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TH E M R EP O RT | 19 COVER STORY enables multi-party communica- tion and real-time collaboration will prove to be the industry's best defense against cybercrime, and must be adopted sooner rather than later." A Shift in the Market I n the past, the industry has experienced several significant changes in the marketplace that will require more attention from lenders in 2018. Ray Brousseau, President of Carrington Mortgage Services, LLC, said that the days of simple "rate-and-term" refinancing are largely a thing of the past. Interest rates have dropped as much as possible, and there is a shift from refinancing to consumers taking advantage of the increased appreciation in their homes and cashing out. "Second, we've experienced a very slow shift in the willing- ness of lenders to help distressed or borrowers with credit chal- lenges," said Brousseau. "The overall market has been slow to respond to them and demonstrate its willingness to work with this underserved market." Dan Hoppes, SVP at Assurant Mortgage Solutions, said market valuations have shifted dramati- cally in the past five years. "Coming out of the mortgage crisis, there was a high degree of regulatory focus on all parties, including appraisers and appraisal management companies (AMCs)," Hoppes said. "Add the changes to closing a loan with regards to TRID, and the industry had a lot of change to digest in a very short time period." There is still a high focus on the regulatory environment, but now that everyone is gaining a comfort level with most of the increased requirements fostered by Dodd-Frank, the focus is moving toward innovation and efficiency. Not everyone agrees with the comfortability of the increased requirements. Anderson said he is hopeful that he will see a bit of moratorium slowdown in the number of major regula- tions to provide the industry some breathing room. Major regulations include: Qualified Mortgage (QM), TILA-RESPA Integrated Disclosure (TRID), Home Mortgage Disclosure Act (HMDA), and Uniform Closing Dataset (UCD). Additionally, Matt Woolley, SVP of Sales with LoanLogics, zeroed in on one aspect of the mortgage industry he would gladly leave behind in 2018. "In a word, overregulation," Woolley said. "Under the current administration, we look forward to the elimination of burdensome lending regulations that added costs to loan production, yet did not provide consumers and inves - tors with any concrete benefits." Forecasts for 2018 also include looking forward to more of a pur- chase home loan market versus the heavy percentage of refinances experienced over the past several years. "Although many companies continue to survive on these refinances, a successful housing and mortgage market cannot be sustained by an overabundance of refinances," said Woolley. "Refis artificially bolster the economy with a short-term boost from the extra cash homeowners realize after refinancing." Will Fisher, SVP, National Sales and Marketing Director of Citadel, said the market will expe- rience a "sea of change" in the type of borrower that is available to purchase or refinance. "This will be due to two fac- tors: the first, increased inter- est rates," Fisher said. "Second, government intervention, with potential changes to the tax code and housing regulation." However, a sustainable and successful housing market and economy are based on a strong home-purchase market—and Woolley believes the industry should start to see a stronger pur - chase market in 2018 and beyond. Tom Hutchens, SVP at Angel Oak Mortgage Solutions, antici- pates 2018 to shed light on win- ners and losers emerging from the refinance cliff. "We have already seen refi- nance volume dry up as rates rose throughout 2017," Hutchens said. "Lenders who prepared by adding additional purchase products have been successful in attracting new customer bases. However, those who did not diversify their prod- uct offerings will face challenges in 2018 and beyond." The expected rise in interest rates may reduce refinancing ap plications and also drive competi tion in the market, potentially resulting in decreased margins for lenders. Seth Kronemeyer, Vertical Marketing Leader, Equifax Mortgage & Housing, says prepa- ration is paramount. "Mortgage lenders should develop their DE- REGULATION ON THE HORIZON "Among the biggest market challenges in 2018, housing professionals will have to address building new lending products to reflect changing borrower needs. We see hints of this already with work being done on improved reverse mortgage products and introduction of new equity products." — Joe Dombrowski, Director, Product Management, Fiserv

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