IMB Mortgage Production Profits Jump In Q2

It was a big quarter for independent mortgage banks and mortgage subsidiaries of chartered banks.

IMBs and subsidiaries reported a net gain of $4,548 on each loan they originated in the second quarter – up from a $1,600 per loan in the first quarter of the year, according to a report released by the Mortgage Bankers Association.

“Fueled by a surge in borrower demand and record-low mortgage rates, mortgage production profits in the second quarter reached the highest level since the inception of MBA’s report in 2008,” said Marina Walsh, MBA’s Vice President of Industry Analysis. “Production volume averaged over $1 billion per company, and there was an ideal combination of higher revenues and lower costs.”

The report also found:

  • The average pre-tax production profit was 167 basis points in the second quarter, up from an average net production profit of 61 bps in the first quarter of 2020.   
  • Average production volume was $1.02 billion per company in the second quarter, up from $728 million per company in the first quarter.The volume by count per company averaged 3,631 loans in the second quarter, up from 2,654 loans last quarter.   
  • The average loan balance for first mortgages increased to a new study high of $282,309 in the second quarter, up from $276,291 in the first quarter.   

See the full report here.