Redfin enters mortgage business, hiring advisers
Real estate brokerage Redfin has launched a mortgage lending business and expects to start originating loans in the first half of 2017.
The company says its ultimate aim is to offer a fully-digital service which it says will drive down costs. The lending service will only be available to those buying homes through the company and will initially only be available in Austin, Dallas, Houston and San Antonio markets.
The new mortgage business is being led by Jason Bateman, former executive VP of mortgage operations at BBVA Compass. The firm will hire its own mortgage advisers.
Redfin says that there will be no incentive for its real estate brokers to recommend one of the firm’s mortgages and it will continue to work with other lenders.
The new mortgage arm will not offer refinance mortgages or loans for those buying through other agents, however this could change later.
Even hottest markets can be relatively affordable
The US housing markets where homeowners have the largest mortgage burdens can still offer some relatively affordable options according to Zillow.
One example is metro San Jose one of the most expensive parts of the country, where buyers in Palo Alto can expect to pay 75 per cent of their income on a house payment. But just 15 miles away in Milpitas buyers would need 35 per cent of their income for a median home.
"The Bay Area and other expensive West Coast markets get a lot of attention for being unaffordable, but even they have some areas where the share of income spent on housing is relatively low," said Zillow Chief Economist Dr. Svenja Gudell.
"Of course, buyers have to be willing to make some trade-offs to live in more affordable cities within the metro. Some cities in the most in-demand housing markets across the country have such a high housing burden that they are simply not feasible for buyers with lower incomes. If income growth doesn't keep pace with home value growth, especially as mortgage rates rise, inequality will persist."
Zillow’s analysis shows that the benefits of a wider-net home search has less impact in less-heated markets. For example, Kansas City buyers will spend between 7.3 per cent and 13.2 per cent of their income on home payments wherever they buy in the metro.
Black Knight closes out record 2016 loan processing on schedule
Mortgage tech firm Black Knight says it closed out 2016’s year-end processing for clients on schedule.
With a record of nearly 45 million loans for 67 servicers, including millions of mortgages, the firm reported that all processing was completed by early morning on New Year’s Day 2017, allowing servicers to complete their reports for IRS and other agencies without delay.