Mortgage Market with Daryl Jones

One of the topics I think that’s been a hot one lately, Darryl, is the mortgage origination space. It’s getting ready to heat up again, we think, maybe with interest rates. Tell me a little bit about that.

Yeah, I do. I think everybody’s expecting rate cuts probably coming in September, at least one this year.

Maybe sooner.

Probably not. I think the government needs a little bit of a rest, but probably in September.

Okay.

But yeah, I mean, I think if that happens, we’ll probably see a bit of a pop in action. I think inventory’s been pretty tight all year. And I think lenders, in total, have been really looking at the whole year as kind of flatlined, with moderate growth at best.

Okay.

I think lenders have kind of seen that, some doing better than others. But I think that if we get a cut in rates, it’ll probably free up some inventory. Some people who have been pretty much sitting tight will look to move, and that might provide a bit of a pop.

So I think lenders are going to need to get in front of that because I know they’ve done some retooling on their side just from a staffing and process perspective, because volumes have pretty much dried up.

So a lot of the back office and a lot of the origination staff have been reallocated or reassigned. They might need to think about pushing them back into the origination space, you think?

Yeah, it could be. I mean, in some cases they’ve let them go.

Yeah.

Or they’ve retooled them and moved them. Some have had a big pop in home equity, so they’ve moved them over there or moved them into other areas. So they’ll have to look at that.

But I know one thing that a lot of lenders have been looking at, especially smaller ones, is, should they be outsourcing to another provider?

Sure.

Because either they’re outsourcing operations or they’re going to use them as kind of overflow.

Yep.

And they’re probably going to have to get ahead of that and get a feel for it before they need it.

Get a partnership in place ahead of time.

Correct. Correct.

Gotcha. So it’s possible that mortgage originations are going to pick up toward the end of the year.

Are you ready? Do you have the right vendors in place? Do you have the staff in place? Is the comp structure around your MLOs set up?

If you have any questions about that or want to talk more about it, Darryl’s around. Definitely let us know.

But thanks for the time.