The 2020 Refinance Wave: Where Activity Is Strongest, Where It’s Not, And What’s Ahead

iLeads Mortgage Market Minute
Welcome back to iLeads Mortgage Market Minute, where we bring you the latest, most relevant news regarding the mortgage market. We hope you enjoyed last week’s edition where we talked about What Will The Fed Do To Mortgage Rates?. This week we’re bringing you:


Low mortgage rates fuel demand for valuation and settlement services*

VRM Mortgage Services CEO shares how the company is navigating an unusual year

HousingWire recently spoke with Keith Murray, president and CEO of VRM Mortgage Services, about the importance of diversity in an organization and how VRM has continued to serve its clients in an unusual year.

HousingWire: The term we keep hearing to describe 2020 is “unprecedented.” How has VRM continued to serve its clients in such unusual times?

Keith Murray: VRM has always taken a community-first approach to serving the needs of our clients. We do this with a talented team of professionals that we support with superior technology and continuing education to keep abreast of how the COVID-19 pandemic has impacted real estate markets across the country.

Since our vendor partners are our eyes and ears on the ground, we support them as well, with a variety of educational offerings though our VRM University platform. By marrying the best of the best of internal and external resources, VRM has continued to deliver superior results for our customers during these historic times.

Read more in-depth here.


Homeowner Equity Surged in Q2*

There was another big surge in the amount of equity on the balance sheets of American homeowners in the second quarter of this year. CoreLogic reports that the 4.3 percent gain in home prices over the past year sent home equity shooting up by 6.6 percent.

The report shows U.S. homeowners with mortgages (which account for roughly 63 percent of all properties) saw an average gain in equity from the second quarter of 2019 of $9,800. The collective nationwide increase was $620 billion.

This is especially important at this point, as equity may provide some insulation for homeowners during the pandemic. During the housing boom millions of buyers used low down payment mortgages and there was an epidemic of cash-out refinances, leaving many homeowners with little equity. When prices began to fall, millions fell quickly into negative equity, owing more on their mortgages than their homes are worth. This left them with little flexibility to refinance or sell their homes to get out of financial difficulty.

Read more in-depth here.


Refresher on The New Refi Fee and Its Effect on Mortgage Rates*

Fannie Mae and Freddie Mac are the two government sponsored agencies that guarantee timely payment of principal and interest to the investors who front the money that finances the American mortgage market. This guarantee means that more investors are willing to participate and at more advantageous rates for homeowners. Naturally, not every mortgage is repaid perfectly. Sometimes, payments are missed. In more serious situations, loans can end in foreclosure, short sales, etc. In those cases, the housing agencies are there to act as a backstop ensuring investors are made whole.

In order to foot that bill, Fannie and Freddie collect fees on loans that they guarantee. Shockingly, these are called guarantee fees (or guaranty fees” with a “Y” in the case of Fannie Mae). The mortgage industry and the rest of this article will typically refer to them as G-fees.

Read more in-depth here.


[PULSE] Even during origination surge, don’t forget to brush up on compliance*

Regulators don’t take a break when the housing market is doing well

It’s really easy to get caught up in the moment in the mortgage industry. During this particular moment, the prevailing thought is “throughput!” It’s no secret that much of our space is busy trying to push mortgage loans through the pipeline without losing them as their sales funnels overflow.

So who could possibly be thinking about compliance right now, except maybe, compliance officers?

This is not a suggestion where you drop what you’re doing, push your production team into training and staff up the compliance department. Who’s got time for that when the fish are jumping into the boat? But when you do get a little time to look ahead, it may be time to realize that, at some point, you’ll want to revisit your compliance program. Is it current? Is it continuous? Is it working? Is someone keeping an eye on it?

Enforcement agencies and regulators don’t take a break when the market is going well. They have jobs to do, too. Things like the Fair Housing Act and Dodd-Frank are still with us, no matter how aggressive or lax you believe the agencies responsible for enforcing them should be or are. You don’t have to look too far through the pages and articles of HousingWire to find a few examples of that. And being too busy on the sales and production side, unfortunately, is never an effective defense to most regulatory violations.

Read more in-depth here.


Home Sales Surge to Best Levels in 14 Years*

Existing home sales continued on a roll for the third consecutive month, hitting the highest level in August since December 2006. The National Association of Realtors® (NAR) said sales of pre-owned single-family houses, townhomes, condos, and cooperative apartment were at a seasonally adjusted annual rate of



Read more in-depth here.


[PULSE] The 2020 refi wave: Where activity is strongest, where it’s not, and what’s ahead*

The MBA expects a near 17-year high for refis in 2020, but the market may be cresting

The housing and mortgage markets have been the rare bright spots in an otherwise fragile economy brought forth by the ongoing COVID-19 pandemic. Mortgage origination volume this year is on track to be the highest in more than 15 years, led by a strong wave of refinances.

Just how busy have lenders been? 2003 was the last time refinance activity was as high as the $1.75 trillion MBA is forecasting for 2020.

Mortgage rates have reached record lows, driven by the unprecedented economic weakness, as well as the Federal Reserve’s substantial efforts to keep the economy afloat by cutting short-term rates to zero and purchasing more than $1 trillion dollars of mortgage-backed securities. Homeowners are benefitting from lower monthly payments, while lenders are struggling to manage high volumes – all during a time when their employees continue to work remotely, and many temporary origination flexibilities remain in place.



Read more in-depth here.


Finding highly affordable leads to keep sales coming in

At iLeads, we have many great solutions for mortgage LO’s at a low cost. If you’d like to see how we can help you bring in consistent sales for a great price, give us a call at (877) 245-3237!

We’re free and are taking phone-calls from 7AM to 5PM PST, Monday through Friday.

You can also schedule a call here.


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