As a lender, there’s no sure-fire way to know exactly what the mortgage market will be like a few months or even a year from now. Your best chance to make sure your business keeps going when rates go up is to prepare your clients for those higher mortgage rates. That way, they won’t be taken by surprise when they have to pay more.
Communicate with Your Clients
Since mortgages rates are dynamic and change regularly, lenders should keep borrowers and prospects informed of any major changes in the industry or market that might affect interest rates. Housing inventory is still slim and thus causing home prices to inflate.
Keep in contact with possible leads at all times—especially when the market is volatile. One percentage point can mean borrowers will have to spend thousands of dollars more to obtain financing. It will also increase the interest the borrower pays during the total life of the loan.
Clients Should Refinance Sooner Rather Than Later
Mortgage rates have been slowly but steadily increasing over the last year. If your clients own a home and they haven’t refinanced yet, it might be too late. This is not to say that your clients cannot refinance, but the opportunity was better about a year ago to do so.
If you have borrowers who are eligible and would like to refinance, make sure they do so sooner rather than later. There is no time to wait because mortgage rates will most likely rise soon. It’s important for you to urge them to act right away before rates change or increase. Acting fast will allow them to get the current, lower rates.
Inform Business Partners of Market Changes
Make sure your referral partners are also aware of changes in the mortgage market. They need to know what mortgage rates are like just as much as you do as it will help them with their business while improving yours. By keeping them informed, they will be able to give accurate information to their clients.