Effective marketing and loan fulfillment programs, coupled with a laser-sharp focus on customer service will drive the mortgage industry to generate solid revenue and profit in a tough year according to a white paper titled “Efficient Collateral Valuation Key to Success in 2018,” published by Veros Real Estate Solutions(Veros) recently.
The paper also outlines the important opportunities for mortgage lenders working to be more competitive in a purchase money market and how they can position themselves well for securing additional business when loan volume levels increase in the future.
According to the study, “by focusing their efforts on the right products, [lenders] will also have the opportunity to build stronger relationships with existing bank customers and credit union members.” Outlining three keys to success in a tough year, the study said that excellent customer service, good marketing, and efficient operations to ensure good customer experience while reducing costs and increasing profitability would be important for lenders in 2018.
“This paper offers lenders a real opportunity during a year that both the MBA and Fannie Mae predict mortgage loan originations will be down, making competition more intense,” said David Rasmussen, SVP, Operations at Veros.
Towards the end of 2017, the paper indicated, mortgage lenders began to gear up to attract more purchase money transactions, but “now four months into the new year, competition for this business has heated up significantly.” Adding pressure on smaller institutions that wanted to compete for business, were the deep pockets of the bigger lenders who were investing a great deal of their marketing budget into television and radio ads, the paper said.
Home equity products were another great opportunity for both, borrowers and lenders the paper indicated. Despite the new tax law that reduced the overall amount of interest borrowers could write off depending upon the number of qualified residential mortgage loans they carried, the paper said that for the vast majority of home equity borrowers, the loans still made excellent sense.
Making home equity loans more attractive for borrowers was the fact that as interest rates continue to rise, cash out refi lending would become unsustainable. Home equity loans, therefore, would provide lenders with the opportunity for effective marketing and efficient processes to stay ahead of the competition.