NMP - December 2016 - 8
How High Can
Non-Agency Lending Fly
in 2017 and Beyond?
By Tom Hutchens
ne hundred billion dollars-this is the total
loan volume the non-agency mortgage
market could reach in the near future,
according to many experts in the space.
When this will happen is still unclear, but
tailwinds driving supply and demand for
these products continue to encourage non-agency loan
Non-agency loans today are a far cry from the relics that
led to the 2008 financial crisis. Today, the average FICO score
of a non-agency loan is 680, up from 580 in 2006. Nonagency loans also require a 10 to 20 percent downpayment in
2016, as opposed to the loans provided without any required
downpayment a decade ago. For more info on this, check out
our recently published White Paper, "A Closer Look at the
New World of Non-Prime" at
As you can see in the chart below, rising mortgage rates
will cause purchases to grow as a portion of total originations.
With refinances disappearing, lenders will turn to non-agency
loans to replace that volume.
The potential for continued non-agency market expansion
is sky high. While the $100 billion figure may not be reached
next year, we expect 2017 to see significant growth in the
non-agency arena as demand for and awareness of these
DECEMBER 2016 n National Mortgage Professional Magazine n
Tom Hutchens is senior vice president of sales
and marketing at Angel Oak Mortgage Solutions,
an Atlanta-based wholesale lender currently
licensed in 33 states. Tom has been in the real
estate lending business for nearly 20 years. He
may be reached by phone at (855) 539-4910 or
Be a Teacher, Not a Salesman
BY ANDY W. HARRIS, CRMS
f you haven't realized it yet, most people don't like to be sold or
"uncomfortably influenced" into making important financial
decisions. For those of us in mortgage and real estate, we don't
want to get caught up in selling someone into taking on debt.
Instead, we want to educate and "comfortably influence" our
clients in making the wisest financial decisions when ready to
buy. Understanding this can be a goldmine in marketing as an expert
and teacher to others. Your behavior as an educator relays the best
intentions to those seeking your services and your motivation for
what you do.
Most are not aware of how they may come across to potential
clients when communicating. It is vitally important that you seek out
colleague and client feedback to have perspective on the experience
consumer's face when interacting with you. It is easy to become blind
or immune to your own actions over time or if your responses could
use some improvement. Spend time listening to others on the phone
and in meetings. Do they sound like an Internet call center trying to
make a deal, or a legitimate professional seeking to educated and
support the best interests of their clients?
Make sure not to assume the consumer already knows something
that they may not. This is a common mistake by many professionals
who are immersed in day-to-day business activities. Be cautious on
terms used without explanation, not taking time around details, and
listening more than you talk. The more you understand the client's
needs, the better prepared you will be to teach them the best course
of action. When you teach them the best course of action, that
course usually involves you as the driver.
Teaching can be done at or before meeting a potential applicant.
You can simply embrace teaching as a primary form of marketing
through articles, blogging, in marketing messages, your Web site,
etc. Consumers are attracted to professionals who educate them
rather than selling them. It's a feeling of 'wanting' the business,
versus 'needing' the business. I personally believe the lower the
production, the higher the emotions and desperation to sell versus
educate. Get more production through education and grow your
business in 2017 and beyond.
Andy W. Harris, CRMS is president and owner of Lake
Oswego, Ore.-based Vantage Mortgage Group Inc. and
past president of the Oregon Association of Mortgage
Professionals. He may be reached by phone at (877) 4960431, e-mail AHarris@VantageMortgageGroup.com or visit