Mortgage Originations Hit $4T, More Refis Expected

Oct 28, 2021

Freddie Mac and HouseWire predict that we’ll see $3.9T in mortgage originations in the US by the end of 2021. That’s just shy of the record $4T clocked in 2020. What does it all mean for the market and investors?

Mortgage Originations Remain Strong

Freddie Mac’s outlook for the US mortgage market is that we will see a near record year for originations this year. 

We may come in slightly short of 2020’s record if interest rates rise as expected through the fourth quarter of this year. 

The rush to purchase homes and refinances that will come with rising rates should put a strong finish on the year. 

Purchases Versus Refinances

Freddie expects mortgage originations to be split close to 50/50 between purchase loans and refinances this year. 

Low rate home purchase loans are going to make more vintage loan notes with higher yields even more desirable and valuable.

Refinances will be great for many mortgage note investors, as it will give them early payoffs. These will solve any underperforming loans and provide lump sums of capital to take advantage of new opportunities over the next six months. 

The Outlook For 2022

Freddie Mac has slashed the outlook for mortgage originations in 2022. It is expected they will come in at just around $2.5T. Dramatically less than this year.

The housing and debt market is expected to stay strong through 2022, though likely growing at a much more moderate and sustainable pace. 

So many people will have bought homes and refinanced by then that demand may be tamer. Shortages of inventory, especially with home builders slashing forecasts of deliveries due to labor costs and shortages of materials are likely to continue. 

Any significant rise in interest rates would also price many would-be retail home buyers out of the market as well.


US mortgage originations are on track for a close to record year in 2021. These are only surpassed by the records set in the middle of COVID in 2020. 

This is great for investors. As will be any modifications next year, which could optimize pricing on mortgage notes and income properties. 

Investment Opportunities

Find out more about investing in secured debt and real estate, go to NNG Capital Fund