Redefining Lending: A Changing Industry

By Victor Ciardelli

In the last three years we have witnessed an unprecedented amount of change for the mortgage industry that will redefine real estate lending as it enters a new era. New policies and regulations being put in place will protect borrowers, improve documentation and enhance customer service and transparency. Homebuyers today have strong credit and high equity, and loans currently being made can be expected to have outstanding performance as the economy recovers. With the housing market stabilizing, great opportunities abound in numerous areas.

Mortgage rates are also currently at all-time lows. Since early 2009, the Federal Reserve has been purchasing mortgages at an aggressive pace to increase lending liquidity and drive down the cost of financing. The Mortgage Bankers Association surveyed on Oct 13th that 30-year fixed mortgages were being offered at an average rate of 4.12 percent, their lowest survey on record. Housing affordability is the best it has been in a generation, which is only good news for prospective homebuyers.

Recent changes in the industry can be readily seen at the borrower level. The origination process has changed in order to protect the interests of borrowers and protect against the originating of fraudulent loans. These changes span from the manner in which appraisals can be ordered, to the method in which disclosures are delivered to borrowers, to regulating how and when borrowers must be contacted about critical changes to a loan. There has also been an overhaul of nearly every document provided to borrowers to describe loan terms in a clear and accurate manner throughout the entire origination process from loan application to closing.

As we look toward 2011, we expect there to be additional regulatory and legislative changes that will require further adjustment in the lending industry. Several provisions of the recently passed Wall Street Reform and Consumer Protection Act are directly applicable to the residential lending industry. Most of these changes will likely continue to make the lending process simpler and more understandable for borrowers. Despite all of the volatility our industry has experienced in recent years, there is one thing that will probably never change: Housing in the United States will always remain closely tied to the American Dream and mortgage lending will continue to play an integral part.

Guaranteed Rate is well positioned in the marketplace to meet the new demands of the industry. With over 1,200 employees and 70 branches nationwide and funding more than $800 million a month in loans, the company has the financial strength, manpower and flexibility to meet the constantly changing lending landscape.

Victor Ciardelli III is the CEO and president of Guaranteed Rate.

  • Dominic Mancini says:

    Great article Victor.
    With all the new changes in the mortgage industry and the stricter underwriting standards affecting borrowers and lenders, it seems that the loan processing and loan approval is taking a lot longer. It is a pleasure to work with a lender that is knowledgeable about all the new consumer disclosure requirements so that the closing can occur in a timely fashion. As an Illinois attorney, I can honestly say that I have never had to postpone a closing because Guaranteed Rate did not do their job. The money has always been at the closing table on time and this is a credit to you and your organization. Congratulations on a well run and prosperous company.
    Nice picture too but the beard has to go.
    Dom Mancini

  • Victoria says:

    Working for Guaranteed Rate is exciting in these challenging times for borrowers, lenders and loan officer but I have to say that Guaranteed Rate takes care of their employees and has a great system in place for new opportunity! Way to go G-RATE!

  • Sheila Mitchell says:

    Guaranteed Rate is a terrific company to trust with your purchase, refinance, construction, or Fha loan. I have been in the industry for over sixteen years and really appreciate working with a company that is responsive to the customers needs. Call me if you are looking for a loan in Minnesota. 952-646-1213.