Credit unions poised to improve purchase mortgage business
by. Mike Corn
Everyone in the mortgage industry predicted the recent flood of mortgage refinancing applications was going to slow down at some point because (a) interest rates would eventually rise and (b) once homeowners had refinanced their mortgage at record-low rates they weren’t going to do it again.
Recent data from the Mortgage Bankers Association shows we have reached the end of the refinancing surge. Last week, mortgage refinancing accounted for only 57 percent of all mortgage applications, falling from the previous week’s level of 61 percent.
This is bad news for some in the mortgage industry. Many of the big institutions, like Citigroup, Bank of America, Wells Fargo and JPMorgan Chase, announced layoffs because of the decreased need for loan servicing and underwriting.
The motivation to increase purchase mortgage volumes will intensify across the industry. What does this mean for credit unions who want to grow their purchase mortgage volumes?
Instead of wringing hands at the decrease in a revenue stream, a recent HousingWire article says smaller mortgage lenders should see this as an opportunity to enlarge their market share. Offering comprehensive real estate services, like referrals to knowledgeable Realtors® and access to online listings, credit unions can reach their members when they start the home-buying process – and thus be more likely to acquire the mortgage.
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