Mortgage Industry Updates: Monthly RoundUp – December 2021

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.

The Housing Market Will Cool Off in 2022, But Not By Much, Says Fannie Mae

Over the past year, U.S. home prices are up a record 19.8%. You don’t need to be an economist to know that the current level of growth—which is faster than the run-up to the 2008 financial crisis—isn’t sustainable.

But where will this historically competitive housing market go next?

According to the latest forecast put out by Fannie Mae, median home prices are expected to rise 7.9% between the fourth quarter of 2021 and the fourth quarter of 2022. While that would mark a slowing from the extreme price growth we’ve seen this year, it would still represent strong growth by historical standards. (On average, U.S. home prices have climbed 4.1% on an annual basis since 1987.)

Why Is This Important to Me and My Financial Institution?

The housing market, at least in the eyes of Fannie Mae, is set to return to a normal-ish level of price appreciation.

Regulatory compliance roundup - September 2020

Don’t Feel Threatened by Informed Borrowers

A borrower’s inclination for research, and an ability to educate themselves on the mortgage process and current rates long before they even approach a lender, should not be threatening. Rather, mortgage lenders and mortgage loan originators should be encouraged to develop client-centric pricing strategies with the informed borrower in mind, and thus be equipped to better serve a variety of clients with varying mortgage needs.

Just as they expect in other retail-based environments, today’s mortgage borrowers are looking to do business digitally and expect convenient journeys through their loan shopping and application processes. Presenting the right price and the right offer through the borrower’s preferred channel is the simplest way for originators to not only develop a client-centric strategy but also to attract previously untargeted clients.

Why Is This Important to Me and My Financial Institution?

Pricing insights give lenders a greater competitive advantage. By using competitive rate intel mortgage lenders gain insights into their competitors’ pricing, allowing them to set their own rates based on the current market as well as their strategic goals in a certain marketplace.

Auction Could Be Emerging as Alternative for Homebuying Option for Millenials

With the residential real estate market remaining competitive and for-sale inventory still in short supply, younger home shoppers may be viewing auctions as viable alternative pathways to homeownership, according to new data from a survey conducted online by The Harris Poll on behalf of ServiceLink.

The fintech’s newly released survey of more than 3,000 U.S. consumers revealed that more than three in five consumers (62%) are open to buying a home at auction — and this share rises as respondents get younger. Seventy-five percent of millennials in ServiceLink’s survey reported they would consider purchasing a home at auction, compared to 65% of Gen Xers and 54% of baby boomers.

Why Is This Important to Me and My Financial Institution?

It is important to understand where purchasing attitudes are at today and headed in 2022. Consumers anticipate the real estate market will continue to be competitive for potential homebuyers in 2022. Potential cost savings and a faster homebuying process are key motivating factors for consumers when considering buying a home at auction.

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By |2021-12-29T09:50:24-06:00December 13th, 2021|Financial Services, Mortgage|0 Comments

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