Posted by KimmyMD on 7/8/13 11:28am
Msg #475920
The future
Hello, any guesses what the industry might do? I know I don't have a crystal ball, how much longer will the refinance market last? I have had my best two years since being in business for almost 7. What say you?
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Reply by JanetK_CA on 7/8/13 1:58pm
Msg #475939
You started a bit before the "mortgage meltdown", but things were already beginning to slow down. The past 1.5 - 2 years reflected a bit of a boom, with very low interest rates and a frenzy for people to take advantage of that situation. That opportunity involved a very wide swath of the market, since nearly anyone who owned a home and could still qualify for a mortgage, took advantage of the chance to reduce rates or term, etc. HARP, and other programs pulled in others.
Many people refinanced more than once, as rates continued to decline. The last 6 to 18 mos or so, we saw the stragglers rushing in to get it done before it was too late, in anticipation of rates going up. Over the last few weeks, we've finally seen interest rates take what might be considered a bit of a leap, and refi activity in the pipeline has been greatly reduced. If someone has a 3.8% interest rate locked in with a fixed rate loan, why would they refinance to a higher rate? Not likely, unless they have to move or decide to sell for other reasons, or we see a return to people pulling cash out of equity as property values start to go up. (Some never learn...  )
We're seeing purchase activity rise and the pent up demand there will likely fill in some of the decline in refi activity, but overall, I don't expect it to return to the levels we've seen in the past. This is a very cyclical business. IMO, as interest rates rise, our business, overall, is likely to slow dramatcially. I think there will be some dips on the way up which might generate additional activity here and there, but that could be just little blips in the over all picture.
Frankly, as our economy continues to improve (hopefully), this might be a good time for some notaries to consider finding a full time job with regular pay and benefits. Lots of previous forum members did just that after the last slowdown. I think that would be especially true for anyone just trying to get started in this business or who isn't already fairly well established, unless they have significant financial reserves available.
I hope I'm wrong about this, but the trends seem to be bearing out this theory. In the meantime, perhaps the best answer to your question lies in watching the interest rates and reading as much as you can about what's happening in the industry. But *none* of us have a crystal ball, including those who write about this topic! 
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Reply by BevTX on 7/8/13 8:04pm
Msg #475989
I don't know what it's like where you are, but in Texas if you refinance your current home you are required to buy a whole new title insurance policy. Those aren't cheap--but they are through the title companies and the rates are regulated through the state. Even as a realtor I still don't see why the existing title policy already in place isn't good enough, but that's how title companies make their money. I am not familiar with the HARP program. Can you explain that?
I do know that all of those bazillions of foreclosures that were illegally robosigned are about to come on the market finally. I got an email today at my Remax office inviting me to a webinar to get on the list to list those properties. Say the property is in Austin, but the lender is in Florida and they have to have a certain title company that is not in Austin. They'll be needing us for those.
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Reply by Linda_H/FL on 7/8/13 9:39pm
Msg #476014
"I still don't see why the existing title policy already in place isn't good enough, but that's how title companies make their money"
Because the existing title policy insured the other lender for the other loan. Each new lender (even if same lender) requires their specific loan be insured. There IS a discount for re-issues - mortgage title policies aren't as expensive in a refi as they are in a purchase, first time ever mortgage.
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