Originators – don’t panic

Yet interest rates are still pretty low, and will remain so from a historic standpoint. And while the refinancing boom has eased, homeowners will still have the need to refinance their homes, she added. Higher interest rates have curbed the equity-pulling explosion, but the need for such cash outlays will continue despite rising rates, she said.

“But people are still buying homes,” she said. “The supply and demand issue is still a massive challenge for everybody. People will always buy homes, and people will always refinance as well. They’ll refinance to do things like pulling equity out to buy investment property, consolidate debt. Because at the end of the day even with rates being a little bit higher from where they were, they’re still amazing.”

Sans that crystal ball, Cavanaugh prefers to focus on the past for guidance: “When you look at the historical chart – like a 20- or 30-year lookback – it’s cheap money. You can’t borrow money as cheap as you can with a mortgage anywhere else.”

Still, some people believe loan officers and brokers will eventually be relegated to the dustbin of history. In nearly primal defense, the mortgage industry metamorphosed as the COVID-19 virus spread – with software platforms fast-tracked in response to lockdown rules just as vaccinations were developed at astonishingly rapid rates to mitigate the scourge. What emerged was digitization of the mortgage process, enabling virtual originators to engage with clients from the comfort of home.