TORONTO--(BUSINESS WIRE)--Real Matters Inc. (“Real Matters” or the “Company”) (TSX: REAL), today issued the following statement, providing an update on its operations and sharing the latest mortgage market data:
Today, the Mortgage Bankers Association (MBA) announced that activity remains strong; mortgage applications were up 14.5% week-over-week. Refinance applications were up 25.5% week-over-week and purchase applications were down 10.3% week-over-week.
Notwithstanding the short-term impact that COVID-19 may have, we continue to receive strong title and appraisal volume – higher than any week in 2019. As of today, our mortgage origination orders over the past week were up double digits over the previous week for both our U.S. Appraisal and U.S. Title businesses. Based on the market activity we are seeing today, we believe that lower mortgage applications for home purchases are being made up by the large pool of refinance mortgage candidates.
Additionally, as we discussed on our March 19, 2020 conference call, the low 10-year U.S. Treasury yield continues to support low mortgage interest rates. However, mortgage underwriting capacity has been constrained, although this appears to have improved over the last week as lenders settle into their business continuity operations. The vast majority of field professionals on our network continue to accept and complete orders from us, and we have not seen any material change in our appraiser or notary capacity. Further, the opportunity to lower mortgage payments and to access equity from homes is keeping homeowners engaged, while respecting social distancing. Both homeowners and field professionals are collaborating well to support mortgage closings.
We believe that low U.S. mortgage interest rates will create a large, multi-year market opportunity for us. At recent mortgage rates, we estimate that more than 14.5 million U.S. mortgages are incented to refinance, roughly 70% of outstanding mortgages. We further estimate that even if lenders increase underwriting capacity by 20% annually, it would take approximately two to three years to cycle through this volume.
Real Matters has a strong balance sheet with more than US$80 million in cash as of December 31, 2019, and we have no debt.
About Real Matters
Real Matters is a leading network management services provider for the mortgage lending and insurance industries. Real Matters’ platform combines its proprietary technology and network management capabilities with tens of thousands of independent qualified field professionals to create an efficient marketplace for the provision of mortgage lending and insurance industry services. Our clients include the majority of the top 100 mortgage lenders in the U.S. and some of the largest insurance companies in North America. We are a leading independent provider of residential real estate appraisals to the mortgage market and a leading independent provider of title and mortgage closing services in the U.S. Established in 2004, Real Matters has offices in Buffalo (NY), Denver (CO), Middletown (RI), and Markham (ON). Real Matters is listed on the Toronto Stock Exchange under the symbol REAL. For more information, visit www.realmatters.com.
This press release contains “forward-looking information” within the meaning of applicable Canadian securities laws. Words such as “could”, “forecast”, “target”, “may”, “will”, “would”, “expect”, “anticipate”, “estimate”, “intend”, “plan”, “seek”, “believe”, “likely” and “predict” and variations of such words and similar expressions are intended to identify such forward-looking information, although not all forward-looking information contains these identifying words.
The forward-looking information in this press release includes statements which reflect the current expectations of management with respect to our business and the industry in which we operate and is based on management’s experience and perception of historical trends, current conditions and expected future developments, as well as other factors that management believes appropriate and reasonable in the circumstances. The forward-looking information reflects management’s beliefs based on information currently available to management, including information obtained from third party sources, and should not be read as a guarantee of the occurrence or timing of any future events, performance or results.
The forward-looking information in this press release is subject to risks, uncertainties and other factors that are difficult to predict and that could cause actual results to differ materially from historical results or results anticipated by the forward-looking information. A comprehensive discussion of the factors which could cause results or events to differ from current expectations can be found in the “Risk Factors” section of our Annual Information Form for the year ended September 30, 2019, which is available on SEDAR at www.sedar.com.
Readers are cautioned not to place undue reliance on the forward-looking information, which reflect our expectations only as of the date of this press release. Except as required by law, we do not undertake to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.