Mortgage bankers predict decline

CHICAGO – The Mortgage Bankers Association is predicting a $300 billion decline in mortgage originations for the coming year.
In an estimate released Tuesday, the MBA projected mortgage originations for 2012 dropping to $900 billion in 2012 from $1.2 trillion this year.
“We think growth driven by consumer spending on durables and business spending on new plants and equipment will keep the United States out of recession, but there is significant uncertainty around this forecast,” said Jay Brinkmann, MBA’s chief economist and senior vice president for research and education in a news release.
“Europe is in or soon will be in recession. There is the risk that the European situation could harm the US financial system, and could lead to further damage to US consumer and business confidence,” Brinkmann said.
The forecast said the decline would likely come in the form of a significant drop in mortgage refinances with new mortgages increasing only slightly.