The January data is in for the TMC members that submit to TMC Benchmark. Simply put, things are still busy. Far busier than most expected they would be heading into this winter. And about to get a lot busier.
In January, the participants in TMC Benchmark saw month-over-month increases in closed loan units (+4.6%) and closed loan fundings in $ (+3.9%). More notably though, new applications skyrocketed in January vs. December, increasing by 81%! It's exciting for our team to have daily discussions with lenders having volume capacity issues in the winter, especially after the climate we saw last winter.
Through those conversations we also anecdotally know that February was another incredible month for our members, with 30-year fixed rates dropping into the mid 3's early in the month and down into the low 3's towards the end of the month. This pre-spring buying season surge of business ensures a great start to 2020 for most lenders, setting them up for a very strong 2020 if the rest of the year plays out close to expectations. We're excited to see the changes in the TMC Benchmark numbers when the Feb data is in and reconciled here in late March.
Getting back to January data, the mix of conventional/government closed loan production was in line with the last couple of months. Refinance activity ticked up on January closings, going from 36% in December to 38% in January, a trend we know will continue into February and particularly March with the drop in interest rates.
Operational efficiency fell off a bit in January, continuing the decline we've seen since the even busier summer and fall months of last year. This is most likely do to lenders making no seasonal winter staff reductions like we saw a year ago. Closed loans per FTE processor in January fell from 9.5 to 10.3 (versus the month prior), closed loans per underwriter fell from 36.5 to 27.7, and closed loans per closer saw a huge drop from 49.5 to 33.6. The average loan originator closed 3.6 loans in January after closing 4.7 loans on average in both September and October. Loans closed a bit quicker in November, with the average "app to clear to close" time frame falling to 36.6 days (a new TMC Benchmark low) from 38.2 days in the month prior.
The average LO comp fell to 92.3 bps on January closed loans from 94.4 bps in October. The average non-third party lender fees charged rose from $1,115 in December to $1,135 in January on conventional loans and dropped by $1 from $1,096 to $1,095 on govies. Average salaries paid to processors ($50,739), underwriters ($82,121), and closers ($52,911) fell slightly in January.
This was the 9th straight record month for participation in TMC Benchmark! 51% of participants this month were IMB's and 49% were depositories. 45% of November participants originate $500M or less in annual production, 16% are in the $500M-$1B annual originations range, and 39% of January TMC Benchmark submissions were from companies that originate more than $1B/year. The "over $1 billion" camp rose from 33% to 39%, which could have impacted the overall lower commissions, salaries, and lender fees charged.
TMC - Chief Operating Officer