Headlines Could Be Deceiving. Don’t Get Distracted by the Hype

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In today’s digital world, websites are able to generate advertising dollars based on content and clicks and views of the site. The more clicks (views) the more successful the site and the more advertising dollars can be generated.

So, just as it is with news print media, news outlets seek creative ways to draw attention to their site. One day bold headlines predict a recovering housing market, increased mortgage applications, new products and markets and other good news about home financing. Then next we read about slowing applications, a potential fed rate hike, a stagnant economy and the challenges mortgage lenders may face in the future.

You gotta take it all with a grain of salt. Today with QM and ATR in the rear view mirror, and TRID coming under control, lenders are once again concentrating on how to generate new profitable business. The key word is “profitable”. Lenders can’t waste time and expense originating and processing loans that won’t close, or worse, loans that close that are not saleable or compliant.

The game has changed. Play different. Lenders need to mesh savvy origination processes with quality loan manufacturing. They won’t be successful unless they do both. They need to carefully track new applications to make an early determination on potential approval, and then ensure the loan is disclosed, processed and closed in compliance with all rules, regulations and product guidelines. Otherwise you’re just asking for trouble.

It’s time for volumes and spreads once again. It’s origination time! Concentrate on new business and controlled expenses. However, don’t lose sight of what we’ve learned. Loans not originated properly can create huge problems and with more volume comes more problems, regardless of the spreads. 

BTW, with QM, ATR and TRID under control don’t lose sight of changes coming down the road. While you’re working at producing all that new quality business, you need to keep an eye on the new HMDA requirements and the revised loan application. Better be working with your technology providers to be ready for these changes when they take effect.  

Let’s not have a TRIDpeat…let’s get ready to make money, the quality way.

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.