We just wrapped up our final Mortgage Industry Roundtable of the year where industry professionals come together to exchange ideas, navigate challenges, and share strategies for success.
Our latest discussion centered on what’s ahead for the mortgage industry in 2025—covering everything from regulatory changes to economic trends and compliance strategies.
Here’s a recap of the key takeaways and insights from the conversation.
The economic backdrop and industry recovery
Rising interest rates remain a significant factor impacting the mortgage industry, with many expressing concern about how sustained rates around 6% might impact both demand and affordability.
While these rates are historically stable—far from the 14 to 15% highs of the 1980s—they still feel steep compared to the sub-3% rates consumers became accustomed to during the pandemic.
Participants speculated on whether these rates might stabilize home-buying trends or create additional barriers for first-time buyers. Some are optimistic for a slight recovery in the coming year, with a potential uptick in refinancing activity, albeit short of a “boom.”
The discussion also touched on generational shifts in attitudes toward homeownership. Younger generations seem less interested in buying homes altogether. Renting feels more flexible to them since it eliminates a lot of maintenance calls and responsibilities required for owning a home.
But, with rent prices continuing to increase and rivaling mortgage payments, it remains to be seen if and how this will impact the market.
Regulatory change will be the biggest challenge in 2025
54% of roundtable participants said that regulatory changes are the biggest anticipated challenge in 2025.
With shifting priorities at the federal level and heightened scrutiny from states, compliance professionals are expecting a busy year of examinations and adjustments.
Participants noted a growing trend of state regulators, particularly in California and New York, focusing on more minor compliance issues, often making audits feel overly detailed or, as one participant put it, “nitpicky.”
Meanwhile, in Texas, some regulatory requirements are being simplified, making compliance less of a burden on mortgage lenders.
The general takeaway is that rules are constantly shifting, and it’s important to stay vigilant and proactive when it comes to compliance and consumer protection.
Innovative compliance strategies to do more with less
With changing regulatory expectations and tightening budgets, efficiency was a major theme of the roundtable.
Compliance technology emerged as a key enabler of efficiency. Many attendees highlighted platforms like Winnow and PerformLine for their ability to streamline compliance monitoring and simplify regulatory tracking.
But, the cost of implementing technology solutions remains a barrier for some organizations, particularly smaller ones.
Participants also talked about how to stay on top of regulatory updates and changes, and many recommended following COMPLY by PerformLine, Venable LLP, Ballard Spahr, and Goodwin, which regularly offer compliance webinars and guides.
For state-specific updates, joining local calls—such as Texas’s monthly compliance call—can also be invaluable.
What’s next for federal regulation and junk fees?
The discussion shifted to federal regulations, specifically the growing scrutiny of so-called “junk fees.”
Proposed rules could classify certain fees, like lender title insurance, as unnecessary costs that don’t directly benefit borrowers. While the intention is to protect consumers, many attendees expressed concern that such changes would ultimately lead to higher costs elsewhere, as lenders often absorb these fees and pass them on indirectly to consumers.
A recent decision to cap late fees at $8 also sparked debate. While it may seem like a win for borrowers, several participants questioned whether it would achieve its goal of encouraging timely payments. Instead, some saw it as removing an effective incentive for borrowers to avoid being late.
If mortgage compliance professionals had a magic wand…
At one point, we asked attendees: “If you could wave a magic wand, what would you change about compliance?”
The answers were simple but telling:
- “Clearer responses from regulators”
- “One central place for state compliance rules”
It’s no secret that navigating compliance is complex, and while technology and collaboration help, there’s still a strong desire for more straightforward processes and better communication from regulatory agencies.
Looking ahead to 2025
Despite the challenges, the roundtable ended on a hopeful note. While business activity remains uncertain for many, some attendees reported a slight uptick heading into 2025, particularly in refinancing opportunities.
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