Setting The Stage

TheMReport — News and strategies for the evolving mortgage marketplace.

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Th e M Rep o RT | 31 O r i g i nat i O n s e r v i c i n g a na ly t i c s s e c O n da r y m a r k e t ORIGINATION the latest ORIGINATION Finding Opportunities in Home equity CoreLogic's chief economist examines where loan demand will come from in the near future. W ith mortgage ap- plications down more than half from last year's figures, lenders might be better served in the year ahead by home equity loans, says Core- Logic's chief economist. In a blog post, CoreLogic's Mark Fleming notes that as of the most recent numbers, mortgage applications are down 54 percent compared to a year ago, with much of that decline stemming from a plunge in refinances, which are down 65 percent year-on-year. However, while rising inter- est rates have removed some of the incentive homeowners had to move or refinance, improving home prices have created a greater space for home equity loans. "When homeowners decide they want to increase the utility they receive from their shelter, they can choose to either sell their existing home and buy a bigger home, refinance their entire mortgage and get 'cash out' to do home improvements, or get a home equity loan or home equity line of credit (HELOC) to pay for home improvements," Fleming said. "In a rising interest rate environment, the first two options are more expensive, as the cost of borrowing increases for even the original loan balance." As prices and interest rates con- tinue to rise, lenders with the right mindset stand to benefit, he adds. "This is good news for the home improvement industry and mortgage lenders who focus on home equity lending, as both will benefit from the resurgent consumer demand." mortgage returns launches spring Purchase Program The company seeks to equip lenders ahead of the spring shopping season. i n St. Louis, Mortgage Returns announced the launch of its Spring Purchase Program as a way to help lenders boost loan volumes and referrals during the upcoming busy season. Developed in response to in- dustry forecasts of lower volumes for 2014, the campaign aims to provide lenders with the tools and capabilities to thrive in the purchase market by filling their pipelines with leads. Incorporated in the program are two postcards and a three-touch email campaign to customers, prospects, and refer- ral partners. Also provided is a referral card for recipients to give to family and friends. "This initiative expands on the program we offered last year, in which our clients utilized a one-touch direct mail piece and achieved an average ROI of 540 percent," said Mortgage Returns CEO Jim Blatt. "We expect even better results this year as we have increased the marketing frequency and look forward to assisting loan originators with their marketing efforts in their communities." According to Mortgage Returns, the Spring Purchase Program is part of the company's TRUE CRM (customer relationship man- agement) concept, "which trains lenders to increase the effective- ness of marketing campaigns and strengthen relationships with customers, prospects, and referral partners to drive revenue and profitability."

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