In today’s digital world, websites are able to generate advertising dollars based on content and clicks and views of the site. The more clicks (views) the more successful the site and the more advertising dollars can be generated.
So, just as it is with news print media, news outlets seek creative ways to draw attention to their site. One day bold headlines predict a recovering housing market, increased mortgage applications, new products and markets and other good news about home financing. Then next we read about slowing applications, a potential fed rate hike, a stagnant economy and the challenges mortgage lenders may face in the future.
You gotta take it all with a grain of salt. Today with QM and ATR in the rear view mirror, and TRID coming under control, lenders are once again concentrating on how to generate new profitable business. The key word is “profitable”. Lenders can’t waste time and expense originating and processing loans that won’t close, or worse, loans that close that are not saleable or compliant.
The game has changed. Play different. Lenders need to mesh savvy origination processes with quality loan manufacturing. They won’t be successful unless they do both. They need to carefully track new applications to make an early determination on potential approval, and then ensure the loan is disclosed, processed and closed in compliance with all rules, regulations and product guidelines. Otherwise you’re just asking for trouble.
It’s time for volumes and spreads once again. It’s origination time! Concentrate on new business and controlled expenses. However, don’t lose sight of what we’ve learned. Loans not originated properly can create huge problems and with more volume comes more problems, regardless of the spreads.
BTW, with QM, ATR and TRID under control don’t lose sight of changes coming down the road. While you’re working at producing all that new quality business, you need to keep an eye on the new HMDA requirements and the revised loan application. Better be working with your technology providers to be ready for these changes when they take effect.
Let’s not have a TRIDpeat…let’s get ready to make money, the quality way.