Today is my birthday – number 45, to be precise – and I am going to be spending the day at the Mortgage Bankers Association (MBA) Annual Convention in San Diego. At my age, birthdays are the ultimate affirmation of a good life. Hey, I made it through another year – and every year above ground is a good one!
While the mortgage industry doesn't have an official birthday of its own, the MBA convention can be considered something of a de facto celebration. And the industry shares my reason for celebrating: another year has passed and we're still here.
Admittedly, the industry is not as robust as it had been in previous years, and the next 12 months offer a great deal of uncertainty. There are too many unanswered questions that keep the industry in a state of anxiety.
The next 12 months will be just as hard as the previous 12, and maybe even harder, if foreclosure rates spike and unemployment fails to return to acceptable levels. I think it is impossible to embrace Federal Reserve Chairman Ben Bernanke's recent observation that the recession is nearly over. We cannot fool ourselves into thinking that the seeds of recovery are already producing a new harvest of opportunity.
There is also the fear that the federal government – which has been propping up both the industry and the wider economy – is going to have new troubles with the Federal Deposit Insurance Corp. and the Federal Housing Administration. Both agencies are showing signs of acute stress, and the prospect of new bailouts won't fly with a general public that is already antsy over the perceived lack of results from earlier interventions.
However, birthdays are supposed to celebrate good things. So while we cannot ignore the many problems, we need to pause and consider the many positive things around us.
For those who are still working in mortgage banking, having a job is a cause for celebration. There are parts of the industry where hiring is still happening, albeit mostly on the servicing side.
And there is a good reason why these people are still working: There are borrowers who are still eager to seek out mortgages. Today, housing is a buyer's market – and the loans being written today are among the strongest in the history of our industry.
This leads us to another reason for celebrating: An increased emphasis on responsible business practices. When the industry recovers – and it will, of course – it is going to operate with a greater efficiency in regard to due diligence, quality control and risk management. Admittedly, many of our problems were the result of self-induced sloppiness. But those haphazard days are behind us.
Furthermore, we can celebrate that the industry's leadership is working hard to bring about recovery. Lobbying efforts against the proposed Consumer Financial Protection Agency and industry-driven initiatives like The Warehouse Project are signs of active leadership. Even in the troubled jumbo mortgage, where the government-sponsored enterprises are not helping and the private-label market is comatose, the industry is helping its own, as several larger institutions are actively buying jumbo loans from smaller banks.
So while I am enjoying my birthday today, I am also enjoying an industry that continues to function and is working hard to get back on its feet. So when my next birthday comes around, hopefully we can all enjoy an even larger slice of cake!
– Phil Hall, editor, [b][i]Secondary Marketing Executive[/i][/b]
[i] (Please address all comments regarding this opinion column to email@example.com.)[/i]