Hispanic and Non-White 27.2 55.5 14.8 1.8 0.6 Respondent Education High School or Less 17.5 54.1 25.4 2.4 0.6 Some College 21.7 57.6 17.9 1.9 0.9 College Degree 22.8 61.8 13.9 1.4 0.1 Postgraduate 20.4 63.4 14.8 1.4 0.1 Household Income Less than $50,000 17.8 52.7 26.2 2.0 1.3 $50,000 to $99,999 21.2 59.7 17.1 1.7 0.3 $100,000 to $174,999 22.7 63.1 12.7 1.4 0.1 $175,000 or More 22.3 64.6 11.5 1.6 0.0 Household Type Couple 21.8 60.4 16.0 1.6 0.2 Single 19.7 60.1 17.5 1.9 0.8 All Respondents 21.3 60.3 16.4 1.6 0.4 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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generally decreased with loan size and income. There was generally little variation in expectations on neighborhood house prices across other groups of borrowers. Borrowers were also asked whether they expect the overall desirability of living in their neighborhood to change in the next couple of years. Table 26 reflects that about 52 percent of respondents indicated that they expected the overall desirability of their neighborhood to stay about the same, 47 percent of respondents expected neighborhood desirability to increase, and 2 percent of respondents expected neighborhood desirability to decrease. Homebuyers (50 percent) were more likely to expect neighborhood desirability to increase than refinancing borrowers (43 percent). Borrowers with loans of $50,000 or less, borrowers with credit scores below 680, and borrowers with household income of less than $50,000 were more likely than other groups of borrowers to expect that neighborhood desirability would decrease.
12. Financial Expectations The survey asked borrowers how likely they were to encounter events in the next couple of years that might constrain their household finances. Specifically, the survey asked whether it was very, somewhat, or not at all likely over the next couple of years that the respondent would experience any of the following: a) retire; b) be laid off, become unemployed, or be forced to reduce hours of work; c) have difficulties making mortgage payments; or d) experience some other personal financial crisis. Table 27 reflects responses to these questions. Expectations of Retirement
Seventeen percent of respondents indicated that they were very or somewhat likely to retire in the next couple of years. About 21 percent of refinancing borrowers reported being very or somewhat likely to retire in the near term, compared to 13 percent of homebuyers. Respondents who were older than 56 were at least twice as likely to report they were very or somewhat likely to retire in the next couple of years than were those aged 46 to 55 years old, while 4 percent of respondents aged 36 to 45 years old and 1 percent of respondents aged 35 years or younger indicated that they were very or somewhat likely to retire in the next couple of years. Two percent of first-time homebuyers indicated they were very or somewhat likely to retire in the next couple of years and 29 percent of investor purchasers expressed that they were very or somewhat likely to retire in the near term. Expectations of Financial Difficulties
Nine percent of respondents reported that they were very or somewhat likely to have difficulties making their mortgage payments in the next couple of years. Eleven percent of refinancing borrowers reported that they were very or somewhat likely to have difficulties making mortgage payments in the next couple of years compared to 8 percent of homebuyers. Respondents with household income less than $50,000 a year (16 percent), credit scores 620 and below (16 percent), or high school education or less (16 percent) were more likely to believe they could have difficulties making mortgage payments than other respondents. Respondents with postgraduate degrees (8 percent), credit scores of 720 or higher (7 percent), or household income
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Table 26. Expectations for Neighborhood Desirability over Next Couple of Years, by Loan and Demographic Characteristics
(Percentage Distribution) Characteristics
Living in the Neighborhood Will Become More Desireable Stay About The Same Become Less Desirable
Loan Type 1 Purchase 50.4 48.4 1.3 First-Time Homeowner2 49.8 48.2 2.0 Repeat Homeowner 50.6 48.7 0.7 Non-Occupant Owner 51.3 46.9 1.8 1 Refinance 42.8 54.8 2.4 Homeowner Cashout3 42.7 54.5 2.7 Homeowner Regular 42.5 55.2 2.3 Non-Occupant Owner 46.8 51.9 1.3 Loan Size $50,000 or Less 22.1 75.0 2.9 $50,001 to $150,000 35.9 61.4 2.8 $150,001 to $300,000 49.5 48.9 1.6 More than $300,000 57.4 41.8 0.9 Credit Score 2 Lower than 620 46.1 50.6 3.3 620 to 679 46.7 50.2 3.1 680 to 719 45.5 53.0 1.5 720 or Higher 47.1 51.6 1.4 Respondent Age 52.2 45.8 2.0 35 Years or Younger 36 to 45 47.1 51.1 1.7 46 to 55 44.9 53.5 1.5 56 to 65 41.2 56.9 1.9 Older than 65 43.8 54.3 1.9 Respondent Race/Ethnicity Non-Hispanic White 44.6 53.6 1.8 Hispanic and Non-White 52.3 45.7 1.9 Respondent Education High School or Less 35.2 62.5 2.3 Some College 42.9 53.9 3.2 College Degree 49.4 49.5 1.0 Postgraduate 51.5 47.2 1.3 Household Income Less than $50,000 39.0 57.6 3.4 $50,000 to $99,999 43.2 54.8 2.0 $100,000 to $174,999 50.9 47.9 1.2 $175,000 or More 55.2 43.9 0.9 Household Type Couple 48.2 50.2 1.6 Single 42.4 55.1 2.4 All Respondents 46.7 51.5 1.8 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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Table 27. Expectations About Future Financial Situation, by Loan and Demographic Characteristics
(Percent Very or Somewhat Likely to Face Each Situation in the Next Couple of Years) Characteristics
Retirement
Difficulties Making Mortgage Payments
Unemployment, Layoff, or Forced Hour Reduction
Some Other Personal Financial Crisis
Loan Type Purchase 1 13.3 8.0 11.3 12.6 First-Time Homeowner2 2.4 8.3 11.2 13.3 Repeat Homeowner 18.2 8.0 11.3 12.1 Non-Occupant Owner 28.6 7.5 11.4 12.7 1 Refinance 20.9 10.7 12.5 15.7 Homeowner Cashout3 21.7 13.4 12.6 17.5 Homeowner Regular 20.1 9.0 12.8 14.4 Non-Occupant Owner 24.7 8.9 8.1 15.9 Loan Size $50,000 or Less 23.7 9.5 7.4 14.4 $50,001 to $150,000 18.8 10.5 11.1 16.6 $150,001 to $300,000 16.5 9.2 11.8 13.8 More than $300,000 15.1 8.1 13.2 11.6 2 Credit Score Lower than 620 14.1 16.0 11.2 19.9 620 to 679 16.7 13.2 11.8 17.4 680 to 719 15.5 11.7 11.6 16.1 17.8 6.9 12.0 12.0 720 or Higher Respondent Age 35 Years or Younger 1.1 7.6 10.4 11.5 36 to 45 4.5 8.6 13.7 12.5 46 to 55 18.0 9.7 13.2 16.4 56 to 65 49.2 11.3 13.5 16.9 Older than 65 36.8 12.1 5.7 15.3 Respondent Race/Ethnicity Non-Hispanic White 18.0 9.4 11.7 14.0 Hispanic and Non-White 14.4 9.3 12.3 14.4 Respondent Education High School or Less 19.9 15.5 13.4 17.2 Some College 20.8 10.5 11.7 15.0 College Degree 14.1 7.7 10.9 12.7 Postgraduate 16.0 7.9 12.7 13.8 Household Income Less than $50,000 17.6 16.3 11.2 19.7 $50,000 to $99,999 16.5 10.4 12.1 15.3 $100,000 to $174,999 17.0 6.7 12.0 12.3 $175,000 or More 17.6 4.4 11.6 8.8 Household Type Couple 17.5 9.3 12.5 13.8 Single 15.4 9.4 9.9 14.9 All Respondents 17.0 9.3 11.9 14.1 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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of $175,000 or more (4 percent) were less likely to believe they would have difficulties in paying their mortgage in the next couple of years. Expectations of Layoff or Unemployment
Nearly 12 percent of respondents indicated that it was very or somewhat likely that they might experience a layoff, unemployment, or forced reduction in hours over the next couple of years. Refinancing investors (8 percent), those borrowing $50,000 or less (7 percent), and those older than 65 years (6 percent) were less likely to expect these events than were other respondents. Fourteen percent of all respondents indicated that it was very or somewhat likely that they would face some other personal financial crisis in the next couple of years. Respondents with household income of less than $50,000 (20 percent) and respondents with credit scores below 620 (20 percent) were most likely to report that they were very or somewhat likely to face some other personal financial crisis. Expectation of Ability to Pay Bills without Borrowing
Table 28 reflects that about 86 percent of respondents indicated that they were very or somewhat likely to pay their bills for the next three months without borrowing. Respondents with household income of $175,000 or more (94 percent), investor homebuyers (91 percent), respondents with credit score of 720 or above (91 percent), and respondents with loans of more than $300,000 (90 percent) were more likely than other respondents to indicate they were very or somewhat likely to pay their bills for the next three months without borrowing. Respondents with a credit score below 620 (73 percent) and those with a credit score between 620 and 679 (76 percent) were the least likely to report that they were very or somewhat likely to pay their bills for the next three months without borrowing. Expectation of Receiving Financial Help from Friends or Family
Sixty-one percent of respondents indicated that they were very or somewhat likely to get significant financial help from family or friends if they suffered an unexpected financial crisis. More homebuyers (65 percent) believed they were very or somewhat likely to get significant help compared to refinancing borrowers (57 percent). Forty-two percent of respondents aged 56 to 65 and 38 percent of respondents older than 65 reported that they were very or somewhat likely to get significant help from family or friends, while 79 percent of respondents aged 35 years or younger and 77 percent of first-time homebuyers reported that they were very or somewhat likely to get financial help from their family or friends. Fifty-five percent of respondents felt that it was very or somewhat likely that they could significantly increase their income if they experienced a financial shock. More homebuyers (59 percent) reported that they were very or somewhat likely to significantly increase their income than refinancing borrowers (51 percent). First-time homebuyers and younger respondents were more likely to indicate that they could significantly increase their income than other respondents. Sixty-four percent of first-time homebuyers and 65 percent of respondents 35 years or younger reported that they were very or somewhat likely to significantly increase their income. Older respondents were less likely to indicate they could significantly increase their income than other
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table 28. Ability to Weather an Adverse Financial Shock, by Loan and Demographic Characteristics
(Percent Very or Somewhat Likely to Perform Each Action in the Next Couple of Years) Characteristics
Pay Bills for the Next Get Significant Three Months Financial Help from Without Borrowing Family or Friends
Borrow Enough Money from a Bank or Credit Union
Increase Income Significantly
Loan Type Purchase 1 86.4 65.0 64.7 58.5 First-Time Homeowner2 81.8 77.0 67.9 63.8 Repeat Homeowner 88.8 59.2 62.3 55.8 Non-Occupant Owner 91.3 50.6 66.6 52.6 1 Refinance 85.0 56.9 65.1 51.0 Homeowner Cashout3 85.1 54.7 63.0 49.5 Homeowner Regular 84.7 58.5 65.9 51.5 Non-Occupant Owner 87.1 55.1 70.8 57.3 Loan Size $50,000 or Less 76.3 45.7 54.9 35.9 $50,001 to $150,000 81.9 59.6 62.3 54.2 $150,001 to $300,000 86.4 60.3 65.3 55.4 More than $300,000 90.1 65.3 68.1 56.3 2 Credit Score Lower than 620 73.2 51.5 52.8 58.8 620 to 679 76.4 57.6 61.3 55.3 680 to 719 80.4 62.1 62.0 54.7 91.2 62.8 67.9 54.3 720 or Higher Respondent Age 35 Years or Younger 84.4 79.3 74.0 65.0 36 to 45 85.7 67.7 66.5 59.1 46 to 55 84.4 55.2 62.2 55.5 56 to 65 88.1 42.3 56.6 44.5 Older than 65 88.3 38.8 56.0 32.3 Respondent Race/Ethnicity Non-Hispanic White 86.4 62.0 67.7 54.1 Hispanic and Non-White 84.0 58.5 57.2 57.0 Respondent Education High School or Less 77.9 51.1 54.3 49.7 Some College 83.4 54.6 61.3 52.2 College Degree 87.3 65.5 67.6 56.6 Postgraduate 89.0 65.2 69.0 57.0 Household Income Less than $50,000 77.3 56.9 54.4 50.3 $50,000 to $99,999 83.4 60.4 63.4 54.3 $100,000 to $174,999 88.7 62.8 69.1 56.3 $175,000 or More 94.3 63.6 71.3 58.2 Household Type Couple 85.9 61.3 65.3 55.4 Single 85.0 60.3 63.8 53.2 All Respondents 85.7 61.1 64.9 54.8 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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respondents. Forty-four percent of respondents aged 56 to 65 years old and 32 percent of respondents older than 65 reported they were very or somewhat likely to significantly increase their income if they experienced a financial shock.
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Appendix. About the National Mortgage Database Project The National Mortgage Database is a multiyear project being jointly undertaken by the Federal Housing Finance Agency (FHFA) and the Consumer Financial Protection Bureau (CFPB). The project is designed to provide comprehensive information about the U.S. mortgage market based on a 5 percent sample of residential mortgages. The project has three primary components: (1) the NMDB®8, (2) the quarterly NSMO 9, and (3) the annual American Survey of Mortgage Borrowers (ASMB). The NMDB® project will enable FHFA to meet the statutory requirements of section 1324(c) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended by the Housing and Economic Recovery Act of 2008, to conduct a monthly mortgage market survey. Specifically, FHFA must, through a survey of the mortgage market, collect data on the characteristics of individual mortgages, including subprime and nontraditional mortgages, information on the creditworthiness of borrowers, and whether subprime and nontraditional borrowers would have qualified for prime lending. For CFPB, the NMDB® project will support policymaking and research efforts and help identify and understand emerging mortgage and housing market trends. CFPB expects to use the NMDB®, among other purposes, in support of the market monitoring called for by the DoddFrank Wall Street Reform and Consumer Protection Act, including understanding how mortgage debt affects consumers. FHFA and CFPB examined existing databases and determined that none of them fully meet the criteria necessary to achieve the above objectives. The NMDB®, when fully complete, will be a de-identified, loan-level database of closed-end first-lien residential mortgages. It will: (1) be representative of the market as a whole; (2) contain comprehensive information on the terms and performance of mortgages, as well as characteristics of the associated borrowers and property; (3) be continually updated; (4) contain historical information from before the financial crisis of 2008; and (5) provide a sampling frame for the NSMO and ASMB. The core data in the NMDB® are drawn from a random 1-in-20 sample of all closed-end firstlien mortgage files outstanding at any time between January 1998 and June 2012 and maintained by Experian, one of the three national credit repositories. A random 1-in-20 sample of mortgages newly reported to Experian is added each quarter. Mortgages are followed in the NMDB® database until they terminate through prepayment (including refinancing), foreclosure, or maturity. De-identified information from credit repository files related to each borrower associated with the mortgages in the NMDB® sample is collected from at least one year prior to origination to one year after termination of the mortgage. The information on borrowers and loans available for analysis is de-identified and does not include directly identifiable information, such as borrower name, address, or Social Security number. The NSMO is a component of the NMDB® project. The survey is designed to complement the NMDB® by providing information, particularly related to mortgage shopping, that is not 8
9
See National Mortgage Database Technical Report 1.2 for more details. See National Survey of Mortgage Borrowers Technical Report 2.3 for more details.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
otherwise available in the database. To achieve this objective, the NSMO draws its sample from mortgages that are part of the NMDB®, which samples from the same target universe. The NSMO survey is voluntary and its target universe is newly originated closed-end first-lien residential mortgages and the associated borrowers. The NSMO is administered by Westat under a subcontract with Experian. Fair Credit Reporting Act (FCRA) rules require that the survey process be administered through Experian in order to maintain consumer privacy because it utilizes borrower names and addresses drawn from credit repository records. The NSMO sample is selected each quarter from the mortgage loans newly added to the NMDB® sample that quarter. After the sample is selected, Experian eliminates any potential respondents who have opted out of previous surveys or are deemed not to have useable addresses or names. Industry guidance (Metro 2® Industry Standards for Credit Reporting) requires that servicers must supply a billing address for each borrower on a trade line (including mortgages). Experian generally uses these borrower billing addresses as the survey mailing addresses. Where there are multiple addresses and borrowers associated with a survey sample loan, Table A-1 reflects the rules for selecting the borrower(s) and address to which the survey is mailed. The survey is sent to no more than two borrowers who share a common address. FHFA and CFPB never receive the names or addresses chosen for the survey. Only Experian and Westat, as Experian’s subcontractor, have access to this information. Table A-1. Rule for Best Address Number of Borrowers
Same or Different Address
Resulting Survey Recipient
1
Not Applicable
One borrower with Experian’s associated best address
2
Same
Two borrower names with one common best address
2
Different
The one borrower and associated best address with the lowest number of open mortgages
>2
Same
Two borrowers with one common best address that has the highest number of trade lines reported
>2
Different
The one borrower and associated best address with the lowest number of open mortgages
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The survey implementation strategy includes four respondent contacts over a seven-week period: Week 1
Printed questionnaire, cover letter, and cash incentive (entire survey sample population)
Week 2
1st reminder letter (entire survey sample population)
Week 5
2nd reminder letter, printed questionnaire, and additional cash incentive (sampled borrowers who have not responded by Week 4)
Week 7
3rd reminder letter, which includes the due date for returning the questionnaire, to close the communication loop (sampled borrowers who have not responded by Week 6)
Participation in the survey is voluntary, and respondents are assured the confidentiality of their responses. The first and the third contacts contain a printed survey questionnaire and a five dollar cash incentive which respondents are free to keep regardless of whether they return the questionnaire. The mailings and printed questionnaires detail how respondents can also complete the survey online in either English or Spanish using instructions and a unique “survey PIN number” provided in the questionnaire packet. To date, nearly one third of survey responses have been completed online. Mail surveys are processed for four weeks after the third reminder letter, so the field period comprises 12 weeks in total. It takes between five and six weeks to draw the new NMDB® sample, identify and combine duplicative records, draw the NSMO sample, process it at Experian, and print the survey materials. Thus, the survey cycle typically begins six weeks after the end of a quarter and extends about four weeks into the next quarter. All returned questionnaires and any non-delivered mail are sent directly to Westat and not to FHFA, CFPB, or Experian. All survey responses received by Westat are purged of any information related to the name of the borrower, address of the borrower, or name of any financial institution. This is done to maintain the de-identified confidential nature of the data and to ensure that the survey responses cannot be connected to a name or address. During the first eight weeks of each cycle, Experian maintains a NSMO call center to address any questions by respondents. This call center also allows respondents to “opt out” of the survey and future surveys. Both FHFA and CFPB describe the survey on their websites so that respondents can independently verify the legitimacy of the survey. The agency officials signing the cover letter (Sandra Thompson at FHFA and David Silberman at CFPB) are identified on the websites as senior employees of their respective agencies. Once the active phase of a survey cycle ends, it takes about 25 days for Westat to scan and edit returned questionnaires, combine them with on-line responses, and create an electronic data file. This file is delivered to the NMDB® development staff through Experian. It takes an additional
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eight weeks to complete additional processing of survey responses, to create preliminary sample weights, and to assemble a preliminary user data file. The timeline described above applies to each quarterly data release. Because some loans take longer than six months to be reported to the repositories, a data file fully representative of a calendar year will generally not be available until December of the following year.
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A Profile of 2016 Mortgage Borrowers: Statistics from the National Survey of Mortgage Originations Technical Report 6.0
April 18, 2018
This document was prepared by Robert B. Avery, Mary F. Bilinski, Audrey Clement, Tim Critchfield, Samuel Frumkin, Ian H. Keith, Ismail E. Mohamed, Forrest W. Pafenberg, Saty Patrabansh, and Jay D. Schultz.
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table of Contents 1.
Introduction .................................................................................................................... 1
2.
Comparing the 2016 NSMO with 2016 Home Mortgage Disclosure Act Data ........... 2
3.
Profile of 2016 Mortgage Borrowers .............................................................................. 3
4.
Borrower Knowledge of the Mortgage Process .............................................................. 4
5.
Selecting a Mortgage: Mortgage Broker versus Mortgage Lender ............................. 16
6.
During the Application Process .................................................................................... 23
7.
Closing on a Mortgage ................................................................................................. 27
8.
Satisfaction with Mortgage Terms, Mortgage Process, and Information ..................... 31
9.
Opinions on Homeownership and Financial Responsibility......................................... 34
10.
Recent Changes in Neighborhood Housing .................................................................. 37
11.
Expectations on Neighborhood House Prices and Neighborhood Desirability ............ 40
12.
Financial Expectations .................................................................................................. 42
Appendix. About the National Mortgage Database Project................................................... A-1
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1. Introduction This is the fourth Technical Report on the responses received to the National Survey of Mortgage Originations (NSMO or survey), which is jointly administered by the Federal Housing Finance Agency (FHFA) and the Consumer Financial Protection Bureau (CFPB). 1 The survey collects information from a representative sample of recent mortgage borrowers about their experiences in choosing and taking out a mortgage. It is designed to provide researchers, policy makers, and other interested parties with comprehensive data about the consumer experience when getting a mortgage. The NSMO is a recurring quarterly mail survey of new mortgage borrowers using a sample drawn from the National Mortgage Database (NMDB®). 2 The NMDB® is a representative 1-in20 sample of closed-end first-lien mortgages reported to Experian, one of the three national credit repositories. From the second quarter of 2016 to the second quarter of 2017, NSMO sent surveys to 23,724 borrowers with mortgages originated in 2016, representing an average sampling rate of 1-in-320. Of the solicited surveys, 6,285 usable responses were received, making the effective response rate for 2016 originations 26.5 percent. 3 A total of 7.6 million closed-end first-lien mortgages were originated in 2016, which means that one average useable survey response is representative of 1,207 mortgages. 4 The NSMO is a voluntary survey, and the questions included in the survey focus on topics such as mortgage shopping behavior, mortgage closing experiences, and other information not readily available from other sources. In completing this survey, borrowers provide information about a range of topics, such as expectations about house price appreciation, critical household financial events, and life events such as unemployment, large medical expenses, or divorce. 1
Reports for 2013, 2014 and 2015 mortgages and other NMDB® documents are available at https://www.fhfa.gov/PolicyProgramsResearch/Programs/Pages/National-Mortgage-Database.aspx and https://www.consumerfinance.gov/data-research/research-reports/technical-reports-national-survey-of-mortgageborrowers-and-national-mortgage-database/. 2 The National Mortgage Database project is a multi-year project being jointly undertaken by the Federal Housing Finance Agency (FHFA) and the Consumer Financial Protection Bureau (CFPB). The project is designed to provide a source of information about the U.S. mortgage market based on a 5 percent sample of residential mortgages. The NMDB® will enable FHFA to meet the statutory requirements of section 1324(c) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended by the Housing and Economic Recovery Act of 2008, to conduct a monthly mortgage market survey. For CFPB, the NMDB® project will support policymaking and research efforts and help identify and understand emerging mortgage and housing market trends. For further information on the NMDB®, see National Mortgage Database Technical Report 1.2. For additional background, also see the Appendix of this Report. 3 There are several ways by which calculations based on the NSMO raw survey responses may not be representative of the population as a whole. Consequently, survey responses must be appropriately weighted. Commonly, in survey sampling, some individuals chosen for the sample are unwilling or unable to participate in the survey. Nonresponse bias (either complete nonresponse to the survey or nonresponse to selected items within the survey) is the bias that results when respondents differ in meaningful ways from non-respondents. To address this nonresponse bias, the NSMO uses weighting to adjust for differential response to the survey. In addition, to address missing information on individual questions within the survey, the NSMO uses statistical methods to impute missing data. The imputation technique makes multiple estimates of missing data to allow for an estimate of the uncertainty attributable to this type of nonresponse. See National Survey of Mortgage Borrowers Technical Report 2.3 for more details. 4 The weighted percentages reported in this technical document represent the respondents who took out a mortgage in 2016. The words “respondent” and “borrower” are used interchangeably throughout the document.
