Magazine article Mortgage Banking

MBA Study Finds Production Volume and Per-Loan Profit Up in 2Q

Magazine article Mortgage Banking

MBA Study Finds Production Volume and Per-Loan Profit Up in 2Q

Article excerpt

Average mortgage production volume and per-loan profits were up in the second quarter, according to a study in which the sample is heavily made up of independent mortgage banks. The study done by the Mortgage Bankers Association (MBA) found average production volume for participating companies rose to $174 million per firm, up from $164 million in the first quarter.

MBA reported that average profit per loan originated in the second quarter was $575, up significantly from the $346 per-loan profit recorded in the first quarter. The findings were part of MBA's Second Quarter 2011 Mortgage Bankers Performance Report. More than 71 percent of the 310 companies reporting production data in the second quarter for the study were independent mortgage companies.

The refinance share by dollar volume reported by the survey group was down in the second quarter from the prior quarter. Participating companies reported that just 36 percent of their production in the second quarter consisted of refinances. That was down from 50 percent in the first quarter. MBA's research division estimates that the refinance share for the overall industry was 62 percent in the second quarter, down from 65 percent in the first quarter. So the study reflects that independents were more likely to garner higher purchase-loan activity than the overall industry.

Marina Walsh, MBA associate vice president of industry analysis, said, "Contrary to overall MBA industry data in which estimated production volume declined, the average firm in our study of independents and subsidiaries experienced volume growth. …

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