Mortgage opportunities may not be as high as during the refinance boom in 2020. But, high volumes are continuing. The reality is that the refinance boom would not last forever. Many mortgage companies prepared for how to handle life after the boom. When successful, this manifests as improved workflows, which decreases overhead and further streamlines processes.
Since interest rates are continuously changing, it may seem that mortgage opportunities are declining. In April, the Mortgage Bankers Association reports the highest average interest rates since June 2020 for a 30-year fixed-rate loan. This leads to mortgage applications dropping by 5% on a week-over-week basis. Despite this, today’s economy fills with new openings and mortgage opportunities.
There are many ways to channel mortgage opportunities and stay successful after hitting record numbers last year.
Understand the Changing Economy
Rising rates go hand-in-hand with confidence. Regulators, businesses, and consumers, for example, must express confidence before rates move higher. Rising rates translate into a recovering economy. This is typically associated with a growing labor market, higher wages, positive consumer sentiment and greater stock investment activities.
Inflation is heating up, which can lead to concern, but the economy is seen to be improving. Plus, while rising rates can seem like a step in the wrong direction, they actually indicate that conditions remain enticing. So, the demand for housing is still strong.
Sparked Buyer Motivation
As you know, when interest rates rise, many prospective homeowners may hesitate moving ahead with their dream of homeownership. But, when rates head in a different direction, there is incentive to buy.
Also, for many prospective buyers, changing rates are a sign to begin the home financing process. It’s important that mortgage brokers and loan officers occupy multiple lending lanes. As seen by the past year, a focus on refinances can very quickly shift to an uptick in purchases. So, remain flexible and give your attention to buyers with fresh motivation. By getting in front of prospective buyers, they will remember you when the time comes to purchase.
Channel Purchase Power for Mortgage Opportunities
Loan officers must remain focused on the purchase market. Even with a higher volume of refinance business, originators should focus on all clients. This means both within referral markets, and on the purchase side.
As a mortgage originator, you understand the positive feeling of helping a family get their dream home. This process holds even more value during a global pandemic. Homeownership has taken on a whole new meaning for many searching for stability. So, focus on this as great motivation to help as many families as you can.
Thankfully, the market hasn’t shown many signs of weakness, despite all of the recent challenges. Loan officers and brokers who focused on the purchase market over the past year may see their efforts paying dividends now.
Reach Your Goals
Today’s rates stand out, especially considering how much they’ve changed in recent years. The 30-year mortgage was hovering near 5% in late 2018, according to Freddie Mac. Early this past April, however, it is just above 3%. So, the market appears to be readjusting. But, it still fuels by rates that do not have a major impact on affordability.
Also, financing a home purchase is not out of reach for many. Home purchases and mortgage opportunities continue halfway through 2021. So, make the most of every chance to expand business and elevate yourself as a go-to mortgage professional!
With steps being taken toward reopening the economy and getting a better handle on the pandemic, another influx of future homebuyers emerges. This means more mortgage opportunities!
So, become the best loan officer you can be right now. You cannot get to the top by chance or low rates alone. Work well with others, know your purpose, and focus on what you are good at. If you are passionate about the work you do, you continue to be successful with many mortgage opportunities, no matter what the market might hold.