Page 31 - BusinessWest August 31, 2020

Volume Business
Low Rates, Small Supply Mean Brisk Activity for Mortgage Lenders
By MarkWMorris
hen COVID-19 made its arrival in
Western Mass., it was mid-March,
just weeks before the start of the traditional home-selling season. Area mort- gage professionals didn’t know what to expect
Indeed, instead of completely canceling the spring home-buying market, the pandemic merely postponed it, said James Sherbo, senior vice president of Consumer Lending with Holy- oke-based PeoplesBank.
keeping most all lending institutions busy. “It’s crazy ... we’ve seen an 80% volume
increase in our overall business compared to last year,” Smith noted. “And we certainly did not expect that.”
Tami Gunsch, senior executive vice president and director of Relationship Banking at Berkshire Bank, agreed. She said the bank is pleased with the Mortgage Division’s performance, “especially during these unprecedented times of COVID-19.”
For this issue and its focus on banking and financial services, BusinessWest takes an in-depth look at the housing market and the various, and powerful, forces that are driving it.
Rooms for Improvement
Flashing back to mid-March, Sherbo said his department was mostly focused on where (and how) team members would work, and keeping employees and customers safe.
“We just tried to prepare as best as we could to keep our team safe and our custom- ers safe,” Sherbo said. “When COVID-19 first hit, everybody wondered what would happen; nobody had a crystal ball.”
Indeed, no one could have foreseen how the drop in interest rates — one of many steps taken to stimulate the economy — and other
“We’ve been very busy because the activity we would have normally seen in April or May, we saw in June, July, and August.”
“We’ve been very busy because the activity we would have nor- mally seen in April or May, we saw in June, July, and August,” he told BusinessWest.
Jeffrey Smith, vice president and chief Lending officer with Freedom Credit Union, concurred, noting that any debilitating effects on the housing market from the pandemic have been more than offset by lower interest rates. The rates were already fairly low — in the 3.25% to 3.5% range — before
JAMES SHERBO
when the pandemic hit, but they certainly weren’t projecting a solid year.
Soon, though, they had to adjust those expec- tations and projections.
Indeed, a combination of factors, from his- torically low interest rates to high demand and low inventories, have made this a much busier, much better year than most residential lenders and home sellers could have hoped for back in the dark days of March.
the pandemic, he said, but now consumers can now get a 30-year fixed-rate mortgage for well under 3%.
“This is probably the best real-estate market I’ve seen in years,” Smith said. “When the pan- demic first hit, I thought it was going to be just the opposite.”
Meanwhile, many mortgage holders are tak- ing advantage of these lower rates to refinance, and this high volume of refis, as they’re called, is
Jack Vadnais, CFP®
Director of FCU Investment Services and LPL Financial Advisor
1976 Main Street, Springfield, MA Email: [email protected] Direct: (413) 505-5724
Cell: (413) 575-5483
Michael S. Johnson
Associate Director of FCU Investment Services and LPL Financial Advisor
191 Avenue A, Turners Falls, MA Email: [email protected] Direct: (413) 505-5815 Cell: (413) 387-9341
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