The loan officer engineer: The $11,898 problem

The construction industry may not be directly impacted by the costs associated with mortgage origination, but it is closely tied to the overall health of the housing market. With personnel costs making up 67% of origination costs, according to Freddie Mac data, it's clear that lenders are still heavily reliant on human labor in the mortgage process. Despite years of investment in digital mortgage technology, the numbers suggest that automation has not yet reached a level where it can significantly reduce the need for human loan officers.

This is a problem for lenders, as high personnel costs can eat into profit margins and make it difficult to offer competitive interest rates. For construction companies, this could mean that demand for new homes and mortgages may be affected if lenders are unable to keep costs under control. Furthermore, construction firms may need to consider the implications of a potentially slower or more expensive mortgage process on their own business, particularly if they rely on mortgages to finance their projects.

As the industry continues to navigate the challenges of digital transformation, it's worth watching to see how lenders adapt to these high personnel costs. Will they find ways to more effectively leverage technology to reduce labor costs, or will they focus on other areas such as improving customer experience or investing in new products? Construction companies would do well to keep an eye on these developments, as changes in the mortgage market could have a ripple effect on demand for new construction projects.

Originally reported by housingwire.com. ConstructionNews adds analysis for real estate & property readers.