Lenders One: Mortgage Lenders Maintain Positive Sentiment

MBA NewsLink Staff

April 13, 2017


Lenders One Cooperative, St. Louis, said its annual survey of mortgage lending professionals show overwhelming positive sentiment, with first-time home buyers, Generation X and Millennials presenting greatest opportunities for growth.

The Lenders One Mortgage Barometer, a survey of 200 mortgage lending professionals. Reported 94 percent expect an increase in mortgage purchase production, up from 62 percent last year.

The report said continued economic improvement should give first-time home buyers the boost they need to enter the market. The survey reported three in five lenders (59 percent) said it is very likely that there will be an increase in first-time home buyers in 2017.

However, four in ten lenders predict some challenges to mortgage industry growth with respondents seeing consumer debt as the highest risk factor this year (41 percent).

Populations most frequently cited as offering robust opportunity in 2017 include Generation X (86 percent) and Millennials (85 percent, up from 79 percent last year). Following closely are nontraditional buyers, those who are in the rental and vacation home markets (84 percent, up from 70 percent last year); boomerang buyers, those people who can now qualify for a mortgage after undergoing a short sale, foreclosure or bankruptcy (83 percent, up from 68 percent last year) and baby boomers (82 percent).

Most lenders (93 percent) report that they already originate non-qualifying mortgage loans. Bolstering one part of the non-QM market is continued home appreciation, especially in higher end markets, which has created demand for jumbo loans. The survey said 91 percent of lenders project a significant increase in jumbo loan origination volume in 2017 for their organization.

Additionally, 82 percent of mortgage lending professionals anticipate an increase in people looking to finance larger homes to take advantage of rental incomes.

"Housing inventory remains limited and interest rates have increased sharply since the election," said Bryan Binder, CEO of Lenders One. "To be successful in this environment, lenders need to focus on the purchase market and new innovation to replace lost refinancing volume. Lenders must also focus on tools and solutions to help them improve operating efficiencies within their businesses."

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