Rising interest rates and a shortage of affordable housing could cool an otherwise hot home sales market, leading mortgage lenders to approach the coming year with caution. On top of that, lenders must keep up with regulatory changes and borrowers’ increasing expectations for speed and ease in the lending process.
But there are bright spots. Millennials are the largest generation in U.S. history, and they’ve now entered peak homebuying years. The generation accounts for 36 percent of homebuyers in the market, the largest share , according to the National Association of Realtors.
Home-ownership and equity has always been a driver of wealth, typically outpacing other financial investments. Although millennials have been slower to enter the market than other generations, purchasing a home will always be part of the American dream.
And with interest rates ticking up, home-equity loans for bill consolidation, construction projects and other purposes are likely to surge. TransUnion estimates that 10 million consumers will originate a home equity line of credit (HELOC)between now and 2022.
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