“While overall production profits were positive, some lenders are still struggling in this tough market environment,” Walsh added. “For example, for the sub-group of lenders with an annual production volume of less than $500 million in 2024, average net production losses continued for the third consecutive year. It has been difficult to spread the fixed costs of originating loans over [a] lower volume.”
Encompassing both the production and servicing business lines, 68% of the firms in MBA’s survey posted pretax net profits in 2024, up from 36% in 2023 and 53% in 2022.
But the MBA clarified that without profits from the servicing side of the business, the percentage of firms with overall net profits would have fallen to 56% in 2024.
In 2024, the average production volume per company rose to $2.1 billion (or 6,259 loans), up from $1.9 billion (or 6,021 loans) in 2023. For repeat participants, volume averaged $2.4 billion (7,284 loans) in 2024, up from $2 billion (6,380 loans) in 2023.
Total production revenues (which include fee income, net secondary marketing income and warehouse spread) increased to 345 basis points (bps) or $11,520 per loan, up from 329 bps ($10,202) in 2023. Expenses such as commissions, compensation, occupancy and equipment fell slightly to $11,076 per loan, down from $11,258 the year prior.
As a result, average production income improved to 10 bps, compared to a loss of 37 bps in 2023. Since the inception of the MBA’s annual performance report in 2008, net production income by year has averaged 47 bps ($1,077 per loan).
The refinance share of originations for IMBs rose to 16% (up from 11% in 2023). For the mortgage industry as a whole, the MBA estimated a refi share of 27%, up from 16% in 2023.
The average balance for first-lien mortgages hit a record high of $357,631, up from $331,437 a year earlier. Net servicing income grew to $301 per loan, up from $263 in 2023.