(A post from the blog of MCT – Capital Markets Advisory Firm Focused on Technology & Service)
In this article we interviewed MCT’s Director of Analytics, Bill Berliner, to explore how industry trends have contributed to shrinking margins. We’ll discuss lender competition, decreasing volumes, increased interest rates, and weakening of relative pricing of mortgage-backed securities (MBS) as contributors.
We are proud to introduce our latest whitepaper, What Caused the Lender Profit Margin Compression? by Bill Berliner, for those who are interested in taking a deeper dive into detailed MCT client and market data.
The “Mortgage Industry Profitability Trends” graph below reminds us of what our industry has been observing since Q4 2016 – profit margins are at their lowest level since 2008.