Battling for the Borrower in a Changing Market

Coming off of a historic surge in origination volume, current changes in market activity may prove difficult to traverse for many mortgage originators.  The industry has seen record levels of volume, record net profits, and record low-interest rates, all during a devastating pandemic crisis.  These trends, however, are shifting direction and the next question becomes how quickly and how severely these changes will occur.  

Fragile Origination Margins

Momentous origination volume in a low-interest rate environment has pushed net production profit margins to new highs. The Mortgage Bankers Association (MBA) reported that profits for independent mortgage bankers exceeded 200 basis points in the third quarter of 2020.  According to Marina Walsh, MBA vice president of industry analysis research and economics, this is the first time production profits have surpassed this mark as a part of the MBA reporting effort initiated in 2008. Rebounding from this high will almost certainly crush the bottom line for many originators. Effectively summarized in a recent op-ed on “The Rough Road Ahead for the Mortgage Industry,” managing marketing costs, lead conversion, and loan officer effectiveness needs to be a key component of your origination strategy going forward.   

Pandemic Borrower Accommodations

The mortgage industry is approaching the tail end of pandemic relief, as foreclosure moratoria expires at the end of July.  Intervention remains as the Consumer Financial Protection Bureau’s (CFPB) latest ruling, effective August 31st precludes covered entities from initiating foreclosure filings until 2022. Supported by the Federal Housing Finance Agency (FHFA), the industry will continue to support accommodations that ensure homeowners impacted by the pandemic have foreclosure alternatives, including the sale of their homes.  Coinciding with the expiration of the GSE Patch and changes to the definition of a Qualified Mortgage (QM) for Fannie Mae and Freddie Mac, as well as other eligibility restrictions, product options in the non-agency and non-QM space will almost certainly stir up competition for more traditional origination shops.

Easing/Sliding Home Sales

New home sales continue to trickle down.  The Mortgage Bankers Association recently noted that overall new home sales have fallen by seven percent since last year. MBA assistant vice president of economic and industry forecasting, Joel Kan, commented on how low home sale inventory continues to escalate home prices, as well as buyer competition. There has been a recent slowdown in purchase offers for homes, and the real estate community consensus is that the continuing deficit in available home inventory is bearing down on the market. Redfin highlighted this tapering effect in their recent Homebuyer Demand Index, noting that even though home sales are up from a year ago, sales have declined by five percent since the late May high from earlier this year.

Cost to Cure

Juggling multiple aspects of the next phase in origination activity could be an expensive proposition as the cost to acquire new borrowers is most certainly on the rise.  Mortgage originators will have multiple hurdles to cross to get to the other side.  Production profits may quickly erode as originators feel the pressure of declining volume while paying enormous payroll costs to cover the talent acquired to meet the last 18 months of record volume.  Originators will also have to compete with more aggressive non-agency players that are looking to attract borrowers coming out of post-pandemic duress and amidst possible easing of the credit box.  Last but not least, as interest rates inevitably rise, whether quickly or slowly, the refinance market will dissipate, and purchase volume will slow as well as the housing market strives to rebalance.  

Where does this leave originators?  Looking for borrowers? The best, most logical solution is in your own backyard.  Cultivating the enormous volume of recently added borrowers can be a simple, cost-effective venture if you have a unique and compelling offering for homebuyers in your toolbox.  Today’s homebuyer often lacks the time, experience, and wherewithal to manage the myriad of household documents, maintenance activities, and important home-related project milestones that are crucial to successful homeownership.  Bridging this gap is easier than you think and can be a significant avenue for long-term engagement.…. With HomeBinder, your loan officers can present their borrowers with free, unlimited access to a revolutionary centralized home management platform.  This sophisticated opportunity allows your loan officers to achieve a considerable advantage over the competition, generate more referrals and create relationship longevity without extensive use of their time or cost expenditure. 

The HomeBinder platform delivers modern automation that systematizes and assimilates data derived through valued relationships with home service professionals.  By building an ever-expanding referral network that supports the homeowner throughout the life of the property, your loan officers can create a genuine “Client for Life” experience.  The HomeBinder platform is a genuine business differentiator that allows loan officers to focus on developing new leads and relationships, while existing homebuyers grow into repeat business and inherently produce more referrals.  To find out more about how HomeBinder can elevate your organization into the next phase of origination, visit us at www.homebinder.com, contact us directly at 800.377.6915, or Book a Demo today!

