Refinance: The Road to Recovery?

by Michael Shohoney January 7, 2009 07:37

With interest rates at near-historic lows is a refinance boom on the way and will that wave be enough to mend an ailing industry?  That is the $64,000 question (seems a little under-priced doesn't it?) these days.  I have always believed that the mortgage industry is a self-healing industry and that refinance waves are often the beginning of the healing process.  The wounds suffered during this past (and current) crisis are certainly more mortal than those that we've seen in the past.  However, the industry can still recover from them.  How?  By sound lending to what have been reliable customers.  There is a real opportunity out there for existing mortgagors to lower payments and pay off loans with shorter terms.  These refi's can be the foundation of the rebuilding of the secondary market.

How do we go about that?  I have always believed that mortgage lenders have under-marketed themselves to their established borrowers.  Well, now is the time to approach those people with this opportunity and, in turn, boost your volume and generate business.  Out of this new opportunies will spawn.  It may not be the cure-all but it is certainly one way to begin the healing.