Independent mortgage banking firms made an average profit of $575 per origination in the second quarter, a 66% gain compared to 1Q -- but a significant decline from two years ago when the average gain was $1,358.
According to new figures compiled by the Mortgage Bankers Association, these independents (nonbanks and affiliates of depositories) posted average loan production of $174 million in 2Q compared to $164 million the prior quarter.
This slight gain in fundings comes despite total industry-wide residential production falling to $270 billion in the second quarter from $353 billion in the first. (The quarterly funding figures come from National Mortgage News and the Quarterly Data Report.)
The trade group attributed the better profit performance, in part, on secondary marketing gains which came courtesy of improved spreads between 10-year Treasuries and 30-year FRMs.
In 2Q the average independent had a secondary market gain of 210 basis points compared to 201 bp in 1Q. In terms of dollars, the lender took in revenue of $4,006 per loan from a secondary market transaction.
Independents also benefited from lower operating costs, the trade group said: $5,644 per loan compared to $5,837 in 1Q.
