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Inside Mortgage Trends

November 18, 2005

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Both Sides of Mortgage Business Show Improved Profitability in Third Quarter

Both loan production and servicing operations yielded higher profits during the third quarter of 2005, according to a new analysis by Inside Mortgage Profitability of financial reports from eight major lenders. Although servicing operations posted more substantial gains from the previous quarter, income from loan origination and sales activity also improved for the group. The eight lenders reported a combined $1.50 billion in production income during the third quarter, up... Read More

WaMu Throws Investor Party with Executives Singing Same Tune – Bigger, Faster, Better

Washington Mutual is preparing to grab a bigger piece of the mortgage pie with new plans to put a loan officer in every one of its 2,100 retail bank branches. WaMu is “back on track and ready to go,” declared David Schneider, president of home loans, during the company’s annual five-hour investor conference Tuesday in New York.The country’s largest thrift, WaMu lost market share over the past couple of… Read More

NetBank Deals with a Pool of Tainted Loans, Predicts Tough Times Ahead as Market Slows

It has been a tense week for NetBank after the lender delayed reporting third quarter earnings because of problems it uncovered with a group of conforming loans that it fears were misrepresented during underwriting. CEO Doug Freeman declined to talk about the problem loans too much, citing the preparation of a possible legal case. The problem pool of about $13 million forced NetBank to set aside $3.5 million in reserves… Read More

Irwin Financial Corp. Changes Treatment of Incentive Service Fees, Will Restate 2004 Earnings

Irwin Financial Corp. revisited the way it accounted for incentive servicing fees and decided a change was needed. The mortgage banker had been posting the fees as a derivative under financial accounting standard No. 133, but on reflection, determined the fee should be treated as a servicing asset under FAS 140. Irwin began its examination of the fee treatment after stakeholders raised the issue, said CFO Greg Ehlinger. This meant... Read More

Companies Geared for Business in a Higher Interest Rate Environment Begin to Emerge

Companies hoping to capitalize on a changing mortgage market have recently ramped up their efforts to boost business. Clayton Holdings, a provider of outsourcing services to the non-agency MBS market, filed for an initial public offering with the Securities and Exchange Commission last week. Meanwhile, Mortgage Assistance Center Corp., which purchases non-performing loans from financial institutions and resells the loans or underlying real estate to investors, is developing an investor… Read More

Venture Capitalist Takes a Turn in the Mortgage Industry, Hopes to Make Mark in Emerging Markets

GenStone Acquisition Co. is making its first foray into the mortgage industry by buying Washtenaw Mortgage of Ann Arbor, MI. The lender’s new mission will be to serve the subprime markets. The deal begins with GenStone making an immediate cash injection to Washtenaw of $1.6 million, said GenStone CEO Rich Coleman, which will buy nearly 57 percent of the lender’s outstanding shares. Then by February next year, GenStone will buy... Read More

Faced With Increasing Competition, GreenPoint Fights to Hold Its Own by Opening More Branches

With margins decreasing as competition increases in the Alternative A market, one leading wholesale lender is banking on its expansive product line to boost profits. GreenPoint Mortgage aims to increase business by establishing a paperless mortgage system and opening more branches in the coming year as well. Company President and CEO Steve Abreu said competition is driving down margins as subprime lenders enter the market, but GreenPoint’s origination costs are... Read More

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