What did I learn prepping for, and moderating, the Lender panel at the CMBABC annual conference last week?

One topic; rates

There’s a range of expectations among lenders, and this range is somewhere between a decrease in Prime of 0.75% to 1.25% by the end of 2024.

So the average expected cut is 1%.

Optimistic?

I will let you be the judge, as you should consider allowing your clients to draw their own conclusions as well.

One thing worth noting about every estimate above, there are multiple ‘*’ next to each.

In other words, ‘nobody knows anything anymore‘, not for sure.

Another topic; additional policy change

The changes keep coming, most notably discussed with the 450% Loan-To-Income cap which nobody, including the regulator, knows how exactly will be implemented or what the true ramifications will be.

How will income be defined?

How will ‘total loan(s) be defined?

Nobody knows yet, but there’s 180 days to work it out.

Final point (from me today)

There was a consensus that the quality of applications, and the quality and speed of submission of supporting documents, must go up… as the cost of underwriting a (funded) file continues to go up, mainly due to the volume of unfunded files.

Unfunded because well, we can do better.

In other words, many challenges lay ahead on multiple fronts – with no clear solutions to any.

The bottom line; in chaos there is opportunity.

Expect abundant opportunity ahead.

DW