You know how applying for a mortgage feels like a marathon? Loan officers and back-office teams share that pain. They pull together 30-35 documents from different sources, adding up to 500-600 pages to review for a single loan. Quite a task, right? Adoption of technology in the mortgage industry needs to take center stage. However, historically, the mortgage industry has been relatively sluggish in adopting new technologies. Several factors contribute to the limited adoption of technology within this industry, including: Customer apprehensions regarding fraud: Core Logic’s 2022 report (1) ind ..read more

I’m a huge Carolina Panthers fan. After home victories the Panthers blast Neil Diamond’s ‘Sweet Caroline’ across the stadium. I bet the voice inside your head is singing it now. “Good times never seemed so good.” I’m pretty sure that most of us in the mortgage industry have seen better times. Less challenging times for sure. But I’m hugely optimistic about the future of the Non-Qualified Mortgage (non-QM) industry. While fluctuating interest rates and an unreliable supply of inventory remain key issues across the mortgage industry, the potential customer universe for the secondary market is g ..read more

The status quo isn’t working for mortgage companies. Over the last year, we’ve talked with hundreds of clients, thousands of consumers, and too many fintechs to count. And what we learned is that, below the surface, there are turbulent forces that will either reshape today’s leaders or create opportunities for new, more nimble players to emerge in their place. The good news is we see light at the end of the downturn. ‘But the decisions mortgage providers make now will determine their future.’. There is zero doubt that the pandemic has changed mortgage forever. Interest rates exploded. Demand ..read more

Life is full of contradictions. The mortgage industry is no exception. On the one hand, mortgage loan origination and servicing providers want to cut costs. On the other, they need to improve experience­. Is it possible to do both? As if reconciling the two isn’t challenge enough, soaring interest rates, record inflation, and plummeting mortgage origination volumes make matters harder.  Butted from one side by larger competitors with deeper pockets, and on the other from lean and nimble Fintech providers, it’s no wonder mid-market lenders sometimes feel like the underdogs. For many, redu ..read more

Here we go again. The slowdown is a warning for the economy at large, and incumbents may have underestimated preparation for the economic “winter” ahead. The toughest season our industry has faced in a long time, is here. Mike Tyson said, “Everybody has a plan until they get punched in the face.” But how do you plan for an unprecedented event that throws everything at you, from everywhere, all at once? What is different this time compared to the Great Recession of 2008? From our perspective, there are three distinctions: First, there is no contest – inflation is much worse in 2022 than it wa ..read more

Mortgage originators continue to face strong headwinds. I recently accessed the latest Black Knight’s Originations Market Monitor report, as per which, rate lock activity has been down four straight months, with declines across all loan purpose types. It’s noteworthy that purchase mortgages, which presently account for 82% of all lock activity, fell 14.3% by volume from June to July and 22% since last year. The purchase lock count, which doesn’t include the impact of soaring home values on volume, is off 25.8% from last year. It also makes July the first month — the number of purchase ..read more

Team up with an informed and experienced partner Should you look for a pure tech company, or one with bootson the ground? We recommend you go with an experienced partner who has been around for a while for they will bring along their share of successes and worked around roadblocks and surprises. Also, companies with a history in technology and process automation can often bring tools to the table, which can reduce your capital expense outlay. Map processes with an eye for detail The sound way to begin a modernization project is by mapping your current workflow — including how you handl ..read more

The mortgage lending industry will face many hurdles in 2022, not the least of which is maintaining profitability in a shrinking market — not only on a macro basis but on every loan it originates. This year loans will consist largely of non-QM and purchase loans. They will be more expensive to originate and will receive greater regulatory and secondary market scrutiny. And there will be fewer of them; by some estimates, loan origination activity will fall by a third. Here are five steps you can take to improve your ability to remain profitable in this challenging year. 1. Look closely at you ..read more

In the 1970s TV series, “The Six-Million-Dollar Man,” astronaut Steve Austin suffers a near-fatal crash only to be reconstructed into a crime-fighting cyborg with superpowers. “We can rebuild him,” says his superior, Oscar Goldman, at the beginning of each episode. “We have the technology. We can make him better than he was. Better, stronger, faster.” Unfortunately — or perhaps, fortunately — there are no cyborgs in our industry. But we do have CoBots, which are helping lenders and servicers do things much better than before. In fact, the integration of automation with human expertise has th ..read more

The past couple of years may one day serve nostalgic for mortgage originators. With record low mortgage rates and soaring homeowner equity, lenders had a historic level of refinance opportunities. It has been, in many ways, the best of times. However, a completely different picture has emerged. Higher interest rates have caused rate/term refinances to evaporate and prompted the Mortgage Bankers Association to lower its origination forecast for 2022. Meanwhile, higher home prices are shutting out many potential homebuyers. In fact, in late 2021, the National Association of Realtors reported ..read more