November 06, 2017

Fed survey: Q3 banks' mortgage lending standards eased or unchanged

The Federal Reserve's third-quarter senior loan officer survey showed that banks' lending standards on all categories of residential real estate loans either eased or remained mostly unchanged as demand for all categories of these loans weakened.

The survey indicated that there was modest easing for conforming jumbo loans and those eligible to be sold to the government-sponsored enterprises. The other loan categories were left unchanged.

The surveyed banks also reported that in the past three months they tightened their lending standards on credit card and auto loans, while demand for these loans remained mostly unchanged. Regarding auto loans, lenders tightened their terms on rate spreads, down payment requirements and minimum credit scores.

This senior loan officer survey was based on responses from 72 domestic banks and 23 U.S. branches and agencies of foreign banks.

The survey also noted that banks eased their standards and terms on commercial and industrial loans while demand for these loans weakened. Banks' standards on most categories of commercial real estate loans remained almost unchanged, but these loans also saw a declining demand.

NAFCU's 2017 Report on Credit Unions, released today, includes a section on credit union lending standards. The report, comparing lending standards between 2016 and 2017, found that credit union standards have been eased for most types of non-mortgage loans, but tightened for most types of mortgage loans.