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This Report presents the results from the 6,285 responses to the survey and provides an overview of the mortgage market and borrowers’ experiences in 2016. Section two compares the 2016 NSMO with 2016 Home Mortgage Disclosure Act (HMDA) data. Section three contains information about the overall profile of survey respondents in 2016, including their demographic characteristics and the kind of mortgages they obtained. Sections four through seven describe how the 2016 borrowers shopped for their mortgages and the application and closing processes. Section eight presents information about borrowers’ mortgage outcomes and measures of their satisfaction in the mortgage application and closing process. Section nine discusses borrowers’ opinions on financial responsibility, and section ten examines borrowers’ opinions on the neighborhood where they obtained their mortgage. Sections eleven and twelve discuss borrowers’ expectations for house prices, neighborhood desirability, and their own financial circumstances over the next couple of years. The Appendix to this Report provides details on the overall NMDB® project, as well as the sampling and data preparation procedures for the NSMO.
2. Comparing the 2016 NSMO with 2016 Home Mortgage Disclosure Act Data This section provides a comparison of the 2016 NSMO survey responses with the 2016 HMDA data. This comparison is useful because HMDA data are generally accepted as including close to the total of all first-lien mortgages originated in the United States. As a result, this comparison provides a useful benchmark to validate the overall statistical methodology of NSMO. As shown in Table 1, estimates derived from the NSMO data show that there were approximately 7.1 million first-lien mortgage loans associated with owner-occupied homes in 2016. The NSMO estimates for both the loan count and the market dollar estimates are similar to the HMDA estimates. The average loan size for owner-occupied homes in the NSMO was slightly lower than in HMDA – $244,411 compared with $255,263. Table 1. Comparison of Mortgage Originations, 2016 (Count and Dollar Volume) Mortgage Originations
National Survey of Mortgage Originations (NSMO) Home Mortgage Disclosure Act (HMDA) Volume (Billion Dollars) Count (Thousands)1 Volume (Billion Dollars)1 Count (Thousands)1 Owner-occupied 7,092 1,733 6,916 1,765 Purchase 3,596 866 3,545 896 Refinance 3,496 867 3,371 870 Not owner-occupied 493 105 794 190 Source: National Survey of Mortgage Originations, 2016 and Home Mortgage Disclosure Act, 2016 Notes: The owner-occupied count total from the NSMO does not equal the sum of purchase and refinance counts from the NSMO due to rounding.
The estimate of mortgage loans associated with non-owner-occupied properties from the NSMO data is lower than the estimate from HMDA. HMDA estimates 794,088 such mortgages, 61 percent greater than the number estimated from the NSMO. The NSMO data suggest $105 billion in mortgage originations in 2016 associated with non-owner-occupied properties, while HMDA suggests $190 billion. One explanation for this difference is that HMDA reporting covers some larger mortgages made to business partnerships for non-owner-occupied properties that are not reported to the credit bureaus and, thus, are not represented in the NSMO.
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3. Profile of 2016 Mortgage Borrowers Tables 2 through 5 present characteristics of NSMO respondents who acquired a mortgage in 2016. These tables show the distributions of loan and property characteristics for several demographic groups. Table 2 presents loan type, and Table 3 presents loan size and mortgage term to maturity. Table 4 presents credit score, and Table 5 presents property type. The bottom row of each table shows the percentage distribution of each loan or property characteristic. Table 6 presents information about the household life events experienced by survey respondents over the last couple of years. Loan Type and Loan Size
Table 2 reflects that a slight majority of 2016 mortgage loans reported in the survey were used to purchase a property. Fifty-one percent of survey respondents reported they purchased a home, and 49 percent reported they refinanced 5 an existing mortgage. Owner-occupants represented 94 percent of mortgage borrowers, with 47 percent of borrowers having purchased a home that they occupied and 46 percent having refinanced an existing mortgage for a home they occupied. The remaining 6 percent of borrowers were non-occupant investors (owners of seasonal homes, homes for relatives, and rental or investment homes are categorized as investors). Table 3 reflects that of the 51 percent of respondents who purchased a home, 36 percent were first-time homeowners, 56 percent were repeat homeowners, and the remaining 8 percent were non-occupant investors. Of the 49 percent of respondents who refinanced an existing mortgage, 38 percent refinanced a mortgage for the borrower’s primary residence and borrowed additional money, 56 percent refinanced a mortgage for the borrower’s primary residence without extracting equity, and the remaining 5 percent refinanced a mortgage for a non-owner-occupied investment. About half of all respondents (52 percent) were 45 years old or younger, and 63 percent of home-purchase borrowers were 45 years old or younger. About three-quarters of respondents (73 percent) reported that they were non-Hispanic white, 10 percent reported they were Hispanic white, 8 percent indicated they were Asian, and 6 percent stated that they were Black or African American. Three percent of respondents indicated that they were American Indian or Alaska Native, Native Hawaiian or Pacific Islander, or of more than one race. Three-quarters of the respondents who took out a mortgage in 2016 were in households with two adults living together, with 68 percent reporting they were married and 8 percent reporting they were living with a partner. The percentage of married couples was somewhat higher for refinancers than for home purchasers, and the percentage of borrowers with a partner was higher for home purchases than for refinancers. Almost 25 percent of borrowers indicated that they were single—13 percent single females and 11 percent single males. Overall, 87 percent of households included at least one full-time worker. This percentage was higher for homebuyers 5
In this report, refinances include all non-purchase mortgages, 94 percent of which are traditional refinances or modifications, 3 percent are loans on a mortgage-free property, 3 percent are permanent financing of a construction loan, and 1 percent are mortgages for a change in borrowers.
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(90 percent) than those who refinanced (84 percent). Eighteen percent of borrowers reported that they were on active duty or were veterans of the U.S. military. 6 About 17 percent of respondents reported household income in 2016 of less than $50,000 compared to 53 percent of all households in the United States based on the 2013 Survey of Consumer Finances (SCF). 7 Credit Score and Property Type
Table 4 reflects that 60 percent of survey respondents had a credit score of 720 or higher, 34 percent had a credit score between 620 and 719, and 6 percent had a credit score below 620. Sixty percent of homebuyer respondents had a credit score of 720 or higher, similar to respondents who refinanced. Nineteen percent of homebuyer respondents had a credit score below 680, similar to respondents who refinanced (18 percent). Survey respondents were asked to describe their property type. As shown in Table 5, singlefamily properties were the primary property type used to collateralize the respondent’s mortgage. Eighty-four percent of respondents reported that their property was a single-family detached home, 6 percent townhouses, 5 percent condominiums, 3 percent 2-, 3- and 4-unit dwellings, and 2 percent manufactured homes. Life Events
Many respondents reported that they had experienced one or more life events over the last couple of years. The results are reflected in Table 6. Eight percent of respondents indicated that they had divorced or separated, 13 percent indicated they had married or had a new partner, 8 percent reported experiencing a disability or major illness, 2 percent reported that a disaster had affected their home, 2 percent reported that a disaster had affected their job, 30 percent indicated that they moved up to 50 miles from their previous residence, and 15 percent indicated that they moved 50 miles or more from their previous residence.
4. Borrower Knowledge of the Mortgage Process The survey asked borrowers about their knowledge and familiarity with mortgage terminology and the mortgage process, and about their ability to explain the mortgage process. Borrowers’ knowledge about the mortgage process differed significantly based on demographic characteristics and whether the consumer was shopping for a home and a mortgage at the same time. First-time homebuyers differed significantly from repeat homebuyers in their knowledge about mortgages. The extent of mortgage knowledge also differed for repeat borrowers depending on whether they were refinancing or purchasing a home. 6
The question about military and veteran status was revised in the fifteenth wave of NSMO to match the revised question in the American Community Survey (ACS). Only 6,109 responses up to the fourteenth wave of NSMO were used to calculate this share. 7 See National Mortgage Database Technical Report 3.1 for additional comparison of household income in the 2013 SCF to reported income for borrowers with a 2013 origination captured in the NSMO. For more about the Survey of Consumer Finances including results from the 2013 SCF, see http://www.federalreserve.gov/econresdata/scf/scfindex.htm.
4
Respondent Age 35 Years or Younger 36 to 45 46 to 55 56 to 65 Older than 65 Respondent Race/Ethnicity Non-Hispanic White Hispanic and Non-White Hispanic White Asian Black All Other Races4 Respondent Education High School or Less Some School High School Some College Technical School Partial College College Degree Postgraduate Household Income Less than $50,000 Less than $35,000 $35,000 to $49,999 $50,000 to $99,999 $50,000 to $74,999 $75,000 to $99,999 $100,000 to $174,999 $175,000 or More Household Type Couple Married With Partner Single Male Female Military Active Duty or Veteran Active Duty Veteran No Military Service Basic Training Never Served
Characteristics
49.0 15.4 7.5 0.0 0.0 16.5 24.4 29.0 21.6 21.3 23.8 20.9 22.9 20.6 16.3 25.5 13.2 20.9 16.7 29.5 28.5 30.1 22.4 24.3 20.4 12.6 9.5 17.2 14.5 41.1 22.8 24.7 21.3 10.0 22.6 8.4 20.2 15.1 20.6
73.6 49.8 42.4 36.9 38.7 51.2 51.9 57.9 47.5 48.7 51.2 48.8 52.1 48.3 49.2 56.2 46.8 53.4 51.7 57.4 56.2 57.9 54.3 55.9 52.6 46.5 47.1 50.5 48.1 71.6 53.8 52.8 54.7 43.3 55.9 41.7 52.8 48.0 53.2
2
First-Time
All
5 30.1 30.3 30.1 28.4 28.4 28.4
29.0 29.2 27.1 28.1 25.0 30.8
25.8 24.0 26.6 29.6 29.9 29.3 29.8 28.2
25.0 26.7 24.7 29.4 24.8 30.9 28.3 30.5
30.5 24.3 26.3 21.3 25.3 24.1
21.7 31.6 30.6 32.1 31.5
1.0 1.0 1.0 1.4 1.3 1.4
1.5 1.5 1.2 0.8 0.9 0.7
0.3 0.9 0.0 0.4 0.3 0.5 1.7 3.9
0.9 1.0 0.8 0.8 1.6 0.6 1.5 1.8
1.7 0.2 0.4 0.1 0.3 0.0
0.9 0.7 1.9 1.9 2.1
Purchase1 Repeat Seasonal
Table 2. Loan Type, by Demographic and Property Characteristics
(Percentage Distribution)
0.6 0.0 0.7 0.7 0.9 0.6
0.6 0.6 0.9 0.7 0.7 0.7
0.6 0.9 0.5 0.6 0.6 0.7 0.6 0.7
0.7 0.0 0.8 0.9 0.7 0.9 0.4 0.6
0.6 0.8 1.1 0.0 1.0 1.5
0.1 0.6 0.4 0.6 2.7
Relative
1.6 2.1 1.5 2.1 2.3 2.0
2.2 2.3 1.3 1.4 1.6 1.2
1.1 2.0 0.7 1.2 0.9 1.6 1.8 4.8
1.3 1.6 1.3 1.8 3.5 1.2 2.2 2.1
1.9 2.1 1.2 4.4 0.8 1.8
1.8 1.5 2.1 2.4 2.4
Investment
56.7 44.1 58.3 47.2 52.0 46.8
49.5 51.9 28.4 46.2 47.2 45.3
42.6 43.8 42.1 45.7 44.1 47.4 53.5 52.9
51.2 47.9 51.7 50.8 43.8 53.2 46.6 48.3
48.8 48.1 42.1 52.5 51.3 48.8
26.4 50.2 57.6 63.1 61.3
All
Loan Type
21.9 17.9 22.4 18.0 21.4 17.7
18.5 19.1 12.6 19.2 18.8 19.5
17.2 15.7 17.9 21.1 20.3 21.9 19.0 13.9
21.0 17.3 21.6 20.4 17.4 21.5 18.3 16.4
19.0 17.5 17.4 16.5 18.0 19.4
9.8 17.2 22.6 25.1 26.5
Cashout3
32.8 24.2 33.8 26.5 29.6 26.3
28.6 30.2 14.8 24.0 24.9 23.2
24.3 26.5 23.3 22.9 22.2 23.7 31.8 33.2
26.8 30.0 26.3 29.0 25.7 30.1 25.8 28.5
27.3 27.9 21.5 32.8 31.9 26.9
15.5 31.0 31.9 33.7 30.9
0.3 0.0 0.3 0.7 0.2 0.7
0.6 0.7 0.2 0.4 0.6 0.3
0.1 0.1 0.1 0.2 0.0 0.4 0.7 1.7
0.7 0.0 0.8 0.4 0.2 0.4 0.6 0.7
0.6 0.4 0.8 0.2 0.2 0.2
0.1 0.4 1.1 0.8 0.7
Refinance1 Regular Seasonal
1.5 1.6 0.8 2.4 2.5 2.2
0.9 1.3 0.7 1.4 1.4 1.3 1.7 3.5
2.4 0.6 2.7 0.9 0.5 1.0 1.8 2.2
1.6 2.1 1.9 2.9 1.2 2.3
0.9 1.5 1.8 3.0 2.4
Investment
75.3 67.6 7.7 24.6 11.2 13.4
16.9 5.5 11.4 37.3 18.9 18.4 29.4 16.4
11.2 1.6 9.6 25.6 6.4 19.1 36.3 27.0
73.1 26.9 9.5 8.1 6.2 3.2
26.7 25.0 22.1 16.1 10.1
0.3 1.5 17.9 0.0 2.0 2.0 0.3 1.4 15.9 0.2 1.8 79.1 0.0 0.9 5.1 0.3 1.9 74.0 (Continued on the next page)
0.2 0.3 0.0 0.3 0.4 0.2
0.1 0.2 0.1 0.2 0.2 0.1 0.2 0.7
0.2 0.0 0.3 0.2 0.0 0.2 0.2 0.4
0.3 0.2 0.6 0.1 0.0 0.0
0.1 0.0 0.2 0.5 0.7
Relative
Share of All Loans
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
2
2
Loan Type 2
Refinance Regular Seasonal
Share of All Loans
All Relative Investment All Relative Investment Cashout3 First-Time1 Employment Full-Time 53.1 20.6 28.7 1.3 0.5 2.0 46.9 17.5 27.1 0.6 0.2 1.5 86.6 Couple, Both 52.3 20.6 27.2 1.6 0.4 2.5 47.7 17.5 28.0 0.8 0.2 1.3 39.1 Couple, One 51.3 16.5 31.4 1.3 0.5 1.7 48.7 17.7 28.8 0.4 0.3 1.5 28.5 Single 57.4 26.9 27.7 1.0 0.5 1.3 42.6 17.1 22.9 0.4 0.2 2.1 19.1 Not Full-Time 39.8 5.5 29.3 1.3 1.8 2.0 60.2 26.3 29.7 0.7 0.4 3.0 13.4 Couple, Neither 38.5 3.1 29.1 2.0 2.0 2.2 61.5 26.3 31.2 0.9 0.4 2.7 7.8 Single 41.7 8.9 29.6 0.2 1.4 1.7 58.3 26.3 27.7 0.4 0.5 3.4 5.6 Credit Score 2 Lower than 620 43.6 22.0 21.6 0.0 0.0 0.0 56.4 26.1 28.6 0.0 0.0 1.7 6.1 620 to 679 53.5 24.4 27.9 0.6 0.3 0.3 46.5 22.2 22.8 0.4 0.0 1.2 18.6 620 to 639 51.1 27.3 23.0 0.6 0.0 0.3 48.9 28.5 20.2 0.0 0.2 0.0 4.6 640 to 659 54.1 27.1 26.1 0.7 0.2 0.0 45.9 20.6 23.8 0.3 0.0 1.3 6.9 660 to 679 54.4 19.9 32.8 0.5 0.6 0.6 45.6 19.7 23.6 0.7 0.0 1.7 7.1 680 to 719 53.3 23.5 27.8 0.7 0.7 0.7 46.7 19.1 25.1 0.8 0.3 1.4 15.0 680 to 699 54.0 23.2 28.4 1.2 0.7 0.4 46.0 19.3 24.3 1.1 0.6 0.7 7.4 700 to 719 52.7 23.8 27.2 0.2 0.7 0.9 47.3 18.8 25.9 0.4 0.0 2.2 7.6 720 or Higher 51.0 15.3 30.1 1.9 0.8 3.0 49.0 16.7 29.4 0.7 0.3 2.0 60.3 720 to 739 51.0 23.2 24.4 1.1 0.1 2.2 49.0 17.5 28.4 0.4 0.3 2.5 9.9 740 or Higher 51.0 13.7 31.2 2.0 0.9 3.2 49.0 16.5 29.6 0.7 0.3 1.9 50.4 Loan Type Purchase 1 100.0 36.2 56.1 2.6 1.2 3.8 0.0 0.0 0.0 0.0 0.0 0.0 51.3 First-Time Homeowner2 100.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 18.6 Repeat Homeowner 100.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 28.8 Seasonal Home 100.0 0.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.3 Relative Home 100.0 0.0 0.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.6 Investment Home 100.0 0.0 0.0 0.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 2.0 Refinance 1 0.0 0.0 0.0 0.0 0.0 0.0 100.0 38.3 56.4 1.2 0.5 3.6 48.7 Homeowner Cashout3 0.0 0.0 0.0 0.0 0.0 0.0 100.0 100.0 0.0 0.0 0.0 0.0 18.6 Homeowner Regular 0.0 0.0 0.0 0.0 0.0 0.0 100.0 0.0 100.0 0.0 0.0 0.0 27.5 Seasonal Home 0.0 0.0 0.0 0.0 0.0 0.0 100.0 0.0 0.0 100.0 0.0 0.0 0.6 Relative Home 0.0 0.0 0.0 0.0 0.0 0.0 100.0 0.0 0.0 0.0 100.0 0.0 0.2 Investment Home 0.0 0.0 0.0 0.0 0.0 0.0 100.0 0.0 0.0 0.0 0.0 100.0 1.7 Property Type Single-family Detached House 49.5 18.0 29.0 1.0 0.3 1.2 50.5 19.7 28.6 0.6 0.2 1.4 84.1 Townhouse, Row House, or Villa 63.2 22.9 31.7 3.5 1.6 3.4 36.8 9.6 24.4 1.3 0.2 1.3 6.1 Mobile or Manufactured Home 55.7 21.3 26.6 3.5 2.6 1.6 44.3 22.6 20.9 0.4 0.5 0.0 2.0 Two-to-Four Unit Dwelling 57.0 16.3 21.4 1.3 4.3 13.7 43.0 17.5 17.0 0.5 0.0 8.0 2.9 Condo, Apartment House, or Co-op 61.1 25.4 25.3 3.5 1.7 5.2 38.9 11.2 21.7 0.2 1.0 4.8 4.7 Other 84.7 0.0 50.5 3.0 6.2 25.0 15.3 0.0 7.9 0.0 0.0 7.4 0.3 All Respondents 51.3 18.6 28.8 1.3 0.6 2.0 48.7 18.6 27.5 0.6 0.2 1.7 100.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score, loan size, mortgage term to maturity, and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the prior mortgage amount or if a mortgage is for a previously mortgage-free property, the mortgage is classified as a cashout refinance. 4. The "all other races" category includes respondents who reported being American Indian/Alaska Native or Native Hawaiian/Pacific Islander and respondents who reported multiple race categories.
