To date, more than 100 mortgage lenders, including banks, credit unions and independent mortgage companies, have used CompenSafe™ to process incentive compensation for over a trillion dollars in funded loan volume. This makes our repository of loan originator (LO) compensation data the industry’s most comprehensive, and as a result, we receive a lot of questions from business leaders and journalists who want to know how mortgage compensation is trending.
Since introducing our LO Compensation Report in January, we have worked hard to make sure the data is accurate and relevant. By controlling our sample dataset to include only retail, first-lien production from LOs who fund at least six loans in the time period, we can offer reliably meaningful observations that contribute to business decision-making and industry analysis.
This quarter, we’re shaking things up by adding loan processor compensation data to our reporting for the first time. The infographic below contains the five biggest takeaways from our Q3 2020 Loan Compensation Report and what they could mean for you.
- The average LO funded 1.5X as much volume in Q3 2020 as they did the same time last year — and took home about 1.5X the commissions, too.
- Refis accounted for 46% of total loan volume (up 10% from the same time last year).
- Because of the higher percentage of refis, average per-loan commissions were down slightly from 107 basis points this time last year to 106 basis points in Q3 2020.
- The average loan processor handled 30% more loans in Q3 2020 as they did the same time last year, increasing incentive compensation earnings by 54% as a result…
- …but before you get jealous of the processors on your team, consider that while LOs took home an average of $79,838 in commissions in Q3 2020, loan processors earned about one-tenth of that, earning $7,855.
Overall, increased loan volume continues to deliver big paydays for loan originators as well as for loan processors, many of whom earn per-unit bonuses. And while 2020 continues to be “the year of the refi,” this quarter wasn’t quite as bonkers as they were in Q2, when refis accounted for 56% of total loan volume (up 35% from the same time last year). MBA and Fannie Mae forecasts support the view that the refi train may finally be slowing.