Mortgage losses continued at PHH Mortgage as home loan originations diminished and the primary servicing portfolio shrank. A decision on the sale of the mortgage business is likely to come soon.
Parent PHHÂ Corp. said in its earnings report that residential fundings totaled 20,437 loans for $7.384 billion from Jan. 1 through March 31.
Business declined from the fourth-quarter 2013, when it closed 27,506 units for $9.506 billion.
Mortgage production plunged from the 44,153 mortgage originated for $13.319 billion during the same three-month period last year.
First-quarter 2014 business included $5.420 billion in private-label originations, $1.556 billion in retail production and $0.408 billion in wholesale-correspondent activity.
Originations are likely holding up in the current quarter based on applications, which inched up to $10.369 billion from the fourth quarter’s $10.357 billion.
However, the second-quarter outlook is less optimistic based on interest rate lock commitments, which fell to $1.750 billion from $2.135 billion.
PHHÂ serviced 794,648 loans for $128.813 billion as of March 31.
The servicing portfolio moved down from 824,992 loans for $130.494 billion as of the end of last year and 864.501 loans for $139.031 billion as of March 31, 2013.
In addition, PHHÂ subserviced 406,287 mortgages for $96.931 billion as of the end of the latest period.
Mortgage delinquency based on the unpaid balance was 5.11 percent, tumbling from 5.70 percent as of Dec. 31, 2013. The March 31 rate included a 2.32 percent foreclosure-real estate owned rate.
As of the end of March, $116 million in unresolved repurchase requests remained outstanding.
The mortgage production segment saw losses climb to $60 million from $45 million in the fourth-quarter 2013, while servicing earnings swung to a $29 million loss from an $86 million profit.
“Results in our mortgage business were consistent with the mortgage industry environment and our expectations,” PHH Corp. President and Chief Executive Officer Glen A. Messina said in the report. “We continue to take decisive actions to strengthen PHH’s position to meet the challenges and opportunities that lie ahead in a home purchase-driven market.”
Messina went on to say that the Mount Laurel, N.J.-based company continues to explore business sales and expects to reach a conclusion by the end of next month.
As a whole, PHHÂ Corp. swung to a $71 million loss before taxes from a $61 million fourth-quarter 2013 profit and a $96 million first-quarter 2013 profit.