Characteristics Purchase Repeat Seasonal
Table 2. Loan Type, by Demographic and Property Characteristics (Continued)
(Percentage Distribution)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
6
Respondent Age 35 Years or Younger 36 to 45 46 to 55 56 to 65 Older than 65 Respondent Race/Ethnicity Non-Hispanic White Hispanic and Non-White Hispanic White Asian Black All Other Races2 Respondent Education High School or Less Some School High School Some College Technical School Partial College College Degree Postgraduate Household Income Less than $50,000 Less than $35,000 $35,000 to $49,999 $50,000 to $99,999 $50,000 to $74,999 $75,000 to $99,999 $100,000 to $174,999 $175,000 or More Household Type Couple Married With Partner Single Male Female Military Active Duty or Veteran Active Duty Veteran No Military Service Basic Training Never Served
Characteristics
31.9 23.8 29.7 36.1 38.5 32.0 27.3 31.5 12.4 40.5 27.5 50.8 53.7 50.3 39.7 46.8 37.3 27.7 18.0 64.1 68.4 62.0 38.8 45.5 32.0 15.2 5.7 26.7 25.7 35.9 43.0 39.0 46.4 32.8 25.4 33.7 30.3 31.2 30.2
2.4 1.5 2.3 0.3 2.0 1.6 6.6 4.9 6.8 2.4 2.8 2.3 1.6 0.9 6.9 10.8 5.0 1.5 1.5 1.4 1.0 0.9
7 1.8 1.8 1.8 3.2 2.8 3.5 2.2 0.0 2.5 2.2 3.2 2.1
42.4 50.6 41.3 41.4 45.3 41.2
42.3 42.4 41.4 39.6 41.4 38.0
26.7 20.0 29.9 48.6 45.9 51.4 49.4 27.2
33.4 28.1 34.3 42.5 39.9 43.4 44.4 40.4
42.5 39.3 44.6 31.1 39.2 44.3
43.8 41.9 41.9 39.4 38.2
Loan Size1 $50,000 to $150,001 to $150,000 $300,000
1.8 1.5 1.2 3.3 5.1
$50,000 or Less
22.6 24.0 22.5 26.1 20.4 26.5
29.2 30.1 20.8 14.2 16.7 12.1
2.3 0.8 3.0 11.1 7.1 15.2 34.4 66.2
9.2 13.3 8.6 15.4 10.5 17.0 26.3 40.7
23.1 31.9 21.6 56.2 18.3 26.6
22.5 32.9 27.1 21.2 18.1
More than $300,000
2.9 0.8 3.1 3.0 3.9 3.0
2.8 3.0 1.0 3.0 2.9 3.2
3.8 4.0 3.7 2.6 2.6 2.6 2.8 3.1
4.4 3.1 4.6 3.0 4.0 2.6 2.5 2.9
3.3 2.0 1.8 2.0 2.3 1.8
0.8 2.0 3.0 6.1 5.6
Less than 15 Years
11.1 6.3 11.7 15.2 15.4 15.2
15.1 16.0 6.6 12.1 14.0 10.5
9.4 10.4 8.9 12.2 11.5 13.0 16.5 20.3
14.2 15.6 14.0 11.9 11.7 12.0 13.7 17.5
14.7 13.5 12.0 16.5 10.8 15.3
8.4 15.3 17.9 17.8 14.2
8.9 7.1 9.1 7.0 6.4 7.0
7.4 7.7 4.2 7.2 7.7 6.7
8.0 11.9 6.1 7.1 7.0 7.3 8.3 5.4
9.6 6.2 10.2 7.6 7.0 7.8 7.6 5.8
7.6 6.7 5.4 6.5 10.3 4.1
4.4 8.1 9.3 9.0 6.2
77.1 85.7 76.1 74.8 74.3 74.8
74.7 73.2 88.2 77.7 75.4 79.5
78.8 73.7 81.3 78.0 79.0 77.1 72.4 71.2
71.8 75.1 71.2 77.5 77.4 77.5 76.2 73.8
74.5 77.9 80.8 75.1 76.6 78.8
86.4 74.6 69.8 67.0 74.0
Mortgage Term to Maturity1 15 15 to 30 30 Years Years Years or More
Table 3. Loan Size and Mortgage Term to Maturity, by Demographic, Loan, and Property Characteristics
(Percentage Distribution)
17.9 2.0 15.9 79.1 5.1 74.0
75.3 67.6 7.7 24.6 11.2 13.4
16.9 5.5 11.4 37.3 18.9 18.4 29.4 16.4
11.2 1.6 9.6 25.6 6.4 19.1 36.3 27.0
73.1 26.9 9.5 8.1 6.2 3.2
26.7 25.0 22.1 16.1 10.1
74.1 63.3 10.8 25.8 11.5 14.3
18.9 6.0 12.9 39.4 20.6 18.8 26.6 15.0
10.6 1.6 9.0 24.5 7.0 17.4 37.7 27.2
72.8 27.2 10.7 7.5 5.9 3.2
38.3 24.3 18.2 11.6 7.6
Share of Purchases
76.6 72.1 4.5 23.4 10.9 12.5
14.8 4.9 9.9 35.0 17.1 17.9 32.3 17.8
11.7 1.5 10.2 26.7 5.8 20.9 34.8 26.8
73.3 26.7 8.2 8.8 6.5 3.2
14.5 25.8 26.1 20.9 12.7
Share of Refinances
15.1 20.8 2.1 1.8 12.9 19.1 81.4 76.7 4.8 5.5 76.6 71.2 (Continued on the next page)
Share of All Loans
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
1
Loan Size $50,000 to $150,001 to $150,000 $300,000
More than $300,000
Less than 15 Years
1
Mortgage Term to Maturity 15 15 to 30 30 Years or Years Years More
Share of All Loans
Share of Purchases
Share of Refinances
Employment Full-Time 1.6 29.1 42.4 27.0 2.5 14.3 7.2 76.1 86.6 89.5 83.5 Couple, Both 1.6 24.1 42.4 32.0 2.4 14.4 7.2 76.0 39.1 39.8 38.3 Couple, One 1.6 27.5 43.1 27.8 2.9 15.9 7.3 74.0 28.5 28.4 28.5 Single 1.6 41.7 41.2 15.5 2.1 11.8 6.8 79.3 19.1 21.3 16.7 Not Full-Time 5.6 41.7 36.9 15.8 5.5 14.5 8.5 71.5 13.4 10.4 16.5 Couple, Neither 3.4 37.5 39.0 20.1 5.1 15.4 8.4 71.1 7.8 5.8 9.8 Single 8.7 47.6 34.0 9.7 6.1 13.2 8.5 72.1 5.6 4.5 6.7 Credit Score 1 Lower than 620 4.7 37.8 43.0 14.5 3.3 7.0 11.1 78.6 6.1 5.2 7.1 620 to 679 2.7 35.1 42.8 19.3 1.4 8.1 6.1 84.3 18.6 19.3 17.8 620 to 639 3.5 39.2 44.7 12.7 2.1 11.1 4.6 82.2 4.6 4.6 4.6 640 to 659 1.7 34.7 43.4 20.1 1.4 6.5 5.6 86.4 6.9 7.3 6.5 660 to 679 3.1 32.9 41.0 22.9 1.0 7.7 7.7 83.7 7.1 7.5 6.6 680 to 719 1.8 34.2 42.8 21.2 1.5 12.8 6.8 78.8 15.0 15.6 14.4 680 to 699 2.0 31.3 44.2 22.5 1.4 11.9 6.9 79.8 7.4 7.8 7.0 700 to 719 1.5 37.0 41.4 20.0 1.6 13.7 6.7 77.9 7.6 7.8 7.4 720 or Higher 1.8 27.8 40.8 29.5 3.7 17.4 7.5 71.5 60.3 59.9 60.7 720 to 739 1.8 32.1 41.6 24.5 2.0 12.3 6.6 79.1 9.9 9.8 10.0 740 or Higher 1.8 27.0 40.7 30.5 4.0 18.4 7.6 70.0 50.4 50.0 50.8 Loan Type 3 Purchase 2.4 31.4 42.3 24.0 1.3 6.0 2.1 90.5 51.3 100.0 0.0 First-Time Homeowner1 1.9 38.2 42.4 17.4 0.4 3.7 1.7 94.2 18.6 36.2 0.0 Repeat Homeowner 1.7 25.6 43.3 29.4 1.4 6.4 2.1 90.0 28.8 56.1 0.0 Seasonal Home 11.0 29.9 43.3 15.8 3.3 14.8 6.5 75.4 1.3 2.6 0.0 Relative Home 14.2 46.4 36.5 3.0 3.8 15.1 3.8 77.4 0.6 1.2 0.0 Investment Home 5.8 47.7 27.8 18.7 6.5 12.9 2.8 77.8 2.0 3.8 0.0 3 Refinance 1.9 30.1 40.9 27.1 4.6 23.1 12.8 59.5 48.7 0.0 100.0 Homeowner Cashout4 1.8 31.0 41.7 25.6 4.3 20.9 10.7 64.1 18.6 0.0 38.3 Homeowner Regular 1.9 29.3 40.0 28.8 4.8 24.6 14.6 56.0 27.5 0.0 56.4 Seasonal Home 4.8 12.5 51.6 31.2 8.4 23.1 9.2 59.3 0.6 0.0 1.2 Relative Home 3.3 30.5 66.2 0.0 0.0 21.2 30.1 48.7 0.2 0.0 0.5 Investment Home 2.6 38.3 41.0 18.1 4.2 23.9 5.6 66.3 1.7 0.0 3.6 Property Type Single-family Detached House 1.6 29.6 42.9 25.9 2.9 14.4 7.4 75.3 84.1 81.1 87.2 Townhouse, Row House, or Villa 0.9 31.0 43.2 25.0 1.2 14.3 5.4 79.2 6.1 7.5 4.6 Mobile or Manufactured Home 20.3 59.2 18.6 1.9 11.0 15.2 23.2 50.6 2.0 2.2 1.8 Two-to-Four Unit Dwelling 2.1 32.1 34.9 31.0 1.9 7.1 2.2 88.8 2.9 3.2 2.5 Condo, Apartment House, or Co-op 3.1 37.9 32.7 26.4 0.9 14.7 4.7 79.7 4.7 5.6 3.8 Other 58.5 26.9 11.3 3.3 40.8 45.7 6.2 7.3 0.3 0.4 0.1 All Respondents 2.2 30.7 41.6 25.5 2.9 14.3 7.3 75.4 100.0 100.0 100.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Credit score, loan size, mortgage term to maturity, and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 2. The "all other races" category includes respondents who reported being American Indian/Alaska Native or Native Hawaiian/Pacific Islander and respondents who reported multiple race categories. 3. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 4. If a refinance mortgage amount is higher than the prior mortgage amount or if a mortgage is for a previously mortgage-free property, the mortgage is classified as a cashout refinance.
Characteristics $50,000 or Less
Table 3. Loan Size and Mortgage Term to Maturity, by Demographic, Loan, Property Characteristics (Continued)
(Percentage Distribution)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
8
Respondent Age 35 Years or Younger 36 to 45 46 to 55 56 to 65 Older than 65 Respondent Race/Ethnicity Non-Hispanic White Hispanic and Non-White Hispanic White Asian Black All Other Races2 Respondent Education High School or Less Some School High School Some College Technical School Partial College College Degree Postgraduate Household Income Less than $50,000 Less than $35,000 $35,000 to $49,999 $50,000 to $99,999 $50,000 to $74,999 $75,000 to $99,999 $100,000 to $174,999 $175,000 or More Household Type Couple Married With Partner Single Male Female Military Active Duty or Veteran Active Duty Veteran No Military Service Basic Training Never Served
Characteristics All 19.1 18.2 21.6 16.3 15.1 17.3 21.9 27.1 9.2 30.5 22.5 25.9 33.4 24.7 25.3 22.7 26.2 16.8 11.6 24.4 22.6 25.3 22.0 23.4 20.5 16.1 9.3 18.7 18.3 22.9 18.1 17.5 18.6 27.7 36.2 26.6 16.4 26.4 15.7
Lower than 620 5.1 4.5 8.8 6.9 5.7 5.1 8.9 9.1 4.9 15.2 6.3 9.2 11.4 8.9 9.4 10.5 9.0 4.7 3.8 10.5 9.6 11.0 6.5 6.9 6.1 5.1 2.7
9 5.4 5.2 7.1 8.3 8.2 8.3 9.0 5.2 9.5 5.5 8.0 5.4
7.6 17.3 6.4 3.9 7.5 3.6
4.8 4.7 5.6 4.1 3.5 4.5
6.6 5.7 7.0 5.4 5.6 5.2 4.3 1.1
7.2 8.8 7.0 6.4 2.6 7.6 3.9 2.8
3.8 6.7 9.7 2.7 7.5 6.3
5.8 4.8 3.9 3.6 3.9
9.4 10.1 9.3 6.2 8.8 6.0
6.8 6.7 7.8 7.1 6.9 7.2
9.0 6.7 10.2 8.6 9.3 7.9 5.4 3.5
8.9 8.2 9.0 9.8 10.8 9.4 6.3 4.1
6.6 7.7 7.6 2.8 14.9 6.5
6.9 7.6 7.9 6.0 4.3
620 to 679 620 to 639 640 to 659
10.7 8.8 10.9 6.3 10.1 6.1
7.1 6.9 9.5 7.0 7.0 6.9
8.8 10.2 8.1 7.9 8.5 7.3 6.4 4.7
9.8 16.5 8.7 9.1 9.2 9.1 6.6 4.7
6.9 7.5 9.7 3.8 8.1 9.7
6.3 5.8 9.8 6.6 7.0
660 to 679
Table 4. Credit Score, by Demographic, Loan, and Property Characteristics
(Percentage Distribution)
16.3 15.5 16.4 14.7 17.6 14.5
15.0 14.8 16.8 15.0 16.0 14.0
17.2 17.0 17.2 16.7 15.9 17.6 14.4 10.0
18.0 21.1 17.5 19.2 19.7 19.0 13.9 11.3
14.7 15.7 19.2 10.5 17.4 15.6
15.0 16.3 15.1 15.0 11.4
All
7.4 7.6 7.4 7.4 9.6 7.3
7.6 7.3 10.1 6.8 5.8 7.6
6.9 7.1 6.9 8.5 7.3 9.8 7.7 4.8
9.4 12.8 8.9 9.7 8.4 10.1 6.3 6.0
7.4 7.4 9.3 4.5 7.4 9.4
6.8 9.1 7.8 6.1 6.1
680 to 719 680 to 699
1
Credit Score
8.9 8.0 9.1 7.3 8.0 7.3
7.4 7.5 6.7 8.2 10.2 6.5
10.2 9.9 10.3 8.2 8.6 7.8 6.7 5.1
8.6 8.2 8.7 9.5 11.3 8.9 7.6 5.3
7.3 8.3 9.9 6.0 10.0 6.1
8.2 7.2 7.4 9.0 5.3
700 to 719
47.0 43.1 47.5 63.3 48.0 64.4
60.9 61.7 53.2 58.7 58.3 59.0
47.9 50.8 46.5 54.8 53.8 55.8 64.4 78.1
46.9 34.1 49.0 46.1 47.2 45.7 64.7 73.4
62.8 53.4 44.6 75.4 36.9 55.7
60.8 60.9 54.5 61.7 67.7
All
7.7 7.1 7.7 10.3 9.5 10.3
9.9 9.9 10.7 9.8 10.4 9.2
12.6 14.2 11.8 9.1 9.7 8.4 9.9 9.0
11.0 8.7 11.4 9.3 10.3 9.0 9.7 10.3
10.0 9.6 9.9 10.1 10.1 6.4
13.5 8.7 9.2 8.6 7.0
75.3 67.6 7.7 24.6 11.2 13.4
16.9 5.5 11.4 37.3 18.9 18.4 29.4 16.4
11.2 1.6 9.6 25.6 6.4 19.1 36.3 27.0
73.1 26.9 9.5 8.1 6.2 3.2
26.7 25.0 22.1 16.1 10.1
Share of All Loans
39.3 17.9 36.0 2.0 39.8 15.9 53.1 79.1 38.6 5.1 54.1 74.0 (Continued on the next page)
50.9 51.9 42.5 48.9 47.9 49.7
35.3 36.5 34.7 45.7 44.1 47.4 54.6 69.2
35.9 25.5 37.6 36.8 36.9 36.8 55.0 63.1
52.8 43.9 34.8 65.3 26.8 49.3
47.3 52.2 45.4 53.1 60.7
720 or Higher 720 to 739 740 or Higher
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
620 to 679 620 to 639 640 to 659
680 to 719 680 to 699
1
Credit Score 720 or Higher 720 to 739 740 or Higher
Share of All Loans
All 660 to 679 All 700 to 719 All Employment Full-Time 5.9 18.5 4.5 7.1 6.9 15.6 7.7 7.8 60.0 10.3 49.7 86.6 Couple, Both 5.4 19.0 5.1 7.2 6.8 15.8 8.6 7.2 59.7 10.1 49.6 39.1 Couple, One 5.2 18.2 4.2 6.6 7.4 15.1 7.0 8.1 61.4 10.3 51.1 28.5 Single 8.0 18.0 3.9 7.5 6.6 15.7 6.9 8.8 58.3 10.6 47.8 19.1 Not Full-Time 7.0 18.9 5.0 5.8 8.1 11.5 5.6 5.9 62.6 7.3 55.3 13.4 Couple, Neither 5.5 19.2 5.4 5.8 8.0 10.8 5.0 5.8 64.6 7.5 57.0 7.8 Single 9.2 18.5 4.4 5.8 8.3 12.4 6.4 6.1 59.8 7.0 52.8 5.6 1 Credit Score Lower than 620 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.1 620 to 679 0.0 100.0 24.7 37.1 38.1 0.0 0.0 0.0 0.0 0.0 0.0 18.6 620 to 639 0.0 100.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 4.6 640 to 659 0.0 100.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.9 660 to 679 0.0 100.0 0.0 0.0 100.0 0.0 0.0 0.0 0.0 0.0 0.0 7.1 680 to 719 0.0 0.0 0.0 0.0 0.0 100.0 49.4 50.6 0.0 0.0 0.0 15.0 680 to 699 0.0 0.0 0.0 0.0 0.0 100.0 100.0 0.0 0.0 0.0 0.0 7.4 700 to 719 0.0 0.0 0.0 0.0 0.0 100.0 0.0 100.0 0.0 0.0 0.0 7.6 720 or Higher 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 16.4 83.6 60.3 720 to 739 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 100.0 0.0 9.9 740 or Higher 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 0.0 100.0 50.4 Loan Type Purchase 3 5.2 19.3 4.6 7.3 7.5 15.6 7.8 7.8 59.9 9.8 50.0 51.3 1 First-Time Homeowner 7.3 24.3 6.7 10.0 7.6 19.0 9.3 9.7 49.5 12.3 37.1 18.6 Repeat Homeowner 4.6 18.0 3.7 6.3 8.1 14.5 7.3 7.2 62.9 8.4 54.5 28.8 Seasonal Home 0.0 8.3 2.1 3.6 2.5 8.2 6.9 1.4 83.5 8.0 75.5 1.3 Relative Home 0.0 8.1 0.0 1.9 6.2 16.3 8.1 8.2 75.6 1.1 74.5 0.6 Investment Home 0.0 2.9 0.6 0.0 2.3 5.0 1.6 3.4 92.1 10.9 81.3 2.0 Refinance 3 7.1 17.8 4.6 6.5 6.6 14.4 7.0 7.4 60.7 10.0 50.8 48.7 Homeowner Cashout4 8.6 22.1 7.0 7.6 7.5 15.3 7.7 7.7 53.9 9.3 44.6 18.6 Homeowner Regular 6.4 15.4 3.4 6.0 6.1 13.7 6.6 7.2 64.5 10.2 54.2 27.5 Seasonal Home 0.0 11.5 0.0 3.4 8.1 19.7 14.5 5.2 68.8 6.0 62.8 0.6 Relative Home 0.0 3.3 3.3 0.0 0.0 17.7 17.7 0.0 79.0 11.0 68.1 0.2 Investment Home 6.1 12.4 0.0 5.3 7.1 12.5 3.0 9.5 69.0 14.1 54.9 1.7 Property Type Single-family Detached House 6.2 19.9 4.8 7.6 7.5 15.4 7.5 7.9 58.5 9.8 48.8 84.1 Townhouse, Row House, or Villa 5.3 13.3 3.8 3.8 5.7 13.6 7.5 6.1 67.8 11.5 56.2 6.1 Mobile or Manufactured Home 16.5 22.0 8.8 5.1 8.1 13.9 10.0 3.9 47.6 8.4 39.2 2.0 Two-to-Four Unit Dwelling 4.3 8.9 1.5 4.4 3.0 17.2 6.8 10.4 69.6 9.1 60.5 2.9 Condo, Apartment House, or Co-op 1.4 7.8 2.4 0.9 4.6 10.5 6.3 4.3 80.3 9.6 70.7 4.7 Other 15.2 7.1 0.0 7.1 0.0 0.0 0.0 0.0 77.7 27.5 50.2 0.3 All Respondents 6.1 18.6 4.6 6.9 7.1 15.0 7.4 7.6 60.3 9.9 50.4 100.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Credit score, loan size, mortgage term to maturity, and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 2. The "all other races" category includes respondents who reported being American Indian/Alaska Native or Native Hawaiian/Pacific Islander and respondents who reported multiple race categories. 3. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 4. If a refinance mortgage amount is higher than the prior mortgage amount or if a mortgage is for a previously mortgage-free property, the mortgage is classified as a cashout refinance.
