One more for the worry list…

As an industry, we have a lot on our collective plate these days.  Then again, we’ve had a lot on our plate for a while now.  It’s been a slow start to 2014.  Re-fi is a thing of the past.  And between QM and RESPA/TILA disclosure reform, we’re so busy focused on our own operations that it’s hard to pay attention to the borrowers!

My latest Worry List item, as is the case with many of them, is both an issue…and an opportunity.  I worry a bit for the little guy these days.  The broker.  The credit union or small community bank.  These are the folks who have the least resources when it comes to getting compliant.  They can do it, but at tremendous cost.  Some (in fact, more than some) have decided they’re better off calling it quits.  Others are doing the best the can, but they’re not making much money right now.

There are still opportunities if you’re in it for the long haul.  Consider the following:

  1. If you have the cash or capital, there’s a lot of talent being let go by other lenders.  This could be a great time to improve your efficiency, books of business and overall quality if you can afford to.
  2. If you don’t have the cash, MSRs (mortgage servicing rights) are a great way to bring in cash.  I’ve talked about this before, and am amazed that more lenders aren’t moving on this opportunity.
  3. If you’re a broker struggling with the new environment, consider the move to mini-correspondent lending.  Many “emerging bankers” are doing the same.

I don’t believe for a second that we’re in the “new normal.”  Any time we’ve had new regs, we slow down for a bit and get our bearings.  That’s what’s happening now.  In time, we’ll be more comfortable with the regulatory changes, and we will find legal ways to sell more than just vanilla loans to worthy borrowers.  Profit still drives this industry.  The key is to be in it for the long haul, and to recognize change brings opportunity.

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