December 15, 2022

Still Fighting for Every Deal? Here’s How to Get an Edge in 2023’s Last Quarter

Insights
Issues Facing Originators

Updated October 10, 2023

This is an updated version of a December 2022 post. The audio has not been updated.

Rates Up, Inventory Down, Competition Fierce — MI Is Your Ally

This year’s series of rate hikes mean that budget-conscious borrowers are hyper-focused on the best deal. Other would-be homebuyers are feeling shut out of the market altogether. What are your strategies for reaching out to these valuable customer segments as 2023 comes to a close?

Arch MI offers two resources to help you compete effectively on rates and enable first-time homebuyers to purchase with lower down payments.

Discover the Deal Saver

Win the interest-rate wars with RateStar BuydownSM. When borrowers are aggressively shopping rates and yours isn’t the lowest available, you need all the flexibility you can get to save the deal.

RateStar Buydown is an innovative tool that gives lenders the ultimate flexibility — by creating options that benefit borrowers as much as a lower interest rate. You can customize a lower MI premium for each borrower using RateStar Buydown’s easy slider tool:

  • Buy down the MI premium using a gift, grant or homebuyer funds.
  • Lower the PITI to mitigate a slightly higher interest rate.
  • Allow more loans to meet DTI requirements for GSEs’ AUS approvals.

Eliminate potential dealbreakers and close more loans with RateStar Buydown, the Deal Saver. Attract new homebuyers and strengthen existing relationships with your borrowers by logging onto the RateStar Portal to show them the different MI scenarios that can help save them money over the long term.

RateStar Buydown is an innovative tool that gives lenders the ultimate flexibility — by creating options that benefit borrowers as much as a lower interest rate.

Explore Low Down Payment Options with MIHome from Arch MI

Down payments remain a major hurdle that discourages many renters from becoming homebuyers — even though the amounts involved are more manageable than they think.

In a 2022 LendingTree survey, 81% of respondents who’ve never owned a home said they are “stressing about saving for a down payment.”1 Adding to their anxiety, 41% of non-homeowners believe lenders require down payments of 20% or more — far above the 7% actual average down payment for first-time homebuyers.

Marketing affordable mortgages with extremely low down payments to this group is the way to win their business. You can structure the loans with mortgage insurance and the flexible options available with MIHome from Arch MI.

When you insure eligible loans with Arch MI, you can approve down payments as low as 3% of the purchase price. When you insure them with Arch Mortgage Guaranty Company (AMGC), homeownership is possible with even lower down payments. In many cases, a low down payment means renters can become homebuyers using only their existing savings.

1 LendingTree survey, July 2022. 41% of Americans Who’ve Never Owned a Home Believe 20% Down Payments Are Required — And It Could Be Holding Them Back From Homeownership

Affordable Down Payments Add Up to Approvals

Comprising our full range of solutions, products and resources aimed at helping you structure and insure low down payment loans, MIHome from Arch MI has everything lenders need to attract, originate and close this valuable purchase business:

  • Flexible Arch MI guidelines that work with down payments as low as 3%; gifts and grants allowed.
  • AMGC Community Programs allow 1% and even 0% down payments for eligible borrowers; gifts and grants are allowed.
  • Competitive MI pricing with RateStar® and customized premium payments with RateStar Buydown.

Nationally, the median rent for two-bedroom apartments was $1,948 in August — 26.4% higher than in 2019, according to Realtor.com’s Rent Report. MIHome gives you the tools to help Millennials solve down payment challenges and escape future rent increases.

Visit archmi.com/MIHome (Credit Union version) now to learn more about the flexible options available with MIHome from Arch MI.

I also invite you to visit our LO Toolbox (CU version) for additional resources, ranging from our new Spanish-language borrower materials to online homebuyer education programs that are GSE-approved for borrowers seeking HomeReady® and Home Possible® mortgages.

For insightful analysis of current housing data by our expert economics team, our most recent weekly HaMMRSM Digest focuses on confusion over what’s occurring in the financial markets. We also offer scores of complimentary live webinars and on-demand video courses on topics ranging from improving your social media to winning business from self-employed borrowers.

As we begin the countdown to 2024, the Insights blog welcomes your thoughts and comments on meeting current challenges and your outlook for the year ahead. Insights is designed as an interactive forum, so please send your thoughts in an email. We may share them in a future post.

About the Author

Jim Jumpe

Senior Vice President and Chief Marketing Officer

As Chief Marketing Officer, Jim Jumpe oversees a long-term strategy to steward the Arch MI brand, help drive sales through effective customer communication, events, advertising and marketing collateral, and develop and execute innovative marketing strategies.

Prior to his appointment as head of marketing for Arch MI, Mr. Jumpe held marketing and product leadership positions at PMI Mortgage Insurance Co. and CMG Mortgage Insurance Company. He has extensive experience in marketing communications, guiding the verbal and visual articulation of the Arch MI brand to support profitable business growth objectives.

Mr. Jumpe earned a B.A. from Humboldt State University. He has held a past license from the California Department of Real Estate and served on the California Mortgage Brokers Association Board of Directors.