Characteristics Lower than 620
Table 4. Credit Score, by Demographic, Loan, and Property Characteristics (Continued)
(Percentage Distribution)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
10
Respondent Age 35 Years or Younger 36 to 45 46 to 55 56 to 65 Older than 65 Respondent Race/Ethnicity Non-Hispanic White Hispanic and Non-White Hispanic White Asian Black All Other Races1 Respondent Education High School or Less Some School High School Some College Technical School Partial College College Degree Postgraduate Household Income Less than $50,000 Less than $35,000 $35,000 to $49,999 $50,000 to $99,999 $50,000 to $74,999 $75,000 to $99,999 $100,000 to $174,999 $175,000 or More Household Type Couple Married With Partner Single Male Female Military Active Duty or Veteran Active Duty Veteran No Military Service Basic Training Never Served
Characteristics Townhouse 6.9 5.7 5.7 5.5 6.7 5.4 8.0 6.2 11.5 8.0 4.8 5.0 5.1 5.0 4.1 5.4 3.7 6.6 7.7 6.1 5.8 6.3 5.6 4.7 6.5 6.4 6.7 4.9 4.7 6.0 9.8 6.4 12.7 4.6 1.8 4.9 6.4 2.0 6.7
Single-Family 82.5 86.9 86.1 83.3 77.8 84.7 82.3 84.8 77.1 84.8 83.8 82.8 85.9 82.3 87.2 85.5 87.8 83.8 82.0 81.1 77.9 82.7 84.1 84.1 84.1 86.3 83.0 86.9 87.5 81.7 75.6 78.6 73.0 87.9 89.7 87.6 83.2 90.3 82.7
Table 5. Property Type, by Demographic and Loan Characteristics
(Percentage Distribution)
11 2.6 0.8 2.8 1.9 2.5 1.9
2.0 1.9 3.1 2.0 2.7 1.5
5.0 7.7 3.7 2.7 3.0 2.4 0.5 0.1
5.9 3.3 6.3 2.5 3.0 2.3 1.5 0.6
2.4 1.0 1.5 0.5 0.5 1.7
1.7 1.4 1.6 2.7 4.4
Manufactured
1.7 1.8 1.6 3.1 2.9 3.1
2.5 2.3 4.4 3.8 3.6 4.0
2.9 3.0 2.8 3.0 3.4 2.7 2.1 3.7
2.1 1.2 2.3 3.1 4.0 2.8 2.6 3.3
2.9 2.7 2.9 2.0 2.9 3.4
3.5 1.9 2.0 3.3 4.6
Two-to-Four Unit
Property Type
3.1 6.0 2.8 5.0 2.0 5.2
3.4 3.3 4.8 8.7 8.6 8.7
4.7 5.4 4.4 4.4 4.6 4.1 4.3 6.4
4.0 3.9 4.0 2.9 1.8 3.3 5.1 6.2
4.3 5.9 4.7 9.1 3.8 6.0
5.3 3.6 4.4 5.2 6.1
Condo
75.3 67.6 7.7 24.6 11.2 13.4
16.9 5.5 11.4 37.3 18.9 18.4 29.4 16.4
11.2 1.6 9.6 25.6 6.4 19.1 36.3 27.0
73.1 26.9 9.5 8.1 6.2 3.2
26.7 25.0 22.1 16.1 10.1
0.2 17.9 0.0 2.0 0.2 15.9 0.3 79.1 0.3 5.1 0.3 74.0 (Continued on the next page)
0.3 0.3 0.0 0.1 0.1 0.1
0.1 0.2 0.1 0.2 0.2 0.2 0.5 0.2
0.2 0.6 0.1 0.2 0.4 0.1 0.4 0.3
0.4 0.0 0.0 0.0 0.0 0.4
0.2 0.5 0.3 0.0 0.4
Other
Share of All Loans
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Townhouse
Property Type Manufactured Two-to-Four Unit
Condo
Other
Share of All Loans
Employment Full-Time 84.5 6.0 1.7 2.8 4.7 0.2 86.6 Couple, Both 86.9 5.6 1.5 2.2 3.5 0.4 39.1 Couple, One 87.5 3.9 2.1 2.9 3.4 0.1 28.5 Single 75.1 10.1 1.6 3.8 9.2 0.2 19.1 Not Full-Time 81.2 6.5 4.0 3.4 4.8 0.1 13.4 Couple, Neither 84.2 4.9 4.2 3.1 3.4 0.2 7.8 Single 77.1 8.7 3.6 3.8 6.8 0.0 5.6 Credit Score 2 Lower than 620 85.6 5.3 5.4 2.0 1.1 0.7 6.1 620 to 679 89.8 4.4 2.4 1.4 2.0 0.1 18.6 620 to 639 87.8 5.0 3.8 0.9 2.4 0.0 4.6 640 to 659 92.5 3.3 1.5 1.8 0.6 0.3 6.9 660 to 679 88.5 4.9 2.3 1.2 3.0 0.0 7.1 680 to 719 86.0 5.5 1.9 3.3 3.3 0.0 15.0 680 to 699 84.5 6.2 2.7 2.6 4.0 0.0 7.4 700 to 719 87.5 4.9 1.0 3.9 2.6 0.0 7.6 720 or Higher 81.6 6.8 1.6 3.3 6.3 0.3 60.3 720 to 739 83.2 7.1 1.7 2.6 4.6 0.8 9.9 740 or Higher 81.3 6.8 1.6 3.4 6.6 0.3 50.4 Loan Type 3 Purchase 81.1 7.5 2.2 3.2 5.6 0.4 51.3 First-Time Homeowner2 81.2 7.5 2.3 2.5 6.5 0.0 18.6 Repeat Homeowner 84.7 6.7 1.9 2.1 4.2 0.5 28.8 Seasonal Home 62.9 16.1 5.3 2.7 12.4 0.6 1.3 Relative Home 41.8 15.4 8.2 19.4 12.6 2.6 0.6 Investment Home 52.2 10.5 1.7 19.9 12.4 3.4 2.0 3 Refinance 87.2 4.6 1.8 2.5 3.8 0.1 48.7 4 Homeowner Cashout 88.9 3.1 2.4 2.7 2.8 0.0 18.6 Homeowner Regular 87.5 5.4 1.5 1.8 3.7 0.1 27.5 Seasonal Home 81.3 13.5 1.3 2.6 1.4 0.0 0.6 Relative Home 72.4 5.3 3.8 0.0 18.4 0.0 0.2 Investment Home 67.8 4.6 0.0 13.3 13.2 1.2 1.7 Property Type Single-family Detached House 100.0 0.0 0.0 0.0 0.0 0.0 84.1 Townhouse, Row House, or Villa 0.0 100.0 0.0 0.0 0.0 0.0 6.1 Mobile or Manufactured Home 0.0 0.0 100.0 0.0 0.0 0.0 2.0 Two-to-Four Unit Dwelling 0.0 0.0 0.0 100.0 0.0 0.0 2.9 Condo, Apartment House, or Co-op 0.0 0.0 0.0 0.0 100.0 0.0 4.7 Other 0.0 0.0 0.0 0.0 0.0 100.0 0.3 All Respondents 84.1 6.1 2.0 2.9 4.7 0.3 100.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. The "all other races" category includes respondents who reported being American Indian/Alaska Native or Native Hawaiian/Pacific Islander and respondents who reported multiple race categories. 2. Credit score, loan size, mortgage term to maturity, and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 4. If a refinance mortgage amount is higher than the prior mortgage amount or if a mortgage is for a previously mortgage-free property, the mortgage is classified as a cashout refinance.
Characteristics Single-Family
Table 5. Property Type, by Demographic and Loan Characteristics (Continued)
(Percentage Distribution)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
12
Divorced or Separated
Married or Had a Partner
Addition to Household
Left Household
Disability or Illness
Disaster to Home
Disaster to Work or Job
Moved Less than 50 Miles
Moved 50 Miles or More
Loan Type Purchase 1 8.3 18.4 3.1 18.0 6.0 6.5 1.2 1.7 48.0 23.0 First-Time Homeowner2 6.4 29.4 3.2 20.5 2.6 5.3 0.6 1.7 53.4 20.5 Repeat Homeowner 10.2 12.4 3.1 17.7 7.3 7.1 1.5 1.8 50.0 26.7 Non-Occupant Owner 3.0 9.8 2.8 8.5 13.6 7.2 2.1 0.3 8.3 8.5 1 Refinance 7.4 7.7 4.4 13.5 8.9 9.8 2.3 1.9 10.2 5.6 Homeowner Cashout3 9.7 7.7 5.1 13.9 10.2 11.9 2.4 2.0 8.6 3.7 Homeowner Regular 5.7 7.6 3.9 13.7 7.9 8.5 1.9 1.7 11.0 6.3 Non-Occupant Owner 8.3 7.8 4.4 9.7 9.5 9.5 4.3 2.9 14.3 11.8 Loan Size $50,000 or Less 4.5 8.9 8.5 2.8 4.1 11.9 4.3 2.5 17.4 10.2 $50,001 to $150,000 9.7 12.2 5.3 12.1 7.2 9.9 1.8 1.6 27.1 9.9 $150,001 to $300,000 8.2 13.8 3.4 16.2 8.1 8.1 1.9 2.3 30.3 16.1 More than $300,000 5.2 13.6 1.9 20.9 7.0 5.6 1.1 1.0 32.8 17.9 Credit Score 2 Lower than 620 9.5 9.7 4.5 10.8 9.3 15.1 2.5 1.1 24.6 10.4 620 to 679 9.7 17.5 4.6 14.9 9.0 10.8 1.8 2.5 28.7 13.1 680 to 719 8.8 13.8 4.1 16.9 8.5 8.6 1.4 2.2 32.0 13.3 720 or Higher 6.9 12.0 3.3 16.4 6.5 6.4 1.7 1.5 29.9 15.7 Respondent Age 35 Years or Younger 5.1 27.5 2.8 28.9 2.0 3.9 1.6 1.3 47.0 19.2 36 to 45 10.1 11.1 1.8 19.8 6.8 5.7 1.3 1.7 30.6 12.9 46 to 55 10.8 8.8 3.1 7.8 12.4 7.5 1.8 2.1 22.1 12.8 56 to 65 7.8 5.1 6.0 5.6 12.8 13.7 2.1 2.8 18.4 10.9 Older than 65 3.2 2.8 8.8 5.5 4.0 17.7 2.1 0.9 15.6 15.8 Respondent Race/Ethnicity Non-Hispanic White 8.0 13.0 3.8 15.6 7.9 8.1 1.9 1.7 30.8 14.6 Hispanic and Non-White 7.3 13.6 3.5 16.5 6.2 8.1 1.3 2.0 26.6 14.3 Respondent Education High School or Less 7.9 8.2 6.7 11.6 7.8 13.1 1.0 2.3 24.3 8.1 Some College 9.2 12.2 4.4 14.2 7.6 11.4 2.3 2.2 26.1 11.6 College Degree 7.6 15.5 3.1 16.5 6.8 6.4 1.4 1.2 32.2 15.5 Postgraduate 6.9 13.0 2.8 18.2 7.9 5.3 2.0 1.9 31.8 18.6 Household Income Less than $50,000 11.6 10.4 7.5 12.6 4.8 13.8 1.9 2.7 29.2 12.1 $50,000 to $99,999 9.0 13.4 4.4 16.6 6.7 9.3 1.9 1.9 31.8 13.6 $100,000 to $174,999 7.0 14.2 2.3 15.3 9.5 6.1 1.6 1.3 27.9 14.9 $175,000 or More 2.9 13.6 1.0 18.4 8.1 3.3 1.5 1.5 28.2 18.5 Household Type Couple 3.1 16.4 2.4 18.9 7.6 8.5 2.0 2.1 29.7 15.3 Single 22.3 3.3 7.7 6.5 6.8 6.9 1.0 0.9 29.5 12.3 All Respondents 7.8 13.2 3.7 15.8 7.4 8.1 1.7 1.8 29.6 14.5 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Death in Household
Table 6. Household Life Events, by Loan and Demographic Characteristics
(Percent Who Experienced Each Event in the Last Couple of Years)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
13
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Mortgage Features
The survey asked respondents to assess their prior knowledge about getting a mortgage and familiarity with basic mortgage loan terms. The results are reflected in Table 7. At most, 12 percent of respondents reported that they were not previously familiar with different mortgage features: the mortgage process (12 percent), the types of mortgages available (11 percent), down payment (9 percent), income requirements (8 percent), interest rate levels (6 percent), or the type of credit history that was expected (3 percent). First-time homebuyers were less likely to indicate that they were previously familiar with the process of taking out a mortgage, the types of mortgages, or interest rates available compared to borrowers who had bought a home previously and to those who refinanced. First-time homebuyers were also more likely to indicate that they were not previously familiar with the income, credit history, down payment, or closing costs required for a mortgage. Generally, younger borrowers and borrowers with lower credit scores or income reported that they had less prior information about the process and qualification requirements for obtaining a mortgage. For example, 25 percent of borrowers 35 years old or younger indicated that they were not familiar with the process of taking out a mortgage. Eighteen percent of households with less than $50,000 in income indicated they were not familiar with the down payment required to purchase a house, and 20 percent indicated they were not familiar with the amount of money needed at closing. Twenty percent of borrowers with credit scores below 620 reported that they were not familiar with the types of mortgages available. The share of borrowers who reported they were not previously familiar with a mortgage feature generally declined as loan amount, education, credit score, and income increased. The number of persons who reported they were unfamiliar with the process was also comparatively higher among Hispanics, non-white borrowers, and single-headed households. Mortgage Process
The percentage of borrowers concerned about qualifying for a mortgage also declined as loan amount, education, credit score, and income increased. For example, 12 percent of non-Hispanic white borrowers reported that they were very concerned with qualifying compared to 26 percent of Hispanic or non-white borrowers. The differences in the percentages of borrowers concerned about qualifying for a mortgage was most noticeable based on credit score: 35 percent of those with scores below 620 were very concerned about qualifying, while 9 percent of borrowers with scores of at least 720 reported that they were very concerned. More than 69 percent of borrowers who refinanced their mortgage or looked for an investment property indicated that they had a firm idea about the type of mortgage they wanted. In contrast, only 30 percent of first-time homebuyers indicated that they had a firm idea of the mortgage they wanted, 18 percent of first-time homebuyers indicated they had little idea of what type of mortgage they wanted, and 52 percent reported they had some idea. The percentage of borrowers who indicated they had a firm idea about the type of mortgage they wanted increased with age and credit score.
14
Interest Rates Available
Prior Knowledge (Percent Not at All Familiar with Each Feature) Mortgage Process of Down Income Credit Types Taking Out Payment to Needed to History or Available Qualify Qualify Score Mortgage
Money Needed at Closing
Concerned About Qualifying (Percentage Distribution) Very Somewhat Not at All
Idea About the Mortgage Wanted (Percentage Distribution) Firm Idea Some Idea Little Idea
Loan Type Purchase 1 10.4 15.1 18.5 9.3 10.4 3.3 16.3 19.5 33.4 47.1 50.1 40.1 9.8 First-Time Homeowner2 21.0 26.1 39.4 16.8 19.4 5.7 29.7 26.9 42.7 30.4 29.6 52.4 18.0 Repeat Homeowner 4.2 8.7 6.7 5.1 5.1 1.6 8.7 16.2 29.0 54.8 60.7 33.9 5.3 Non-Occupant Owner 5.5 10.0 6.4 4.3 6.3 4.4 8.5 8.5 22.1 69.3 69.4 26.5 4.1 Refinance 1 2.2 7.5 4.3 8.6 6.4 1.7 8.2 12.3 24.8 62.9 69.1 28.5 2.5 Homeowner Cashout3 2.5 8.0 3.9 9.8 6.6 1.4 7.7 15.3 28.8 55.9 68.5 29.2 2.3 Homeowner Regular 2.1 7.2 4.7 7.7 6.4 1.7 8.6 10.9 22.0 67.0 68.6 28.7 2.7 Non-Occupant Owner 1.0 6.3 1.8 9.1 4.9 3.2 8.4 5.7 24.3 69.9 77.4 20.5 2.1 Loan Size $50,000 or Less 13.2 20.8 15.5 11.9 14.0 5.9 13.7 17.6 34.9 47.6 46.7 44.1 9.2 $50,001 to $150,000 8.9 15.8 16.2 12.4 12.1 3.8 15.6 20.1 31.6 48.3 55.5 36.3 8.3 $150,001 to $300,000 6.0 10.6 10.1 8.8 7.5 2.1 12.4 15.1 29.5 55.4 59.3 34.8 5.9 More than $300,000 3.4 6.6 8.1 4.8 5.1 1.5 8.4 12.4 25.4 62.2 65.1 30.8 4.0 Credit Score 2 Lower than 620 12.6 19.6 16.8 12.5 10.7 3.4 20.1 35.4 40.2 24.4 44.9 45.3 9.7 620 to 679 11.4 14.7 15.4 14.4 12.0 3.8 17.6 30.0 39.3 30.7 49.4 40.8 9.8 680 to 719 6.7 13.2 12.4 8.9 9.5 2.5 15.4 19.7 37.3 43.0 57.2 35.4 7.4 720 or Higher 4.1 9.1 9.7 6.9 6.9 2.1 9.2 8.8 23.0 68.3 64.4 31.1 4.5 Respondent Age 35 Years or Younger 12.5 17.2 24.6 10.7 12.6 3.2 20.6 18.7 33.2 48.0 44.3 44.1 11.6 36 to 45 5.2 9.3 7.4 7.0 7.1 2.1 9.4 16.1 29.4 54.5 58.9 35.5 5.6 46 to 55 3.7 9.0 5.9 7.3 5.8 1.4 9.1 17.9 26.9 55.2 64.4 32.1 3.5 56 to 65 3.3 8.7 6.3 8.7 6.6 2.6 7.7 12.2 26.7 61.1 70.7 25.6 3.6 Older than 65 3.9 10.7 8.5 13.2 9.8 4.2 12.5 10.3 27.5 62.3 71.0 25.1 3.8 Respondent Race/Ethnicity Non-Hispanic White 5.6 10.2 10.7 7.9 7.6 2.4 11.6 12.4 27.7 59.9 60.6 33.6 5.8 Hispanic and Non-White 8.4 14.8 14.0 11.7 10.7 2.9 14.5 25.7 33.3 41.0 55.9 36.8 7.3 Respondent Education High School or Less 10.2 19.4 16.6 15.5 11.2 3.3 16.2 26.7 33.7 39.7 52.3 38.4 9.3 Some College 7.7 13.5 12.0 12.6 9.7 3.5 14.9 20.0 33.1 46.9 57.2 36.5 6.2 College Degree 5.7 9.9 11.2 7.1 7.7 2.1 11.1 13.8 27.8 58.4 59.6 34.4 6.0 Postgraduate 4.6 8.2 9.6 5.3 7.1 1.8 10.1 10.8 25.5 63.7 63.8 30.8 5.3 Household Income Less than $50,000 14.0 21.1 21.1 18.1 15.8 5.5 20.3 29.6 36.9 33.5 48.2 41.2 10.7 $50,000 to $99,999 6.8 13.0 13.4 10.4 9.8 2.9 14.7 19.0 32.6 48.4 57.0 35.8 7.2 $100,000 to $174,999 4.2 7.7 7.2 5.0 4.8 1.3 8.6 10.8 26.0 63.2 61.4 34.0 4.6 $175,000 or More 1.4 4.4 5.4 3.0 4.1 1.0 5.6 4.4 19.4 76.2 72.5 25.1 2.4 Household Type Couple 5.4 10.2 10.1 7.7 7.4 2.1 11.0 15.5 27.7 56.8 61.1 33.7 5.2 Single 9.4 14.8 16.2 12.7 11.8 4.0 16.6 17.7 33.8 48.5 54.1 36.6 9.4 All Respondents 6.4 11.4 11.6 8.9 8.4 2.5 12.4 16.0 29.2 54.8 59.3 34.4 6.2 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Table 7. Prior Mortgage Knowledge, Idea about Mortage Wanted, and Concern about Qualifying, by Loan and Demographic Characteristics
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Ability to Explain Mortgage Process
Table 8 reflects that by the end of the process of obtaining a mortgage, 55 percent of first-time homebuyers and 48 percent of those who refinanced a mortgage felt they were somewhat able to explain the process of taking out a mortgage. Forty percent of first-time homebuyers and 47 percent of those who refinanced felt very confident in their ability to explain the mortgage process. For borrowers with $175,000 or more in income, more than 6 out of 10 were very confident in their ability to explain the process of taking out a mortgage, and fewer than 4 out of 10 borrowers with less than $50,000 in income were very confident in their ability to explain the process. Eight percent of households with incomes less than $50,000 and 9 percent of households in which the respondent had a high school education or less were not confident about their ability to explain the process of taking out a mortgage. Forty-six percent of all respondents reported they would have a difficult time explaining the difference between a prime and a subprime loan. The share of borrowers who were not confident in their ability to explain prime versus subprime loans exceeded half of respondents among first-time homebuyers, borrowers 35 years old or younger, borrowers taking out loans of $150,000 or less, borrowers with household income of less than $100,000, and borrowers with some college or less education. Overall, more than one-quarter of borrowers reported that they could not explain amortization or the difference between the interest rate and the Annual Percentage Rate (APR) on a loan. The percentages of respondents who reported that they were not able to explain these mortgage details were highest among borrowers with a high school diploma or less education, first-time homebuyers, those taking out loans of $50,000 or less, those with household incomes below $50,000, and single households.
5. Selecting a Mortgage: Mortgage Broker versus Mortgage Lender The survey asked borrowers about how they chose their mortgage originator, the number of lenders they considered, and important factors in choosing the lender and the mortgage product. Borrowers reported that they consider many features when selecting a mortgage. Table 9 reflects that about 61 percent of all respondents and 67 percent of respondents who refinanced went to a lender for their mortgage rather than to a mortgage broker. For the smallest loan sizes of $50,000 or less, 88 percent of borrowers went to the lender directly. First-time homebuyers were somewhat more likely than other borrowers to use a broker, and the percentage of them who used a broker increased with loan size. Borrowers initiated contact with the lender or broker 69 percent of the time, lenders initiated contact 13 percent of the time, and a third party initiated contact for 18 percent of respondents. Lenders initiated contact for 19 percent of respondents who refinanced compared to 7 percent of homebuyers. The share of loans for which a third party initiated contact was nearly five times higher for home purchase loans than for refinances (29 percent and 6 percent, respectively). Eight percent of all respondents used housing counselors or completed courses on home ownership, and the share who received housing counseling was higher for first-time homebuyers (23 percent), those with household income less than $50,000 (18 percent), those 35 years old or younger (13 percent), and those with credit scores lower than 620 (10 percent).
