MBA Chart of the Week: Independent Mortgage Bank Net Production & Purchase Share

Independent mortgage banks and mortgage subsidiaries of chartered banks reported a net gain of 67 basis points ($1,522 on each loan they originated) in the second quarter, up from a reported gain of 60 basis points ($1,447 per loan) in the first quarter, according to the MBA Quarterly Mortgage Bankers Performance Report. 

The purchase share of total first mortgage originations by dollar volume was 62 percent in the second quarter, up from 51 percent in the first quarter. For the mortgage industry as a whole, MBA estimates the purchase share at 57 percent in the second quarter.

For the period from first quarter 2011 through second quarter 2015, we saw eight quarters when the purchase share was more than 60 percent and 10 quarters when the purchase share was under 60 percent. Net production income for those quarters when purchase share topped 60 percent averaged 32 basis points. Net production income for those quarters when purchase share was below 60 percent averaged 78 basis points.

For those quarters in which the purchase share exceeded 60 percent, second quarter 2015 had the highest net production income, largely because average company production volume was also at the highest level of any quarter, as both purchase volume grew and mortgage pipelines from the first quarter’s refinance boomlet closed.  

Press releases and information about ordering the MBA’s Mortgage Bankers Performance Report reports can be found at www.mba.org/PerformanceReport. 

To view the Chart of the Week, click https://www.mba.org/news-research-and-resources/forecasts-data-and-reports/forecasts-and-commentary/chart-of-the-week. 

(Marina Walsh is vice president of industry benchmarking and research with MBA; she can be reached at mwalsh@mba.org.)