Banks and thrifts reported significant declines in mortgage originations and loan sales during the first quarter of 2020, but they ended the period with a huge pipeline of pending secondary-market activity. (Includes data chart.)
The nonbank took a large loss in the first quarter and halted production. Officials at the firm are now betting on originating GSE-eligible mortgages through call centers to return to profitability in the third quarter.
With one big exception — Freedom Mortgage — correspondent platforms saw declining production of FHA/VA loans in the first quarter. Retail was fairly steady, while wholesale-broker gained momentum. (Includes data chart.)
While overall production volume was down in all three major product groups, the wholesale-broker channel saw increased originations of conventional-conforming and government-insured loans. (Includes two data charts.)
Agency MBS issuance declined modestly from the fourth quarter of 2019 to first quarter of this year. But volume soared abruptly in April, along with signs of COVID-19 stress. (Includes two data charts.)
Production in all three channels was down from the fourth quarter, but brokers had a smaller decline than correspondents and retail producers. (Includes two data charts.)
Correspondent production across all three major mortgage food groups was up 12.6% from the third to the fourth quarter, while retail rose 5.8% and wholesale-broker managed just a 2.5% gain. (Includes two data charts.)
A large concentration of refinance loans meant that retail mortgages sold to the agencies had higher credit scores — along with lower LTV and DTI ratios — than did third-party originations. Seller profiles were shaped by their channel strategies. (Includes two data charts.)
Policymakers should focus on making origination and servicing attractive to banks and nonbanks alike instead of adopting additional standards that apply to non-depositories, the Mortgage Bankers Association says.
Nonbank mortgage lenders and depositories live in a different world. Right? Yes and no. Inside Mortgage Trends ranks the top 20 home lenders by institution type. (Includes two data charts.)
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