TMC Members Outperform the Market in March as Purchase Business Ticks Up Nicely

Despite the continuing ascent in mortgage rates, March was a significantly better month on both the closed loan and new application fronts for The Mortgage Collaborative's national network of lender member companies.

Closed loan production (in units) was up 25% month-over-month for the network. While refinances fell off by 3%, purchase closings saw a 41% increase. Accordingly, the share of closed loans that were purchases ascended to its highest level in the 5+ year history of TMC Benchmark, coming in at 71% in March.

Here's the purchase share we've seen in TMC Benchmark over the last six months:

October 2021: 61%
November 2021: 62%
December 2021: 66%
January 2022: 61%
February 2022: 63%
March 2022: 71%

We also saw the % of conventional closings come in at a TMC Benchmark all-time low in March, falling from 73% to 70% month-over-month. Government loan closings ticked up from 20% to 21% and the "Other" category (all other products) rose from 7% to 9%.

New applications written were up 22% month-to-month. Of note inside that number was the same trend we saw in closings, with new conventional apps falling (by %) and "Other" increasing. Conventional apps dropped from 72% in February to 68% in March with "Other" rising from 6% to 10%. Government apps stayed steady by share at 22% from last month.

Operational efficiency improved in most areas in March after waning throughout the winter amidst the mortgage rate-fueled volume slowdown. The number of closed loan units closed per full-time processor increased by 28% in March to 9.2 and closed loan units per full-time closer increased by 26% to 31.0. In a strange anomaly, closed loan units per full-time underwriter dropped to 19.8 from 21.6 the month prior. The average loan originator closed 4.7 units in March, up from 3.9 in February. LO comp came in at an average of 94.1 bps, down 1.3 bps from last month's 95.4 total.

Average annual compensation paid to operational staff was very flat month-over-month, with average annual comp paid to FTE processors coming in at $51,900 this month. Underwriter annual comp ticked up slightly to $84,800. Average annual comp paid to closers rose slightly to $53,400.

The average "app date to clear to close date" stayed identical month-over-month at 39.6 days. Let's take a look at how this number trended throughout the course of 2021 and now into 2022:

January '21 - 47.9
February '21 - 43.1
March '21 - 42.8
April '21 - 45.7
May '21 - 43.8
June '21 - 41.8
July '21 - 43.2
August '21 - 42.5
September '21 - 42.3
October '21 - 42.6
November '21 - 41.0
December '21 - 34.0
January '22 - 40.1
February '22 - 39.6
March '22 - 39.6

The average cost per closed loan unit our members paid for their loan origination system (LOS) fell slightly to $129 in March after seeing a big rise ($116 to $131) the month prior. The average cost per closed loan unit for our members point-of-sale (POS) system was up $6 to $60 in March and came in flat month-over-month at $89 for their CRM.

Average non-third party lender fees continues to trend slightly upward on conventional loans, coming in at $1,153. Government lender fees fell from $1,109 to $1,062 for this most recent month.

51% of this month's participants in TMC Benchmark were depositories and 49% were IMB's. 38% originate under $500M a year in annual volume, 25% originate between $500M-$1B, and 37% originate over $1 billion per year in annual production.

Rich Swerbinsky
President & Chief Operating Officer
The Mortgage Collaborative