Ally Bank 2012 Annual Report Download - page 50

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• Mortgage brokerage network — Residential mortgage loans originated through mortgage brokers. We review and underwrite the
application submitted by the mortgage broker, approve or deny the application, set the interest rate and other terms of the loan, and,
upon acceptance by the borrower and the satisfaction of all conditions required by us, fund the loan through Ally Bank. We qualify
and approve all mortgage brokers who generate mortgage loans and continually monitor their performance.
The following table summarizes U.S. consumer mortgage loan production by channel.
2012 2011 2010
Year ended December 31, ($ in millions) Number of
loans
Dollar
amount of
loans Number of
loans
Dollar
amount of
loans Number of loans
Dollar
amount of
loans
Correspondent lender and secondary market
purchases 58,766 $ 14,224 196,964 $ 45,349 263,963 $ 61,465
Direct lending 75,096 14,640 37,743 7,414 36,064 7,586
Mortgage brokers 12,996 3,601 12,018 3,495 2,035 491
Total U.S. production 146,858 $ 32,465 246,725 $ 56,258 302,062 $ 69,542
The following table summarizes the composition of our U.S. consumer mortgage loan production. ResCap was deconsolidated from Ally
as of May 14, 2012. Refer to Note 1 to the Consolidated Financial Statements for further details on ResCap.
2012 2011 2010
Year ended December 31, ($ in millions) Number of
loans
Dollar
amount of
loans Number of
loans
Dollar
amount of
loans Number of loans
Dollar
amount of
loans
Ally Bank 146,074 $ 32,324 245,849 $ 56,130 300,738 $ 69,320
ResCap 784 141 876 128 1,324 222
Total U.S. production 146,858 $ 32,465 246,725 $ 56,258 302,062 $ 69,542
Mortgage Loan Production by Type
We intend to continue to originate a modest level of jumbo and conventional conforming residential mortgages for our held-for-
investment portfolio through a select group of correspondent lenders. During 2012, 2011, and 2010, we primarily originated prime
conforming and government-insured residential mortgage loans. We define prime as mortgage loans with a FICO score of 660 and above. Our
mortgage loans are categorized as follows.
• Prime conforming mortgage loans — Prime credit quality first-lien mortgage loans secured by 1-4 family residential properties
that meet or conform to the underwriting standards established by the GSEs for inclusion in their guaranteed mortgage securities
programs.
• Prime nonconforming mortgage loans — Prime credit quality first-lien mortgage loans secured by 1-4 family residential properties
that either (1) do not conform to the underwriting standards established by the GSEs because they had original principal amounts
exceeding GSE limits, which are commonly referred to as jumbo mortgage loans, or (2) have alternative documentation
requirements and property or credit-related features (e.g., higher loan-to-value or debt-to-income ratios) but are otherwise
considered prime credit quality due to other compensating factors.
• Prime second-lien mortgage loans — Open- and closed-end mortgage loans secured by a second or more junior-lien on single-
family residences, which include home equity mortgage loans and lines of credit. We ceased originating prime second-lien
mortgage loans during 2008.
• Government mortgage loans — First-lien mortgage loans secured by 1-4 family residential properties that are insured by the
Federal Housing Administration or guaranteed by the Veterans Administration.
• Nonprime mortgage loans — First-lien and certain junior-lien mortgage loans secured by single-family residences made to
individuals with credit profiles that do not qualify for a prime loan, have credit-related features that fall outside the parameters of
traditional prime mortgage products, or have performance characteristics that otherwise exposes us to comparatively higher risk of
loss. Nonprime includes mortgage loans the industry characterizes as “subprime,” as well as high combined loan-to-value second-
lien loans that fell out of our standard loan programs due to noncompliance with one or more criteria. We ceased originating
nonprime mortgage loans during 2007.
Table of Contents
Management's Discussion and Analysis
Ally Financial Inc. • Form 10-K