Closing Complex Loans Faster With a Digitized Client Workflow

Join us for a discussion on changes in market demographics, suppliers and how focusing on customer experience and a few simple steps during the mortgage loan process can close deals 3x faster.

Brokers, Here’s Everything You Need to Know About Rocket Pro TPO

Want to stay up to date with the latest on what Rocket Pro TPO is offering its broker partners? Check out our TPO hub for updates and more.

Home appraisal’s ugly history and uncertain future

This is Part I of a deep dive into the home appraisal industry. Today we explore the origins of the appraisal industry and its current lack of diversity.

Loan quality lessons learned from 2020

HousingWire recently spoke with Trevor Gauthier, CEO of ACES Quality Management, about the effects of 2020 on loan quality and what lenders should expect regarding loan quality and risk management this year.

Mortgage

2.5 million borrowers face imminent payment shock

Resets to happen over next few years

At least 2.5 million borrowers will face an average increase of $250 per month on their monthly mortgage payment due to the imminent reset in home equity lines of credit over the next three years, according to Black Knight Financial Services’ Mortgage Monitor Report.

However, depending upon borrower behavior between now and the time of the reset, payment increases could change, Kostya Gradushy, Black Knight’s manager of research and analytics, said.

Borrowers whose home equity line of credit will reset over the next three years are utilizing just under 60% of their available credit. If these borrowers utilize more of their credit, they could face even more payment shock as the monthly increase would rise above the $250.

And the news is not much better for the borrowers whose payments are not likely to reset until 2019. These borrowers are exhibiting even lower utilization ratios — about 40% of their available credit. Once reset, they will likely face an average monthly increase of $200.

"Should their drawing pattern match that of older vintages, we could be looking at a significantly higher risk of ‘payment shock’ for this segment,” Gradushy said.  

HELOC resets are long considered a "silent" hazard to the first lien mortgage. In the run up to the housing bust, less and less money was being put down on homes, though the rate of HELOC origination did not necessarily slow.There were even concerns developing for investors in residential mortgage-backed securities.

So far, however, it's the big bang that never happened.

Most Popular Articles

The housing market outsmarted the foreclosure crisis

This isn’t 2008. A bevy of loss mitigation waterfalls, forbearance safety nets and an abundance of equity gave Americans a fighting chance when the foreclosure crisis finally sunsets. HW+ Premium Content

Jun 18, 2021 By

Latest Articles

Existing home sales dip downwards for fourth month

Existing home sales fell for the fourth consecutive month in May, down .9% from April to 5.8 million, the National Association of Realtors reported on Tuesday.

Jun 22, 2021 By
3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please