Loan commissions for independent mortgage bankers continued a downward trend in the second quarter as purchases have exceeded refinancing for the first time in a while, data from benchmarking technology provider Richey May & Co. shows.
“Commissions have been on the decline since their four-month high in the fourth quarter of 2012, when they reached approximately 82 basis points,” Richey May said in a report Wednesday that pegged 2Q commissions at 78 basis points and the four-month average for commissions at about 80 basis points of total production. In 2012, total loan officer compensation was
The company said customers that subscribe to its Richey May Select analytical technology increased their purchase production to $509 million from the previous quarter’s $348 million as rates trended upward in 2Q, while their refinance production fell to $453 million from $516 million.
“This is the first time in the last four quarters where purchase production exceeded refinances, indicating the market has shifted away from refinances for the time being,” according to Richey May. Overall, the company said production was up 11% from 1Q.
Although commissions were down, Richey May said it found profitability among independent mortgage bankers that use its automation increased, with net income margins up by an unspecified amount from 1Q.
The business advisory and technology firm also said net worth with up roughly 20% between 2Q and 1Q.
“This is a continuing trend with capital increasing approximately 34% from the year ending Dec. 31, 2012,” according to the company.
