Countrywide Financial said Thursday September mortgage lending fell 44.3 percent from a year earlier as it tightened underwriting standards, while delinquencies surged and commercial lending also dropped dramatically.
Mortgage loan fundings totaled $21.2 billion, down from $38.1 billion a year earlier. Fundings of adjustable-rate mortgages slid 76 percent, while "nonprime" loan fundings tumbled 92 percent. Countrywide is the second-largest issuer of subprime loans in the U.S.
Delinquencies as a percentage of unpaid principal balances rose to 5.85 percent from 4.04 percent a year earlier, Countrywide said.
Company officials said the sharp dropoff in activity is attributable to conditions of the real estate industry, which is in a prolonged sales slump. Financial institutions, meanwhile, have sharply tightened lending restrictions in light of the major increase in defaults caused by resetting of adjustable-rate mortgages to higher fixed rates.
"The Company is continuing to take the necessary steps to assist borrowers with foreclosure avoidance and investors with loss mitigation," Countrywide President and COO Â David Sambol said in a statement.
The slowdown also affected Countrywide's commercial funding, with volume for September at $242 million, down from $646 million in September 2006.
The mortgage loan servicing portfolio continued its growth, reaching $1.46 trillion, up 17 percent, or $215 billion, from September 30, 2006.
- Reuters contributed to this report