Is technology changing the economics?

Each installment of this series has opened with the 30-year mortgage rate higher than the one before it. This week was no exception. Freddie Mac reported that the 30-year fixed-rate mortgage averaged 7.03% as of September 24, up from 6.95% the previous week and 6.30% a year earlier. Our first article, published four weeks ago, quoted 6.66%. In its mid-September forecast, the Mortgage Bankers Association trimmed its projection for single-family mortgage origination volume as Treasury yields rose and inflation stayed elevated. We’ll keep this last article before the HW Mortgage Summit on October 1 in Dallas data rich. Because data and agentic AI will drive cost downward over the next 2-3 years. The question for our fifth installment: Is technology changing the economics? Hell, yes! Just ask the tech providers. “Sun West puts its cost to originate a loan below $150…using AngelAI.”1 A major LOS provider states its system results in an average of $1,056 increase in gross profit per loan.2 A POS states its system increases profit by $914 per loan.3 These numbers remind us of automobile EPA gas-mileage estimates. “Your results may vary.” Across the industry, the cost to originate remains ...