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Ability to Explain Mortgage Process (Percentage Distribution) Very Somewhat Not at All
Mortgage Knowledge (Percent Not at All Able to Explain Each Feature) Fixed Versus Prime Versus Interest Rate Amortization of Consequence of Adjustable Rate Subprime Versus APR Loan Not Paying
Loan Type Purchase 1 47.1 48.9 4.0 7.8 50.5 29.1 33.1 7.0 First-Time Homeowner2 39.8 54.5 5.6 10.9 63.4 37.2 45.9 10.0 Repeat Homeowner 49.7 47.6 2.7 5.6 43.8 24.7 26.3 4.8 Non-Occupant Owner 62.1 31.9 6.1 9.5 39.3 22.8 22.7 8.3 1 Refinance 47.4 48.4 4.2 4.9 41.3 24.1 26.6 6.2 Homeowner Cashout3 44.2 51.3 4.6 5.3 43.9 27.3 27.1 6.9 Homeowner Regular 48.8 47.1 4.1 4.6 40.1 22.3 27.3 5.7 Non-Occupant Owner 56.9 40.6 2.5 5.1 35.6 19.3 15.5 6.0 Loan Size $50,000 or Less 42.5 47.2 10.3 13.8 61.5 34.6 45.4 13.8 $50,001 to $150,000 41.7 53.3 5.0 8.0 51.3 29.8 36.6 7.2 $150,001 to $300,000 46.1 49.8 4.1 6.7 48.5 27.8 30.2 6.5 More than $300,000 56.2 41.2 2.6 3.4 34.2 20.3 20.2 5.3 Credit Score 2 Lower than 620 36.4 57.1 6.4 9.2 46.6 32.2 39.9 10.0 620 to 679 42.1 52.0 5.9 7.3 50.8 30.0 35.6 6.1 680 to 719 44.2 51.3 4.5 7.1 49.4 29.4 34.5 7.7 720 or Higher 50.7 46.1 3.2 5.7 43.6 24.4 26.0 6.1 Respondent Age 35 Years or Younger 44.4 52.3 3.4 7.7 58.0 33.0 38.7 7.4 36 to 45 48.7 47.5 3.8 5.8 44.3 26.4 27.2 6.6 46 to 55 49.3 46.6 4.1 5.8 42.6 24.7 26.9 6.2 56 to 65 49.1 46.7 4.2 5.5 38.1 22.4 25.0 4.6 Older than 65 44.1 49.4 6.6 7.3 38.7 21.3 28.0 8.5 Respondent Race/Ethnicity Non-Hispanic White 47.4 48.9 3.7 5.6 44.6 27.1 28.7 5.8 Hispanic and Non-White 46.9 47.9 5.2 8.6 49.8 25.4 33.2 8.8 Respondent Education High School or Less 35.5 55.7 8.8 12.4 56.0 33.3 44.7 12.2 Some College 42.1 53.1 4.8 6.8 50.7 27.4 34.3 6.4 College Degree 49.6 47.2 3.2 5.4 44.9 25.5 27.4 5.1 Postgraduate 53.8 43.4 2.8 4.9 39.0 24.8 23.0 6.4 Household Income Less than $50,000 33.0 58.8 8.2 13.7 60.4 37.0 46.3 11.8 $50,000 to $99,999 44.3 50.9 4.8 7.0 52.7 29.6 34.3 6.9 $100,000 to $174,999 50.2 47.4 2.4 3.4 39.8 22.8 24.9 5.2 $175,000 or More 63.4 35.2 1.4 2.8 27.2 16.2 12.3 2.8 Household Type Couple 49.0 47.1 3.9 5.8 44.6 24.8 28.5 6.0 Single 42.1 53.2 4.7 8.3 50.3 32.3 34.4 8.3 All Respondents 47.3 48.6 4.1 6.4 46.0 26.7 29.9 6.6 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Table 8. Knowledge about the Mortgage Process at the Time of Survey, by Loan and Demographic Characteristics
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table 9. Mortage Application Channel, First Contact, and Housing Counseling, by Loan and Demographic Characteristics Characteristics
Mortgage Application (Percent Who Applied) Directly Through Broker
Contact Initiated by (Percentage Distribution) Borrower Lender Third Party
Housing Counseling (Percent Who Received)
Loan Type Purchase 1 55.3 44.1 64.2 6.6 29.2 12.2 First-Time Homeowner2 51.6 47.8 59.6 5.9 34.5 22.5 Repeat Homeowner 56.7 42.7 66.2 6.8 27.0 6.7 Non-Occupant Owner 62.7 37.3 71.8 8.1 20.1 3.6 1 Refinance 67.0 32.9 74.8 19.3 5.9 3.9 Homeowner Cashout3 66.9 32.8 77.1 16.3 6.6 5.4 Homeowner Regular 67.2 32.7 72.5 22.0 5.5 3.1 Non-Occupant Owner 65.5 34.5 81.9 13.5 4.6 1.9 Loan Size $50,000 or Less 87.9 12.1 79.2 8.0 12.8 17.5 $50,001 to $150,000 66.9 32.9 70.3 12.6 17.1 10.5 $150,001 to $300,000 58.7 40.8 67.6 12.9 19.5 8.3 More than $300,000 55.4 44.3 70.4 13.2 16.4 4.3 Credit Score 2 Lower than 620 47.8 51.1 59.4 22.0 18.6 9.5 620 to 679 55.1 44.3 63.4 16.1 20.4 13.1 680 to 719 58.3 41.6 67.8 12.7 19.5 9.5 64.8 34.9 72.6 10.8 16.5 6.2 720 or Higher Respondent Age 35 Years or Younger 55.8 44.0 67.6 8.3 24.0 13.2 36 to 45 60.0 39.5 68.1 14.0 17.9 7.5 46 to 55 61.0 38.3 72.8 13.0 14.2 6.0 56 to 65 66.8 33.2 71.8 15.1 13.1 5.5 Older than 65 67.8 31.9 65.7 17.5 16.8 5.3 Respondent Race/Ethnicity Non-Hispanic White 63.0 36.7 71.9 11.2 16.9 6.3 Hispanic and Non-White 55.5 44.0 62.6 17.0 20.4 13.2 Respondent Education High School or Less 59.1 40.7 63.0 16.2 20.7 15.8 Some College 57.6 42.0 67.3 14.3 18.4 9.6 College Degree 61.8 37.9 71.1 11.6 17.3 7.1 Postgraduate 63.8 35.7 71.7 11.5 16.8 5.1 Household Income Less than $50,000 58.4 41.4 61.4 14.0 24.6 17.8 $50,000 to $99,999 61.3 38.1 68.3 12.7 19.0 9.8 $100,000 to $174,999 60.4 39.2 71.5 13.1 15.4 3.9 $175,000 or More 64.0 36.0 76.2 11.3 12.5 2.3 Household Type Couple 61.3 38.3 69.6 12.9 17.5 7.3 Single 59.9 39.8 68.8 12.5 18.7 10.9 All Respondents 61.0 38.7 69.4 12.8 17.8 8.2 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Number of Lenders Considered
The survey asked borrowers about the number of lenders they seriously considered when selecting a mortgage. As reflected in Table 10, almost half of all borrowers seriously considered applying to only one lender, more than one-third seriously considered two lenders, and 17 percent indicated that they seriously considered more than two lenders. About the same share of respondents who refinanced (49 percent) considered one lender as homebuyers (48 percent). The percentage of borrowers who considered only one lender was higher for borrowers reporting smaller loan size, lower credit score, less education, and lower household income and for older borrowers. Fifty percent of non-Hispanic white borrowers and 44 percent of non-white or Hispanic borrowers seriously considered only one lender. Overall, 72 percent of borrowers applied to one lender. Sixty-nine percent of homebuyers applied to one lender compared to 75 percent of respondents who refinanced. First-time purchasers were the least likely to apply to one lender at 64 percent. Twenty-seven percent of first-time purchasers applied to two lenders compared with 22 percent for borrowers as a whole. Borrowers aged 35 years old or younger reported applying to two lenders 23 percent of the time. Overall, 5 percent of borrowers applied to three lenders, and 1 percent applied to more than three lenders. The share of non-Hispanic white borrowers who applied to one lender was about 10 percentage points higher than the share for non-white or Hispanic borrowers (75 percent and 65 percent, respectively). Important Factors in Choosing the Lender
The survey asked borrowers about how important a variety of factors were in selecting a lender or broker. Tables 11 and 12 list the responses to these questions. Borrowers indicated that the lender’s reputation and having an established banking relationship with a lender were important considerations in choosing a lender or broker. The lender’s reputation was important to 71 percent of borrowers. A banking relationship was important to 55 percent of borrowers. Having a local office or branch nearby was important to 49 percent of borrowers. Borrowers also identified factors they considered unimportant when selecting a lender. For example, whether the lender spoke the borrower’s primary language was reported as not important by 89 percent of borrowers. Homebuyers were much more likely than borrowers who refinanced to report that a lender used previously was unimportant (76 percent and 48 percent, respectively), and homebuyers were less likely than those refinancing loans to say that an agent or home builder’s recommendation was unimportant (45 percent and 82 percent, respectively). As shown in Table 12, 60 percent of all borrowers refinancing a mortgage reported that using a lender with an established banking relationship was important. Sixty percent of first-time homebuyers and 58 percent of borrowers aged 35 years or younger found recommendations from a friend, relative, or co-worker important in selecting a lender or broker. Homebuyers (55 percent) were much more likely than those refinancing an existing mortgage (18 percent) to report that recommendations from a real estate agent or a home builder were important.
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Number of Lenders Seriously Considered (Percentage Distribution) 2 3 4
Number of Lenders Applied to (Percentage Distribution) 2 3 4
1 5 or More 1 5 or More Loan Type 1 Purchase 47.8 35.4 14.4 1.7 0.7 68.7 24.3 5.5 0.7 0.7 First-Time Homeowner2 45.7 36.0 16.2 1.8 0.4 63.8 26.6 7.2 1.0 1.4 Repeat Homeowner 49.1 35.0 13.6 1.7 0.6 71.3 22.9 4.7 0.6 0.5 Non-Occupant Owner 47.8 36.5 12.2 1.2 2.3 73.0 22.9 4.1 0.0 0.0 Refinance 1 49.3 33.5 13.8 1.8 1.6 75.1 20.1 3.8 0.5 0.6 Homeowner Cashout3 48.8 32.6 15.3 2.2 1.0 72.2 22.0 4.9 0.5 0.4 Homeowner Regular 50.1 33.8 12.7 1.5 1.9 76.8 18.9 3.1 0.5 0.7 Non-Occupant Owner 44.2 37.0 16.0 1.1 1.7 78.3 18.7 2.5 0.0 0.5 Loan Size $50,000 or Less 53.6 33.8 11.8 0.8 0.0 73.3 16.7 9.3 0.4 0.4 $50,001 to $150,000 52.9 33.1 11.6 1.3 1.2 71.6 22.2 4.8 0.7 0.8 $150,001 to $300,000 47.5 35.2 14.5 1.8 1.0 72.1 22.8 3.9 0.6 0.6 More than $300,000 44.4 35.3 16.9 2.2 1.3 71.5 21.8 5.4 0.6 0.8 Credit Score 2 Lower than 620 51.4 30.2 14.7 2.5 1.3 66.3 26.9 4.1 1.5 1.1 620 to 679 45.4 37.8 14.7 1.2 0.9 64.7 27.4 6.2 0.5 1.2 680 to 719 53.1 30.8 13.4 1.9 0.8 71.2 22.6 4.9 0.6 0.8 720 or Higher 48.0 34.9 14.1 1.8 1.2 74.7 20.1 4.2 0.5 0.4 Respondent Age 35 Years or Younger 48.9 34.3 13.9 1.4 1.4 70.7 22.8 5.4 0.8 0.4 36 to 45 46.2 36.5 14.9 1.1 1.2 71.2 21.6 5.4 0.4 1.3 46 to 55 45.5 35.0 16.3 2.0 1.2 71.1 23.2 4.4 0.8 0.5 56 to 65 51.6 32.8 11.9 3.0 0.7 75.0 21.1 3.2 0.5 0.3 Older than 65 54.4 31.7 11.7 1.7 0.6 72.7 22.0 4.1 0.5 0.8 Respondent Race/Ethnicity Non-Hispanic White 50.2 33.7 13.4 1.6 1.0 74.5 20.8 3.6 0.6 0.5 Hispanic and Non-White 43.7 36.8 16.0 2.2 1.3 64.5 26.1 7.5 0.7 1.2 Respondent Education High School or Less 58.3 29.4 11.0 1.1 0.2 69.4 23.3 5.9 0.7 0.7 Some College 51.8 33.9 12.5 0.9 0.9 72.3 22.8 3.7 0.5 0.6 College Degree 46.4 35.9 14.2 2.5 1.0 71.2 22.1 5.2 0.7 0.8 Postgraduate 44.1 35.4 16.8 1.9 1.8 73.2 21.4 4.4 0.6 0.5 Household Income Less than $50,000 52.9 30.1 14.1 1.5 1.4 66.9 23.0 7.7 0.9 1.5 $50,000 to $99,999 50.0 35.1 12.2 1.8 1.0 71.2 23.5 4.1 0.7 0.4 $100,000 to $174,999 46.9 35.2 14.9 2.0 1.1 73.0 21.7 4.1 0.4 0.7 $175,000 or More 43.5 36.6 17.2 1.5 1.1 76.1 19.3 3.8 0.5 0.3 Household Type Couple 48.0 34.8 14.3 1.8 1.2 72.4 22.0 4.5 0.6 0.5 Single 50.2 33.7 13.6 1.6 0.9 70.0 23.1 5.1 0.6 1.1 All Respondents 48.5 34.5 14.1 1.7 1.1 71.8 22.2 4.7 0.6 0.7 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Table 10. Number of Lenders Considered and Applied to, by Loan and Demographic Characteristics
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table 11. Importance of Decision Factors in Choosing the Lender
(Percentage Distribution) Factors
Important
All Mortgages Established banking relationship 54.8 Local office 48.8 Used previously 37.4 Lender is a personal friend 15.7 Lender operates online 39.4 Recommended by a friend/relative/co-worker 40.2 Recommended by an agent/home builder 37.0 Lender reputation 71.0 Spoke borrower's primary language (not English) 10.8 Purchases Established banking relationship 49.9 Local office 54.1 Used previously 23.8 Lender is a personal friend 16.1 Lender operates online 37.5 Recommended by a friend/relative/co-worker 47.8 Recommended by an agent/home builder 55.3 Lender reputation 72.0 Spoke borrower's primary language (not English) 11.0 Refinances Established banking relationship 60.0 Local office 43.2 Used previously 51.7 Lender is a personal friend 15.3 Lender operates online 41.5 Recommended by a friend/relative/co-worker 32.3 Recommended by an agent/home builder 17.7 Lender reputation 69.9 Spoke borrower's primary language (not English) 10.6 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses.
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Importance of Factors
Not Important 45.2 51.2 62.6 84.3 60.6 59.8 63.0 29.0 89.2 50.1 45.9 76.2 83.9 62.5 52.2 44.7 28.0 89.0 40.0 56.8 48.3 84.7 58.5 67.7 82.3 30.1 89.4
Recommended by Friend/Relative/Co-worker Important Not Important
Recommended by Agent/Home Builder Important Not Important
Loan Type 1 Purchase 49.9 50.1 47.8 52.2 55.3 44.7 First-Time Homeowner2 48.3 51.7 60.3 39.7 61.7 38.3 Repeat Homeowner 50.2 49.8 41.6 58.4 53.2 46.8 Non-Occupant Owner 55.5 44.5 33.4 66.6 40.6 59.4 1 Refinance 60.0 40.0 32.3 67.7 17.7 82.3 Homeowner Cashout3 60.3 39.7 31.4 68.6 15.8 84.2 Homeowner Regular 59.7 40.3 33.1 66.9 18.8 81.2 Non-Occupant Owner 60.1 39.9 29.9 70.1 18.5 81.5 Loan Size $50,000 or Less 64.6 35.4 26.4 73.6 23.7 76.3 $50,001 to $150,000 58.8 41.2 35.3 64.7 34.6 65.4 $150,001 to $300,000 53.3 46.7 41.8 58.2 39.3 60.7 More than $300,000 51.6 48.4 44.8 55.2 37.3 62.7 2 Credit Score Lower than 620 56.3 43.7 30.7 69.3 37.9 62.1 620 to 679 53.0 47.0 40.7 59.3 42.9 57.1 680 to 719 51.7 48.3 42.6 57.4 40.0 60.0 720 or Higher 56.0 44.0 40.5 59.5 34.3 65.7 Respondent Age 35 Years or Younger 53.3 46.7 57.6 42.4 51.9 48.1 36 to 45 54.0 46.0 43.9 56.1 38.5 61.5 46 to 55 55.3 44.7 34.9 65.1 31.5 68.5 56 to 65 56.4 43.6 25.4 74.6 25.3 74.7 Older than 65 57.1 42.9 20.5 79.5 24.5 75.5 Respondent Race/Ethnicity Non-Hispanic White 53.5 46.5 38.7 61.3 34.7 65.3 Hispanic and Non-White 58.3 41.7 44.3 55.7 43.4 56.6 Respondent Education High School or Less 58.1 41.9 35.1 64.9 37.6 62.4 Some College 55.2 44.8 37.5 62.5 36.9 63.1 College Degree 54.0 46.0 43.1 56.9 38.6 61.4 Postgraduate 54.2 45.8 41.1 58.9 34.7 65.3 Household Income Less than $50,000 58.7 41.3 38.1 61.9 44.6 55.4 $50,000 to $99,999 53.5 46.5 41.2 58.8 38.1 61.9 $100,000 to $174,999 54.9 45.1 40.5 59.5 34.0 66.0 $175,000 or More 53.6 46.4 39.6 60.4 32.1 67.9 Household Type Couple 54.8 45.2 39.3 60.7 36.5 63.5 Single 55.1 44.9 43.0 57.0 38.6 61.4 All Respondents 54.8 45.2 40.2 59.8 37.0 63.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Established Banking Relationship Important Not Important
Table 12. Importance of Decision Factors in Choosing the Lender, by Loan and Demographic Characteristics
(Percentage Distribution)
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Important Factors in Choosing the Mortgage
The survey asked how important a variety of mortgage terms or features were in selecting a mortgage. As shown in Table 13, a low interest rate was important to 98 percent of borrowers, a fixed-rate mortgage was important to 90 percent, and a low APR was important to 88 percent. Low closing fees were important to 84 percent of borrowers. Overall, 61 percent of respondents reported that a low down payment was important. As reflected in Table 14, borrowers with credit scores below 620 (82 percent), borrowers with at most a high school education (75 percent), borrowers with income below $50,000 (74 percent), and first-time homebuyers (71 percent) said that a low down payment was important in choosing the mortgage. A low monthly payment was important to 81 percent of all borrowers. A low monthly payment was important to at least 88 percent of borrowers with a high school education or less, those with credit scores below 680, and those with household income below $50,000.
6. During the Application Process The survey asked borrowers about what additional information, if any, a lender asked them to provide during the mortgage application process. The survey found that purchase-mortgage borrowers were more likely to be requested for additional information by a lender than refinance borrowers. Table 15 shows that 16 percent of all borrowers reported being asked to resolve problems that appeared on a credit report. The share of borrowers who reported lender requests to fix problems with their credit reports differed sharply by credit score: 39 percent of borrowers with credit score lower than 620 and 29 percent of borrowers with credit scores between 620 and 679 were asked by the lender to resolve a problem, compared to 19 percent of borrowers with scores between 680 and 719 and 9 percent of borrowers with scores 720 or greater. About 58 percent of respondents reported answering follow-up requests for more information, and 18 percent reported having to redo paperwork during the application process. The percent of borrowers who redid paperwork was fairly steady across groups defined by demographics and loan characteristics. In contrast, those borrowers who were asked follow-up questions varied more noticeably. Sixty-four percent of borrowers with loans of more than $300,000 had to answer follow-up requests, while 44 percent of borrowers with loans of $50,000 or less received such requests. The percentage of borrowers who responded to follow-up requests also rose with income and education, but the percentage fell with credit score. Purchasers were also more likely to have answered follow-up questions than those who refinanced. Seven percent of borrowers reported needing multiple appraisals. The percentage of borrowers who required multiple appraisals was somewhat higher for first-time homebuyers, borrowers with credit scores below 680, and Hispanic and non-White borrowers. About 24 percent of all borrowers had to delay their closing date. Delays were more common for purchase mortgages than for refinances. The percentage of respondents who reported that the closing date had been delayed ranged from 27 to 33 percent across homebuyers and 17 to 29 percent for borrowers who refinanced.
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Table 13. Importance of Decision Factors in Choosing the Mortgage
(Percentage Distribution) Factors
Important
All Mortgages Low interest rate 97.9 Low APR 87.5 Low closing fees 83.9 Low down payment 61.2 Low monthly payment 80.7 Fixed interest rate 89.9 Term less than 30 years 59.8 No mortgage insurance 54.8 Purchases Low interest rate 97.1 Low APR 87.3 Low closing fees 83.2 Low down payment 64.3 Low monthly payment 81.5 Fixed interest rate 89.7 Term less than 30 years 68.7 No mortgage insurance 50.0 Refinances Low interest rate 98.7 Low APR 87.8 Low closing fees 84.5 Low down payment 58.0 Low monthly payment 79.8 Fixed interest rate 90.1 Term less than 30 years 50.3 No mortgage insurance 59.9 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses.
