It's nearly the end of 2013 -- by most accounts, a banner year for nearly everyone in mortgage banking who is not in default servicing.
Investors have been buying homes, distressed and otherwise, and some institutional investors have even already begun securitizing the cash flows that come from renting out this new asset class.
Home prices have been on the upswing in most markets, with the S&P/Case-Shiller 20 market composite index crossing its highest level in five years. The median existing-home sales price rose to $199,200 by September 2013, up from $178,300 one year earlier.
The Federal Reserve has played willing enabler, too, with continued quantitative easing (read: cheap money) allowing the refi boom to run its legs at least through the first half of this year, until talk of an eventual taper brought the party to a swift and perhaps unceremonious end.
2013 is also the year the nation’s foreclosure crisis finally came to a public end, with the number of U.S. consumers with a new foreclosure down to levels not seen since 2006 according to data from the Federal Reserve Bank of New York. More qualitatively, much of the major financial press has since moved onto the next crisis, be it Greece, Italy or municipal bonds (or student loans, or the debt ceiling, or….the list goes on and on).
That’s not to say we’re entirely past the foreclosure mess, as the number of properties stuck in the foreclosure pipeline remains well above historical norms, creating various challenges for many that work in the default sector of the U.S. mortgage banking industry — challenges that look to continue unabated in the coming year, as well.
The year ahead
As we look ahead to 2014, the landscape in mortgage banking is changing. And fast.
The refi boom is nearly in the rearview mirror, and lenders are already adjusting their strategies to ready their sights on an increasing purchase market. Rates appear set to rise, perhaps significantly, at some point in 2014. And investors cooled somewhat in their enthusiasm for all things single family, helping to cool off recent home price gains, as well.
Mortgage servicers are consolidating, too, and at the same time many are also integrating with lending and investment arms to create top-to-bottom financial institutions that can lend, service, issue and invest in residential mortgages.
New regulations and new legislation goes into effect next year, with some of the largest changes kicking in early in the year — and others yet to be defined. Taken together, the industry is facing both uncertainty and increasing complexity around operations, all at the same time.
But with all challenges come enormous opportunities. And opportunities remain rich in the mortgage industry for companies that are flexible, adaptable and able to anticipate change effectively.
That’s why we set out to highlight 14 companies doing something interesting and noteworthy in the industry—companies that are preparing in unique ways to capitalize on a changing industry. That’s the concept of the inaugural 14 for ’14 project: a chance to demonstrate some of the industry’s most innovative thinking, applied to the challenges and opportunities that 2014 presents for various aspects of the mortgage business.
In this year’s class, you’ll find companies that specialize in technology, consulting, property management, risk management, loan originations, loan servicing, capital markets and much more. As you read about each company’s outlook on the business and what they’re doing to succeed in 2014, we encourage you think about your business.
What can you learn? What can you do to help make sure you’re ready for 2014? Now is the time to put your business into solid footing for the coming year.
Editor's note: The companies participating in this Special Section sponsor their content. Each company tells a unique story, one they wished to share with HW Magazine readers and the industry at-large.