Independent mortgage banks (IMBs) and mortgage subsidiaries of chartered banks dipped into the red during the fourth quarter of 2024, reporting a pretax net loss of $40 per loan originated. That compares to a net profit of $701 per loan in the third quarter of last year, according to data released by the Mortgage Bankers Association (MBA). 

Marina Walsh, the MBA’s vice president of industry analysis, wrote in a press release that overall production volume and revenues were roughly on par with the prior quarter, while average expenses rose. She noted that while larger lenders benefited from economies of scale, those with lower production volume felt the sting of expense increases. 

“Net production losses resumed in the fourth quarter of 2024 after two consecutive quarters of modest gains,” Walsh wrote in a statement. “This decrease marks the ninth quarter of net production losses in the past three years, albeit a much smaller loss compared to the fourth quarters of 2022 and 2023.” 

Costs increased to $11,230 per loan in the fourth quarter, from $10,716 in the previous quarter. According to Walsh, the bump was partially attributable to an increase in applications and related expenses from the prior quarter that weren’t realized until the fourth quarter.