Last month involved several regulatory compliance updates and hot topics in the Mortgage industry. We’ve rounded up some key updates and how they will affect you and your financial institution going forward.
Survey Reveals Why So Many Homeowners Haven’t Refinanced Their Mortgage
Record-low mortgage rates have led to a refinancing boom unlike any other in American history, but according to new Bankrate data, a surprising number of homeowners are missing out on the opportunity to save. More than a quarter of current mortgage holders (27 percent) don’t even know their current rate, putting themselves in a poor position to determine if it’s worth it to refinance.
“Millions of homeowners could be missing out on tens of thousands of dollars in savings by not refinancing their mortgages at this year’s record low rates,” says Greg McBride, Bankrate chief financial analyst. “Roughly 8 in 10 homeowners with a mortgage have not refinanced and more than 1-in-4 doesn’t even know what rate they’re paying.”
Why Is This Important to Me and My Financial Institution?
A continued low rate environment means the refinance bubble has not burst yet. Millions of eager homeowners have taken advantage of the opportunity to save tens of thousands of dollars, but there is an entire set of homeowners who have not taken action for one reason or another. While these ‘easy’ refinances with engaged homeowners may be coming to an end, proactive lenders can still benefit from this market by reaching out to hesitant homeowners to show the benefits of refinancing.
Financial Watchdog Expected to Get Its Teeth Back Under Biden
The Consumer Financial Protection Bureau was created after the last financial crisis to be the tough cop on the beat, making sure people don’t get taken advantage of by lenders, debt collectors or other companies. It’s returned $12 billion to people harmed by financial firms.
“This agency was designed to be a watchdog,” says Deepak Gupta, a former top enforcement lawyer at the bureau. “That mission is more important than ever.”
With millions of Americans in desperate financial straits due to the pandemic, he says, more people are vulnerable to predatory practices.
Why Is This Important to Me and My Financial Institution?
As the presidential transition takes place, lenders are wise to consider how philosophies will vary between the two administrations. Ultimately, time will tell, but the prevailing belief is that there will be more focus on regulatory compliance over the presidential term. If that holds true, this is a great opportunity for lenders to revisit their internal compliance training programs to ensure all staff are properly educated to galvanize their institutions against unwanted scrutiny. As always, OnCourse Learning is here to help lenders accomplish that objective!
2020: Year in Review
It goes without saying that 2020 was a year unlike any other. In March, the COVID-19 virus took hold on our country and significantly impacted nearly every aspect of our lives. The way we gather (or don’t gather) socially changed, the way we shop has changed, the way we work has changed, our sports and entertainment look different, this election cycle was unlike any we had ever seen, we learned how to use Zoom and we now all know what the terms ‘social distancing’ and ‘mask up’ mean.
Our economy was affected as well. The stock market experienced a significant drop, unemployment spiked, and our leaders grappled with decisions to shut down local economies to help stop the spread of the virus.
In spite of all that, the mortgage industry has stood as one of the bright spots for our economy. We saw rates steadily decrease throughout the year, leading to one of the biggest refinance bubbles we have ever seen. Low rates also led to an extremely strong purchase market, giving borrowers more opportunity to buy that house of their dreams, and to make home ownership a reality for those who may have not otherwise qualified. Lenders were agile, pivoting to work from home strategies for employees and finding new and creative ways to accommodate the needs of borrowers.
While we may never see a market quite this hot again, the outlook for the future of our industry remains extremely bright. OnCourse Learning is proud to have partnered with you over the past year and we look forward to continuing to do so in the future, whether for a specific licensing need or to meet a desire to grow professionally for that next career step.
Here’s to a great 2021!
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*For other news, please refer to Industry News through Mortgage HQ!
Mortgage HQ includes industry news and trends from mortgage experts available at your fingertips, as well as daily one-minute videos from Dale Vermillion, one of the foremost leaders in the mortgage industry. Topics include daily market updates, sales tips and motivational videos to keep LOs excelling in their business.
To see a demo that will give you access to valuable training topics like these and more, visit OncourseLearning.com/Mortgage-H-Q.
About the Author
Michael Rhodes
Product Manager at OnCourse Learning
Michael Rhodes is the Product Manager for the mortgage segment at OnCourse Learning. Michael has worked in the financial services industry for 24 years and keeps up to date on mortgage industry hot topics. Michael received his Bachelor of Arts in Business Administration from Carroll University.
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