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Importance of Factors
Not Important 2.1 12.5 16.1 38.8 19.3 10.1 40.2 45.2 2.9 12.7 16.8 35.7 18.5 10.3 31.3 50.0 1.3 12.2 15.5 42.0 20.2 9.9 49.7 40.1
Low Monthly Payment Important Not Important
No Mortgage Insurance Important Not Important
Loan Type 1 Purchase 64.3 35.7 81.5 18.5 50.0 50.0 First-Time Homeowner2 71.4 28.6 86.4 13.6 42.9 57.1 Repeat Homeowner 62.6 37.4 80.3 19.7 54.4 45.6 Non-Occupant Owner 42.8 57.2 67.1 32.9 51.1 48.9 1 Refinance 58.0 42.0 79.8 20.2 59.9 40.1 Homeowner Cashout3 57.9 42.1 80.1 19.9 60.4 39.6 Homeowner Regular 59.0 41.0 80.1 19.9 59.9 40.1 Non-Occupant Owner 48.4 51.6 74.0 26.0 56.5 43.5 Loan Size $50,000 or Less 61.1 38.9 77.8 22.2 47.3 52.7 $50,001 to $150,000 65.2 34.8 81.3 18.7 48.4 51.6 $150,001 to $300,000 62.9 37.1 81.5 18.5 55.8 44.2 More than $300,000 53.7 46.3 78.8 21.2 61.5 38.5 2 Credit Score Lower than 620 82.4 17.6 91.8 8.2 53.7 46.3 620 to 679 75.5 24.5 89.2 10.8 49.3 50.7 680 to 719 69.1 30.9 86.1 13.9 54.5 45.5 720 or Higher 52.7 47.3 75.5 24.5 56.7 43.3 Respondent Age 35 Years or Younger 65.2 34.8 84.1 15.9 50.1 49.9 36 to 45 61.9 38.1 79.8 20.2 57.6 42.4 46 to 55 62.1 37.9 78.1 21.9 57.9 42.1 56 to 65 57.5 42.5 80.2 19.8 53.6 46.4 Older than 65 53.2 46.8 80.0 20.0 55.3 44.7 Respondent Race/Ethnicity Non-Hispanic White 57.7 42.3 78.9 21.1 53.9 46.1 Hispanic and Non-White 70.7 29.3 85.5 14.5 57.4 42.6 Respondent Education High School or Less 74.7 25.3 88.1 11.9 53.7 46.3 Some College 67.5 32.5 85.7 14.3 53.6 46.4 College Degree 60.1 39.9 80.1 19.9 55.6 44.4 Postgraduate 51.3 48.7 73.5 26.5 55.3 44.7 Household Income Less than $50,000 73.7 26.3 88.3 11.7 49.6 50.4 $50,000 to $99,999 67.0 33.0 84.3 15.7 52.1 47.9 $100,000 to $174,999 57.1 42.9 78.7 21.3 59.2 40.8 $175,000 or More 42.5 57.5 67.9 32.1 58.4 41.6 Household Type Couple 60.7 39.3 80.2 19.8 54.7 45.3 Single 62.9 37.1 81.8 18.2 55.1 44.9 All Respondents 61.2 38.8 80.7 19.3 54.8 45.2 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Low Down Payment Important Not Important
Table 14. Importance of Decision Factors in Choosing the Mortgage, by Loan and Demographic Characteristics
(Percentage Distribution)
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Table 15. Additional Steps Taken in the Mortgage Process, by Loan and Demographic Characteristics
(Percent Who Took Each Step) Characteristics
Resolved Credit Answered FollowReport Issues up Requests
Had Multiple Appraisals
Redid Paperwork Due to Delays
Delayed Closing Date
Loan Type Purchase 1 20.3 66.6 8.1 21.0 29.1 First-Time Homeowner2 25.4 68.6 10.4 24.1 31.1 Repeat Homeowner 18.8 64.6 6.9 18.9 27.3 Non-Occupant Owner 7.6 71.3 6.2 22.5 33.2 Refinance 1 11.7 48.1 5.3 15.1 18.2 Homeowner Cashout3 12.8 51.8 6.1 16.1 19.4 Homeowner Regular 10.8 44.2 4.8 14.1 16.5 Non-Occupant Owner 13.0 61.9 4.1 17.5 28.5 Loan Size $50,000 or Less 16.1 44.3 4.5 20.6 25.0 $50,001 to $150,000 17.5 54.2 7.6 19.2 25.6 $150,001 to $300,000 16.4 56.9 7.0 17.4 23.3 More than $300,000 14.1 63.8 5.5 17.7 22.4 Credit Score 2 Lower than 620 39.0 62.3 8.8 23.3 34.2 620 to 679 29.1 62.8 10.3 24.0 28.4 680 to 719 18.9 59.2 7.3 19.5 28.1 9.1 55.0 5.2 15.4 20.3 720 or Higher Respondent Age 35 Years or Younger 16.6 61.3 7.8 18.4 26.0 36 to 45 16.1 58.3 6.7 16.5 21.5 46 to 55 18.0 56.7 6.4 20.0 25.9 56 to 65 15.2 54.9 6.1 16.2 21.0 Older than 65 12.2 52.0 5.4 20.4 23.9 Respondent Race/Ethnicity Non-Hispanic White 14.7 56.7 6.3 17.4 22.9 Hispanic and Non-White 19.9 59.8 7.9 20.0 26.4 Respondent Education High School or Less 21.5 54.2 9.3 20.9 25.0 Some College 19.0 55.1 6.7 19.8 24.9 College Degree 13.7 56.9 6.3 16.3 23.0 Postgraduate 14.5 62.2 6.2 17.9 23.5 Household Income Less than $50,000 22.2 57.5 9.2 22.2 28.8 $50,000 to $99,999 17.3 55.8 7.5 18.7 24.4 $100,000 to $174,999 13.8 56.7 5.1 15.2 20.9 $175,000 or More 11.5 63.1 5.2 17.8 22.5 Household Type Couple 15.6 57.4 6.4 17.9 23.5 Single 17.6 58.2 7.7 18.8 24.8 All Respondents 16.1 57.6 6.7 18.1 23.8 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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7. Closing on a Mortgage The survey asked questions about the sources of information used by borrowers about their closing documents, funding sources of closing costs, finding a settlement agent, title insurance, and other features of the mortgage. Tables 16 to 18 reflect the responses. Source of Information on Closing Documents
Seventy-one percent of borrowers reported seeking information or input from the lender or broker on closing documents. Thirty percent of all borrowers and 64 percent of first-time homebuyers asked their real estate agent for input about their closing documents. Eight to 22 percent of borrowers sought input from the settlement agent, an attorney, the title agent, or a trusted friend, and 1 percent turned to a housing counselor for input on the mortgage closing. The percentage of borrowers seeking input on closing documents was uniformly higher for homebuyers than for refinancing borrowers. Closing Costs
The survey asked borrowers to report who paid any of the closing costs. Table 17 reflects that the borrower paid at least some of the closing costs on 62 percent of loans. In purchase transactions, 81 percent of borrowers paid all closing costs, and the lender and seller were less likely to have paid some of the closing costs (12 percent and 32 percent of loans, respectively). For refinances, the lender paid some or all of closing costs for 24 percent of the loans and the borrower paid some or all of the closing costs for 42 percent. Because closing costs were funded by multiple sources, the percentages do not add up to 100 percent. Closing costs were added to the mortgage amount on 38 percent of loans overall – 18 percent of purchases and 58 percent of refinances. Selecting Settlement Agent
The survey asked respondents about their search for a settlement agent and about the features present in the mortgage they obtained. Table 18 reflects the responses to these questions. Twothirds of respondents indicated that the lender recommended the settlement agent. More than one-fifth of borrowers overall indicated they selected an agent they had used previously, with slightly greater shares for non-occupant purchasers and those who refinanced. Ten percent of borrowers shopped around for a settlement agent to handle their closing, with the highest share for first-time homebuyers. Mortgage Features
Seventy-nine percent of borrowers reported that their mortgages included an escrow account for taxes or homeowner insurance, a higher percentage on purchases than on refinances. Three percent of borrowers reported loans that included a pre-payment penalty and 2 percent reported that their loan included a balloon payment feature.
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Table 16. Sources of Input About Closing Documents, by Loan and Demographic Characteristics Characteristics Lender or Broker
Sources of Input About Closing Documents (Percentage Who Sought Input from Each Source) Personal Real Estate Settlement Title Agent Trusted Attorney Agent Agent Friend
Housing Counselor
Loan Type Purchase 1 79.0 11.4 53.0 26.2 18.7 28.0 2.0 First-Time Homeowner2 80.6 12.8 63.9 22.8 20.3 46.5 3.1 Repeat Homeowner 79.1 10.5 48.1 27.6 17.4 17.0 1.1 Non-Occupant Owner 70.4 11.6 37.3 32.1 20.1 20.8 3.4 Refinance 1 63.3 3.6 4.7 17.3 8.8 11.2 0.4 Homeowner Cashout3 61.1 2.8 4.6 15.7 9.5 11.2 0.6 Homeowner Regular 64.8 3.5 4.8 17.7 7.9 11.4 0.3 Non-Occupant Owner 62.3 11.4 5.5 25.2 12.8 8.8 0.5 Loan Size $50,000 or Less 60.8 3.0 20.5 14.4 14.3 22.9 7.1 $50,001 to $150,000 69.2 7.3 30.0 16.5 15.5 20.8 1.2 $150,001 to $300,000 71.4 7.8 30.5 22.3 13.8 19.9 1.3 More than $300,000 74.6 8.1 28.1 28.4 12.0 18.2 0.7 Credit Score 2 Lower than 620 68.3 8.4 30.3 14.6 11.4 16.4 2.0 620 to 679 70.1 6.8 30.9 20.9 15.5 20.8 2.0 680 to 719 72.6 9.0 32.5 20.3 16.0 19.6 1.4 720 or Higher 71.7 7.5 28.3 23.3 13.1 19.9 0.9 Respondent Age 35 Years or Younger 78.0 9.0 47.0 20.8 15.0 38.3 2.0 36 to 45 70.9 7.0 28.0 22.9 14.7 19.0 1.4 46 to 55 68.5 8.4 23.5 21.8 13.7 12.1 0.7 56 to 65 66.0 7.1 17.5 21.1 12.8 8.3 0.8 Older than 65 69.4 4.6 19.5 23.4 10.8 7.9 0.8 Respondent Race/Ethnicity Non-Hispanic White 71.2 7.8 28.5 20.9 13.1 19.8 1.0 Hispanic and Non-White 71.6 7.2 32.4 24.4 16.0 19.7 2.0 Respondent Education High School or Less 64.2 7.7 26.4 17.3 15.1 17.2 3.0 Some College 70.0 6.1 29.4 20.0 14.5 16.6 1.2 College Degree 73.0 7.9 30.3 21.8 13.6 22.6 0.8 Postgraduate 73.2 8.7 29.9 25.7 13.2 20.2 1.1 Household Income Less than $50,000 68.1 7.6 34.4 17.8 16.9 23.9 2.8 $50,000 to $99,999 71.8 7.6 32.6 20.7 14.0 21.6 1.3 $100,000 to $174,999 72.9 7.0 25.6 22.1 12.1 17.2 0.5 $175,000 or More 70.7 8.9 24.4 28.4 13.6 16.2 0.7 Household Type Couple 71.9 7.2 28.8 22.5 13.6 17.9 1.1 Single 69.8 8.9 31.7 20.2 14.6 25.4 1.6 71.3 7.6 29.5 21.9 13.9 19.8 1.2 All Respondents Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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Table 17. Source of Funding for the Closing Costs, by Loan and Demographic Characteristics
(Percent Who Reported Each Source) Characteristics
By Borrower
Closing Costs Paid By By Lender Seller
By Adding to Mortgage
Loan Type Purchase 1 81.2 11.8 31.5 18.1 First-Time Homeowner2 79.8 12.3 39.1 13.8 Repeat Homeowner 81.6 11.5 28.1 20.3 Non-Occupant Owner 84.6 11.7 19.8 21.5 1 Refinance 41.6 24.4 0.0 58.4 3 Homeowner Cashout 31.4 19.2 0.0 72.0 Homeowner Regular 47.1 27.9 0.0 49.1 Non-Occupant Owner 56.8 24.7 0.0 58.3 Loan Size $50,000 or Less 57.3 21.3 16.9 43.5 $50,001 to $150,000 59.6 14.0 16.4 40.3 $150,001 to $300,000 61.7 17.4 18.0 36.9 More than $300,000 65.5 23.2 12.7 35.2 Credit Score 2 Lower than 620 55.8 19.7 14.0 42.0 620 to 679 56.3 15.8 20.7 41.4 680 to 719 54.8 17.6 18.7 41.5 720 or Higher 66.0 18.5 14.3 35.2 Respondent Age 35 Years or Younger 69.8 16.5 29.1 23.8 36 to 45 64.1 18.8 15.6 33.6 46 to 55 59.0 17.3 11.2 42.3 56 to 65 53.4 19.1 7.1 51.3 Older than 65 55.6 18.8 8.6 52.8 Respondent Race/Ethnicity Non-Hispanic White 61.8 17.5 16.2 39.3 Hispanic and Non-White 62.1 19.2 16.1 33.3 Respondent Education High School or Less 56.7 17.2 13.6 40.2 Some College 57.3 15.4 15.2 40.7 College Degree 62.1 19.0 18.0 37.1 Postgraduate 68.2 19.1 15.6 34.5 Household Income Less than $50,000 56.6 16.0 19.2 36.9 $50,000 to $99,999 61.8 15.9 19.7 40.1 $100,000 to $174,999 61.5 20.1 13.2 38.4 $175,000 or More 68.4 20.6 10.1 31.5 Household Type Couple 61.3 18.5 16.1 37.2 Single 63.8 16.2 16.3 39.2 All Respondents 61.9 17.9 16.2 37.7 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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Settlement Agent Selection (Percent Who Used Each Method) Lender Recommended Previous Agent
Shopped Around
Prepayment Penalty
Mortgage Features (Percent with Each Feature) Escrow Balloon Account Payment
Interest-Only Payment
Loan Type Purchase 1 66.2 19.0 11.5 2.6 82.5 1.9 4.9 First-Time Homeowner2 67.3 11.8 13.6 3.1 83.6 1.9 6.2 Repeat Homeowner 66.9 21.6 10.2 2.2 84.2 1.8 3.9 Non-Occupant Owner 56.3 34.1 11.1 2.9 65.2 2.6 5.5 1 Refinance 66.1 22.6 8.5 2.5 74.5 1.2 4.3 Homeowner Cashout3 65.3 22.6 8.5 2.3 75.3 1.1 4.2 Homeowner Regular 66.4 22.3 8.5 2.6 74.7 1.0 4.3 Non-Occupant Owner 68.0 26.0 8.7 2.3 65.9 2.7 4.0 Loan Size $50,000 or Less 63.7 24.7 8.4 4.0 57.0 5.6 9.8 $50,001 to $150,000 63.5 19.0 10.4 3.5 79.7 1.2 5.0 $150,001 to $300,000 68.8 20.7 9.5 2.0 82.1 1.2 4.0 More than $300,000 65.3 22.6 10.7 2.0 73.3 2.1 4.6 Credit Score 2 Lower than 620 66.9 18.0 9.6 2.4 87.7 1.9 4.9 620 to 679 67.8 18.2 11.7 3.0 83.4 1.3 5.0 680 to 719 68.3 20.8 8.9 3.3 83.8 1.2 6.0 720 or Higher 65.0 21.7 9.8 2.2 74.9 1.6 4.1 Respondent Age 35 Years or Younger 65.0 19.9 12.7 2.7 83.8 1.7 4.5 36 to 45 66.7 21.5 10.5 3.2 79.4 1.0 4.5 46 to 55 67.4 21.5 9.0 2.2 77.3 1.4 5.2 56 to 65 64.5 20.1 8.0 1.4 74.8 1.9 4.1 Older than 65 67.9 20.4 7.4 3.0 72.0 2.3 4.3 Respondent Race/Ethnicity Non-Hispanic White 66.5 21.1 9.1 2.0 79.7 1.4 4.3 Hispanic and Non-White 65.3 19.6 12.5 3.9 75.7 1.8 5.2 Respondent Education High School or Less 65.8 21.8 10.0 4.8 76.2 1.8 6.9 Some College 66.1 20.4 9.3 1.8 80.3 0.8 5.1 College Degree 65.7 20.0 10.1 2.6 79.6 1.8 4.2 Postgraduate 67.0 21.6 10.6 2.1 76.7 1.7 3.6 Household Income Less than $50,000 65.0 19.2 10.0 4.3 78.1 1.6 6.9 $50,000 to $99,999 66.2 20.8 10.4 2.2 82.2 1.3 4.7 $100,000 to $174,999 67.4 20.5 9.7 2.2 79.3 1.7 3.3 $175,000 or More 65.0 22.6 9.9 1.9 69.7 1.6 4.2 Household Type Couple 66.5 21.0 9.6 2.6 78.2 1.7 4.6 Single 65.2 19.7 11.3 2.2 80.0 1.0 4.4 All Respondents 66.2 20.7 10.0 2.5 78.6 1.5 4.6 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Table 18. Settlement Agent Selection and Mortgage Features, by Loan and Demographic Characteristics
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8. Satisfaction with Mortgage Terms, Mortgage Process, and Information The survey asked borrowers about their satisfaction with the terms, interest rate, and closing costs on their most recent mortgages. The survey also asked borrowers about their satisfaction with the lender or broker used by the borrower, the application and closing process, and the mortgage disclosure documents provided to the borrower. Tables 19 to 21 reflect the responses to these questions. Satisfaction with Overall Mortgage Terms
Seventy-nine percent of respondents indicated that they were very satisfied with the general terms of their mortgage, and an additional 20 percent indicated that they were somewhat satisfied. Two percent of respondents indicated that they were not at all satisfied with their mortgage terms. There was little variation in reported satisfaction with mortgage terms across groups of borrowers. Satisfaction with Interest Rate
Seventy-three percent of respondents indicated that they were very satisfied that they received the lowest interest rate for which they could qualify, and 23 percent reported they were somewhat satisfied. Overall, 4 percent of borrowers reported that they were not satisfied that they received the lowest interest rate for which they could qualify. Borrowers older than 65 years (9 percent), non-occupant homebuyers (9 percent), and borrowers taking loans of $50,000 or less (9 percent) were slightly more likely to report being dissatisfied with their interest rate. Satisfaction with Closing Costs
Respondents were less likely to report that they were very satisfied that they received the lowest closing costs than to report satisfaction with overall terms and interest rates. Approximately 58 percent were very satisfied that they had received the lowest closing costs, and 34 percent were somewhat satisfied that they received the lowest closing costs. Nine percent were not satisfied that they had received the lowest closing costs. Borrowers older than 65 years (13 percent), borrowers with household income less than $50,000 (11 percent), and Hispanic or non-white borrowers (11 percent) were more likely to report being dissatisfied with their closing costs than other groups. Satisfaction with Lender or Broker
Table 20 reflects respondents’ overall satisfaction with the lender or broker used by the borrower, the mortgage application process, and the loan closing process. About 95 percent of all respondents indicated that they were very or somewhat satisfied with the lender or broker they used. Slightly more than three out of four respondents reported being very satisfied with their lender. Four percent reported being dissatisfied with their lender.
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Terms Somewhat
Not at All
Very
Interest Rate Somewhat
Not at All
Very
Closing Costs Somewhat
Not at All Loan Type 1 Purchase 77.2 21.3 1.5 70.9 25.1 3.9 55.7 36.2 8.0 First-Time Homeowner2 72.5 26.1 1.4 66.6 30.1 3.2 56.8 35.1 8.1 Repeat Homeowner 80.1 18.4 1.5 75.1 21.1 3.8 56.1 36.5 7.4 Non-Occupant Owner 77.8 20.4 1.8 60.9 30.7 8.5 48.4 39.5 12.1 Refinance 1 80.0 18.2 1.7 75.3 20.0 4.7 59.5 31.5 9.1 Homeowner Cashout3 76.1 22.0 2.0 71.2 22.6 6.2 54.0 35.0 11.0 Homeowner Regular 83.1 15.2 1.7 78.6 17.7 3.7 64.3 28.2 7.5 Non-Occupant Owner 75.7 23.2 1.1 69.3 25.8 4.9 46.8 41.4 11.8 Loan Size $50,000 or Less 71.6 26.0 2.4 63.8 27.7 8.5 55.5 32.0 12.5 $50,001 to $150,000 79.2 18.7 2.1 74.3 21.3 4.4 60.8 30.2 9.0 $150,001 to $300,000 78.4 20.3 1.3 73.0 23.0 4.1 57.1 34.7 8.2 More than $300,000 78.5 19.9 1.6 72.5 23.3 4.2 54.6 37.2 8.1 Credit Score 2 Lower than 620 67.2 29.8 2.9 65.3 29.4 5.3 59.6 29.8 10.7 620 to 679 73.2 24.3 2.6 70.7 24.2 5.1 59.6 30.5 9.9 680 to 719 79.2 18.9 1.9 74.9 21.9 3.2 59.4 31.8 8.8 720 or Higher 81.2 17.7 1.1 74.1 21.7 4.2 56.2 35.9 7.8 Respondent Age 35 Years or Younger 77.6 21.5 0.9 71.2 26.4 2.5 57.2 37.1 5.7 36 to 45 78.8 20.4 0.9 74.6 22.4 3.0 58.9 34.7 6.3 46 to 55 77.0 20.4 2.6 73.3 21.6 5.1 55.7 33.1 11.1 56 to 65 81.1 16.9 2.0 75.8 18.8 5.4 58.5 31.5 9.9 Older than 65 79.7 17.5 2.7 69.1 21.9 9.0 57.5 29.1 13.4 Respondent Race/Ethnicity Non-Hispanic White 81.2 17.2 1.6 75.7 20.5 3.8 58.8 33.5 7.7 Hispanic and Non-White 71.3 27.0 1.7 65.9 28.6 5.6 54.2 35.1 10.7 Respondent Education High School or Less 75.9 21.5 2.6 71.0 23.1 5.9 59.9 29.7 10.4 Some College 76.9 21.6 1.5 72.6 23.1 4.3 60.0 31.0 9.0 College Degree 80.2 18.3 1.5 74.5 21.7 3.8 57.5 34.6 7.8 Postgraduate 79.0 19.4 1.6 72.4 23.3 4.3 54.3 37.5 8.2 Household Income Less than $50,000 74.3 23.0 2.7 70.5 24.2 5.3 61.3 27.9 10.7 $50,000 to $99,999 77.0 21.3 1.7 72.0 23.0 4.9 56.8 34.6 8.5 $100,000 to $174,999 81.0 17.6 1.4 74.7 21.6 3.6 56.9 35.1 8.0 $175,000 or More 82.1 17.3 0.6 74.9 22.1 3.1 56.3 36.4 7.3 Household Type Couple 79.3 19.1 1.5 74.0 22.1 3.9 57.9 33.9 8.2 Single 76.2 21.9 1.9 70.1 24.2 5.6 56.7 33.7 9.7 All Respondents 78.5 19.8 1.6 73.0 22.7 4.3 57.5 33.9 8.5 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics Very
Table 19. Satisfaction that Mortgage Was the Loan with the Best Features, by Loan and Demographic Characteristics
(Percentage Distribution)
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Lender or Broker Somewhat
Not at All
Very
Application Somewhat
Not at All
Very
Closing Somewhat
Not at All Loan Type 1 Purchase 75.6 18.6 5.8 64.4 27.0 8.7 65.3 25.9 8.8 First-Time Homeowner2 72.2 21.7 6.1 62.3 29.7 8.0 62.9 29.0 8.1 Repeat Homeowner 77.7 17.1 5.2 66.9 24.4 8.7 67.9 23.5 8.6 Non-Occupant Owner 76.8 15.1 8.1 55.9 32.3 11.8 57.5 28.4 14.1 Refinance 1 77.7 19.6 2.7 67.6 26.8 5.6 70.4 23.6 6.0 Homeowner Cashout3 75.2 22.3 2.5 65.9 28.5 5.5 67.4 26.4 6.2 Homeowner Regular 80.3 17.0 2.7 70.0 24.9 5.1 73.6 20.9 5.5 Non-Occupant Owner 67.8 27.7 4.5 54.2 35.0 10.8 57.1 32.9 10.0 Loan Size $50,000 or Less 75.7 20.2 4.1 63.5 27.1 9.3 65.0 26.0 9.0 $50,001 to $150,000 77.6 17.4 5.0 66.5 25.7 7.8 69.6 23.3 7.0 $150,001 to $300,000 75.9 20.1 4.1 66.7 26.8 6.5 69.0 23.6 7.4 More than $300,000 76.7 19.5 3.8 64.1 28.5 7.4 63.7 28.3 8.0 Credit Score 2 Lower than 620 74.5 19.8 5.7 65.0 23.1 11.9 66.9 24.6 8.5 620 to 679 73.0 22.1 5.0 63.3 28.2 8.5 65.5 26.7 7.8 680 to 719 76.8 19.0 4.3 66.7 26.3 7.0 69.0 22.5 8.5 720 or Higher 77.9 18.1 3.9 66.7 27.0 6.3 68.2 24.8 7.0 Respondent Age 35 Years or Younger 74.6 21.0 4.3 63.8 29.7 6.5 64.7 28.0 7.3 36 to 45 76.7 19.3 3.9 68.7 24.6 6.7 68.8 24.5 6.7 46 to 55 76.8 18.8 4.4 63.7 27.7 8.6 67.0 24.2 8.8 56 to 65 78.9 16.5 4.6 69.0 25.0 5.9 71.2 22.0 6.8 Older than 65 77.6 18.0 4.4 64.7 26.5 8.9 69.6 22.4 8.0 Respondent Race/Ethnicity Non-Hispanic White 78.1 17.5 4.3 67.0 25.5 7.5 68.7 23.7 7.6 Hispanic and Non-White 72.5 23.3 4.2 63.2 30.6 6.2 65.3 27.5 7.2 Respondent Education High School or Less 75.9 20.8 3.3 68.0 23.6 8.3 70.6 23.4 6.0 Some College 75.7 19.6 4.7 65.9 26.5 7.6 68.9 23.6 7.5 College Degree 78.0 17.6 4.3 66.5 27.2 6.2 67.7 25.0 7.3 Postgraduate 75.9 19.9 4.2 64.3 28.2 7.5 65.6 26.1 8.3 Household Income Less than $50,000 74.5 20.7 4.8 64.5 27.3 8.3 68.2 24.2 7.5 $50,000 to $99,999 75.4 20.0 4.6 66.4 26.7 6.9 68.3 23.8 8.0 $100,000 to $174,999 79.5 17.3 3.2 68.4 26.0 5.6 69.1 24.7 6.2 $175,000 or More 76.3 18.6 5.1 61.9 28.6 9.5 63.8 27.6 8.6 Household Type Couple 76.7 19.3 4.0 66.2 26.6 7.2 67.8 24.6 7.6 Single 76.3 18.6 5.1 65.4 27.6 7.0 67.6 25.2 7.1 All Respondents 76.6 19.1 4.3 65.9 26.9 7.2 67.8 24.8 7.5 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics Very
Table 20. Satisfaction with the Mortgage Process, by Loan and Demographic Characteristics
(Percentage Distribution)
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Satisfaction with Mortgage Application Process
Overall, 93 percent of respondents reported that they were very or somewhat satisfied with the mortgage application process. Sixty-six percent reported they were very satisfied, and an additional 27 percent were somewhat satisfied. Seven percent were not satisfied. Investors who purchased a house (12 percent), respondents with a credit score below 620 (12 percent), and investor refinancers (11 percent) were more likely to report that they were dissatisfied with the application process. Satisfaction with Mortgage Closing Process
Ninety-three percent of respondents reported that they were very or somewhat satisfied with the mortgage closing process. Sixty-eight percent reported that they were very satisfied, and 25 percent reported that they were somewhat satisfied. Eight percent of investors who purchased a house reported being dissatisfied with the closing process. Satisfaction with Mortgage Disclosure Documents
Table 21 reflects the overall satisfaction of borrowers with the information in mortgage disclosure documents, the timeliness of the mortgage disclosure documents, and their settlement agent. High percentages of respondents indicated they were very or somewhat satisfied with the disclosure information (96 percent), with their settlement agent (93 percent), and the timeliness of the mortgage disclosure process (92 percent). Borrowers with loans of $50,000 or less and investors were more likely to report that they were not satisfied with disclosures, timeliness, or the settlement agent than other borrowers.
