Mortgages during quantitative tightening

[Ali Asjad]

Hi all! It's my first post here. I've always wondered what happens during quantitative tightening when it's much harder to get a mortgage approved. Are there other kinds of lenders that still offer mortgages when credit is tightened? Do they have stricter requirements during QT? 

[Chris Mason]

Originally posted by @Mike H.:

 If anything QT would be an incentive for lenders to lend more.  Larger margins between what they could make on the loan versus what they could get by parking the money with the Fed.

Mortgage industry profits actually go down when rates go up. Refinances are just as profitable as purchase mortgages and you have had these call centers churning out stupid-for-the-borrower refinances to save $20/mo ("don't mind those closing costs") like no one's business. That's all gone now; hence most of the people reading this getting more junk mail and cold calls than ever in the past as these refi sweatshops try to do anything they can to keep the doors open.

Mortgage industry is being culled as we speak, and will continue as rates continue to increase. The three largest lenders are Wells Fargo, Quicken Loans, and BofA we're all down double digits in volume in 2017 (WF -27%, QL -10%, BofA -21%), and rates have done nothing but go up at an even faster rate since 1/1/18. I'm excited for all the "save $20/mo!" people to be gone from my industry.