Sales Boomerang released its inaugural Mortgage Market Opportunities Report (MMOR) for the second quarter of 2021.
The MMOR uses Sales Boomerang system data to identify market opportunities relevant to today’s borrowers and lenders. The company reviewed data from more than 125 residential mortgage lenders that use its borrower intelligence and retention tools to monitor millions of customer and prospect records, then calculated the aggregate frequency with which those contact records “triggered loan-opportunity and risk-and-retention alerts during the first and second quarters of 2021.”
Loan opportunity alert types included were
- Mortgage inquiry alerts, where a customer or prospect has shopped with a competitor in the last 24 hours (5.87 percent of monitored contacts, down 33.97 percent quarter-over-quarter).
- EPO alerts, where a customer or prospect whose loan closed six or less months ago has shopped with a competitor in the last 24 hours (2.43 percent of monitored contacts, down 24.3 percent from the first quarter of 2021).
- Credit improvement alerts, where a customer or prospect has improved their FICO score (2.2 percent of monitored contacts, up 41.94 percent).
- New listing alerts, where a customer or prospect has listed their home for sale (1.37 percent of monitored contacts, up 163.46 percent).
- Equity alerts, where a customer or prospect’s home equity has increased (8.55 percent of monitored contacts, down 0.7 percent).
- Rate alerts, where the interest rate of a customer or prospects existing mortgage is significantly higher than current prevailing rates (13.33 percent of monitored contacts, up 31.85 percent).
The MMOR also included the frequency of risk-and-retention alerts for a subset of lenders maintaining servicing portfolios. This alert, which occurs when a customer is engaging in one or more of 15 credit activities that may put their serviced loan at risk, was down 5.69 percent from the first quarter of 2021, showing a total of 36.63 percent of monitored contacts.
The analysis of these numbers indicated the market may be seeing the first signs of the purchase market’s reawakening, the company stated. Sales Boomerang CEO Alex Kutsishin said the data from the report also showed a different trend for refinances than previously thought.
“Industry experts have been pushing the idea that the refinance market has dried up since early 2021, but our data shows that plenty of borrowers still have the opportunity to improve their rates,” Kutsishin said in a release. “Meanwhile, the housing inventory shortages that have stymied the purchase market’s potential may finally be turning a corner, as our customers saw significant gains in new listings in Q2.”
Despite refinance opportunities continuing to produce results, the decrease of mortgage inquiries quarter-over-quarter indicates lenders may need to proactively reach out to potential refinance customers who are not shopping for rates with the same enthusiasm as they were earlier this year, the company stated.
The risk and retention alert results, Sales Boomerang continued, may be partially because of the sensitive nature of the alert, which can be triggered by any of the 15 consumer behaviors that place a borrower in danger of missing a mortgage payment, but the frequency of the alert also underscores the nation’s uneven economic recovery post-pandemic. In light of this finding, Sales Boomerang recommends mortgage servicers closely manage their default and foreclosure risk in the coming months.