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Home>CoreLogic Reports Mortgage Credit Risk Increased in Q2 2017

CoreLogic Reports Mortgage Credit Risk Increased in Q2 2017

CoreLogic Reports Mortgage Credit Risk Increased in Q2 2017

09/28/2017

CoreLogic Reports Mortgage Credit Risk Increased in Q2 2017

—Credit Risk for Loans in 2017 Comparable to Loans Issued in Early 2000s—

  • Increase in Condo Co-op and Investor Shares in Q2 2017 Make Loans Appear Riskier
  • Purchase Mortgage Loans Are Still High Quality in Terms of Credit Risk

CoreLogic® (NYSE: CLGX), a leading global property information, analytics and data-enabled solutions provider, today released its Q2 2017 CoreLogic Housing Credit Index (HCI) which measures trends in six home mortgage credit risk attributes. The HCI indicates the relative increase or decrease in credit risk for new home loan originations compared to prior periods. The six attributes are borrower credit score, debt-to-income ratio (DTI), loan-to-value ratio (LTV), investor-owned status, condo/co-op share and documentation level.

This Smart News Release features multimedia. View the full release here: http://www.businesswire.com/news/home/20170928005305/en/

Figure 1: CoreLogic National Housing Credit Index Q2 2017 (Graphic: Business Wire)

Figure 1: CoreLogic National Housing Credit Index Q2 2017 (Graphic: Business Wire)

In Q2 2017, the HCI increased to 117, up 20 points from Q2 2016. Even with this increase, credit risk in Q2 2017 is still within range of the HCI for 2001 to 2003, a timeframe that is considered to be a normal baseline for credit risk. The loosening in the Credit Index during the past quarter was partly due to a shift in the mix of more investor and condominium loans which offset lower-risk signals from the credit score, as well as DTI and LTV attributes.

“Mortgage risk for new originations increased modestly in the second quarter of 2017, but much of this rise was due to a small shift in the mix of loan types to more investor and condominium loans, which have slightly higher risk attributes,” said Dr. Frank Nothaft, chief economist for CoreLogic. “Despite the somewhat higher risk of new origination loans, purchase mortgage underwriting remains relatively clean with an average credit score of 745 and low delinquency risk.”

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