IndyMac Loan Production Down, Quality Improves

April 11, 2008 No Comments »

quality

IndyMac Bancorp announced today on a blog post on its company website that total mortgage loan production was $3.3 billion in March, down five percent from February and a whopping 63 percent from March 2007.

Of that $3.3 billion, $2.9 billion, or 88 percent was saleable to Fannie Mae and Freddie Mac (conforming loan), reflecting the company’s move towards GSE-backed loan production.

The largest chunk of IndyMac’s production that was not saleable to the GSEs was its prime jumbo loan production of $235 million, up from $176 million a month earlier.

However, the Pasadena, CA-based mortgage lender noted that some of this production will fall under the temporary conforming jumbo underwriting guidelines, which may actually be eligible for purchase by the GSEs.

The company’s largest sales channel, the Mortgage Broker and Banker Division (wholesale), had production of $2 billion, down two percent from February and 61 percent from the same time last year.

Conversely, the retail lending group saw loan origination volume rise two percent from February to $466 million, up from just $11 million in March 2007.

The major slip was in the Servicing Retention Group, where production of $255 million was off 47 percent from last month.

IndyMac noted that credit quality on current loan production continues to improve, with expected lifetime loan loss estimates showing sequential signs of improvement.

First payment defaults on new production also declined to one percent from 1.8 percent in February, two percent in January, and three percent in August.

But quality comes with a cost; IndyMac’s loan pipeline ended March at $5.3 billion, down 30 percent from February and 67 percent from March 2007.

Shares of IndyMac were down 6 cents, or 1.39%, to $4.27 in afternoon trading on Wall Street.

(photo: kb35)

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