HomeBinder ● Expected by Homeowners ● Driven by Lenders

Creating Homeowner Satisfaction Amidst Mounting Regulatory Complexity

The mortgage industry has seen a flurry of new regulatory announcements, whereby simply keeping up with the myriad of deadlines will be a challenge.  Starting with forbearance extensions, the duration of forbearance based on start dates, as well as required actions, documentation, and new programs expanding eligibility…. wrapping up pandemic relief is no joke. 

Finish with interim guidance intended to bridge the gap between the end of eviction and foreclosure moratoria at the end of this month, and implementation of the new Consumer Financial Protection Bureau (CFPB) Final Rule at the end of August.  All this equates to mortgage servicers once again facing unprecedented regulatory strain.

Foreclosure Moratoria & The Final Rule

During the last two weeks of June, the Centers for Disease Control and Prevention (CDC) announced the final extension of the eviction moratorium through July 31, 2021, with the White House following suit on the end of the foreclosure moratorium.  The Federal Housing Finance Agency (FHFA) announced that the Government-Sponsored Enterprises (GSEs) are going to proactively support the CFPB new Rule that goes into effect on August 31st.  A key element of this Rule is the prohibition of foreclosure filings through yearend. Per FHFA, GSE servicers cannot initiate a foreclosure, move for foreclosure judgment, order of sale, or complete a foreclosure sale during the interim gap from July 31 to August 31, 2021.  Any loans that potentially violate the Final Rule are prohibited from delivery to Fannie Mae and Freddie Mac during the gap timeframe, and these are just the federal changes to foreclosures.

Exiting Forbearance?

On the forbearance front, the U.S. Departments of Housing and Urban Development (HUD), Veterans Affairs (VA) and Agriculture (USDA) have announced that homeowners impacted by COVID-19 can access forbearance programs through September 30, 2021. This covers Federal Housing Administration (FHA), VA and USDA Rural Development loans. Additionally, both Fannie Mae and Freddie Mac have updated COVID-19 guidelines that state they will continue to purchase loans in forbearance through the end of this September. Although the number of borrowers in forbearance continues to slow, the Mortgage Bankers Association (MBA) reported an estimated 1.9 million homeowners are still in forbearance and undoubtedly this includes a growing number of seriously delinquent loans.  

Expanding Relief Eligibility

As the industry grows closer to expiring pandemic relief, several of the agencies have also issued new loss mitigation criteria and programs.  FHFA just announced the expansion of GSE Flex Modification terms that will allow Fannie Mae and Freddie Mac to offer interest rate reduction without loan-to-value restrictions for many distressed borrowers.  The FHA just introduced the COVID-19 Advance Loan Modification (ALM) program.  This is a new home retention option for borrowers that are exiting forbearance or are more than 90 days delinquent.  Although these programs are timely, and certainly needed in order to assist homeowners that continue to struggle as a result of COVID-19 hardship, all of these related guidelines must be incorporated into loss mitigation communication and operational processes, as well as corresponding technology and delivery platforms.  

Your Servicing Resources

As servicers work under the duress of this most recent maze of regulation, requirements, and guidance, it is crucial to maintain borrower satisfaction and confidence.  A task made exceedingly more difficult, as servicers strive to implement changes to timeframes and programs, as well as manage employees that are now split between working at home and the office.  Borrowers will also become more stressed as they are moved out of forbearance, fear that they face near-term foreclosure, and/or do not fully understand the options available to them at this time.  If your team is not fully prepared to assist these homeowners, if your resources are tied up addressing regulatory change, onboarding new originations, or otherwise utilized, your borrowers may become further unengaged and disgruntled.  With the CFPB still reporting a large percentage of complaints from delinquent borrowers, now is the time to leverage an easy to deliver, value-added service like HomeBinder.

