2021 got off to a fast start for the lenders of The Mortgage Collaborative off the heels of a record setting production year for much of our national network of best-in-class lender members.
Closed loan units were collectively down 15.7% from December to January. However, new applications were up 20.4% from the month prior. While we've anecdotally heard of a new application slowdown in February amidst rising rates, the new application boon in January will translate into a good first quarter for our members in a year that's expected to be another prosperous one for the industry.
Starting our commentary on the optimistic application front, January was the best new app month for our members since August of last year. June, July, and August 2020 were (by far) the three biggest new application months for The Mortgage Collaborative in the nearly five-year history of TMC Benchmark. And January was the fourth biggest new app month we've ever seen over that same time period. The mix of new January applications was identical to the mix of January closed units - 78% conventional, 18% government, and 4% other.
Moving to closings, as noted above, January was down fairly considerably from the months prior, but we saw that coming with the slowdown in new apps in November and December previously chronicled in this space. The statistic of note on January closings was the increase in the % of refinances. After watching the purchase/refinance mix teeter around 50/50 for the entire back half of last year, refinance closings accounted for 58% of January closings, the highest refi closing mix we've seen post-pandemic.
Operational efficiency fell off in January, but that's not a surprise given the slowdown in closings and no lenders reducing staffing levels. The number of closed loan units closed per full-time processor in January fell to 11.1 from 13.9 the month prior. Closed loan units per full-time underwriter fell to 37.2 from 44.7 in December. Closed loan units per full-time closer dropped to 44.5 from 52.4 a month ago. The average loan originator closed 6.7 loans in January, down from 7.8 in December. That average was in the low 8's all summer before peaking at 8.6 in September 2020. LO comp came in at an average of 97.2 on January closings, down from exactly 100.0 bps in December.
The average "app date to clear to close date" time frame continued to rise in January (sixth straight month of increase) hitting an all-time TMC Benchmark high of 47.9 days. Let's take a look at how this number escalated throughout the course of the last several months:
After peaking in the summer, and subsiding in the fall, average salaries paid to processors, underwriters, and closers ticked down slightly this month. On average, processors in our network were paid $54,200 annually in January, while underwriters came in at $87,200 and closers at $55,600.
The average cost per closed loan unit our members paid for their loan origination system came in at $116 in January, down $1 from the month prior. We also saw decreases in the average cost per closed loan for point-of-sale systems to $45 and for CRM's at $85. The average non-third party lender fees charged by our members on January closed loans was $1,118 on conventional loans, which was identical to last month. Conversely, the average non-third party lender fees charged by our members on government loans fell to an all-time low of $989 this month.
57% of this month's participants in TMC Benchmark were depositories and 43% were IMB's. 39% originate under $500M a year in annual volume, 22% originate between $500M-$1B, and 39% originate over $1 billion per year in annual production.
President & Chief Operating Officer
The Mortgage Collaborative
TMC - Chief Operating Officer