Loan brokers enjoyed a slight gain in their market share during a very strong third quarter for originations, but are still seeing their business come under pressure.
According to exclusive survey figures compiled by National Mortgage News and the Quarterly Data Report, the wholesale/broker loan channel accounted for 11.6% of originations in 3Q, compared to 10.5% in the second quarter, a period in which broker-sourced loans fell to an all-time low in terms of market share.
In 3Q all mortgage bankers funded $444 billion of product, the industry's best quarter since the second quarter of 2009.
Three years ago brokers accounted for 24% of all loans produced in the nation. Many notable table funders have exited the space in the past few years, and recently Bank of America — a top ranked table funder — announced its decision to close down the channel in favor of retail and correspondent lending.
NMN/QDR found that in 3Q retail production dominated the production business with a market share of 47.3%, but correspondent lending, which entails the purchase of an already funded loan by another originator, was not too far behind at 40.9%.
Today, the National Association of Mortgage Brokers has roughly 5,000 members compared to 25,000 four years ago.
In the third quarter, the top three wholesale lenders were: Wells Fargo & Co. with $9.7 billion table funded, followed by Provident Funding Associates, Burlingame, Calif. ($7.1 billion), and U.S. Bank Home Mortgage ($6.9 billion).
Among the top five wholesalers, U.S. Bank Home had the strongest gain in fundings with 65%.
