The average loan balance for first mortgages rose from $345,761 in the first quarter to $356,993 in the second, the Mortgage Bankers Association reported.
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Independent mortgage banks notched a profit on loan originations in the second quarter for the first time in two years, the Mortgage Bankers Association reported this week.
After eight straight quarters of net losses on loans, IMBs reported earning a pre-tax profit of $693 per loan origination in the three months that ended June 30. That was up from a net loss of $645 per loan in the first quarter of the year.
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“With a pickup in quarterly volume, productivity, and closings-to-applications pull-through, production costs dropped by about $1,800 per loan,” Marina Walsh, MBA’s vice president of industry analysis, said in a statement. “These developments contributed to better net results, even as production revenues decreased from the previous quarter.”
“Almost 80 percent of mortgage companies in the sample posted overall profits, including both production and servicing business lines,” Walsh said. “After two of the most challenging years in the mortgage business, many companies are seeing light at the end of the tunnel.”
Seventy-eight percent of the firms that reported production data in the quarter reported earning a pre-tax profit for both production and servicing, up from 59 percent in the first quarter.
Companies reported earning an average of $492 million in production volume on 1,503 loans in the quarter, up from $384 million on 1,193 loans to start the year.
The average loan balance for first mortgages rose from $345,761 in the first quarter to $356,993 in the second, the MBA reported.
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