Production edged down during the fourth quarter for American Home Mortgage Investment Corp. and may dip further.
The real estate investment trust announced today it originated $13.6 billion in the fourth quarter, down slightly from the third quarter but $6.9 billion above the comparable period a year earlier.
The $9.2 billion pipeline of applications at the end of the period indicates another volume decrease is on the horizon, as it is below the $11.6 billion reported for the third quarter's end.
However, annual volume of $45.3 billion surged over 2004's level of $23.0 billion, American Home said.
The fourth quarter's volume represented a record market share for the Melville, N.Y.-based of 1.92%, according to the announcement.
Of the latest quarter's originations, 51% of the loans were refinances and the remainder purchase money fundings, the REIT said.
The ARM share of quarterly originations was reported at 50%.
The size of the servicing portfolio reportedly grew about 12% during the fourth quarter to $30.7 billion as of Dec. 31.
American Home noted overall fourth quarter results were "highly disappointing" -- net income of $16.7 billion shrunk 69% from the third quarter.
"Our company's income was negatively impacted by low gain on sale margins due to poor market conditions for whole loan sales at the end of the quarter," Chief Executive Michael Strauss said in a written statement.
"In addition, credit spread widening and continued high repayment speeds caused write-downs of our junior mortgage securities, our inventory of newly originated loans and our pipeline of locked loan applications."
American Home reportedly employed approximately 2,373 loan officers and account executives at yearend.