Saturday, May 7, 2011

Where were YOU in 2001?

For those of you who were in the business in 2001, you might remember rates were coming off a high where rates were pushing 10% on jumbo fixed rate mortgages.  People were still buying homes back then.  Looking at the employment numbers compared to the rate numbers, you will see where we are heading as the jobs picture starts to improve and inflation starts to kick in.  If you look at the charts there is a clear correlation between employment growth, inflation and interest rates.  As jobs go, so goes inflation and interest rates. 

The point is, we complain when rates go over 5%, but the reality is that rates could easily go to 10%, but that will be relative in terms of the business.  We have already seen a contraction in the number of people in the business, so there will be a smaller pie, but fewer people competing for it.
10 Years of Job Growth Information
Historical Inflation Rate - 10 Years

Weekly average rates on 30-year fixed, 15-year fixed and 1-year adjustable rate mortgages vs. Prime Rate, 1-Year CMT, 1992 - present.
Rates for the last 15 Years
Historical Graph

Thursday, May 5, 2011

Shocker - Home Buyers Don't Understand Mortgages, but think they do

An article appearing in the Housing Wire cites an Ipsos Consulting Study based on a Zillow quiz, showing Home Buyers really don't understand the business.

As loan originators, we assume that our borrowers understand what we are telling them. But while they may hear us, they don't understand. This can cause a loan officer to lose a transaction, because the borrower doesn't have the comfort level to make a purchasing decision. Always confirm the borrower understands by asking them to explain what they know. Overlooking this step, particularly when the borrower represents him or herself as experienced, can cause you lost business.

For mortgage lenders, originators and even real estate agents, it is important to have a tool that can quickly educate borrowers on the ins and outs of mortgages AS THE INFORMATION APPLIES TO THEM. Too long, and they won't read it. Too detailed, and they won't read it. But if it's useful, they will read it, keep it and pass it on to their friends.

To answer this need we have put together an educational marketing tool for individuals and companies to custom label with the company name, individual name and logo. This can be distributed to all of your potential new customers as a way to represent yourself as an industry expert.

It includes a tear out pre-application kit, so that when the customer is ready to apply, they have all the tools to submit a complete application.

Your own personalized guide to distribute to consumers, referral sources and business partners.


Wednesday, May 4, 2011

De-Mystifying NMLS Call Reports

Jonathan Foxx at Lenders Compliance Group has done a great job of putting together a list of resources on the NMLS Call Reports. Click here for the posting on the NMLS USER FORUM, which we highly recommend you join.

We have put together a policy and procedure which will be implemented as an update to the Federal Law sections of our Quality Control/Compliance Module as well as our Loan Production Module.

Please check for updates and downloads section of the website.