Financial KPIs

11 metrics for analyzing profitability

Financial KPIs measure the economics of your mortgage operation. Track revenue, costs, margins, and profitability to optimize your business model and compensation structures.

RevenueCostsMarginsCompensation

Revenue per Loan

critical

Average total revenue generated per funded loan, including origination fees, points, and gain on sale.

Formula

Total Revenue ÷ Funded Loans

Benchmark: $8,000-$15,000 per loan

Higher is better

Example: $12,500 revenue per loan

Common Dimensions

Loan TypeChannelBranchLoan Officer

Gross Margin per Loan

critical

Revenue minus direct costs per loan. Measures unit economics before overhead.

Formula

(Revenue - Direct Costs) ÷ Funded Loans

Benchmark: $3,000-$6,000 per loan

Higher is better

Example: $4,200 gross margin per loan

Common Dimensions

Loan TypeChannelBranch

Cost per Funded Loan

critical

Total cost to originate and close a loan, including labor, overhead, and vendor costs.

Formula

Total Costs ÷ Funded Loans

Benchmark: $7,000-$10,000 per loan

Lower is better

Example: $8,300 cost per funded loan

Common Dimensions

Loan TypeBranchCost Category

Commission Expense per Loan

high

Average commission paid to loan officers per funded loan.

Formula

Total LO Commissions ÷ Funded Loans

Benchmark: 50-150 bps of loan amount

Lower is better

Example: $3,750 commission on $375K loan (100 bps)

Common Dimensions

Loan OfficerLoan TypeBranch

Commission as % of Revenue

high

Portion of revenue allocated to loan officer compensation.

Formula

(Commission Expense ÷ Revenue) × 100

Benchmark: 30-45%

Example: 38% of revenue to commissions

Common Dimensions

BranchLoan Officer Tier

Processor Bonus per Loan

medium

Average bonus paid to processors per funded loan.

Formula

Total Processor Bonuses ÷ Funded Loans

Benchmark: $150-$400 per loan

Example: $250 processor bonus per loan

Common Dimensions

ProcessorLoan Type

Underwriter Bonus per Loan

medium

Average bonus paid to underwriters per decision or funded loan.

Formula

Total UW Bonuses ÷ Decisions (or Loans)

Benchmark: $50-$150 per decision

Example: $75 underwriter bonus per decision

Common Dimensions

UnderwriterDecision Type

Gain on Sale Margin

critical

Profit margin when selling loans on the secondary market.

Formula

(Sale Price - Par Value) ÷ Loan Amount × 100

Benchmark: 150-300 bps

Higher is better

Example: 225 bps gain on sale

Common Dimensions

InvestorLoan TypeRate Type

Net Income per Loan

critical

Fully-loaded profit per funded loan after all costs and overhead.

Formula

(Revenue - All Costs) ÷ Funded Loans

Benchmark: $500-$2,000 per loan

Higher is better

Example: $1,200 net income per loan

Common Dimensions

BranchLoan TypeChannel

Warehouse Interest Cost

medium

Cost of carrying loans on warehouse line until sold to investors.

Formula

Warehouse Interest ÷ Funded Loans

Benchmark: $100-$300 per loan

Lower is better

Common Dimensions

Warehouse LineDwell Time

Fallout Cost

high

Revenue lost from loans that fail to close after significant processing work.

Formula

Processing Cost × Fallout Units

Benchmark: Track and minimize

Lower is better

Example: $2,500 sunk cost per fallout

Common Dimensions

Fallout ReasonStage at FalloutLoan Officer