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I N D U S T R Y I N S I G H T / D E N I S B R O S N A N
Despite the fact that many of the nation's largest banks saw
lower profits in the first quarter—compared to the fourth
quarter of 2016—and that mortgage demand fell during the
same period, industry surveys show lender confidence is high
that 2017 will be a good year for home finance.
SETTING THE STAGE
Part of the uptick in lender confidence
may be due to the overall better performance
they saw last year. According to a Mortgage
Bankers Association (MBA) survey,
independent mortgage banks and mortgage
subsidiaries of chartered banks made $1,346
per loan on average in 2016, up from $1,189
per loan in 2015. While that's still less than
what banks were earning before the crash, the
trend is positive.
On the servicing side, the trends are
mixed. First, loans at least 30 days delinquent
ticked down slightly in January, and seriously
delinquent loans—90 days or more overdue—
have fallen to just 2.5 percent of all loans. On
the negative side, the cost to service seriously
delinquent loans has skyrocketed, and
servicers are warned not to consider shortcuts.
In its most recent Fair Lending Report to
Congress, the Consumer Financial Protection
Bureau (CFPB) indicated that it will continue
to scrutinize mortgage servicers.
In its report, the CFPB told legislators it
would watch to see if delinquent borrowers
were being discriminated against due to their
race, ethnicity, age, or gender as they sought a
workout solution with their servicer.
Finally—and this impacts both lenders
COME TOGETHER
Bundling loss mitigation and conveyance-related
services may help save servicers money and increase
their efficiencies.
