The past few years have been a rollercoaster for independent mortgage banks (IMBs). In 2020, mortgage rates reached historic lows, with the average 30-year fixed-rate mortgage dipping below 3%. Compared to the historic lows of the early 2020s, mortgage rates have more than doubled, reaching 6.72% as of October 31, 2024.
With today’s higher rates impacting borrower affordability, IMBs face heightened competition as they aim to attract clients with competitive rates and exceptional service. Mortgage activity is projected to grow, with total mortgage originations expected to increase to $2.3 trillion in 2025 from $1.79 trillion in 2024.
IMBs need technology that streamlines processes, enhances efficiency, and improves pricing accuracy to stay ahead. One of the most significant advancements driving change in 2025 is the adoption of pricing engines — a must-have tool for firms looking to optimize rate locks, manage risk and boost profitability in a volatile market.
Pricing Engines: The Smart Way to Handle Rate Locks and Hedging
In mortgage pricing, timing is everything. Independent firms may not have the resources for the tech-heavy systems used by large lenders, but pricing engines like SmartPricer offer powerful tools to level the playing field. Here’s how they can give you a competitive edge:
- Real-Time Market Analysis: Pricing engines continuously monitor the secondary market, enabling you to respond instantly to shifts in rates and conditions. This means you can lock in competitive rates that attract clients and protect your profitability, especially in fast-changing conditions. With up-to-the-minute data at your fingertips, pricing engines take the guesswork out of rate setting, giving your team the confidence to make decisions that meet client needs and support your business goals.
- Efficiency and Speed: Automation handles complex rate locks and hedging tasks, freeing up your team to focus on what matters most — your clients. No more late nights or extra hours spent on manual calculations and data entry. By reducing the need for hands-on input, pricing engines help your team work smarter, not harder, allowing them to get more done in less time.
- Flexibility for Clients: Today’s clients expect mortgage solutions that fit their unique financial situations and goals. Pricing engines make this possible by letting you quickly adjust rates and terms based on factors like loan size, credit profile and current market conditions. This means you can generate personalized rate options in seconds, eliminating the need for time-consuming manual adjustments, all while building trust and lasting client loyalty.
- Proactive Risk Management: With tools to automatically adjust pricing in response to market volatility, pricing engines help you mitigate risk by stabilizing margins and ensuring consistent pricing accuracy. For independent firms, this reliability isn’t just about protecting profitability — it’s also a powerful way to build trust. When clients see steady, reliable pricing even in a fluctuating market, they gain confidence in your firm’s stability and expertise. This consistency fosters stronger client relationships, showing that your firm is prepared and responsive to changing conditions without compromising their needs.
Make 2025 Your Year With SmartPricer
Rising competition and increasing client demands are pushing IMBs to adapt fast or risk being left behind. By taking action now and equipping your team with the right tools, you’ll do more than just keep up with the market — you’ll get ahead of it.
SmartPricer’s advanced pricing engine and lock desk solutions simplify complex tasks, helping your team make faster, data-driven decisions that keep your clients coming back. With tools that let you respond to rate changes in real-time, offer clients tailored options easily, and reduce manual work, SmartPricer allows your team to work more efficiently, all while potentially cutting operating costs.
Don’t let the competition get ahead. Request a demo today to see how SmartPricer can make 2025 your firm’s best year yet.
