Obviously, we have navigated back into 1990s mortgage credit crunch waters. This, you would think, has become somewhat predictable to the mortgage business. However, the originations environment change significantly during the last boom:
- Wall Street got closer to direct originations and purchased platforms,
- Products became much more exotic and specialized (driven by investor portfolio needs as much as consumer needs),
- Internet originations became a viable business model, and
- Lead generation entered the market to capture the 60%+ consumers using the Internet to seek a mortgage
The last one is particularly interesting since it is a player in the mortgage market that has never experienced this dramatic downturn. So, how will their process change? What will be different?
Paul Knag, formerly of American Home Mortgage and one of the casualties of grand scale mortgage implosion has some ideas. What do you think?
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2 comments ↓
It is very different than the 90s, I agree Bill. The I think an important difference is that much of the trouble is the fact that borrowers in this crisis now lack the ability to repay, due to liar loans, arm adjustments and general debt overload. I’d think about getting into credit counseling and debt counseling leads, and out of mortgages.
Another interesting thing is to look how the mortgage lead generation portals, such as lendingtree or lowermybills have flourished during recent times.
I believe even during the current crisis, the mortgage refinancing business will do pretty well.
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