# ASC 948-10-05: Financial Services—Mortgage Banking — Overall — 05 Overview and Background Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/948/10/#05-overview-and-background) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-10T02:20:11.669Z to 2026-09-10T02:20:11.669Z Record version: sha256:9c1ad7c0bff2e8a727cbb4f695aedbecf20c90a8f0e9e08d97380aba0d1c89d8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 948-10-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/948/10/#05-overview-and-background) SEC content: no ##### [948-10-05-1](https://asc.understandingaccounting.org/asc/948/10/#948-10-05-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:20:11.669Z to 2026-09-10T02:20:11.669Z Record version: sha256:62e604689c2547205b20cc4d3486c2e3af0ca52f4be7acf111ad6d964c73f5ac Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Financial Services—Mortgage Banking Topic establishes accounting and reporting standards for [mortgage banking entities](https://asc.understandingaccounting.org/glossary/m/#mortgage-banking-entity "An entity that is engaged primarily in originating, marketing, and servicing real estate mortgage loans for other than its own account. Mortgage banking entities, as local representatives of institutional lenders, act as correspondents between lenders and borrowers.") and entities that engage in certain mortgage banking activities. This Topic includes the following Subtopics: 1. a Overall 2. b Receivables 3. c Other Assets and Deferred Costs 4. d [Subparagraph superseded by Accounting Standards Update No. 2014-09](https://asc.understandingaccounting.org/updates/asu-2014-09/). 5. e Other Expenses. ##### [948-10-05-2](https://asc.understandingaccounting.org/asc/948/10/#948-10-05-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:20:11.669Z to 2026-09-10T02:20:11.669Z Record version: sha256:9ae616a5499c018f90e7ce1604f8e12fabeb041ef5f057cfc2e3e6cd373d891b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Overall Subtopic provides general information concerning certain mortgage banking activities and specific guidance on capital disclosure requirements for mortgage banking entities. ##### [948-10-05-3](https://asc.understandingaccounting.org/asc/948/10/#948-10-05-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:20:11.669Z to 2026-09-10T02:20:11.669Z Record version: sha256:248a9a50f0f8a30084e5094de1b874986d80e8c360a44a5974fe05d7681027e2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. As indicated in Section 948-10-15, while entities within the scope of this Topic must apply standards contained in all relevant Topics, the following are some of the more closely related Topics to the mortgage banking industry: 1. a Guarantees 2. b Consolidation 3. c Financial Instruments 4. d Interest 5. e Transfers and Servicing. ##### [948-10-05-4](https://asc.understandingaccounting.org/asc/948/10/#948-10-05-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:20:11.669Z to 2026-09-10T02:20:11.669Z Record version: sha256:69a7f0bfb81fc42853e4e4e8b683c4959041d6a0fe9e415a73a0a25407b009a3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Mortgage banking activities primarily consist of two separate but interrelated activities: 1. a The purchase or origination of mortgage loans and the sale of the loans to [permanent investors](https://asc.understandingaccounting.org/glossary/p/#permanent-investor "An entity that invests in mortgage loans for its own account, for example, an insurance entity, commercial or mutual savings bank, savings and loan association, pension plan, real estate investment trust, or Federal National Mortgage Association (FNMA).") 2. b The subsequent long-term servicing of the loans. ##### [948-10-05-5](https://asc.understandingaccounting.org/asc/948/10/#948-10-05-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:20:11.669Z to 2026-09-10T02:20:11.669Z Record version: sha256:813197ae0ba1994f608c31c71f6dceac70059d280705487013294e004fc34904 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Mortgage loans are acquired for sale to permanent investors from a variety of sources, including the following: 1. a Applications received directly from borrowers (in-house originations) 2. b Purchases from realtors and brokers 3. c Purchases from investors 4. d Conversions of various forms of interim financing to permanent financing. ##### [948-10-05-6](https://asc.understandingaccounting.org/asc/948/10/#948-10-05-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:20:11.669Z to 2026-09-10T02:20:11.669Z Record version: sha256:0a2c10245001e2660d6adef1e7ee818bf38127b01f5c1b0738bf298c9fdbd4d1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Topic 310 for guidance on mortgage loan purchases. ##### [948-10-05-7](https://asc.understandingaccounting.org/asc/948/10/#948-10-05-7) Pending content: no Source downloaded (UTC): 2026-09-10T02:20:11.669Z to 2026-09-10T02:20:11.669Z Record version: sha256:d6ae2aae808e7dc9aed0249670afe09c92cb50b39edc6861e593ba49f01945d9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A mortgage banking entity usually retains the right to service mortgage loans it sells to permanent investors. A servicing fee, usually based on a percentage of the outstanding principal balance of the mortgage loan, is received for performing loan administration functions. When servicing fees exceed the cost of performing servicing functions, the existing contractual right to service mortgage loans has economic value. Because of their value, rights to service mortgage loans frequently have been purchased and sold. ##### [948-10-05-8](https://asc.understandingaccounting.org/asc/948/10/#948-10-05-8) Pending content: no Source downloaded (UTC): 2026-09-10T02:20:11.669Z to 2026-09-10T02:20:11.669Z Record version: sha256:65ef7f7d3ab17590c223cd27bf86b9fc9132e61c1856f594fb93c38d48c79c37 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Mortgage banking entities may receive or pay nonrefundable loan and commitment fees representing compensation for a variety of services. Those fees may include components representing, for example, an adjustment of the interest yield on the loan, a fee for designating funds for the borrower, or an offset of loan origination costs. For guidance on accounting for loan and commitment fees, see Subtopic 310-20.