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As we know, the more liquid, dynamic mortgage financing market we are now in has placed additional pressure on lenders to process and underwrite loans. Below we review some of the most recent data demonstrating what is driving this demand. To assist mortgage finance clients with fulfilling their very full pipelines, we have expanded our loan origination staffing services. The Oakleaf Group’s expanded Resource Solutions services now support the full spectrum of front-line market activity, including processing, underwriting, closing, funding and post-closing processes. See more about our Resource Solutions following the mortgage data review below.

MBA: Mortgage Loan Application Volumes Dip But Remain Well Above 2019 Levels

Mortgage loan application volumes experienced a slight dip from the previous week but continue to outpace those of 2019, the Mortgage Bankers Association said on Wednesday.

Last week, mortgage rates dropped to another record low, with the average 30-year fixed rate mortgage falling to 2.87% as the Federal Reserve continues to hold its target rate at a range of 0 – 0.25 percent. According to the MBA’s Weekly Mortgage Applications survey for the week ending July 31, 2020, while refinance activity decreased slightly despite the decline in rates, the overall pace remains 84 percent higher than the same week a year ago.[1] Similarly, the unadjusted Purchase Index was 22 percent higher than the same week one year ago, despite a modest decrease of 2 percent from the week prior.

While the decrease in refinance activity in recent weeks may reflect the growing uncertainty surrounding the COVID-19 pandemic and related economic crises and recovery efforts, the Federal Reserve is expected to hold its current rates until 2022. As a result, “MBA’s forecast calls for [mortgage] rates to remain at these low levels, which will continue to spur strong refinance activity and offer homeowners relief in the form of lower monthly payments during these uncertain economic times,” MBA’s Associate Vice President of Economic and Industry Forecasting Joel Kan explained.

Additionally, the Federal Reserve’s mortgage-backed securities purchasing program has helped free up more money for lending and, as lenders saw overall market conditions improve this summer versus March, credit availability also increased in July.[2]

For the full year, MBA is forecasting $1.5 trillion of refinancings and $1.3 trillion of purchases. Similarly, Fannie Mae’s July forecast estimated an overall market of more than $3 trillion, including $1.9 trillion in refinance activity and $1.26 trillion in purchase volume.[3]

Oakleaf’s Resource Solutions For The Mortgage Business

Our Resource Solutions offering builds on Oakleaf’s deep financial services and mortgage industry knowledge to deliver the consulting talent required to conduct complex transformational initiatives, cover expansions in business-as-usual or modernization efforts requiring specialized skills. Whether we build a team for a complete turnkey solution, provide existing Oakleaf resources for targeted consulting or provide you with extra capacity, we use our industry and subject matter expertise and network to deliver qualified resources when and where you need them.

With over 1 million hours of professional services delivered to large, complex and demanding financial institutions since our founding in 2007, clients can rest assured that they are enlisting qualified mortgage experts when they partner with Oakleaf Group. Click here or contact Muhammad Malik to learn more about how your organization can Partner with the Experts to meet today’s and tomorrow’s demands in the mortgage markets.

[3] “Ancillary Services Get a Boost as Originations, Defaults Rise.” National Mortgage News. 31 July, 2020.