BOSTON–With mortgage rates near historic lows, homeowners are swamping lenders with refinancing applications, with one credit union apologizing via Twitter for delays in processing.
One bank is even offering a $5,000 reward to employees who can recruit someone to work in its mortgage department.
“Demand for home loans is so hot that some firms aren’t picking up the phone,” noted one Bloomberg report. “They’re raising rates to discourage customers, pumping the brakes on marketing campaigns and capping the amount loan officers can lend. Good luck getting someone on the phone -- especially if you’re not courteous.”
At the time of this report the national average on the 30-year fixed-rate mortgage was 3.36%, up slightly from 3.29% one week earlier.
“The historically low rates have fueled unprecedented demand, making the industry a bright spot as the U.S. economy is battered by the expanding outbreak,” Bloomberg noted. “Loan application records are being shattered at lenders such as United Wholesale Mortgage, Guild Mortgage and Quicken Loans Inc., the nation’s largest mortgage lender. Internet searches for refinancing this month spiked to their highest levels in data going back to 2004, according to Google Trends data.
“Last week, a measure of U.S. home-refinancing applications soared to the highest level since April 2009,” the report continued. “Refinancing, which puts money back in the pockets of American homeowners, could help boost an economy that appears to be on the brink of recession.”
‘Appreciate Your Patience’
On Twitter, Colorado-based Ent Credit Union told members, “Unprecedented mortgage rates are causing some delays in service and we apologize for longer than normal response times. We’re handling requests in the order received and appreciate your patience.”
What Other Lenders Are Saying
Ent Credit Union isn’t alone. Among the other lenders reporting surging volumes as compiled by Bloomberg:
- Brian Koss, EVP with Massachusetts-based Mortgage Network, Inc., said, “If you’re difficult, a negotiator, or a grinder, they’re probably not going to call you back. We’re sorting calls by who are my best customers, who’s on top of it, engaged, and giving me all their documents up front.”
- “There isn’t an owner in America who shouldn’t be refinancing right now,” said Mat Ishbia, United Wholesale’s chief executive officer.
- San Diego-based Guild said it has stopped soliciting new refi clients.
- At JPMorgan Chase & Co., mortgage application volume three times above average overwhelmed the bank’s systems last week, forcing the company to work through the weekend to deploy new computer servers to improve capacity and speed, according to a memo seen by Bloomberg. “The bank has shifted workers to its mortgage group to deal with the extraordinary volume and is offering employees $5,000 for every new mortgage worker they can recruit, according to people familiar with the matter,” Bloomberg added.