Mortgage lenders managed to boost quarterly home loan originations while, at the same time, increasing the amount they earn per loan.
The average non-bank residential lender closed 2,593 loans for $631 million during the three months ended June 30.
Business accelerated from the first quarter, when an average of 1,961 loans were closed for $484 million.
The findings were detailed in the Quarterly Mortgage Bankers Performance Report Q2 2015 provided to Mortgage Daily by the Mortgage Bankers Association.
The study included survey responses from 354
independent mortgage bankers and home lending subsidiaries of chartered banks. However, quarter-over-quarter comparisons were only based on the 334 companies that participated in both the first-quarter and second-quarter 2015 surveys.
Activity also ascended from the second quarter of last year, when average originations amounted to 1,676 loans funded for $378 million.
MBA said the average monthly closings per production employee climbed to 2.7
loans in the second-quarter 2015 from 2.3 units three months earlier and a year earlier.
Zeroing in on just sales employees, average monthly production per employee jumped to 7.6 loans from 6.4 loans in the first quarter and 6.3 loans in the second-quarter 2014.
Origination fees averaged 41 basis points during the latest period, not as much as the 46 BPS earned in the first quarter nor as good as the 54 BPS earned in the second quarter of last year.
At companies that close between between $50 million and $100 million per quarter, origination fees jumped to 53 BPS in the second quarter of this year. But average origination fees dropped to 35 BPS
at firms with more than $250 million in quarterly production.
At just retail originators, average loan origination fees
were 48 BPS. The average dropped to 38 BPS at companies that originate through retail originators and mortgage brokers, while firms that rely on wholesale business for at least 75 percent of their production earned just 11 BPS.
The average home lender employed 311 people in the most-recent quarter, more than the 287 employees as of three months prior and 265 as of one year prior.
Lenders cut their personnel expenses to 198 BPS in the second-quarter 2015 from 205 BPS three months earlier and 203 BPS twelve months earlier.
Personnel expense at lenders with $50 million to $100 million in quarter volume jumped to 225 BPS and dropped to 192 BPS at organizations that closed more than $250 million per quarter.
Net interest income — the difference between warehousing income and warehousing expense — inched up to five BPS from four BPS but came up short of the six BPS earned in the second-quarter 2014.
Secondary marketing income, meanwhile, fell to 291 BPS from 300 BPS but was better than 270 BPS as of the year-earlier period.
Net production income most recently worked out to 66 BPS, more than the 60 BPS earned in the first quarter. Income also improved from the second-quarter 2014, when independent lenders earned just 46 BPS.
“Average company production volume was up in the second quarter, as purchase volume grew and mortgage pipelines from the first quarter’s refinance boomlet closed,” MBA Vice President of Industry Analysis Marina Walsh explained in the report. “The production volume increase resulted in a nominal decrease in per-loan production expenses, which offset a decrease in secondary marketing income.
“However, by historical standards, production expenses remained elevated given that the average company production volume was at the highest level since inception of the study in 2008.”
