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Home Lending Activity Dips at Flagstar

Flagstar Bancorp Inc., like many of its financial industry peers, saw a drop in quarterly mortgage production. The servicing portfolio also declined.

The home loan provider funded $7.876 billion in the third quarter, according to data provided in Flagstar’s latest financial reports.

New mortgage business regressed from the $8.448 originated in the second quarter.

On a year-over-year basis, however, recent quarter activity was better compared to the $7.187 billion in home loans closed during the three-month period that ended Sept. 30, 2014.

Altogether, Flagstar’s nine-month 2015 mortgage origination total came to $23.578 billion.

Third-quarter refinance share fell to 44 percent from 55 percent in the prior three-month period.

The majority of third-quarter volume came from correspondent acquisitions at $5.6 billion. Mortgage brokers originated $1.9 billion, and $0.4 billion came from the retail channel.

Fallout-adjusted rate-lock commitments slipped from $6.8 billion in the second quarter to $6.5 billion.

At the end of the third quarter, the mortgage lender’s servicing portfolio came to 148,466 loans at $32.013 billion — a decline from 152,405 loans serviced for $32.890 billion reported on the last day of June.

The recent portfolio also had fewer serviced loans compared to 149,459 as of Sept. 30, 2014, but the amount actually increased from $31.440 billion. Both prior-year servicing numbers were revised up from the original report.

Third-party servicing activity accounted for $26.306 billion of the latest portfolio total.

As of Sept. 30, the financial entity also reported an additional $42.282 billion in third-party subservicing.

Residential loans on the balance sheet increased to $3.271 billion at the end of the third quarter from $3.060 billion at the end of the second quarter and $2.640 billion as of the third quarter a year ago.

The recent mortgage investment portfolio accounted for residential first mortgages at $2.726 billion, second mortgages at $0.140 billion and home-equity lines of credit at $0.405 billion.

The balance sheet accounted for warehouse lending assets at $1.011 billion, a decline from $1.203 billion, revised down from the original June 30-ended amount. The most current total, however, was well ahead of the $0.595 billion reported as of Sept. 30 last year.

At $0.707 billion, commercial real estate investment loans grew from $0.629 billion at the end of the second quarter and $0.567 billion at the end of the third-quarter 2014.

As of Sept. 30, the repurchase pipeline was down to $30 million from the second-quarter ended amount of $46 million.

At the holding company level, the Troy, Michigan-based firm’s income before income taxes reached $71 million, a $3 million decline from the second quarter. But the latest earnings swung from a $38 million loss reported in the third-quarter 2014.

Full-time employees equaled 2,677 at the end of September. Staffing fell by 36 from the June 30 tally and by 48 from the third-quarter 2014 headcount.

As of Sept. 30, Flagstar claimed 99 bank branches or one less than reported at the end of the second quarter.

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