9. Opinions on Homeownership and Financial Responsibility The survey asked borrowers whether they agreed or disagreed with statements about homeownership and financial responsibility. The results are reflected in Table 22. For example, 97 percent of all groups of respondents agreed that owning a home is a good financial investment. Late Payments and Credit Rating
Borrowers were asked if they thought that late payment of their mortgage would lower their credit ratings. More than 9 out of 10 respondents agreed that late payments would lower their credit ratings. This opinion was shared by most respondents, ranging from 94 percent for borrowers with incomes $175,000 and above to 89 percent for borrowers with household income less than $50,000. Thirteen percent of respondents agreed with the statement that lenders should not care about late payments, only whether loans are fully repaid. The share that agreed with this statement differed across groups, from 8 percent for investor refinancers to 23 percent of those with a credit score below 620.
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Disclosures Somewhat
Not at All
Very
Timeliness Somewhat
Not at All
Very
Settlement Agent Somewhat
Not at All Loan Type 1 Purchase 67.2 28.2 4.6 65.2 27.0 7.8 67.7 24.5 7.9 First-Time Homeowner2 64.4 31.4 4.1 61.8 31.0 7.2 64.5 27.3 8.2 Repeat Homeowner 69.8 25.7 4.6 67.8 24.3 7.9 70.4 22.3 7.2 Non-Occupant Owner 60.8 32.1 7.1 62.4 27.9 9.7 62.4 26.5 11.2 Refinance 1 69.7 26.8 3.5 69.0 25.1 5.9 70.2 22.4 7.4 Homeowner Cashout3 67.9 28.7 3.4 68.1 25.8 6.1 68.8 24.0 7.2 Homeowner Regular 72.1 24.6 3.2 71.0 23.7 5.2 72.4 20.3 7.3 Non-Occupant Owner 56.7 36.9 6.4 54.7 34.3 10.9 56.7 33.7 9.6 Loan Size $50,000 or Less 71.1 21.9 7.0 63.7 25.8 10.5 65.3 20.4 14.3 $50,001 to $150,000 70.3 26.1 3.7 68.1 25.1 6.9 69.8 21.8 8.4 $150,001 to $300,000 68.1 28.3 3.7 67.1 26.6 6.3 70.0 23.3 6.6 More than $300,000 66.4 28.7 4.9 66.2 26.4 7.4 66.3 25.9 7.8 Credit Score 2 Lower than 620 64.5 31.1 4.4 63.5 29.9 6.6 66.3 26.8 6.8 620 to 679 66.4 30.3 3.4 64.0 28.6 7.3 67.6 24.7 7.7 680 to 719 68.8 26.1 5.1 67.2 24.8 8.0 69.5 22.9 7.7 720 or Higher 69.3 26.7 4.0 68.3 25.2 6.4 69.4 22.9 7.7 Respondent Age 35 Years or Younger 66.1 30.2 3.7 64.9 28.9 6.3 66.5 27.0 6.5 36 to 45 69.6 26.1 4.3 68.6 24.0 7.4 68.6 23.7 7.7 46 to 55 67.0 28.7 4.3 65.7 27.2 7.0 68.0 23.9 8.1 56 to 65 71.9 24.5 3.6 70.4 24.1 5.5 73.1 19.1 7.9 Older than 65 69.0 26.5 4.6 66.8 24.2 9.0 71.3 19.6 9.2 Respondent Race/Ethnicity Non-Hispanic White 69.6 26.4 4.0 68.3 24.8 6.9 70.8 21.8 7.4 Hispanic and Non-White 65.1 30.6 4.3 63.8 29.5 6.6 63.8 27.9 8.4 Respondent Education High School or Less 69.3 26.5 4.2 64.4 28.8 6.7 70.0 21.3 8.7 Some College 68.9 27.3 3.8 66.4 26.1 7.5 69.1 23.5 7.4 College Degree 69.2 26.4 4.4 68.6 24.2 7.3 69.3 23.3 7.4 Postgraduate 66.5 29.8 3.7 66.8 27.4 5.8 67.7 24.6 7.7 Household Income Less than $50,000 68.1 27.9 4.0 65.0 27.2 7.8 67.1 24.3 8.6 $50,000 to $99,999 68.1 27.7 4.2 66.3 26.5 7.2 70.0 22.8 7.2 $100,000 to $174,999 70.2 26.0 3.8 69.5 25.2 5.4 69.4 23.9 6.7 $175,000 or More 66.0 29.6 4.3 66.6 25.5 7.9 67.4 23.3 9.3 Household Type Couple 68.9 27.1 4.0 67.3 25.9 6.8 69.0 23.3 7.7 Single 66.9 28.8 4.3 66.5 26.4 7.1 68.6 24.0 7.4 All Respondents 68.4 27.6 4.1 67.1 26.1 6.9 68.9 23.5 7.6 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics Very
Table 21. Satisfaction with Information During the Mortgage Process, by Loan and Demographic Characteristics
(Percentage Distribution)
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Mortgage Lenders Generally Treat Borrowers Well
Late Payments Will Lower Credit Rating
Lenders Should Not Care About Late Payments, Only Whether Loans Fully Repaid
It Is Okay to Default If It Is in the Borrower's Financial Interest
Loan Type Purchase 1 97.1 83.1 92.1 12.7 6.2 2 First-Time Homeowner 97.1 84.0 91.5 13.0 6.5 Repeat Homeowner 97.0 82.5 92.4 12.5 5.8 Non-Occupant Owner 98.3 83.4 92.4 12.3 8.2 1 Refinance 96.5 80.9 93.0 13.2 5.7 Homeowner Cashout3 97.2 80.2 92.9 12.9 5.7 Homeowner Regular 95.9 81.1 92.9 14.0 5.8 Non-Occupant Owner 97.4 83.6 93.6 7.5 4.7 Loan Size $50,000 or Less 97.3 85.0 90.6 19.7 8.2 $50,001 to $150,000 97.3 84.1 90.9 13.3 4.4 $150,001 to $300,000 97.2 82.4 92.9 12.0 6.3 More than $300,000 95.5 78.7 93.9 13.5 7.1 2 Credit Score Lower than 620 96.6 87.8 90.1 23.4 9.5 620 to 679 98.2 78.0 90.2 15.8 5.7 680 to 719 97.9 81.7 91.4 16.1 5.5 720 or Higher 96.1 82.8 93.7 10.2 5.8 Respondent Age 35 Years or Younger 97.0 82.7 93.7 10.7 7.0 36 to 45 96.5 81.2 93.3 12.8 7.7 46 to 55 96.9 79.9 90.3 13.7 4.5 56 to 65 96.3 84.6 92.7 13.3 5.0 Older than 65 97.5 83.0 91.8 17.1 3.9 Respondent Race/Ethnicity Non-Hispanic White 96.8 84.4 93.2 10.8 5.1 Hispanic and Non-White 96.8 75.7 90.5 18.7 8.3 Respondent Education High School or Less 97.8 86.4 89.7 18.2 5.8 Some College 97.5 84.6 91.0 15.2 4.3 College Degree 97.4 81.7 93.4 10.9 6.8 Postgraduate 95.0 78.3 93.8 11.3 6.5 Household Income Less than $50,000 97.9 82.8 88.7 17.0 5.8 $50,000 to $99,999 97.5 83.3 92.4 14.3 4.7 $100,000 to $174,999 96.5 81.3 93.9 10.1 6.6 $175,000 or More 94.6 79.6 94.2 10.8 8.0 Household Type Couple 96.6 81.7 92.2 12.9 6.0 Single 97.5 83.0 93.5 13.1 5.8 All Respondents 96.8 82.0 92.5 12.9 6.0 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Owning a Home Is a Good Financial Investment
Table 22. Opinions on Homeownership, Lenders, and Mortgage Payments, by Loan and Demographic Characteristics
(Percent Who Agreed with Each Statement)
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
Mortgage Default and Borrower’s Financial Interest
An estimated 6 percent of respondents agreed with the statement that it is okay to default or stop paying if it is in the borrower’s financial interest. Borrowers older than 65 (4 percent) were least likely to agree with this statement. Ten percent of borrowers with a credit score below 620, 8 percent of Hispanic or non-white borrowers, 8 percent of investor homebuyers, and 8 percent of borrowers with mortgages of $50,000 or less reported that they agreed that it is okay to default when it is in the borrower’s financial interest.
10. Recent Changes in Neighborhood Housing The survey asked borrowers’ opinions about changes in the neighborhoods where homes were located for which they had most recently acquired a mortgage. The survey also asked borrowers for their opinions about changes to house prices and the overall desirability of living in the neighborhood. Tables 23 and 24 reflect respondents’ responses. Change in Number of Homes Available for Sale
Seventy-one percent of respondents indicated that the number of homes available for sale in their neighborhood experienced little or no change, while 25 percent reported that the number for sale had increased significantly (Table 23). About 4 percent of respondents reported the number of homes for sale declined significantly in their neighborhood. There was little variation across borrower groups in reporting either a significant increase or significant decrease in the number of homes for sale. Investor refinancers (7 percent), borrowers with incomes of $175,000 or more (6 percent), and borrowers with loans above $300,000 (6 percent) reported a decrease in available homes for sale, slightly more than other borrowers reported. Change in Number of Vacant Homes
Borrower groups varied in their descriptions of changes in the number of vacant homes in the neighborhood over the last two years. Overall, 4 percent of respondents indicated that the number of vacant homes increased significantly, 85 percent indicated that there was little or no change, and 10 percent reported that the number of vacant homes had declined significantly. About the same share of refinancing borrowers (5 percent) as homebuyers (4 percent) reported a significant increase in vacant homes in their neighborhood over the last two years. Borrowers with a credit score below 680 (8 percent) were slightly more likely to report a significant increase in vacant homes in their neighborhood than other borrowers. Respondents with incomes above $175,000 (2 percent) and borrowers with mortgages above $300,000 (2 percent) were less likely to report a significant increase in vacant homes. Change in Number of Homes for Rent
Overall, 7 percent of respondents reported a significant increase in rental housing in their neighborhood, 86 percent of borrowers reported little or no change, and 7 percent reported a significant decrease. Refinancing borrowers (8 percent) were slightly more likely to report a significant increase in the number of rental properties in their neighborhoods than homebuyers (6 percent). Borrowers with a credit score below 620 (11 percent) were more likely to report a
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Number of Vacant Homes Significantly Little or No Significantly Increase Change Decrease
Number of Homes for Rent Significantly Little or No Significantly Increase Change Decrease
Loan Type Purchase 1 22.7 73.0 4.3 4.1 86.3 9.7 5.9 87.0 7.2 First-Time Homeowner2 20.9 75.3 3.8 3.6 88.7 7.7 6.0 89.3 4.7 Repeat Homeowner 23.6 71.9 4.5 4.3 85.3 10.4 5.7 86.0 8.4 Non-Occupant Owner 24.9 69.8 5.3 4.9 81.7 13.4 6.3 83.5 10.2 Refinance 1 26.6 69.0 4.4 4.8 83.9 11.3 8.2 84.9 6.9 Homeowner Cashout3 26.4 69.5 4.2 5.3 83.8 10.9 7.4 86.2 6.4 Homeowner Regular 27.4 68.4 4.3 4.6 83.9 11.5 8.8 84.0 7.2 Non-Occupant Owner 20.5 72.4 7.0 3.4 85.2 11.4 7.2 84.6 8.3 Loan Size $50,000 or Less 17.9 80.8 1.3 8.8 84.7 6.5 5.8 86.9 7.3 $50,001 to $150,000 21.9 74.8 3.3 5.9 85.7 8.5 9.2 85.7 5.1 $150,001 to $300,000 26.0 69.6 4.4 4.8 84.7 10.6 6.5 86.3 7.2 More than $300,000 26.2 68.1 5.7 1.7 85.3 13.0 5.2 85.7 9.2 Credit Score 2 Lower than 620 28.2 67.8 4.0 7.6 83.0 9.4 10.6 81.2 8.3 620 to 679 27.4 68.8 3.8 7.7 80.5 11.8 7.5 83.3 9.2 680 to 719 27.6 68.8 3.6 5.4 84.0 10.5 7.2 85.5 7.3 720 or Higher 22.7 72.6 4.7 2.9 87.0 10.1 6.4 87.4 6.2 Respondent Age 35 Years or Younger 24.0 71.7 4.4 3.3 86.9 9.8 6.5 88.4 5.1 36 to 45 27.7 68.6 3.7 4.7 86.6 8.7 6.8 86.8 6.4 46 to 55 24.4 71.5 4.1 6.1 82.9 11.0 8.5 83.3 8.3 56 to 65 23.0 72.0 5.0 4.0 83.4 12.6 7.1 84.7 8.3 Older than 65 21.7 72.8 5.5 3.9 84.4 11.7 5.1 85.4 9.5 Respondent Race/Ethnicity Non-Hispanic White 23.0 72.9 4.2 3.9 86.6 9.5 6.1 87.1 6.7 Hispanic and Non-White 29.2 66.0 4.8 5.8 81.0 13.1 9.3 82.8 7.9 Respondent Education High School or Less 24.7 71.0 4.3 7.3 81.5 11.2 8.2 83.5 8.4 Some College 25.6 70.6 3.8 6.3 83.3 10.4 7.6 84.9 7.5 College Degree 26.1 69.6 4.3 3.7 85.0 11.3 7.2 86.3 6.6 Postgraduate 21.8 73.3 4.9 2.4 88.6 9.1 5.7 87.6 6.8 Household Income Less than $50,000 21.8 73.5 4.7 4.6 84.8 10.6 6.4 86.4 7.2 $50,000 to $99,999 25.8 71.2 2.9 5.9 84.5 9.7 8.2 85.5 6.4 $100,000 to $174,999 25.7 69.4 4.9 3.9 85.0 11.1 7.3 85.0 7.8 $175,000 or More 22.9 71.0 6.1 1.9 87.2 10.9 4.3 88.4 7.3 Household Type Couple 25.0 70.7 4.3 4.3 85.6 10.1 6.3 86.7 6.9 Single 23.5 72.2 4.4 4.8 83.7 11.5 8.9 83.6 7.5 All Respondents 24.6 71.0 4.3 4.4 85.1 10.4 7.0 86.0 7.1 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Number of Homes for Sale Significantly Little or No Significantly Increase Change Decrease
Table 23. Changes in Housing Availability in Neighborhood over Last Couple Years, by Loan and Demographic Characteristics
(Percentage Distribution)
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Significantly Increase
House Prices Little or No Change
Significantly Decrease
Overall Desireablity of Living There Significantly Little or No Significantly Increase Change Decrease
Loan Type Purchase 1 3.6 85.5 10.9 37.1 60.5 2.5 37.0 61.2 1.9 First-Time Homeowner2 3.4 90.1 6.4 34.2 63.8 2.1 32.9 64.8 2.3 Repeat Homeowner 3.2 83.8 12.9 38.2 59.1 2.7 39.2 59.3 1.5 Non-Occupant Owner 6.8 76.3 16.9 42.6 54.7 2.7 39.7 58.0 2.3 Refinance 1 5.0 78.4 16.6 54.2 41.5 4.4 41.2 56.4 2.4 Homeowner Cashout3 5.1 78.6 16.3 57.1 39.2 3.7 41.9 55.9 2.1 Homeowner Regular 5.1 78.6 16.3 52.3 42.9 4.8 41.0 56.4 2.6 Non-Occupant Owner 4.0 74.3 21.7 52.0 42.9 5.1 38.2 59.9 1.9 Loan Size $50,000 or Less 6.2 85.2 8.6 21.2 74.2 4.7 18.6 70.6 10.8 $50,001 to $150,000 6.0 83.2 10.9 33.1 61.8 5.1 27.4 69.4 3.2 $150,001 to $300,000 4.1 81.4 14.5 47.4 49.7 2.9 42.2 56.2 1.7 More than $300,000 2.4 81.5 16.1 58.9 39.1 2.0 49.7 49.6 0.7 Credit Score 2 Lower than 620 6.7 79.1 14.2 37.7 59.1 3.1 36.9 60.0 3.1 620 to 679 6.4 78.9 14.8 43.6 52.3 4.1 37.1 59.3 3.7 680 to 719 4.5 82.3 13.2 44.0 52.7 3.3 39.5 57.8 2.7 720 or Higher 3.4 83.3 13.4 47.0 49.7 3.3 39.7 58.9 1.4 Respondent Age 35 Years or Younger 2.9 86.3 10.9 43.5 54.6 1.9 37.9 59.8 2.3 36 to 45 4.3 83.0 12.7 46.4 50.5 3.0 40.0 57.9 2.0 46 to 55 6.3 78.7 15.0 44.4 51.7 3.9 37.1 61.0 1.9 56 to 65 4.8 80.0 15.2 47.4 47.7 4.9 39.1 59.0 2.0 Older than 65 2.8 79.3 17.9 46.6 48.5 4.9 43.7 53.7 2.6 Respondent Race/Ethnicity Non-Hispanic White 4.4 83.3 12.3 44.2 52.3 3.5 38.3 59.6 2.1 Hispanic and Non-White 3.9 78.8 17.3 48.6 48.2 3.2 41.1 56.8 2.1 Respondent Education High School or Less 6.7 80.2 13.1 37.3 57.0 5.7 29.5 66.5 4.1 Some College 5.4 79.7 14.9 41.2 54.5 4.3 37.2 59.7 3.1 College Degree 4.3 81.3 14.4 48.5 48.9 2.6 40.5 57.9 1.5 Postgraduate 2.2 86.2 11.6 48.4 48.9 2.7 42.6 56.1 1.2 Household Income Less than $50,000 5.4 83.1 11.5 31.5 63.7 4.8 29.9 66.3 3.8 $50,000 to $99,999 5.0 82.7 12.3 41.0 55.1 4.0 35.4 62.0 2.6 $100,000 to $174,999 3.8 80.3 15.9 53.0 44.4 2.7 44.5 54.2 1.3 $175,000 or More 2.4 82.8 14.8 56.1 41.9 1.9 47.0 52.3 0.7 Household Type Couple 4.3 81.9 13.8 46.6 50.3 3.1 40.0 58.0 2.0 Single 4.4 82.4 13.2 41.8 54.0 4.2 36.1 61.3 2.6 All Respondents 4.3 82.1 13.6 45.4 51.2 3.4 39.0 58.9 2.1 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
Characteristics
Number of Foreclosures or Short Sales Significantly Little or No Significantly Increase Change Decrease
Table 24. Changes in Neighborhood Desireability over Last Couple Years, by Loan and Demographic Characteristics
(Percentage Distribution)
NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
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significant increase in the number of rental properties in their neighborhoods than other borrower groups. Change in Number of Foreclosures and Short Sales
As reflected on Table 24, about 82 percent of respondents indicated that the number of foreclosures and short sales in their neighborhood had little or no change over the last couple of years. Four percent of respondents reported a significant increase, while 14 percent reported a significant decrease. About the same share of refinancing borrowers (5 percent) as homebuyers (4 percent) reported an increase in the number of foreclosures. Investor homebuyers (7 percent), borrowers with credit scores below 620 (7 percent), and borrowers with a high school education or less (7 percent) reported an increase in the number of foreclosures. Change in House Prices
Fifty-one percent of respondents reported that there was little or no change to house prices in their neighborhood over the last couple of years, while 45 percent reported a significant increase in prices and 3 percent reported a significant decline in house prices in their neighborhood. However, respondents who took out mortgages above $300,000 (59 percent), cashout refinancers (57 percent), and borrowers with incomes above $175,000 (56 percent) were more likely to report a significant increase in house price over the last couple years than were other respondents. Borrowers who purchased a home, including investors and first-time homebuyers, were about as likely to report a significant decline in house prices (3 percent) as respondents who refinanced a mortgage (4 percent). Change in Desirability of Neighborhood
Borrowers were asked if the overall desirability of living in their neighborhood had changed over the last couple of years. Over 59 percent of respondents indicated that there had been little or no change in desirability, 39 percent reported a significant increase in desirability, and 2 percent reported a significant decline. Borrowers with loans greater than $300,000 (50 percent) and borrowers with household income greater than $175,000 (47 percent) were far more likely to indicate that the desirability of their neighborhood had increased significantly.
