MAY 17, 2018
It’s the “surprise” that everyone should have seen coming from 10 years away.
The mortgage refi market is deader than dead. Of course it is. Every homeowner with a pulse and an ounce of common sense refinanced at their leisure during the Fed’s ZIRP-a-thon of the past 10 years. How dead is it?
Try less than 45,000 (that’s not a typo) logical refi candidates remaining in the United States. “Of the nearly 28 million borrowers with 30-year mortgages originated in 2012 or later, fewer than 45,000 have 75 basis points of interest rate incentive to refinance while also meeting broad-based eligibility requirements.”
So what’s next? What’s always next. As a mortgage lender, you just care about the next commission. Which means you need to sell mortgages. Which means you have to start loaning to people who are not creditworthy. Which means more subprime loans to bad credit risks. What could possibly go wrong?
Mortgage State of Play. Below are a few recent headlines and datapoints higlight why revolutionary change will happen…
ORIGINAL SOURCE: Mortgage-Mageddon; What’s Next? Revolutionary Change… by Mark Hanson at M Hanson on 5/16/18