Latest / Chrisman Commentary - Daily Mortgage News / 11.2.26 M&A Continues; Keynova's Beth Robertson on Home Equity Experience; Midterm Week

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11.2.26 M&A Continues; Keynova's Beth Robertson on Home Equity Experience; Midterm Week · Chrisman Commentary - Daily Mortgage News

• 0:02
  SPEAKER_01: Welcome to the Chrisman Commentary, Daily Morgan's News podcast.
• 0:05
  SPEAKER_01: I'm your host, Robbie Chrisman.
• 0:08
  SPEAKER_01: Topics on today's episode include It's T-Lock week here at Chrisman.
• 0:14
  SPEAKER_01: Kind of.
• 0:15
  SPEAKER_01: Why capital markets probably won't be impacted by the election.
• 0:19
  SPEAKER_01: In my interview with Keynoba's Beth Robertson on growing competition and innovation and digital home equity lending, emphasizing pastor applications, real-time pre-qualification, transparent pricing, and streamlined personal customer experiences as key differentiators for lenders.
• 0:33
  SPEAKER_01: Here, take a listen to a little preview.
• 0:36
  SPEAKER_01: In your estimation, what will the digital mortgage experience look like in three to five years for digital home lending experience look like in three to five years?
• 0:45
  SPEAKER_00: I think that right now you're still seeing a lot of lenders' flows that are digital digital application flows.
• 0:53
  SPEAKER_00: They look very much like paper.
• 0:55
  SPEAKER_00: They need to continue to evolve that, and they will continue to evolve that to look less like what, you know, the form that we fill out if we're doing that uh application on paper.
• 1:07
  SPEAKER_00: I think there will be much more pre-filling of existing known information if someone's already a customer of the lender.
• 1:16
  SPEAKER_00: There will also be more transparent use of third-party data.
• 1:22
  SPEAKER_00: Um, right now there's places where you could, as a consumer, enter your credentials and information might be pulled in, like your asset balances and things like that.
• 1:34
  SPEAKER_00: But a lot of that information could be accessed in other ways.
• 1:38
  SPEAKER_00: Um, certainly property information is one thing that can be pulled from third-party data and doesn't have to even be asked or provided by the customer.
• 1:47
  SPEAKER_00: So I think we'll see a lot less requirement for the consumer to enter the information.
• 1:54
  SPEAKER_00: The flows will be much more accelerated.
• 1:58
  SPEAKER_00: And then the back-end process, too, I think is going to become a lot more streamlined.
• 2:03
  SPEAKER_00: And probably, you know, a big piece of that will be integration of AI into the underwriting flows.
• 2:11
  SPEAKER_01: Thanks to this week's podcast sponsor, First Close, which helps financial institutions grow a successful home equity business with innovative solutions that minimize application drop-off, automate time-consuming processes, and reduce time to close from weeks to days.
• 2:26
  SPEAKER_01: To learn more, visit firstclose.com.
• 2:31
  SPEAKER_01: Yes, I mentioned it's home equity week here at Quiristman.
• 2:34
  SPEAKER_01: That was a little tongue-in-cheek, but in the past, much of this product, 85% by some estimates, was held by banks.
• 2:41
  SPEAKER_01: Now, that is estimated to be down to 65%, and non-banks of all shapes and sizes are coming on strong market share-wise.
• 2:48
  SPEAKER_01: Besides having decent margins, some will say these products are the best recapture tool today.
• 2:53
  SPEAKER_01: While this is going on, the adjustable rate market is still a jumble.
• 2:58
  SPEAKER_01: Remember the saying, popular with some, date the rate, marry the house?
• 3:01
  SPEAKER_01: Borrowers with 3-1, 5-1, and 7-1s that are adjusting are in for a rude awakening, simultaneously leading to LOs having to explain rates, but also potentially leading to a lead source for nimble originators.
• 3:14
  SPEAKER_01: U.S.
• 3:15
  SPEAKER_01: Treasuries and agency mortgage-backed security prices rallied sharply to close last week, pushing Treasury yields across the curve down approximately 40 basis points from their October highs.
• 3:25
  SPEAKER_01: Equity market volatility and growing skepticism surrounding AI-driven earnings revived the traditional flight quality trade, suggesting the early October yield spike may have been due to short-term market positioning and trading dynamics rather than a meaningful deterioration in economic fundamentals that would warrant higher interest rates.
• 3:45
  SPEAKER_01: And it's worth noting to you that Dark Matter acquired House Numbers, a genetic AI platform for home lending, and the team behind it is joining Dark Matter.
• 3:52
  SPEAKER_01: House Numbers co-founder and CEO Jeff Levinson will also join Dark Matter as its chief AI officer.
• 3:59
  SPEAKER_01: Quote, House Numbers has already built AI, or had already built AI agents and proven them live in mortgage production, so bringing that work and its team into dark matter accelerates what we were already building for you.
• 4:12
  SPEAKER_01: It also reflects where dark matter is today in a strong position for your future.
• 4:18
  SPEAKER_01: Nothing changes for you, your empower environment, your agreement, your sport team, and your dark matter contacts all stay the same, and there's nothing you need to do.
