Commissions Are Up

August 26, 2020
Commissions Are Up
LOs averaged $1.4M in funded refinance volume per month, an increase of more than 230% over Q2 2019.

How were your commissions in the second quarter of 2020? You’re below average if they weren’t up 59% over 2Q 2019. LBA Ware, a provider of incentive compensation management and business intelligence software solutions for the industry, today released summary statistics on the state of industry compensation in the second quarter of 2020. While things looked good, the company is advising originators to realize the money won’t keep flowing. “In this year of bleak economic news, surging refinance volume and steady home purchase business have been bright spots. Low rates have fortified lenders’ pipelines and put more money in originators’ paychecks,” said LBA Ware founder and CEO Lori Brewer. “LO commissions paid out during the three-month period are up 59% over 2019. I just hope some of that hard-earned money gets set aside for the rainy days that are bound to follow expected increases in unemployment and loan defaults.” Refinance transactions drove the market in Q2 2020, accounting for 56% of total volume funded in the quarter (versus only 21% of total volume funded in Q2 2019). LOs averaged $1.4M in funded refinance volume per month, an increase of more than 230% over Q2 2019. The paychecks definitely looked larger but they could have been even bigger if not for refinances capturing a bigger piece of the pie. The uptick in refinance production contributed to a 2.7% decrease in per-loan commissions. Refinance leads, LBA Ware says, are more likely to be company-generated versus self-sourced, so they tend to pay out at a lower rate than purchase loans.

Source: National Mortgage Professional