Falling mortgage profits hurt U.S. banks

U.S. banks are feeling the pinch as mortgage profits get eroded by rising cost of funding mortgages and a narrowing of the spread between revenue from bond investors and what the banks charge borrowers.

Although mortgage rates rose 11 basis points to 3.53% recently, it has done little to boost lenders’ profits, reports FT.com.

Banks have often been accused of using QE3 to their advantage as mortgage originators who benefited from the Fed’s bond buying program, but didn’t share the spoils with their customers.

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Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.