• 4:25
  SPEAKER_01: We'll share more over the next couple of weeks, but expect some announcements over the next few months as well as at our Horizon conference in April next year.
• 4:32
  SPEAKER_01: End quote.
• 4:36
  SPEAKER_01: For today's interview, I wanted to welcome to the show Keynova's Beth Robertson to talk about growing competition and innovation in digital home equity lending, emphasizing faster applications, real-time pre-qualification, transparent pricing, and streamlined personalized customer experiences as key differentiators for lenders.
• 4:53
  SPEAKER_01: She's managing director of Keynova Group, a principal competitive intelligence source for digital financial services firms that publishes semi-annual online and mobile insurance scorecards.
• 5:03
  SPEAKER_01: So Keynova Group recently released the results of its 2026 mortgage home equity scorecard, which includes new insights about the lending digital experience.
• 5:14
  SPEAKER_01: Key findings, big takeaways, stuff that you thought is notable and worth sharing with the audience today.
• 5:20
  SPEAKER_01: Maybe let's start there.
• 5:21
  SPEAKER_00: So one of the big findings really is that we're speedy home equity application is becoming more common.
• 5:30
  SPEAKER_00: Actually, the number of organizations offering that has doubled since last year.
• 5:36
  SPEAKER_00: Not that it's yet at a significant number, but it definitely is expanding.
• 5:41
  SPEAKER_00: We're also seeing a lot more of the uh non-banks offering home equity products.
• 5:47
  SPEAKER_00: And most of the banks that had pulled, the banks that had pulled out of offering home equity during the pandemic also are generally re-entering, with Wells Fargo the exception.
• 6:00
  SPEAKER_01: It looks like Bank of America and PNC tied for first place overall for the second year in a row.
• 6:09
  SPEAKER_01: What are they doing right to lead the pack?
• 6:12
  SPEAKER_00: They both are doing a lot of things that nobody else is doing, but um, you know, to talk to each one of them, PNC, I think has really a very uh interesting, cohesive, and integrated set of tools.
• 6:26
  SPEAKER_00: Um, they have uh the primary name around it is Home Insight Planner, but it lets you develop your budget, search for a property, build scenarios with different price points and also interest rates and points values and things like that.
• 6:46
  SPEAKER_00: And they also have a lot of um very strong educational resources, uh, videos, articles, et cetera, calculators that are helpful.
• 6:56
  SPEAKER_00: And then Bank of America, two things that I like about them.
• 7:01
  SPEAKER_00: Number one, when when you apply either for mortgage or home equity, the status tool is actually integrated into online banking.
• 7:10
  SPEAKER_00: So if you're an existing customer, you're already there, you're familiar with the interface, you can easily transition into your loan information or back into anything else that you want to manage while you're logged on.
• 7:25
  SPEAKER_00: Um, and then they also have a lot of uh good support features that are taken as a group better than what many offer.
• 7:35
  SPEAKER_00: Um they have live chat, they have uh Erica, of course, on their app that can help with mobile uh mortgage and home equity questions.
• 7:45
  SPEAKER_00: They have contextual appointment setting.
• 7:47
  SPEAKER_00: So they have a variety of different things.
• 7:51
  SPEAKER_00: Um, and then the one thing that also they both have that uh most organizations don't is real-time pre-qualification and detailed information on costs.
• 8:00
  SPEAKER_00: So um closing costs, various points per uh, you know, calculations for various loan types, et cetera.
• 8:10
  SPEAKER_01: Well, I'm glad you brought up pre-qualification because it seems like there's an increasing percentage of lenders out there that are providing digital approval in minutes.
• 8:22
  SPEAKER_01: And I think I saw one-third of lenders, mostly non-banks, are providing funding in as soon as a week with these products.
• 8:28
  SPEAKER_01: Is speed becoming the biggest competitive advantage in home equity lending?
• 8:34
  SPEAKER_00: I think it is really important.
• 8:37
  SPEAKER_00: Um, I think it's gonna be important for a mortgage as well.
• 8:40
  SPEAKER_00: I think there are reasons competitively when you're putting in a bid on a house.
• 8:45
  SPEAKER_00: Um, if you can ask or set your closing date earlier, that's helpful.
• 8:51
  SPEAKER_00: And then from a home equity perspective, just knowing quickly whether you qualify, uh, what maybe what rate you qualify for, how much you qualify to borrow, and then knowing that you can get your funding quickly, it's just it's just more kind of in keeping with the digital age as well.
• 9:11
  SPEAKER_00: We're not in the in the paper-based world anymore, and uh expectations are really changing on the part of consumers as to uh what the speed is going to be for for various experiences.
• 9:22
  SPEAKER_01: I remember when I started working at SoFi in the early 2010s, we we thought to ourselves, how can we create a customer for life?
• 9:30
  SPEAKER_01: They get out of school, they want to refinance their student loans.
• 9:32
  SPEAKER_01: Well, now that they've worked with us, maybe they want a personal loan, maybe they want a mortgage.
• 9:37
  SPEAKER_01: Now it's moving into home equity.
