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  • Writer's pictureDavid Fleig

First Quarter was a Challenge, but MSR Markups Helped

The first quarter of 2018 came to a close Saturday, with many conventional lenders happy to see it end, but that doesn’t mean the origination downturn – courtesy of higher rates – was a horror show by any means. Certain shops posted modest production declines compared to the fourth quarter of 2017 and several increased lending compared to 1Q17, according to interviews conducted by Inside Mortgage Trends. But perhaps the biggest shot in the arm came from an increase in the asset value of servicing rights held on the balance sheets of nonbanks and depositories alike.

“Origination margins are getting compressed,” said David Fleig, CEO and president of MorVest Capital, Houston, “but the firms that are really shining right now are the ones that built up and kept servicing instead of selling it.” For more details, see the new edition of Inside Mortgage Trends, now available online.

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