2018 is Shaping Up to Be A Pretty Good Year

0 0

According to most reports, indications are that 2018 may the best economic year since the housing crash of 2008. That’s great news for everyone.

One of the main reasons for optimism is in the 30,000 rise in construction jobs in December. This increase is the highest in this area in the last seven years. This points to an increase in new home construction which will add more homes for sale to the market.

With unemployment at record lows, the economy improving, continued wage growth, and more millennials poised to enter the market, the demand for housing will increase.

The supply of affordable existing and new homes available for sale needs to keep pace with the increasing demand.

This increase in demand for housing is increasing home values across the board. Such increases are creating wealth for existing homeowners in the form of increased home equity.

This increase in home equity creates an opportunity for these homeowners to tap that equity in the form of equity loans and cash-out refinances.

Both approaches will provide homeowners with cash to pay off higher rate credit cards and maybe those pesky student loans.

With the investment markets continuing to improve, they may consider taking some money for investing toward retirement or to pay for their children’s education.

Even though the interest on a HELOC will no longer be deductible, these may still be a viable option for some homeowners looking for some additional cash who now have a low rate on the existing mortgage.

Through construction lending, home purchase financing, cash out refi’s, or HELOCs, there will be plenty of opportunities for mortgage lenders in the new year.

Now is a good time to review your business and lending plan for 2018. Do you have the products to provide the needed home financing and the sales and support staff adequately trained to deliver them?

The housing market is changing. Can you offer, and deliver, products that include government loans as well as non-QM type options? How about HELOC’s?

All in all, it looks as though 2018 is shaping up to be a pretty good year. One of the best we’ve seen in a while.

Mortgage lending may be tight, but we’ll still have a nice mix of opportunities in both refi’s and purchase loans.

Are you ready for some lending?

About the Author

Michael Vitali

Michael L. Vitali – Independent Consultant to the Mortgage Industry Mike Vitali is an independent consultant to the mortgage industry on matters concerning compliance and mortgage lending. He most recently served as the Senior Vice President and Chief Compliance Officer for LoanLogics, monitoring regulatory developments and their practical implications for the mortgage lending industry. His duties included research, interpretation, and analysis of existing and proposed legislation related to the industry in support of recommendations for policy and/or procedure changes to maintain continued quality and compliance with all applicable laws, rules and regulations, investor requirements, and standard mortgage practices. In his more than 40 years in the mortgage industry, in senior level management, he has gained experience in all areas of mortgage lending, risk management, and compliance. Mike is a past President of the MBA of Greater Philadelphia, is a charter member and was the second Chairman of the MBA of Pennsylvania, and a past board member and Legislative Chair of both associations. He is a recipient of the 1998 Mortgage Banker of the Year Award from the MBA of Greater Philadelphia, and the 2003 Chairman's Award from the MBA of PA, and currently serves on several compliance related task forces for MBA.