Mortgage bankers funded $11.3 billion of interest-only loans in the first quarter, a 60% gain from the same period a year earlier, according to figures compiled by ASR's sister publication, National Mortgage News and the Quarterly Data Report.
However, many IO loans are actually jumbo mortgages and roll over within five to seven years.
Wells Fargo & Co., San Francisco, ranked first among all IO lenders in 1Q, originating $3.1 billion of product, a 55% gain from a year ago. PHH Mortgage, Mt. Laurel, ranked second with $2.3 billion (up 95%), and Union Bank, San Francisco, ranked third with $1.8 billion, a 120% jump from a year ago.
Union Bank is also a top ranked jumbo funder and is on track for a record year in originations.
Among the top five IO lenders, the gains ranged from 16% (U.S. Bank Home Mortgage) to Union’s 120%.