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First-Time Buyers are in the Driver’s Seat

With a new president about to take office in January, there is a lot of uncertainty around how that president’s policies will affect the mortgage market.

Despite that uncertainty, mortgage bankers are optimistic about first-time homebuyers how they will drive growth of the housing market in 2017, according to a survey of lenders, national secondary providers, and national program providers from the Lenders One Cooperative, a national alliance of independent mortgage bankers, correspondent lenders, and suppliers of mortgage products and services.

Approximately 58 percent of those surveyed said that they were concerned about the effect the November election will have on the industry. Nevertheless, 66 percent of respondents said that they believe the greatest opportunity to grow business in 2017 lies with first-time homebuyers.

Survey respondents said the second greatest opportunity for business growth lies with rising rents that are prompting renters to become homebuyers, with 20 percent. At the same time, 39 percent of respondents said they believe that potentially rising mortgage rates—which have remained near record lows for the last three months and below 4 percent for the whole year in 2016—will have the greatest negative impact on the growth of the industry next year.

The majority of respondents (64 percent) said they expect a modest to heavy sellers’ market in 2017, compared to only 36 percent who said they expect a modest to heavy buyers’ market.

When asked about the biggest challenge experienced in TRID implementation, more than half of survey respondents (58 percent) said the biggest challenge was dealing with the process and workflow changes when trying to deliver the loan estimate in three days. Approximately 8 percent of respondents identified the consolidation of existing documents into the two new disclosures as the biggest TRID-related challenge.

“While the mortgage industry is often adjusting to regulatory and compliance uncertainty, the issues around TRID have become clearer, enabling lenders to proactively manage workflow challenges and set strategies to better meet consumer needs through technology integration and innovation,” said Bryan Binder, CEO of Lenders One.

About Author: Seth Welborn

Seth Welborn is a Harding University graduate with a degree in English and a minor in writing. He is a contributing writer for MReport. An East Texas Native, he has studied abroad in Athens, Greece and works part-time as a photographer.
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