11. Expectations on Neighborhood House Prices and Neighborhood Desirability Borrowers were asked what they think will happen to prices of homes in their neighborhood over the next couple of years. As shown in Table 25, 82 percent of all respondents expect house prices to increase, with 60 percent expecting that prices will increase a little and 21 percent expecting that prices will increase a lot. About 16 percent of respondents indicated that prices would remain about the same over the next couple of years, and about 2 percent of respondents expect prices to decrease. The percentage of borrowers who reportedly expect prices to increase generally rose with loan size and borrower income. The percentage of borrowers expecting home prices to remain about the same, and the percentage of borrowers expecting price declines
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Table 25. Expectations for House Prices in Neighborhood over Next Couple of Years, by Loan and Demographic Characteristics
(Percentage Distribution) Characteristics
Prices of Similar Homes in Neighborhood Will Increase Remain About Decrease a Little the Same a Little
Increase a Lot
Decrease a Lot
Loan Type Purchase 1 20.5 61.9 16.4 1.0 0.2 First-Time Homeowner2 20.0 59.9 18.7 1.1 0.3 Repeat Homeowner 20.8 63.3 15.0 0.9 0.1 Non-Occupant Owner 21.0 61.1 16.5 1.0 0.4 1 Refinance 22.1 58.6 16.4 2.3 0.6 Homeowner Cashout3 22.4 58.3 15.9 2.3 1.1 Homeowner Regular 22.4 58.1 16.9 2.4 0.2 Non-Occupant Owner 16.6 67.3 14.6 1.5 0.0 Loan Size $50,000 or Less 12.0 43.2 42.7 0.6 1.6 $50,001 to $150,000 15.6 57.6 23.9 2.4 0.5 $150,001 to $300,000 23.0 62.3 13.1 1.2 0.3 More than $300,000 26.1 61.8 10.5 1.5 0.1 Credit Score 2 Lower than 620 24.5 51.3 20.4 3.4 0.4 620 to 679 22.8 56.6 17.7 1.7 1.2 22.8 57.2 18.5 1.1 0.4 680 to 719 20.1 63.1 15.1 1.6 0.1 720 or Higher Respondent Age 35 Years or Younger 19.0 61.4 17.8 1.2 0.5 36 to 45 21.0 60.6 15.6 2.5 0.3 46 to 55 22.5 59.0 16.6 1.7 0.3 56 to 65 22.2 61.1 15.1 1.3 0.3 Older than 65 23.6 58.2 16.5 1.2 0.5 Respondent Race/Ethnicity Non-Hispanic White 19.1 62.1 17.0 1.6 0.3 Hispanic and Non-White 27.2 55.5 14.8 1.8 0.6 Respondent Education High School or Less 17.5 54.1 25.4 2.4 0.6 Some College 21.7 57.6 17.9 1.9 0.9 College Degree 22.8 61.8 13.9 1.4 0.1 Postgraduate 20.4 63.4 14.8 1.4 0.1 Household Income Less than $50,000 17.8 52.7 26.2 2.0 1.3 $50,000 to $99,999 21.2 59.7 17.1 1.7 0.3 $100,000 to $174,999 22.7 63.1 12.7 1.4 0.1 $175,000 or More 22.3 64.6 11.5 1.6 0.0 Household Type Couple 21.8 60.4 16.0 1.6 0.2 Single 19.7 60.1 17.5 1.9 0.8 All Respondents 21.3 60.3 16.4 1.6 0.4 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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generally decreased with loan size and income. There was generally little variation in expectations on neighborhood house prices across other groups of borrowers. Borrowers were also asked whether they expect the overall desirability of living in their neighborhood to change in the next couple of years. Table 26 reflects that about 52 percent of respondents indicated that they expected the overall desirability of their neighborhood to stay about the same, 47 percent of respondents expected neighborhood desirability to increase, and 2 percent of respondents expected neighborhood desirability to decrease. Homebuyers (50 percent) were more likely to expect neighborhood desirability to increase than refinancing borrowers (43 percent). Borrowers with loans of $50,000 or less, borrowers with credit scores below 680, and borrowers with household income of less than $50,000 were more likely than other groups of borrowers to expect that neighborhood desirability would decrease.
12. Financial Expectations The survey asked borrowers how likely they were to encounter events in the next couple of years that might constrain their household finances. Specifically, the survey asked whether it was very, somewhat, or not at all likely over the next couple of years that the respondent would experience any of the following: a) retire; b) be laid off, become unemployed, or be forced to reduce hours of work; c) have difficulties making mortgage payments; or d) experience some other personal financial crisis. Table 27 reflects responses to these questions. Expectations of Retirement
Seventeen percent of respondents indicated that they were very or somewhat likely to retire in the next couple of years. About 21 percent of refinancing borrowers reported being very or somewhat likely to retire in the near term, compared to 13 percent of homebuyers. Respondents who were older than 56 were at least twice as likely to report they were very or somewhat likely to retire in the next couple of years than were those aged 46 to 55 years old, while 4 percent of respondents aged 36 to 45 years old and 1 percent of respondents aged 35 years or younger indicated that they were very or somewhat likely to retire in the next couple of years. Two percent of first-time homebuyers indicated they were very or somewhat likely to retire in the next couple of years and 29 percent of investor purchasers expressed that they were very or somewhat likely to retire in the near term. Expectations of Financial Difficulties
Nine percent of respondents reported that they were very or somewhat likely to have difficulties making their mortgage payments in the next couple of years. Eleven percent of refinancing borrowers reported that they were very or somewhat likely to have difficulties making mortgage payments in the next couple of years compared to 8 percent of homebuyers. Respondents with household income less than $50,000 a year (16 percent), credit scores 620 and below (16 percent), or high school education or less (16 percent) were more likely to believe they could have difficulties making mortgage payments than other respondents. Respondents with postgraduate degrees (8 percent), credit scores of 720 or higher (7 percent), or household income
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Table 26. Expectations for Neighborhood Desirability over Next Couple of Years, by Loan and Demographic Characteristics
(Percentage Distribution) Characteristics
Living in the Neighborhood Will Become More Desireable Stay About The Same Become Less Desirable
Loan Type 1 Purchase 50.4 48.4 1.3 First-Time Homeowner2 49.8 48.2 2.0 Repeat Homeowner 50.6 48.7 0.7 Non-Occupant Owner 51.3 46.9 1.8 1 Refinance 42.8 54.8 2.4 Homeowner Cashout3 42.7 54.5 2.7 Homeowner Regular 42.5 55.2 2.3 Non-Occupant Owner 46.8 51.9 1.3 Loan Size $50,000 or Less 22.1 75.0 2.9 $50,001 to $150,000 35.9 61.4 2.8 $150,001 to $300,000 49.5 48.9 1.6 More than $300,000 57.4 41.8 0.9 Credit Score 2 Lower than 620 46.1 50.6 3.3 620 to 679 46.7 50.2 3.1 680 to 719 45.5 53.0 1.5 720 or Higher 47.1 51.6 1.4 Respondent Age 52.2 45.8 2.0 35 Years or Younger 36 to 45 47.1 51.1 1.7 46 to 55 44.9 53.5 1.5 56 to 65 41.2 56.9 1.9 Older than 65 43.8 54.3 1.9 Respondent Race/Ethnicity Non-Hispanic White 44.6 53.6 1.8 Hispanic and Non-White 52.3 45.7 1.9 Respondent Education High School or Less 35.2 62.5 2.3 Some College 42.9 53.9 3.2 College Degree 49.4 49.5 1.0 Postgraduate 51.5 47.2 1.3 Household Income Less than $50,000 39.0 57.6 3.4 $50,000 to $99,999 43.2 54.8 2.0 $100,000 to $174,999 50.9 47.9 1.2 $175,000 or More 55.2 43.9 0.9 Household Type Couple 48.2 50.2 1.6 Single 42.4 55.1 2.4 All Respondents 46.7 51.5 1.8 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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Table 27. Expectations About Future Financial Situation, by Loan and Demographic Characteristics
(Percent Very or Somewhat Likely to Face Each Situation in the Next Couple of Years) Characteristics
Retirement
Difficulties Making Mortgage Payments
Unemployment, Layoff, or Forced Hour Reduction
Some Other Personal Financial Crisis
Loan Type Purchase 1 13.3 8.0 11.3 12.6 First-Time Homeowner2 2.4 8.3 11.2 13.3 Repeat Homeowner 18.2 8.0 11.3 12.1 Non-Occupant Owner 28.6 7.5 11.4 12.7 1 Refinance 20.9 10.7 12.5 15.7 Homeowner Cashout3 21.7 13.4 12.6 17.5 Homeowner Regular 20.1 9.0 12.8 14.4 Non-Occupant Owner 24.7 8.9 8.1 15.9 Loan Size $50,000 or Less 23.7 9.5 7.4 14.4 $50,001 to $150,000 18.8 10.5 11.1 16.6 $150,001 to $300,000 16.5 9.2 11.8 13.8 More than $300,000 15.1 8.1 13.2 11.6 2 Credit Score Lower than 620 14.1 16.0 11.2 19.9 620 to 679 16.7 13.2 11.8 17.4 680 to 719 15.5 11.7 11.6 16.1 17.8 6.9 12.0 12.0 720 or Higher Respondent Age 35 Years or Younger 1.1 7.6 10.4 11.5 36 to 45 4.5 8.6 13.7 12.5 46 to 55 18.0 9.7 13.2 16.4 56 to 65 49.2 11.3 13.5 16.9 Older than 65 36.8 12.1 5.7 15.3 Respondent Race/Ethnicity Non-Hispanic White 18.0 9.4 11.7 14.0 Hispanic and Non-White 14.4 9.3 12.3 14.4 Respondent Education High School or Less 19.9 15.5 13.4 17.2 Some College 20.8 10.5 11.7 15.0 College Degree 14.1 7.7 10.9 12.7 Postgraduate 16.0 7.9 12.7 13.8 Household Income Less than $50,000 17.6 16.3 11.2 19.7 $50,000 to $99,999 16.5 10.4 12.1 15.3 $100,000 to $174,999 17.0 6.7 12.0 12.3 $175,000 or More 17.6 4.4 11.6 8.8 Household Type Couple 17.5 9.3 12.5 13.8 Single 15.4 9.4 9.9 14.9 All Respondents 17.0 9.3 11.9 14.1 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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of $175,000 or more (4 percent) were less likely to believe they would have difficulties in paying their mortgage in the next couple of years. Expectations of Layoff or Unemployment
Nearly 12 percent of respondents indicated that it was very or somewhat likely that they might experience a layoff, unemployment, or forced reduction in hours over the next couple of years. Refinancing investors (8 percent), those borrowing $50,000 or less (7 percent), and those older than 65 years (6 percent) were less likely to expect these events than were other respondents. Fourteen percent of all respondents indicated that it was very or somewhat likely that they would face some other personal financial crisis in the next couple of years. Respondents with household income of less than $50,000 (20 percent) and respondents with credit scores below 620 (20 percent) were most likely to report that they were very or somewhat likely to face some other personal financial crisis. Expectation of Ability to Pay Bills without Borrowing
Table 28 reflects that about 86 percent of respondents indicated that they were very or somewhat likely to pay their bills for the next three months without borrowing. Respondents with household income of $175,000 or more (94 percent), investor homebuyers (91 percent), respondents with credit score of 720 or above (91 percent), and respondents with loans of more than $300,000 (90 percent) were more likely than other respondents to indicate they were very or somewhat likely to pay their bills for the next three months without borrowing. Respondents with a credit score below 620 (73 percent) and those with a credit score between 620 and 679 (76 percent) were the least likely to report that they were very or somewhat likely to pay their bills for the next three months without borrowing. Expectation of Receiving Financial Help from Friends or Family
Sixty-one percent of respondents indicated that they were very or somewhat likely to get significant financial help from family or friends if they suffered an unexpected financial crisis. More homebuyers (65 percent) believed they were very or somewhat likely to get significant help compared to refinancing borrowers (57 percent). Forty-two percent of respondents aged 56 to 65 and 38 percent of respondents older than 65 reported that they were very or somewhat likely to get significant help from family or friends, while 79 percent of respondents aged 35 years or younger and 77 percent of first-time homebuyers reported that they were very or somewhat likely to get financial help from their family or friends. Fifty-five percent of respondents felt that it was very or somewhat likely that they could significantly increase their income if they experienced a financial shock. More homebuyers (59 percent) reported that they were very or somewhat likely to significantly increase their income than refinancing borrowers (51 percent). First-time homebuyers and younger respondents were more likely to indicate that they could significantly increase their income than other respondents. Sixty-four percent of first-time homebuyers and 65 percent of respondents 35 years or younger reported that they were very or somewhat likely to significantly increase their income. Older respondents were less likely to indicate they could significantly increase their income than other
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Table 28. Ability to Weather an Adverse Financial Shock, by Loan and Demographic Characteristics
(Percent Very or Somewhat Likely to Perform Each Action in the Next Couple of Years) Characteristics
Pay Bills for the Next Get Significant Three Months Financial Help from Without Borrowing Family or Friends
Borrow Enough Money from a Bank or Credit Union
Increase Income Significantly
Loan Type Purchase 1 86.4 65.0 64.7 58.5 First-Time Homeowner2 81.8 77.0 67.9 63.8 Repeat Homeowner 88.8 59.2 62.3 55.8 Non-Occupant Owner 91.3 50.6 66.6 52.6 1 Refinance 85.0 56.9 65.1 51.0 Homeowner Cashout3 85.1 54.7 63.0 49.5 Homeowner Regular 84.7 58.5 65.9 51.5 Non-Occupant Owner 87.1 55.1 70.8 57.3 Loan Size $50,000 or Less 76.3 45.7 54.9 35.9 $50,001 to $150,000 81.9 59.6 62.3 54.2 $150,001 to $300,000 86.4 60.3 65.3 55.4 More than $300,000 90.1 65.3 68.1 56.3 2 Credit Score Lower than 620 73.2 51.5 52.8 58.8 620 to 679 76.4 57.6 61.3 55.3 680 to 719 80.4 62.1 62.0 54.7 91.2 62.8 67.9 54.3 720 or Higher Respondent Age 35 Years or Younger 84.4 79.3 74.0 65.0 36 to 45 85.7 67.7 66.5 59.1 46 to 55 84.4 55.2 62.2 55.5 56 to 65 88.1 42.3 56.6 44.5 Older than 65 88.3 38.8 56.0 32.3 Respondent Race/Ethnicity Non-Hispanic White 86.4 62.0 67.7 54.1 Hispanic and Non-White 84.0 58.5 57.2 57.0 Respondent Education High School or Less 77.9 51.1 54.3 49.7 Some College 83.4 54.6 61.3 52.2 College Degree 87.3 65.5 67.6 56.6 Postgraduate 89.0 65.2 69.0 57.0 Household Income Less than $50,000 77.3 56.9 54.4 50.3 $50,000 to $99,999 83.4 60.4 63.4 54.3 $100,000 to $174,999 88.7 62.8 69.1 56.3 $175,000 or More 94.3 63.6 71.3 58.2 Household Type Couple 85.9 61.3 65.3 55.4 Single 85.0 60.3 63.8 53.2 All Respondents 85.7 61.1 64.9 54.8 Source: National Survey of Mortgage Originations, 2016. Based on 6,285 survey responses. Notes: 1. Mortgages to purchase a property are classified as the "purchase" loan type and all other mortgages are classified as the "refinance" type. 2. Credit score and first-time homebuyer status are assembled from the National Mortgage Database. Credit score from Vantage ranges from 300 to 850. A homebuyer is classified as first-time if neither the respondent nor the spouse is older than 54 years in age and there is no evidence of a prior mortgage in the credit files. 3. If a refinance mortgage amount is higher than the previous mortgage or if a mortgage is for a previously mortgage-free property, it is classified as a cashout refinance.
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respondents. Forty-four percent of respondents aged 56 to 65 years old and 32 percent of respondents older than 65 reported they were very or somewhat likely to significantly increase their income if they experienced a financial shock.
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Appendix. About the National Mortgage Database Project The National Mortgage Database is a multiyear project being jointly undertaken by the Federal Housing Finance Agency (FHFA) and the Consumer Financial Protection Bureau (CFPB). The project is designed to provide comprehensive information about the U.S. mortgage market based on a 5 percent sample of residential mortgages. The project has three primary components: (1) the NMDB®8, (2) the quarterly NSMO 9, and (3) the annual American Survey of Mortgage Borrowers (ASMB). The NMDB® project will enable FHFA to meet the statutory requirements of section 1324(c) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended by the Housing and Economic Recovery Act of 2008, to conduct a monthly mortgage market survey. Specifically, FHFA must, through a survey of the mortgage market, collect data on the characteristics of individual mortgages, including subprime and nontraditional mortgages, information on the creditworthiness of borrowers, and whether subprime and nontraditional borrowers would have qualified for prime lending. For CFPB, the NMDB® project will support policymaking and research efforts and help identify and understand emerging mortgage and housing market trends. CFPB expects to use the NMDB®, among other purposes, in support of the market monitoring called for by the DoddFrank Wall Street Reform and Consumer Protection Act, including understanding how mortgage debt affects consumers. FHFA and CFPB examined existing databases and determined that none of them fully meet the criteria necessary to achieve the above objectives. The NMDB®, when fully complete, will be a de-identified, loan-level database of closed-end first-lien residential mortgages. It will: (1) be representative of the market as a whole; (2) contain comprehensive information on the terms and performance of mortgages, as well as characteristics of the associated borrowers and property; (3) be continually updated; (4) contain historical information from before the financial crisis of 2008; and (5) provide a sampling frame for the NSMO and ASMB. The core data in the NMDB® are drawn from a random 1-in-20 sample of all closed-end firstlien mortgage files outstanding at any time between January 1998 and June 2012 and maintained by Experian, one of the three national credit repositories. A random 1-in-20 sample of mortgages newly reported to Experian is added each quarter. Mortgages are followed in the NMDB® database until they terminate through prepayment (including refinancing), foreclosure, or maturity. De-identified information from credit repository files related to each borrower associated with the mortgages in the NMDB® sample is collected from at least one year prior to origination to one year after termination of the mortgage. The information on borrowers and loans available for analysis is de-identified and does not include directly identifiable information, such as borrower name, address, or Social Security number. The NSMO is a component of the NMDB® project. The survey is designed to complement the NMDB® by providing information, particularly related to mortgage shopping, that is not 8
9
See National Mortgage Database Technical Report 1.2 for more details. See National Survey of Mortgage Borrowers Technical Report 2.3 for more details.
A-1
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otherwise available in the database. To achieve this objective, the NSMO draws its sample from mortgages that are part of the NMDB®, which samples from the same target universe. The NSMO survey is voluntary and its target universe is newly originated closed-end first-lien residential mortgages and the associated borrowers. The NSMO is administered by Westat under a subcontract with Experian. Fair Credit Reporting Act (FCRA) rules require that the survey process be administered through Experian in order to maintain consumer privacy because it utilizes borrower names and addresses drawn from credit repository records. The NSMO sample is selected each quarter from the mortgage loans newly added to the NMDB® sample that quarter. After the sample is selected, Experian eliminates any potential respondents who have opted out of previous surveys or are deemed not to have useable addresses or names. Industry guidance (Metro 2® Industry Standards for Credit Reporting) requires that servicers must supply a billing address for each borrower on a trade line (including mortgages). Experian generally uses these borrower billing addresses as the survey mailing addresses. Where there are multiple addresses and borrowers associated with a survey sample loan, Table A-1 reflects the rules for selecting the borrower(s) and address to which the survey is mailed. The survey is sent to no more than two borrowers who share a common address. FHFA and CFPB never receive the names or addresses chosen for the survey. Only Experian and Westat, as Experian’s subcontractor, have access to this information. Table A-1. Rule for Best Address Number of Borrowers
Same or Different Address
Resulting Survey Recipient
1
Not Applicable
One borrower with Experian’s associated best address
2
Same
Two borrower names with one common best address
2
Different
The one borrower and associated best address with the lowest number of open mortgages
>2
Same
Two borrowers with one common best address that has the highest number of trade lines reported
>2
Different
The one borrower and associated best address with the lowest number of open mortgages
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The survey implementation strategy includes four respondent contacts over a seven-week period: Week 1
Printed questionnaire, cover letter, and cash incentive (entire survey sample population)
Week 2
1st reminder letter (entire survey sample population)
Week 5
2nd reminder letter, printed questionnaire, and additional cash incentive (sampled borrowers who have not responded by Week 4)
Week 7
3rd reminder letter, which includes the due date for returning the questionnaire, to close the communication loop (sampled borrowers who have not responded by Week 6)
Participation in the survey is voluntary, and respondents are assured the confidentiality of their responses. The first and the third contacts contain a printed survey questionnaire and a five dollar cash incentive which respondents are free to keep regardless of whether they return the questionnaire. The mailings and printed questionnaires detail how respondents can also complete the survey online in either English or Spanish using instructions and a unique “survey PIN number” provided in the questionnaire packet. To date, nearly one third of survey responses have been completed online. Mail surveys are processed for four weeks after the third reminder letter, so the field period comprises 12 weeks in total. It takes between five and six weeks to draw the new NMDB® sample, identify and combine duplicative records, draw the NSMO sample, process it at Experian, and print the survey materials. Thus, the survey cycle typically begins six weeks after the end of a quarter and extends about four weeks into the next quarter. All returned questionnaires and any non-delivered mail are sent directly to Westat and not to FHFA, CFPB, or Experian. All survey responses received by Westat are purged of any information related to the name of the borrower, address of the borrower, or name of any financial institution. This is done to maintain the de-identified confidential nature of the data and to ensure that the survey responses cannot be connected to a name or address. During the first eight weeks of each cycle, Experian maintains a NSMO call center to address any questions by respondents. This call center also allows respondents to “opt out” of the survey and future surveys. Both FHFA and CFPB describe the survey on their websites so that respondents can independently verify the legitimacy of the survey. The agency officials signing the cover letter (Sandra Thompson at FHFA and David Silberman at CFPB) are identified on the websites as senior employees of their respective agencies. Once the active phase of a survey cycle ends, it takes about 25 days for Westat to scan and edit returned questionnaires, combine them with on-line responses, and create an electronic data file. This file is delivered to the NMDB® development staff through Experian. It takes an additional
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NMDB® ____________________________________________________________________________________ Technical Report 6.0 A Profile of 2016 Mortgage Borrowers
eight weeks to complete additional processing of survey responses, to create preliminary sample weights, and to assemble a preliminary user data file. The timeline described above applies to each quarterly data release. Because some loans take longer than six months to be reported to the repositories, a data file fully representative of a calendar year will generally not be available until December of the following year.
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