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24 | TH E M R EP O RT FEATURE out of balance with profitability and loan volume, while larger firms can benefit from economies of scale. Smaller firms need to de - termine whether or not they have the money to invest in building the staff and internal systems necessary to compete with bigger, more-established lenders. Does the firm have the management capa - bilities and resources to succeed in today's competitive market? 03 Purchase Business Will Remain Strong P urchase business will con- tinue to dominate the market in 2018. The MBA is predicting an increase in purchase business in 2018 and a drop in refinances. They anticipate $1.2 trillion in purchase-mortgage originations next year, which is a significant increase from 2017. The challenge will be inven - tory shortages in major hous- ing markets across the country. Housing demand continues to outweigh supply, and new con- struction hasn't been able to keep up for years. I don't see this trend changing any time soon. With demand continuing to drive up the cost of purchasing a home and rising rates keeping many would-be buyers on the side - lines, affordability challenges will continue. In many cases, it will be more attractive for homeowners to upgrade the house they're in rather than reinvest in a new home. 04 Cash-Out Refinances an Attractive Option A s upgrades and renova- tion projects become more attractive, more homeowners will look to tap into their home's equity. Lenders will begin to offer programs targeting those looking for a cash-out refinance option specifically for a home renovation or similar project. We're going to see second mortgages and construction loans become much more prevalent for those looking to upgrade their homes in 2018. We've heard from many of our current customers who are planning to renovate their homes, add solar panels to save on utility costs, put in a pool, or redo the kitchen. For many, investing in these upgrades makes more sense than purchasing a new home at current rates. 05 Attracting Talent, Establishing Future Success W ith the mortgage industry growing more competi- tive, we will continue to see an emphasis on attracting top talent. Further advancements in technol- ogy and compliance systems at bigger firms will make running a business easier and more efficient for loan officers, allowing them to spend more time managing their pipelines and closing loans. The ability to allow loan offi - cers to focus on their relationships and sell more homes will be a key differentiator. Larger firms with the capacity to invest in the right tools and in back-office support will have a distinct advantage. These lenders will be positioned to pair experienced loan of - ficers with industry knowledge, proven sales skills, and estab- lished relationships with younger professionals who have the tech- nology know-how, but may still need to learn the business. This type of relationship will benefit everyone and allow more loan officers to provide the ideal high-tech, high-touch solution that customers are looking for. Each individual brings a unique skill set to the table, allowing teams to learn and benefit from each other. Pairing experienced salespeople with new talent helps provide the best possible service to the customer. With rising interest rates, short inventories, and more competi - tion for every loan, lenders will be required to come up with creative offerings to differentiate themselves. Some will turn to technology, believing that more tech-savvy customers are looking for a completely digital solution. Others will develop unique prod - ucts to target certain segments of the market. The mortgage industry remains a people business. Many pur - chase buyers—especially first-time homeowners—want a streamlined process backed by skilled loan officers ready to answer any question and solve problems. Experienced loan officers who connect on a personal level and are committed to finding the right solution for each customer will stand above the competi - tion, helping more people get into homes and stay in their homes, and becoming key contributors to the growth of any mortgage lender. MARY ANN MCGARRY is president and CEO of Guild Mortgage and has been a member of Guild's board of directors since 1988. She was named president in 2005 and CEO in 2007, when she led a management buyout of the company from its founder. She leads the development and execution of the company's strategic plans and objectives, and has been one of the driving forces in formulating and executing Guild's financial, operational, and technology strategies. "Those that can find the right balance between technology and superior customer service will be well positioned to serve the needs of more homebuyers across all generations and create customers for life."

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