“Clients for Life”

HomeBinder builds meaningful client relationships on your behalf, with little to no effort on your part.  We offer a sophisticated home management platform that provides your borrowers with the opportunity to centralize all aspects of homeownership, including storage and access to key documents such as mortgage, financial, title and insurance records.  HomeBinder utilizes the corresponding data, and leverages relationships with industry professionals, to create an interactive digital experience for the homeowner.  Driving homeowner education, timely activities, and projects, as well as active engagement with servicer-driven actions, HomeBinder helps empower your borrowers as successful homeowners.  This experience generates borrower satisfaction and retention, branded by you and delivered by you, throughout the life of the property.

Use your resources where they are most effective and let HomeBinder engage your borrowers, creating “Clients for Life”.  Connect with us today to find out more about this progressive approach to homeowner engagement and retention. Visit www.homebinder.com, contact us directly at 800.377.6915, or Book a Demo today!

HomeBinder Expected by Homeowners Driven by Lenders

Does Your Tech Stack Support Speed to Market?

In today’s world of exponential industry change and transaction velocity, it is imperative that your technology stack supports rapid implementation of digital functionality crucial to your success. As industry participants across the board seek the capabilities needed to differentiate their offering and ensure speed to market, applications should be cloud-based, flexible, and nimble, so engagement is not delayed by convoluted requirements definition, complex technology alignment, and tiresome implementation delays.

What is your strategy?

The pandemic influence in this area has been unprecedented as companies have scrambled to support remote workforces and improve the online experience for their customers.  This scenario turned many early adopters into innovative experts when it comes to technology infrastructure.  Whether you are a novice or a pro, understanding the significance of investing in the digital experience, to engage both your employees and expand your customer base, is vital.  A strategic approach to your data ecosystem helps ensure your technology infrastructure is designed to embrace solutions and applications, creating the right environment to spontaneously, yet purposely, expand your overall technical offering in time to meet and beat industry market demands. 

Positioning to embrace today’s modern innovation not only necessitates your understanding of how to effectively interconnect data and applications into your core systems but working with vendors that offer a like-minded approach to technology. Most companies offer an average of 88 applications per customer, representing what is fast becoming a highly active digital universe.  HomeBinder deploys its revolutionary offering on a robust platform that does not interfere with your technical prowess.  Our functionality supports your clients’ access to applications and platforms by building the connectivity through HomeBinder’s infrastructure and our authorized partner program.  

HomeBinder understands the importance of ease of implementation and speed to market.

As you evolve your technology offering, we are doing the same. Our expertise allows us to offer lightweight flexible implementation that does not tie up your valuable resources and in the end offers a valuable user-friendly platform to your client base. We are a sophisticated industry implementation partner, with numerous integrations to a highly varied group of industry partners.  Using a flexible cloud-based platform, HomeBinder opens access to homeowner service providers on a centralized platform that automates home management.  Your clients gain access to relevant data that is securely provided to the homeowner. For example, our platform leverages AVM data, designed to help the homeowner identify property enhancement opportunities, inclusive of “what if” decisioning capabilities. 

How does your organization succeed?

Offering innovation branded to your organization, the HomeBinder platform allows your loan officers or servicing account managers access to a unique digital experience that engages clients in an area that is previously untouched in our industry, home management.  Access to the HomeBinder platform is a distinctive offering whereby your client receives a personal binder, exclusively from you as an authorized provider, and at a cost as low as $7 per loan. The binder is highly customized to your borrower and the property, delivering the 24/7 tech-savvy, yet personalized, home management platform that 68 percent of borrowers request.  HomeBinder helps you meet the expectations of today’s homeowner, while helping your organization deliver a Client for Life and a Property for Life experience that builds referrals and retention.  This creates relevance for your organization as the balance of the industry continues to juggle pandemic volatility, a low interest rate environment, and younger demographic demands, amidst rapidly evolving technical innovation. – – It is time to step ahead of your competition by making a meaningful addition to your technology stack.

HomeBinder is a proven integration and implementation partner, building a robust network of homeowner services on a sophisticated centralized platform.  Our partners build, inspect, manage, buy, sell, finance and insure homes – services that can easily and effectively become a part of your prospect and borrower offering.  HomeBinder leverages this collaboration and education, enabling your organization to deliver homeowners a branded, valuable support system that extends throughout the homeownership lifecycle, not solely the life of the loan.  

To find out more about how to readily expand your technology and service offering with a best of breed digital partner, visit us at www.homebinder.com, contact us directly at 800.377.6915, or Book a Demo today!

