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The Right Servicing Software Supports Selling to the GSEs and Retaining Servicing
Rising property values and low interest rates pushed mortgage loan origination volume to roughly $4 trillion in 2021, the highest level ever recorded. Since then, the economic impact of rising inflation and interest rates has quickly changed the mortgage industry.
Now, lenders are facing the highest interest rates in a decade. In 2021, the average 30-year fixed mortgage rate was 2.65 percent. In early August 2022, the average 30-year fixed mortgage rate was 5.5 percent. These interest changes are increasing demand for Adjustable Rate Mortgages (ARM), with the MBA reporting that ARMs made up nearly 11% of all mortgage applications in May.
These rapid changes mean that mortgage servicers face new challenges, including supporting high volumes of new loans, and more loans that will have changing terms over the course of the loan’s life. By investing in the right mortgage servicing software, lenders can effectively meet those challenges and service their loans in-house. The right software can help servicers comply with investor requirements and create value for their organization and its customers.