$9.2 billion 4th quarter production
By MortgageDaily.com staff
1/12/2006

Subprime production fell at MortgageIT Holdings Inc., and the company plans to close half of its subprime branches -- cutting jobs in the process.

Fourth quarter volume, including nonprime and conforming, totaled $9.2 billion, off just slightly from the record achieved in the prior quarter, according to the New York-based company's latest preliminary operating data announcement. Funding, however, are 111 percent above a year earlier.

Refinances represented 53 percent of fourth quarter fundings and purchase loans the remainder, the real estate investment trust said.

Correspondent lenders reportedly accounted for about 96 percent of the quarter's production, while the remainder consisted of brokered loans.

Subprime fundings fell $327.6 million from the third quarter to about $972.4 million and are expected to continue decreasing -- to approximately $200 to $400 million this quarter, according to the announcement.

Citing continued compression on profit margins in its subprime business as the reason, MortgageIT said it consolidated the unit by reducing the number of subprime branches from six to three, which also resulted in related job reductions.

The REIT said the "significant pressure" on gain on sale margins that persisted in the unit and the consolidation are expected to negatively impact fourth quarter earnings by approximately 10 cents to 15 cents per share.

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