Hello, LOs!
Who are the winners and losers in a higher rate environment?
Well, as Joe Garrett of mortgage banking consulting firm Garrett, Mcauley & Co. put it, "there are hardly any winners in the mortgage industry."
Among the very few are firms with a lot of servicing, he said. Those having a tough time are almost too numerous to count, but we all know originators are on the front lines.
So todaylet's talk about some of the challenges specific to LOs.
Several LOs we've spoken to recently opined that reduced purchasing power has resulted in deals falling through. Christian Dicker, a senior loan officer at Motto Mortgage, told me a client just backed out on a $295,000 house in Michigan.
"After hearing their monthly mortgage payment would be around $2,000 a month, my client backed out of the offer the next day," said Dicker, whose pipeline has thinned with fewer refis. "Less than a year ago, my client could've bought the home with a monthly mortgage payment of $1,700."
LOs, I'd love to hear from you – have you lost commissions because clients couldn't close on a house they had under contract when rates were lower? How are you handling the (relatively) high rate environment?
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