The San Francisco-based bank reported $80 billion in one-to-four family originations in 3Q, down from $112 billion in 2Q.
Chief financial officer Tim Sloan noted that purchase mortgage volume remained relatively strong in the third quarter, down 4% from the second quarter, benefiting from the continuing strong housing market, the CFO said.
Wells Fargo ended 3Q with $35 billion in applications in its mortgage pipeline, down 44% from the prior quarter. Sloan noted that the low application is partially due to a shortening up in closing times. He cautioned analysts not to use the pipeline to estimate 4Q originations. I assume it will be down, he said, but it would be premature to guess right now.
Meanwhile, the nations largest mortgage lender reported $1.1 billion in net gains on mortgage loan origination and sales activity in the 3Q, compared to $2.4 billion in the prior quarter.
Total mortgage banking and servicing income totaled $1.6 billion, down 28% from 2Q.
Sloan noted that expenses from layoffs in its mortgage division would show up in the fourth quarter.