When it comes to first-time homebuyers, Fannie Mae and Freddie Mac have nothing on the FHA.

Despite strong demand for refinancings, Federal Housing Administration (FHA) lenders stuck to their bread and butter product, originating $124.5 billion of purchase money loans in fiscal year 2012 with nearly 78% going to first-time homebuyers.

FHA, in a new report, notes that purchase mortgages represented 62% of all government insured forward loans originated in 2012 full-year, which ended Sept. 30.

The agency’s ‘Single-Family Outlook’ report shows lenders made 1.18 million forward mortgages in FY 2012 with 734,000 being used for a home purchase. (At Fannie and Freddie, refis are north of 70% of their volume.)

Overall, FHA insured $213.4 billion of forward mortgages in full-year 2012 and $13.2 billion of reverses. Originations of reverse loans (officially known as home equity conversion mortgages (HECMs) dropped by 28% from full-year 2011. Several large lenders exited the HECM business last year.

Meanwhile, the FHA September report shows the pipeline of applications for streamline refinancings is slowing somewhat. In June, FHA launched a low-cost streamline program to incentivize refinancings by existing FHA borrowers who had not refinanced in the past three years.

This streamline refi program was designed to lower the borrower’s payments and strengthen FHA’s $1.1 trillion insured mortgage portfolio, which ended full-year 2012 with a 9.6% serious delinquency rate, up from 8.6% a year ago.

FHA has received roughly 300,000 streamline refinance applications from June 10 through September. However, applications dropped to 55,000 units in September, down from 72,000 in August and 102,600 in June.

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