What the Seers See for the Mortgage Industry in 2017

Generation Gap

"We can expect that in 2017 the purchase market will increase significantly due to multiple factors, including the rise in wealth and homeowner readiness among millennials. As companies try to meet the demand of this diverse segment, we will see the following unique trends: "Tech-driven mortgage companies will gain greater notoriety and market share, placing a strain on traditional mortgage companies to maintain a competitive advantage. We will see a more visible gap between traditional companies and those which meet the demand of millennial and multicultural consumers. The most successful companies will not just appeal to these markets through technology but demonstrate a greater appeal to these segments' values for social impact and transparency." Kristin Messerli, Managing Director, Cultural Outreach Solutions

Watching Washington

"Lenders will rely more heavily on housing finance agencies and the Federal Housing Administration. Non-QM and alternative credit products should gain steam. Lenders will pursue operational efficiency and invest in fintech to eliminate leakage. The new political landscape is uncertain with a renewed focus on agency conservatorships, the mortgage interest deduction and Dodd-Frank. Will anything be done? Or will Washington just talk it to death? Grab your Magic 8 Ball and hope for wisdom." Ruth Lee, Senior Director of Mortgage Services at Titan, a MetaSource Company

Paper Chase

"Along the quality control and compliance front, lenders and servicers will continue to emphasize implementation of improved systems and processes to meet the rapidly evolving regulatory oversight. Lenders seem to be course-correcting admirably post-TRID and are growing more comfortable with how the secondary market is reviewing loans and interpreting TRID violations. Other loan defect areas will decrease over the next year as lenders continue to implement remediation processes to address other areas of concern, like missing documentation." Phil McCall, Chief Operating Officer, ARMCO

Going Digital

"With the Uniform Closing Dataset, we expect the shift from delivering documents to delivering accurate, post-closing documents and data to accelerate. This will lay a foundation for better data standardization across the industry, but it will also increase the need for tighter system integration that facilitate better collaboration between stakeholders in the larger real estate transaction. Furthermore, the GSEs' recent revised policy to allow electronic security instruments when the note is e-recorded will finally make paper a thing of the past." Nancy Alley, VP of Strategic Planning, Simplifile

Pendulum Swings

"The biggest issue facing the mortgage industry will be fair lending. Although arguably they are the cause of this issue, through unprecedented regulation and enforcement, the Consumer Financial Protection Bureau, Federal Reserve and Federal Deposit Insurance Corp., will continue to shift their focus from alleging that lenders have preyed upon and targeted a population of borrowers with predatory marketing, products and lax underwriting standards, to alleging that the very same lenders have now restricted that very same population of borrowers' access to credit." Craig Nazzaro, Attorney, Baker Donelson

Ripple Effects

"A big sell-off in global credit markets could bring a significant rise in the cost of mortgage finance. Commercial real estate in the U.S. is especially vulnerable to tighter credit conditions and a downturn here could spread shock waves more widely." Brendan Brown, Chief Economist, MUFG Securities

Clearing the Air

"The major change is that, as opposed to merely responding to regulatory challenges there may be a real possibility of trying to address them on an agency level. Respectfully, it has been my experience that beyond the formal process of required notice and comment, there was not a very open dialogue concerning the unintended consequences and challenges created by new regulations. With the possibility in a new administration, there will be a fresh re-evaluation and, with that, an opportunity to address certain challenges at an agency and regulatory level." Ari Karen, Partner, Offit Kurman and CEO, Strategic Compliance Partners