Caught our eye: WSJ says Homeowners Ditch Refinancings as Mortgage Rates Rise

Lenders turn to home-equity loans, adjustable-rate mortgages amid fears of falling home-purchase activity

Many lenders over the past few years have found themselves caught up in a "race-to-the-bottom" where technology and the "lowest rates" were king.  This is a side-effect of a booming refi market that finally appears to be drying up.  So what do lenders do now? 

This WSJ article details some efforts many are taking - at least at a high-level.  Some are scrambling with more "exotic" loans types while others are repositioning themselves to get back to a traditional purchase operation.  The challenge is that the infrastructure now in place - from systems, to 3rd party lead generation, to even the types of loan officers in place - are still in the quick and easy refi mode. 

To sell a new purchase loan is entirely different.  It takes longer (no matter how good the technology) and requires a different skill-set built on trust and value to the customer.  Pushing fair rates is only one piece of the equation.  The rest lies in the perceived value to each individual homeowner.  When they are making an almost entirely emotional decision to purchase a home, they need to feel confident in that decision especially in today's market where they are overwhelmingly concerned about buying too high and inventory is low.  They need to know that you are helping them make the right decision and that begins by simply offering products that actually help them - like down payment protection. Whether they take it or not, offering buyer-centric products builds trust and a deeper relationship with a potential borrower or business partners. 

So, while other lenders focus on themselves pushing short-term, stop-gap ideas like no-appraisal loans, HELOCS or ARMs to try and get customers, you can stand-out in a crowd and build a strong, differentiated base of buyers and partners to get you ready for the post-refi mortgage cycle.