Mortgage Bankers Record Largest Average Loss Since 2008

Source: National Mortgage News

The average mortgage banker's bottom line slipped further into the red than it's been since the Great Recession during the third quarter, as rates rose further, exerting more pressure on lending.

Companies generally took a loss of $624 per loan, or 20 basis points, during the quarter. This compared to a loss of $82 or 5 basis points in the second quarter and brought industry earnings to their lowest point since 2008, according to the Mortgage Bankers Association. That stands in stark contrast to a year ago, when the average independent mortgage banker generated $2,954 or 89 basis points of profit.

Marina Walsh, MBA's vice president of industry analysis, called the latest quarter's results "sobering news," given that the third quarter is generally the strongest of the year for the industry.