The nation's top five ranked residential funders, as a group, are continuing to lose production market share, but most of that loss can be attributed to one firm: Bank of America, which is deemphasizing mortgages.
According to figures compiled by National Mortgage News and the Quarterly Data Report, the top five had a combined market share of 54.99% in the third quarter. A year earlier their share was measured at 58.40%. (Fourth quarter figures will be available at the end of February.)
Wells Fargo once again had the highest production market share, 25.29%, followed by Chase (10.92%), B of A (9.51%), CitiMortgage (4.9%), and Ally Financial/GMAC (4.37%).
Combined, the five originated $194 billion of loans. Wells and Chase grew their market shares while B of A's plunged by 6.84 market share points. CitiMortgage's share was up slightly, and Ally's was just about flat.
But some lenders fear that Wells is becoming an immensely dominating presence in the lending market, especially in the correspondent channel where it buys already funded loans from other originators. One warehouse executive, requesting his name not be used, said 50% of the loans that he is currently financing are committed to be sold to Wells Fargo.
Wells, which does not disclose its warehouse lending volume, is however the nation's largest correspondent buyer by far. In 3Q it bought $41.7 billion of mortgages from other firms, almost triple its closest competitor, B of A, which is in the process of leaving that channel.
Wells' warehouse division extends credit to nonbanks who then turn around and sell their originations to the megabank.
