Genworth Mortgage Insurance Industry Survey: Rising interest rates and alternative mortgage products seen as biggest 2018 market challenges
"Rising interest rates and inflation, when combined with today's inventory shortage, are accelerating home price appreciation, causing some lenders and consumers to explore less-tested methods for financing home purchases," said
Additional data shows that the majority of industry executives believe removing legal uncertainty for lenders originating FHA loans (44 percent) and lower compliance cost for lenders (30 percent) are the best ways to improve access to credit in the mortgage market. Additional responses included adoption of alternative credit scores (14 percent) and more ambitious affordable housing goals for the GSEs (12 percent).
Further findings below highlight industry sentiment on the role of compensating factors in underwriting, navigation advancements in loan processing platforms, and GSE Day One Certainty tools:
Compensating factors should play a role for borrowers above 45-DTI
Industry professionals universally agree (92 percent) that given the recent rise in Debt-to-Income (DTI) limits, compensating factors should play a role for an above 45-DTI applicant. Only eight percent said that high DTI limits will facilitate more credit access, allowing more individuals to achieve homeownership without adding risk to the market.
Industry calls for easily customizable dashboards for LOS platforms
The majority of respondents (54 percent) identified easily customizable dashboards for organization-wide production management as the top service they want integrated into Loan Origination System (LOS) platforms. Respondents also noted the ability to share screens and data with a customer (21 percent) and the ability to upload lists of closed loan data to active commitments (20 percent) as desired services.
Industry has started to incorporate GSE Day One Certainty tools
Sixty-eight percent of respondents said that they have begun to integrate or have already fully integrated GSE Day One Certainty tools into their processes. However, about one third of respondents (32 percent) report that they have still not begun using third-party data validations on DU/LP loans.
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