• 9:38
  SPEAKER_01: There's also wealth products that SoFi offers.
• 9:40
  SPEAKER_01: And so there's been a big push in the mortgage industry toward recapturing borrowers, creating that loyalty.
• 9:47
  SPEAKER_01: And obviously, depositories can offer a lot of products that independent mortgage banks can't.
• 9:51
  SPEAKER_01: However, independent mortgage banks are focusing on getting creative in the home equity space and offering more products to create repeat business.
• 10:00
  SPEAKER_01: So, from your perspective, when we think about how home equity lending on houses in general can be turned into broader customer relationships, where's your mind go?
• 10:12
  SPEAKER_00: A couple of places.
• 10:13
  SPEAKER_00: I mean, uh, first is if you as a consumer have a very smooth application and funding experience, immediately you have a better perspective of the organization that you're borrowing with.
• 10:29
  SPEAKER_00: Um, if they are servicers, you know, the efficiency, um, the type of information, the whole experience of servicing can also be important.
• 10:41
  SPEAKER_00: And then, you know, a lot of banks and some of the non-bank lenders have programs that basically reward existing customers with additional, you know, things like maybe a discount on your mortgage or home equity rate based on the balances that you carry in other areas, or an incentive for a credit card or credit card earnings, rewards earnings based on the other accounts that you hold.
• 11:10
  SPEAKER_00: So there's a lot of different ways that that can be leveraged.
• 11:13
  SPEAKER_00: And getting back to my earlier point on Bank of America integrating the loan status tool with online banking, that's a good way to, again, cross-sell and expose people to like B of A has a very uh extensive rewards program that that very much encourages people to hold multiple products and higher balances.
• 11:37
  SPEAKER_01: I saw as part of the scorecard that 60% of lenders cover the mortgage process via video, which is kind of news to me, but I want to dive into it with you a little bit.
• 11:50
  SPEAKER_01: How can video and visual tools simplify the home lending process?
• 11:55
  SPEAKER_00: I think the main thing that they do is they take something complex, a complex topic, and break it down into kind of bite-sized components that can help uh a consumer to better understand something that's uh a lot of people just don't really know a lot about the home buying and home lending process.
• 12:16
  SPEAKER_00: And so these uh things like videos and articles can really help someone get a better understanding.
• 12:22
  SPEAKER_00: And I think when you're looking at a video, you also have the opportunity to you're seeing it and hearing it.
• 12:29
  SPEAKER_00: And so you have this uh better ability to kind of integrate that information into your everyday thinking.
• 12:37
  SPEAKER_01: Since it's your birthday, let's close with a fun question here.
• 12:41
  SPEAKER_01: You know, group is the nation's foremost competitive intelligence firm that provides trusted benchmarking insights and analysis of consumer and small business digital financial services.
• 12:52
  SPEAKER_01: What do you like so much about what you do?
• 12:56
  SPEAKER_00: What I do.
• 12:57
  SPEAKER_00: The learning component of what I do, I'm always you know being exposed to new capabilities and then being able to convey that information to my customers.
• 13:08
  SPEAKER_00: We have a lot of customers that are very interactive, you know, really like to discuss and uh ask questions and learn things.
• 13:16
  SPEAKER_00: And I really enjoy that sort of interaction.
• 13:20
  SPEAKER_01: Well, I had fun asking you questions today.
• 13:22
  SPEAKER_01: Hopefully, this is the first of many of these.
• 13:24
  SPEAKER_01: Excited to see more of your research and excited to have you back on the show.
• 13:27
  SPEAKER_01: So thank you very much, Beth.
• 13:29
  SPEAKER_00: Great.
• 13:29
  SPEAKER_00: Thank you.
• 13:33
  SPEAKER_01: Today's economic calendar kicks off later this morning with final October SP Global U.S.
• 13:37
  SPEAKER_01: Manufacturing PMI, September job opening, September construction spending, October ISM manufacturing, and U.S.
• 13:43
  SPEAKER_01: Treasury's quarterly refunding refinancing estimates.
• 13:46
  SPEAKER_01: We begin the week with Agent CMBS prices, little change from Friday's close, the two-year yielding 4.59, and the 10-year yielding 4.92 after closing last week at 4.93%, down six basis points over the course of last week.
• 14:01
  SPEAKER_01: Let's wrap up with a joke and some housekeeping.
• 14:04
  SPEAKER_01: The bank robber pulls out a gun and points it at the teller.
• 14:07
  SPEAKER_01: The robber says, Give me all your money, or you are geography.
• 14:10
  SPEAKER_01: The cashier, puzzled, says, Did you mean to say or your history?
• 14:14
  SPEAKER_01: The robber says, Please don't change the subject.
• 14:20
  SPEAKER_01: Thanks again to First Close for sponsoring this week's podcasts.
• 14:24
  SPEAKER_01: First Close helps financial institutions grow a successful home equity business with innovative solutions that minimize application drop off, automate time consuming processes, and reduce time to close from weeks to days.
• 14:35
  SPEAKER_01: To learn more, visit firstclose.com.