Wholesale Leaders – September 2010

We already knew that September was a down month for endorsements in the industry overall, but now we can look at the tally in a bit more detail. We’ll talk more next week about different markets around the country in our Industry Trends report, but this week we’re focused on retail/direct vs. broker/wholesale and other views on competition.

After several months of the broker/wholesale channel losing the volume battle, the down market showed less decline there (-4%) compared to retail/direct (-14%). One month isn’t going to change the tide of regulation and resulting transformation of some brokers consolidating into direct lenders while others become loan officers at larger institutions. That said, brokers are nothing if not scrappy and we’ll see more than a few stay in the broker/wholesale side as it transitions to TPO.

We’ve also been following closely the breadth of our industry’s recovery from the May volume lows, as measured by lenders above/below their May volume figures. We’ll be the first to caution that normally you shouldn’t look at individual months as especially important when using endorsement data, but in this case the decline and recovery have each been severe enough and long enough to make for interesting comparisons. Among the top 10 lenders specifically, several companies seemed to lag behind in increasing loan volumes while others leaped forward. The chart below shows that as of September almost all are well on the recovery path:

Chart of Top 10 Lender Volume Growth

As you can see, 9 of the top 10 lenders have increased volume since May, with several showing dramatic increases. As of just two months ago, only 5 lenders had increased volumes at an almost identical industry volume (1.4% higher in September). Whatever your thoughts about each of these lending leaders, we can all agree that it doesn’t progress our industry forward to see volume declines wash out major lenders from our business.

Click the image below to access the full report:

Wholesale Leaders