Surveyed Banks Report Weaker Demand Across All Seven Mortgage Categories

Surveyed banks reported weaker demand across all seven categories of home-purchase mortgages in the third quarter, while lending standards changed little for most types of loans. The results cover banks’ reports of changing demand, rather than mortgage applications or completed loans.

The Federal Reserve released its October Senior Loan Officer Opinion Survey on Bank Lending Practices on Monday, Nov. 2, at 2 p.m. ET (19:00 UTC). Net demand balances ranged from -40.0 percentage points for subprime mortgages, with 10 responses, to -25.5 points for nonqualified-mortgage (non-QM) jumbo loans, with 47 responses.

The other readings were -32.1 points for GSE-eligible mortgages, based on 53 responses; -30.0 for government-backed mortgages, based on 50; -35.8 for qualified-mortgage (QM) non-jumbo, non-GSE-eligible loans, based on 53; -30.2 for QM jumbo loans, based on 53; and -31.8 for non-QM non-jumbo loans, based on 44.

Each balance compares the share of banks reporting stronger demand with the share reporting weaker demand. A negative balance means the share reporting weaker demand was larger. The question covers loans to purchase homes, excludes refinancing and asks banks to set aside normal seasonal variation.

Banks eased standards for QM jumbo and non-QM jumbo mortgages and tightened them for subprime loans. Standards were largely unchanged for most other mortgage categories.

The survey received responses from 61 domestic banks and 18 U.S. branches and agencies of foreign banks. In the October 2025 survey, banks described residential mortgage demand as stronger on balance.