BY TIM MISLANSKY
Is your credit union’s purchase mortgage business thriving as well as it should be? If not, the lessons learned and the trends that emerged from the housing crash could prove fertile ground for growing a purchase mortgage services program. Keep reading to help get your CU up to speed on real estate advocacy.
When is a trend no longer a trend? When does it become the new normal or an industry standard against which all other efforts are measured?
During the 2007–2012 housing market crash, many lenders struggled. Some failed. Home sales and new construction evaporated, and of course, the stream of purchase mortgage applications came to a virtual standstill. Instead, refi loans ruled supreme. That changed. Since that time – in spite of some ups and downs – consumer confidence has crept up. People are shopping for homes again.
That’s all great news but that’s not the whole story. Something big transpired during the housing crash. In the absence of “normal mortgage operations,” a trend emerged: Credit unions increased their efforts to develop a stronger “watchdog” approach over their members’ real estate interests. And as a result, they discovered innovative opportunities to grow their purchase mortgage business. Here’s how the “real estate advocacy” trend started, matured and emerged as the industry standard for any CU that wants to develop a thriving purchase mortgage services program.
Before It Was a Trend
The spark of change occurred in 2000, a decade before the crash. This is when Mike Corn – a successful Scottsdale, Ariz.-based entrepreneur – was searching for a new home and selling his existing one. He found the entire real estate experience to be expensive, time-consuming and inefficient. Corn, who had launched and sold several thriving tech companies, was frustrated and wondered about better options. He believed buyers should be able to preview homes online and spend less money buying them. It’s important to remember that this was long before the days of direct access to web-based MLS databases, so this was a very cutting-edge concept. Corn shared his experience with Craig Davis, a friend and real estate broker, and they began to develop an idea to offer a better way to buy and sell homes.