Led by subprime lending, mortgage fundings continued to fall at Washington Mutual Inc.
Residential loan volume amounted to $51.5 billion in the first quarter, off by $8 billion from the prior three-month period and more than $5 billion below the level a year earlier, according to WaMu's earnings announcement Wednesday.
Of the latest period's production, home equity loans and lines represented $7.3 billion, decreasing 20 percent from the fourth quarter, the Seattle-based thrift said. Subprime fundings from Long Beach Mortgage Co. had a larger quarterly decline -- off about one-third to $6.4 billion.
Short-term adjustable-rate loans accounted for about two-fifths of the home loans, while medium-term ARMs accounted for another 37%, WaMu reported. Option-ARM production was $7.1 billion.
Refinances reportedly represented almost half of the overall volume.
The retail channel contributed 41 percent of total loans secured by real estate, the wholesale unit added 30 percent and the remainder was correspondent production, the company reported.
The size of the total servicing portfolio increased to $828 billion, WaMu said.
Net income for the home loans group was $38 million, off 35 percent from the fourth quarter, according to the report. WaMu noted the decrease was due to an increase in short-term interest rates and the flat yield curve, in conjunction with a smaller portfolio of loans outstanding.