At the NEXT women’s conference Thursday in Dallas, Texas, a panel of experts, moderated by our own Sarah Wheeler, managing editor of HW content solutions, gathered together to talk about the changes that need to come to the construction lending industry.
“We’ve all seen the headlines, including those from our very own HousingWire, that Fannie Mae is preparing to launch a new program in the construction lending space,” NEXT Mortgage Events Co-founder Molly Dowdy said as she introduced the panel.
Back in November, Fannie Mae announced that it could be on the verge of introducing a pilot program to change the way it buys residential construction loans.
Under the new program, Fannie Mae would buy the loan on the first day of construction, possibly making the loan easier to get and cheaper. The borrower wouldn’t begin making payments until after they moved into the home.
Now, Jonathan Lawless, Fannie Mae vice president of product development and affordable housing and Built CEO Chase Gilbert joined together to discuss what changes are coming to the industry.
Lawless spoke on Fannie Mae’s upcoming pilot program, saying Fannie Mae hopes to roll out the program sometime this year.
“We’re actively trying to change it,” Lawless said of the mortgage construction industry. “I think we’ll see some progress in the coming year.”
Gilbert explained that servicing continues to lag behind other areas of the mortgage industry in technology and efficiency. And servicing construction loans is even more complex, he pointed out.
In fact, back in November, Built announced it raised $21 million in order to revolutionize construction lending, saying it plans to use the money to expand in residential and commercial construction.
While larger lenders may have the funds required improve efficiency in mortgage lending, smaller lenders are left behind, Gilbert explained in an interview with HousingWire. However, that’s where third party technology providers can play a role, bringing tech to an industry that is ready to revolutionize.
“It’s a confusing and intimidating space but it doesn’t have to be,” Gilbert told HousingWire. “Technology could make it easier.”