Contact: Richey, May & Co. (Colorado, USA - TIAG)
We're hearing independent mortgage bankers need to do more to cut expenses to keep profits from sliding any further.
"Obviously production declined significantly and margins compressed, but what really jumped off the page is people didn't have great control over their expenses," says Trevor Reinhart, manager of advisory services at Richey May, a company that recently released third quarter mortgage banking data.
Net income declined 60 basis points on a consecutive quarter basis as overall production fell about 12%, Richey May data show. This left independent mortgage bankers overall with a net income near zero on average, according to Reinhart.
The exception is the retail channel, where third quarter net profitability was up 32 basis points compared to the second quarter. Home loan originators with strong builder affiliations or referrals boosted this group's profitability, he says.