HomeBinder ● Expected by Homeowners ● Driven by Lenders

Don’t Risk Losing Your Quality Loan Officers

As the summer months hit, along with midyear bonuses, it is not uncommon for loan officers to consider a move to the competition.  Even if they are not actively looking, recruiters are looking for them.  Mortgage executives that participated in the Mortgage Collaborative’s recently released biannual survey, The Pulse of the Mortgage Industry, listed staff retention at the top of the list of most critical issues for mortgage lenders.  As you can imagine, if staff retention is that urgent, then your competition is looking to hire as well. It becomes extremely important that your overall business strategy include a perspective that proactively supports the needs and expectations of your loan officers.  This is not a consideration to be put off until yearend, when it may actually be too late to keep your winning team intact. 

Consider Origination Volume

Do not let any lull in your application volume or business planning compel qualified loan officers to look elsewhere for employment. The mortgage industry has been running on overdrive, hitting a 15-year high in 2020 with $4.3 trillion in mortgage originations.  The Mortgage Bankers Association predicts a 14 percent drop in this year’s total origination volume, bringing us down around $3.28 trillion.  Although refinance activity is expected to drop, purchase volume is projected to break a new record at $1.67 trillion!  With purchase originations on the rise, your team of loan officers becomes even more valuable as their ability to cultivate and retain relationships is what will lead many of these purchase borrowers to your institution.  

What Do Winning Loan Officers Value?

Whether focused on relationships, referrals, and/or technology, winning loan officers leverage success tactics that draw from these areas because this is how they excel for the long term. With half of the year behind us, many mortgage operations are busy tweaking processes and systems to accommodate forthcoming third and fourth quarter production.  However, the CRM, which is certainly a mainstay in this effort, is rarely developed or evolved with the loan officer as a primary consideration.  This can create misalignment in ensuring consistency in utilization and more importantly lead to a gap in relationship and referral data. Loan officers are persistent and astute so will find ways to tap the CRM, but even with automated emails and communication, many rely on individually sent emails, text messaging and phone calls, which although more personalized, are not nearly as traceable. So how can management ensure alignment and transparency in terms of relationships, referrals and technology?

Envision an innovative technology platform that can be branded to your valued loan officers, and simultaneously offer a meaningful approach that fosters relationships and expands referral business…. without spending additional time in pursuit of this effort.  Complimentary to CRM platforms, which market a database by producing a myriad of semi-generic automated communications, is HomeBinder.  Delivering a unique centralized home management platform, HomeBinder provides property-specific communication, actionable maintenance, and document storage that is readily accessible through a private-label, mobile-friendly portal.

How Does this Promote Loan Officer Retention? 

HomeBinder uses sophisticated automation to systematize and assimilate valued relationships with the professionals that regularly interact with homebuyers.  This methodology builds an ever-expanding referral network that supports the homeowner throughout the life of the property, creating a genuine “Client for Life”.  Gifted to the homeowner by the loan officer, for as little as $7 per loan, the branded loan officer forever remains top of mind. No more ongoing communication, follow-ups or tickler systems, the homeowner is regularly reminded of the relationship with their valued loan officer as they are prompted to complete maintenance, presented with educational information, or access key household documents, all through the HomeBinder platform.   

This is a genuine business differentiator that allows loan officers to focus on developing new relationships and supporting applicants through closing, while existing homebuyers flourish into repeat business and inherently produce more referrals.  To find out more about the HomeBinder revolutionary approach to homeowner engagement and the “Client for Life” opportunity, visit us at www.homebinder.com, contact us directly at 800.377.6915, or Book a Demo today!

