It was a record year for independent mortgage banks.
IMBs and mortgage subsidiaries of chartered banks made an average of $4,202 on each loan they originated in 2020 – up from $1,470 per loan the year before, according to a new report released Tuesday by the Mortgage Bankers Association.
The Annual Mortgage Bankers Performance report found:
- 99 percent of the firms posted overall pre-tax net financial profits in 2020, compared to 92 percent of firms in 2019 and 69 percent of firms in 2018.
- Average production volume was $4.5 billion (16,198 loans) per company in 2020, up from $2.7 billion (10,411 loans) per company in 2019.
- The average production profit (net production income) was 157 basis points in 2020, compared to 58 basis points in 2019.
- The refinancing share of total originations (by dollar volume) increased to 55 percent in 2020 from 34 percent in 2019.
“2020 was a banner year for the mortgage industry, despite the COVID-19 global health crisis essentially shutting down the U.S. economy in March and forcing personnel into remote work environments,” said Marina Walsh, MBA’s Vice President of Industry Analysis. “A surge in housing and mortgage demand, record-low mortgage rates, and widening credit spreads translated into soaring net production profits that reached their highest levels since the inception of MBA’s annual report in 2008.”