Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Andrew Wessel - JP Morgan
Andrew Wessel - JP Morgan
Just a couple of quick questions. On fee per file that you’ve been reporting obviously, it’s lower than in the past maybe on the refinance purchase mix. As the refi kind of boom slows and I guess the mix gets weighted a little bit more towards purchase, is the fact that home prices are down a lot and that’s obviously one of the variables in pricing and policy against, the fact that you’ve gotten a lot of price increases from a number of states.
I mean, kind of comparing what you would expect a normalized fee per file to be versus, kind of 2007 levels are up in the $1600, kind of $1700 range. Is there some kind of guidance you can give us around that?
Randy Quirk
Our resale closings in the second quarter, or the refinanced closings in the second quarter ran about 65% and that gave us a fee per file of the high $1100 per file. As we move more towards the 50/50 mix that we see on the opening side today, which will probably flush out in the third quarter. The fee per file based on even last year 2008 will start to run back towards that $1600 level. So we see that moving now, we’re actually moving through $1200 right now as we sit in July.
Andrew Wessel - JP Morgan
Thanks Randy, that’s very helpful. Then on operating expenses you mentioned now that you’ve got a more stable order account, have a little bit better visibility I guess into the next few months of operations. Can you put any numbers around or percentages around what you’d expect that happens at OpEx line?
Al Stinson
It’s difficult, but we are in a pretty stable environment at 9,000 orders open today. As you know, given a steady state we always manage the business effectively. So our target remains 10% pre-tax margin.
I don’t see any reason we can’t achieve that at some real aberrations in the market, and I would say that with Lawyers and Commonwealth fully integrated in where we are, where Randy is with his staff reductions, we are well positioned that might popup such as volume increased, purchase transactions and perhaps increased commercial transactions, which would further increase that fee per file.
I think we’re in pretty good shape. As you know, we don’t give guidance, but I think the 10% number that we’ve talked about many times is doable.
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