Even with rates that are historically low, it seems that the origination tide has finally turned toward purchase loans. And with refis flattening out, lenders are looking at flatter profit margins, too.
Fannie Mae's quarterly Mortgage Lender Sentiment Survey showed that 69% of lenders believe profit margins will decrease in the three months ahead, compared to 52% in the prior quarter. Just 19% believe profits will remain the same and 11% — bless the optimists — believe profits will actually increase.
That's the largest quarterly decline in sentiment recorded since the survey began in 2014, Fannie Mae said.
"Those who expected a lower profit margin continued to cite competition from other lenders and market trend changes as the primary reasons…With the shift from refinance to purchase business, some lenders commented that purchase transactions are harder to complete and have lower margins," said Doug Duncan, Fannie Mae's chief economist.
Face it — the time of the elves is over. The next phase will belong to the lenders who know how to profitably originate purchase loans. That's why we designed our engage.marketing summit — a virtual event happening this Thursday — around winning in a purchase market.
We'll kick off the day with a fireside chat with the aforementioned Doug Duncan, who will explain Fannie Mae's latest forecast so you can plan accordingly for what's coming next. Then we have an incredible agenda designed to give marketing teams strategic steps they can implement right away, from reaching a diverse audience to making the most of their time on social.
We've tailor-made this event for you and for this time — don't miss it! Register here.
In this episode, HousingWire Editor in Chief Sarah Wheeler discusses why the FHFA is reviewing executive compensation at Fannie Mae and Freddie Mac for the first time in nearly a decade.
The recent action in the 10-year yield has puzzled many people, but it looks wonderful to me as it shows that the U.S. economy is leading the world out of the recession. HW+ Premium Content
Traditional data sources are often too sparse or stale to provide any real competitive edge. Nomis Solutions' holistic pricing intel combines non-anonymized market- and lender-specific data with real-time rates and actionable recommendations. Compete more effectively.
ICE Mortgage Technology will deploy an eVault solution as part of its mortgage closing platform to ensure the secure storage of digital mortgages and notes.
By adopting technology once only available to big banks and capitalizing on their natural strengths, community lenders can hope to acquire a sizable share of this year's strong homebuyer cohort. Presented by Maxwell
To scale without more payroll requires automated thinking & decision making, not automated tasks. That's how our Top 5 & Top 20 clients get such massive ROI and lift. Candor is on to something really big. Curious?
Sponsored by Candor
HousingWire, 433 East Las Colinas Blvd., Suite 830, Irving, TX 75039, (469) 893-1480
EmoticonEmoticon