Profit margin decline suggests mortgage bonanza is waning

Source: Housing Wire — 

Independent mortgage banks (IMB) and mortgage subsidiaries of chartered banks saw an average net profit of $3,361 on each loan they originated in the first quarter of 2021, down from a reported gain of $3,738 per loan in the fourth quarter of 2020, according to a new report from the Mortgage Bankers Association.

The average pre-tax production profit was 124 basis points, down from an average net production profit of 137 bps in the fourth quarter of 2020, but up on a yearly basis from the 61 basis points average in the first quarter of 2020.