House remains a dream, as banks lose money on mortgage

Adding to the woes of the depressed housing market, a new report released by the Mortgage Bankers Association (MBA) reveals that banks are losing money on mortgages.

It is because tired of battling high mortgage rates and still-rising home prices, buyers backed out of the housing market.

Independent mortgage banks and subsidiaries of chartered banks had record-low profits in 2022.

Financial institutions lost an average of $301 per loan they finalized in 2022, compared to the $2,339 profit per loan in 2021, a 113% decrease, per Business Insider.

This is the first time MBA saw a profit loss since reporting began in 2008.

Cost goes up
Banks and other mortgage companies each financed an average of $2.6 billion in loans in 2022, half the $5 billion figure for 2021.

The cost to finance a loan went up, increasing by 23% over 2021.

Properties are not available in the market; buyers and sellers are holding out with interest rates soaring. Rates are nearly double the 2-3% fixed annual percentage rate (APR), the market had seen in recent years.

APR is the cost you pay each year to borrow money, including fees.