“Mortgage lending has always been a volume game. Traditionally, narrow profit margins have made it necessary for lenders to originate as much as they can at the lowest cost in order to stay profitable — a task that is aided when loan volume is easy to capture. If volumes are large enough, lenders can still make money even if their cost to originate is high. The reality is that most lenders will see their volumes drop regardless of what they do, so they are also looking for additional strategies for staying profitable; one place to affect meaningful change is in lowering existing operational costs.”
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July 21, 2022