Lunch & Learn: Are appraisals the next big opportunity in mortgage fulfillment?

This Lunch & Learn for mortgage lenders will explore the evolution of the appraisal process as well as opportunities for innovation.

Why brokerages and mortgage lenders are rushing into JVs

Joint ventures are suddenly stitched into the fabric of a handful of national brokerages. But the idea of the joint venture collides with the loose, informal networks that color the American housing economy.

How to simplify the appraisal process for everyone in today’s hot market

While the world might be slowly getting back to normal, the housing boom is far from over. Appraisers need to make sure they have the right tools to manage the high demand.

Robert Dietz on why the single-family rental market is growing

In this episode of HousingWire Daily, NAHB's Robert Dietz explains why the marketshare of single-family rentals is growing despite strong homebuyer demand. He also discusses the NAHB’s latest Housing Market index.

Mortgage

The cyclical nature of the mortgage industry

Here’s what 2020 taught us

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The ability to look past the now and develop strategies that poise an organization for future success is key to any leadership position in almost any business. It’s true for the mortgage industry and especially the long-term strategies we’ve developed to react to the current low-rate environment brought on by a global pandemic.

One of the most fascinating factors that drove rates lower was the decoupling of duration and swap spreads for mortgage- backed securities, which, ironically, analysts expected to be short-lived in 2020. This rally caused rates to drop which lured millions of homeowners to refinance their current home loans throughout 2020, leading to unprecedented loan volume for the entire mortgage industry.

While much of the mortgage industry fixated on low mortgage rates the past year, it’s important to understand the anatomy of what drives rates. In the U.S., the federal funds rate refers to the rate that banks can charge other banks for lending excess cash from their reserve balances on an overnight basis. This rate can influence short-term rates on mortgages and credit cards in addition to impacting the stock market. This rate is also set by the Federal Open Market Committee.

While they can’t mandate a particular rate across the board, the Federal Reserve can adjust the money supply so that interest rates will move toward the target rate — when they increase the amount of money in the system, rates fall, when they decrease the amount of money, rates rise. This rate is set eight times a year based on economic conditions.

Over the last year, Fed Chair Jerome Powell consistently pledged that the Fed would continue to buy mortgage-backed securities to stabilize the American economy, which increased the amount of money in the Federal Reserve System and drove rates lower.

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