HomeBinder ● Expected by Homeowners ● Driven by Lenders

Easy Ways to Add Value to Your Home

With the arrival of summer, homeowners may want to spruce up their home. It is common for homeowners to make changes to their houses to increase the comfort level and make their homes look better. These changes may be based on personal taste or they may be to make their home life more convenient. In many cases, these improvements add value to the home. Smart homeowners make their upgrades based on these value-added changes. They prioritize how they are going to improve their homes based on the changes that will make their home worth more. One of the main ways to determine if a change will add value is to consider what room you are improving. Carrying out some home improvements to your home not only increase the functionality and usability of your home, if the right improvements are carried out then you can also add value to your home. Whether you want to add value to your home to sell it or just to update your home for your own pleasure, here are easy ideas you can do to add value to your home:

Do a Paint Job

Without a doubt, the easiest and quickest way to update the look of your home is to paint it. Painting the exterior and interior of your home can make it look newer, cleaner, and more stylish. Pay attention to the latest design trends to see which colors are hottest right now. A fresh coat of paint attracts buyers and adds value to your home. It may seem simple, but if you are selling a property, you initially have to get buyers through the front door. This means that the outside of the property should look smart and as attractive as possible

Create a New Kitchen Feel

This is perhaps one of the simplest ways to recreate a room. The kitchen is generally seen as the focal point in any house, and small improvements can make a big difference. Most people do not realize the major bang for the buck that swapping out hardware can create. Do a kitchen make over, you can do re-tiling or add cabinets. Nothing attracts people more than a modernized kitchen with attractive drawers and a big spotless sink. Changing the handles on your cabinets can bring an outdated kitchen back into the right decade. Equally, cabinets should be cleaned up wherever possible, or replaced if beyond repair. There are now options to simply replace the fascia above cabinets, rather than install a brand new kitchen, so this may be worth considering. Before viewings, ensure that any personal clutter is removed, allowing visitors to gage the space accurately.

Curb Appeal is Key

The truth is that the curb appeal of your home is probably one of the most influential factors in its value, as the curb appeal will increase its perceived value – thereby increasing its actual value. If you want to raise the value of your home, fixing it up and making it look nice is one of the best ways to make it more valuable and appealing to those that are going to buy it. While fixing up the inside and outside of the house is important, the property itself will also go a long way towards the sale of the house. Do landscaping and if possible, plant trees. If you have a yard with walkways, backyard structures such as a gazebo, beautifully cared for grass, flowers and gardens, trees, and all the other beautiful landscaping elements, your attention would no doubt be divided between the house and the outside. Even if the house isn’t perfect, most people will be interested in the home due to the beautiful landscape.

Improve the Inside

Consider improving the wall, floor, and window insulation. You do not have to resort to super expensive solutions. Cork wall tiles and insulating curtains can do a good job. Making your heating system more energy efficient is highly recommended.

Change the Windows

The windows should match the house as it is now, and should be in keeping with the age and style your home. Don’t be tempted to install brand new white PVC windows in an older-style property; it can actually be detrimental to the value of the house. Generally speaking, if the windows are in good condition, concentrate on cleaning up the paintwork on the windowsills and surrounds.

Improve Your Lighting

Instead of using basic lamps, add accent lighting to your home. Track lights or spotlights can be purchased and installed at budget-friendly prices while adding visual appeal to your space.

Make Use of Every Available Space

There are several ways to make use of available spaces in your home. The available space under your stairs can be useful by turning it into a closet where you can put extra books, papers or cleaning equipment. Home buyers will be glad to have a place to store extra household items. You can readily use these rooms traditionally meant for storage to create functional areas in the home. The attic can be turned into a spacious family room, TV room, kids’ room or a playroom. The basement can be modified into a functional study.

Change or Make New Flooring

Installing a new floor or giving some TLC to the one you already have can significantly increase your home’s value. It’s easy to overlook your floors. You use them every day without a second thought. However, the flooring can play a huge role in the overall functionality, look, and value of your home. If you feel like your house is looking a little worn around the edges, or if you want to increase its value, redoing your floors is a great choice.

Add Additional Bathroom

If you have only one bathroom, adding one or two is a very good idea. If you only have one bathroom in your home, the installation of a second one is definitely going to pay dividends. Although bathroom additions tend to be expensive, the money you put into the project can be almost entirely recouped when it comes time to sell. Before getting started, you would need to find a good spot for it. You can start looking at any room that has no designated purpose, like a spare bedroom. The space under the stairs is usually unused and left to go to waste. You need 18 square feet for a bathtub, as a minimum, but the more space you have the better. You need to look carefully to make sure the space you want to use is going to give you the bathroom that you want. If you have several bedrooms, then it is necessary to add enough bathrooms to cater to the needs of the occupants. It is not necessary to build an extension; simply using available space in your home will do the trick.