Visualizing Mortgage Loan Originations in the United States

Every year, the Federal National Mortgage Mortgage Association, commonly known as Fannie Mae (traded as FNMA), provides financial backing to thousands of mortgage lenders across the United States.

In an effort to promote home ownership, Fannie Mae expands the secondary mortgage market by purchasing mortgage loans from lenders and packaging them into Mortgage Backed Securities (MBSs).

This process allows mortgage lenders to reinvest their assets and originate more mortgages. This effectively increases the number of mortgage lenders in the United States by reducing reliance on lender reserves.

Fannie Mae publishes aggregated data on the mortgage loans they purchase using a tool called Data Dynamics.

Using Data Dynamics and Tableau, I located and visualized data on single-family home mortgages originated to serve as a primary residence.

This first visualization shows the count of mortgage loans purchased by Fannie Mae broken down by credit score.

Credit Range Color Key

This key applies to all subsequent data visualizations.

In the early 2000s, a wide variety of credit score ranges were represented across millions of mortgage loans. Leading up to 2008, the total number of loan purchases decreased.

Following the Great Recession, lending to low credit score individuals decreased with a slow increase to the 620-660 credit range starting in 2010.

Mortgage loan count by year broke down by credit score.

I wanted to take a closer look at the percentage of mortgage loans from each credit score range regardless of the count.

This highlights the diverse credit score ranges that were accepted in the early 2000s, tightening percentages on low scores near 2008, and a steady increase of credit score diversity into 2016.

Percent share of mortgage loans by credit score.

Using Loan to Value (LTV) data from Data Dynamics, I was able to calculate an estimated average down payment percentage on mortgages Fannie Mae purchased for each year.

Estimated Down Payment % = (1 – LTV) * 100

The average down payment, according to Data Dynamics, steadily increased across all credit ranges until 2006. From 2006 to 2008, the average down payment fell from 23% to 21%.

During the recession, down payments increased to 25% and have been declining since 2010.

The average down payment on Fannie Mae mortgages for each year.

Data Dynamics also provides data on borrower’s Debt to Income Ratios (DTIs). Using a box and whisker plot, I was able to visualize the average DTIs for each credit score range.

As expected, borrowers with lower credit scores (0-620 and 620-660) had the highest DTI’s. Borrowers with the highest credit scores (780+) always had the lowest DTIs.

A box and whisker plot that shows yearly DTI trends for each credit score.

Every day, Fannie Mae helps Americans achieve the dream of homeownership. Through innovative financing solutions, Americans are able to build equity in their homes and live more enriched lives.