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BofA mortgage originations beat correspondent exit

Bank of America (BAC) exited the correspondent mortgage business in late 2011.

In one year’s time it meet and beat that level of mortgage originations.

In its third quarter results, Bank of America funded $21.2 billion in residential home loans and home equity loans during the third quarter of 2012, up 12 percent from the second quarter of 2012, and 18 percent higher than the third quarter of 2011.

In the year-ago quarter, correspondent originations equaled a comparative $15.9 billion.

Overall mortgage revenue also soared at the bank.

Total mortgage revenue increased from $274 million from the third quarter of 2011 to $3.1 billion in the third quarter of 2012. However, the news isn’t all that great.

“While the Home Loans business was profitable in the quarter, the continued high costs of managing delinquent and defaulted loans in the servicing portfolio combined with the costs associated with managing other legacy mortgage exposures resulted in the overall net loss for consumer real estate services for the quarter,” the earning said.

Money set aside for representations and warranties issues also reduced in the short term.

The reps and warrants provision was $307 million in the third quarter of 2012, compared to $395 million in the second quarter of 2012 and $278 million in the third quarter of 2011.

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