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In this mortgage market the best way to make money may be as a newcomer to the business.  That’s how it appears to be for MetLife, which began mortgage lending in September by acquiring First Horizon National’s mortgage operation, minus most of its bad loans.  While First Horizon did $5.8 billion in business for all of 2008, MetLife reports $4.5 billion for just the final quarter of the year.

Third quarter loan production — including $1.3 billion originated as MetLife Bank during September and $3.1 billion originated as First Horizon in July and August — was $4.4 billion.

In January alone MetLife residential fundings were $2.8 billion — suggesting first-quarter originations could exceed $8 billion.

MetLife serviced 506,601 residential mortgages as Dec. 31. The portfolio included 159,286 loans owned by MetLife and 347,315 loans serviced for others.

Mortgages and consumer loans held-for-investment were $49.4 billion at yearend, rising from $49.2 billion at the end of the third quarter.

Net income at MetLife was $3.1 billion last year, according to its earnings report. Income fell from $4.2 billion in 2007.

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January 16, 2009 — Having sold most of its mortgage operation last year to MetLife, First Horizon National Corp’s residential originations dropped 97 percent in the fourth quarter of 2008, the company reported today. Last year, Memphis-based First Horizon funded $17.5 billion in residential mortgages, according to the company’s earnings report released today, down from $27.4 billion in 2007.

MetLife Bank, N.A. bought 250 First Horizon mortgage production offices outside Tennessee on Aug. 31. An origination platform, servicing platform and $19 billion first-lien servicing portfolio were also included in that sale.

With no new loans coming from outside Tennessee, loan production during the fourth quarter was less than $0.1 billion, falling from $3.1 billion in the third quarter and $6.3 billion a year earlier.

First Horizon’s servicing portfolio ended December at around 351,000 loans for $63.7 billion, dropping from less than 451,000 loans for $65.3 billion at the end the previous quarter and roughly 632,000 loans for $103.7 billion at the end of 2007.

First Horizon had a full-year loss of $192 million across the company.

Earnings during the latest period were a $56 million loss, retreating from a $125 million third-quarter loss and a $249 million loss in the fourth-quarter 2008.

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