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- Luck O' The Originator? ☘️
Luck O' The Originator? ☘️
By Jeff Walton & Kelly Guest
The Mortgage Bankers Association says that IMB profits oozed backward last quarter, sliding from net profit of $701 per loan in Q3, to a net loss of $40 on each loan they originated in Q424.
Brokers and IMBs freaked out about Redfin parting itself out to Rocket and Zillow might be interested in a conversation that J.D. Power had with National Mortgage Professional. The piece quotes Power's senior director of lending intelligence Bruce Gehrke, who said, “Borrowers are looking for more individual interaction from their lender throughout the process. The preference for purely digital lending is declining. Borrowers are looking for a more advisory experience driven by lender expertise delivered through live representatives.” Score one for the humans.
At a time when even the industry's big names don't agree on production forecasts (Fannie keeps adjusting sales and originations numbers down, while TransUnion predicts a 13.3% uptick in purchase mortgages this year), ServiceLink's 2025 State of Homebuying Report offers clues for where originators can point their prospecting efforts. The report found that 73% of consumers who were unsuccessful in purchasing a home in the last four years plan to try again in 2025. There could be pots of gold in your own CRM.
CHATTER
The U.S. Department of Housing & Urban Development (HUD) spent $29.2B in 2019 and $52B in 2024, a 78% increase in five years. Multiple sources report the Trump administration is "considering" closing several field offices; there has been no official announcement from HUD as of this morning.
Compass reportedly in talks to buy Home Services of America; Barron's has an interesting take.
loanDepot reported a 9% YoY increase in revenue for FY24 and smaller YoY net losses over 2023. The company also had a 13% increase in revenue for Q424.
Finance of America posted a quarterly loss for Q424, but net income gains for the full year.
Angel Oak REIT reported a 20% YoY increase in net interest income in Q424 as well as a , and Q4 2024 GAAP net loss of $(15.1) million. The company also saw a 28% increase in net income YoY for FY2024.
MBA congratulated William Pulte on his confirmation as Federal Housing Finance Administration (FHFA) Secretary.
MOVING & SHAKING
Pennymac hired Isaac Boltansky as Managing Director, Head of Public Policy.
Cenlar FSB announced that Andrew Pohlmann has joined the organization as Senior Vice President of Business Development.
Rate hired Drew Church as SVP/Regional Sales Manager.
Supreme Lending welcomed Brian Keranen and Eli Fairfield as Regional Directors.
Asurity appointed Christine Kirby as Director, Chief Implementation Officer for their Propel and RegCheck divisions.
MARKET/INDUSTRY
IMBs Back in the Red (MBA): Mindings from the newly released Quarterly Mortgage Bankers Performance Report:
The average pre-tax production loss was 4 bps in Q424, down from the reported profit of 18 bps in Q324, but less than the loss of 73 bps one year ago. The average quarterly pre-tax production profit, from the fourth quarter of 2008 to the most recent quarter, is 41 basis points.
The average production volume was $540 million per company in the fourth quarter, down from $542 million per company in the third quarter. The volume by count per company averaged 1,609 loans in the fourth quarter, down from 1,642 loans in the third quarter.
Total production revenue (fee income, net secondary marketing income, and warehouse spread) decreased to 339 bps in Q4, down from 341 bps in Q3. On a per-loan basis, production revenues decreased to $11,190 per loan in Q4, down from $11,417 per loan in Q3.
Mortgage Rates Remained Essentially Flat This Week: Freddie 3-13-25
Stocks and rates got off the same page last week, but there could be some bond-friendly news on the horizon. Bill Bodnar says the Fed is getting ready to release their quarterly summary of economic projections in his latest Master the Markets segment.
Mortgage Applications Increased 11.2% From One Week Earlier: MBA Survey for week ending 3-7-25.
The Refinance Index increased 16% from the previous week and was 90% higher than the same week one year ago. The seasonally adjusted Purchase Index increased 7% from one week earlier.
The MBA Builder Application Survey (BAS) data for February 2025 shows mortgage applications for new home purchases decreased 6.9% compared from a year ago. They were up by .3% MoM from January.
MBA’s Mortgage Credit Availability Index (MCAI) rose by 1.4% to 100.4 in February. “Mortgage credit availability in February increased for the third consecutive month to its highest level since March 2023.” Joel Kan, MBA’s Vice President and Deputy Chief Economist.
The Good, the Bad, & the Equity: CoreLogic Q424 Home Equity Report
Home equity increased nationwide by $281.9 billion in the fourth quarter of 2024, an increase of 1.7% year over year, according to the latest CoreLogic Homeowner Equity Report (HER). Washington D.C., Oregon, and some sunbelt states are showing rising negative equity.
“Housing equity growth slowed in 2024 versus 2020-2023 due to moderating price appreciation, but homeowners maintain substantial equity gains from prior years, preserving their strong financial position.” - Dr. Selma Hepp, chief economist for CoreLogic.
Beyond Dollars: Fannie's ESR Group Finds Consumers Place Increasing Importance on Their Homes
Almost half of consumers say their home has become more important to them over the past few years, compared to just 10% who say their home has become less important to them. This shift is driven primarily by consumers' appreciation for the location of their home and the sense of security it offers.
More than half of consumers say they have made functional changes to how they use their home in the last few years. These changes include using the home as a gym or for hobbies, growing food or gardening, and working from home.
Although more consumers still say the security and lifestyle benefits outweigh the financial benefits as the best reason to buy a home, this gap has closed significantly since we last asked the question in 2015.
More Findings from ServiceLink’s 2025 State of Homebuying Report:
Gen Z leads in the demographic findings of consumers planning to buy a home in 2025 with 67%, while 51% of Millennials say buying is on their agenda this year. Gen X and Boomers follow with 49% and 22% respectively.
Of homeowners planning to refi this year, 50% say it’s for rate/term improvement, 49% for other reasons.
The survey found 25% of homeowners say they’ll get a HELOC this year for home improvements and debt relief.
Up MoM, Down YoY: February 2025 U.S. Foreclosure Market Report from ATTOM Data
The release says there's a total of 32,383 U.S. properties with default notices, scheduled auctions or bank repossessions, that's up 5% from the prior month but down 1.7% from a year ago.