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M R EP O RT | 33 EXPERT INSIGHTS refi business is still out there to be done. We finished last year near $4 trillion in originations, which is a record, higher than 2003. You also have the Fed, doing everything it can to try to keep the economy afloat and rolling through this process. If we can come up the other side in a positive way, the challenge will be in determining how much of the business do you want to pivot towards more private product, more credit-related product? And if you pivot too early, you might miss the interest rate product. There are decisions that need to be made from a staffing perspective and from a strategy perspective. If you want to hedge it a little bit, you will not get the maximum, but you also won't have as much of the downside. M // What are some of the factors that go into managing those decisions and trying to navigate an unpredictable market? FILKEY // Interfirst has a different problem than the industry, because we're scaling and growing, and we can take market share. We can still grow into the space, regardless of which direction it goes, based on our low-cost business model and recent re-entry into the space. But if you're a typical big lender, and you've got more employees than you've ever had before, you have to start to determine, especially at the cost basis that you brought those people in, how do you keep them satiated? Are you going to let margins tighten up, as the industry margins tighten up? Are you going to invest in tech- nology? Are you going to pivot and save your tokens for a rainy day? Are you going to double or triple down to try to take up market share for the next refi wave? There are just different perspectives, depending on where you are in this universe. Are you massive already, hitting record numbers? Or are you growing and trying to figure out how you're going to fit in the 2.0 version of the refi wave? M // What should lenders be prioritizing this year? Are there areas of untapped potential that you're seeing? FILKEY // From my perspective, if you look at heavily regulated industries in general, you normally see very large market share by a handful of players. Take insurance or banking, for example. The mortgage industry has gone through a lot of changes for banking and nonbanks. So, the question is, will there be consolidation within this industry that looks more like other heavily regulated industries? If you believe that's the case, are you investing for the long haul to make that happen? The opportunities available within this universe … it's one of the last manufactur- ing bastions where you don't have a tre- mendous amount of technology applied in order to reduce the cost dramatically. And there's a compliance aspect of this, which has raised the cost of producing loans, which is quite different than manufactur- ing nails or something to that extent. But there is a tremendous opportunity from a consumer perspective. The dynamic of our consumer is changing; they're looking to engage with lenders in a technological fashion. The old business model of heavy sales commissions, agents controlling the purchasing process, and which lender gets that loan—those are changing now. Borrowers want to know how much they can spend beforehand, or they want to pre-qualify before they go off to pur- chase a home and many of them want the tools to determine it themselves. So, there are a lot of ways for forward-thinking originators that want to try to grasp what the wave and the future will be. Anywhere. Anytime. MReport Digital Bringing Today's Lending Headlines into Focus, MReport Digital Puts Mortgage Banking News at Your Fingertips Experts you trust. People you know. News you want. MReport is putting essential mortgage market news at your fingertips with our new digital edition, now available online via your smartphone, tablet, or computer. Enjoy the magazine at your desk, and tap into MReport Digital's easily accessible platform anywhere, anytime. Committed to giving originators, servicers, and all lending professionals access to smarter perspectives, MReport believes it's time to think differently about the mortgage industry. Because the American Dream is evolving . . . are you? Subscribe to MReport and MReport Digital now! Call 800.856.8060 or connect with us online at themreport.com to take advantage of our special introductory offer! digital.themreport.com powered by THEFIVESTARINSTITUTE There are decisions that need to be made from a staffing perspective and from a strategy perspective. If you want to hedge it a little bit, you will not get the maximum, but you also won't have as much of the downside.