This piece originally appeared in the September 2024 edition of MortgagePoint magazine, online now.
Scott Lindner serves as National Sales Director of Mortgage Lending for TD Bank, one of the 10 largest banks in the nation. TD Bank provides more than nine million clients with a full range of retail, small-business, and commercial banking products. In his current role, Lindner leads TD’s Mortgage Loan Officer sales force, and guides sales strategy and product development. He has more than 25 years of experience in the financial services industry.
TD Bank recently issued its 2024 Mortgage Service Index, surveying more than 1,800 homeowners nationwide, to gather insights and analyze perceptions around the homebuying and mortgage experience, as well as attitudes on the current state of the housing market.
The 2024 Mortgage Service Index found that optimism in the market was reflected even more so among younger generations, as 84% of Gen Z and 68% of millennials said that purchasing a home still feels attainable, despite the rising cost of homeownership. Optimism wavered just slightly among Gen Xers with 66% feeling that purchasing a home was attainable, followed by 59% of baby boomers. As U.S. existing home sales reached a nearly 20-year low in 2023, these sentiments highlighted a sense of hope among the nation’s home buyers.
MortgagePoint had a chance to speak to Lindner about the findings of the report, and how prospective buyers can overcome burdensome affordability constraints to successfully enter the housing market.
Q: How did you first get your start in the industry?
Scott Lindner: Early in my career, I served as a retail stockbroker working for various firms, including Drexel Burnham, Prudential Securities, and Smith Barney. I later transitioned to running retail bank branches. I served as the Division Manager for Bank of New York branches in Westchester County, New York, followed by a similar position at Chase.
In 2009, Chase was reimagining its mortgage distribution model and asked me to help move that work forward in a Senior Lending Manager position, which further deepened my knowledge and perspective in the industry. In this role, I was responsible for mortgage lending in Westchester and Rockland Counties in New York, Upstate New York, and Connecticut. I later joined Scottrade Bank, serving as SVP, Head of Retail Banking, running its online retail bank. And as a result of TD Bank’s acquisition of Scottrade, I joined TD as National Sales Director for its mortgage business in 2017. In my current role, I am accountable for leading TD’s mortgage loan officer and community mortgage loan officer salesforce, as well as guiding sales strategy and product development.
Q: According to the study, “84% of Gen Z and 68% of millennials say purchasing a home still feels attainable despite the rising cost of homeownership.” What tips do you have for those in the market to begin the path to homeownership?
Scott Lindner: When buying your first home, there is quite a bit to consider—like how much you can afford right now, how much you can put down as a down payment, and what kind of loan options you qualify for. To start off on the right foot, it is a great idea to chat with a mortgage professional who can break down the details. They will help figure out how today’s interest rates and different mortgage options might impact your overall budget and long-term plans.
You should also make sure that you get a copy of your current credit report. This gives you the opportunity to ensure that there are no errors in the report that could impact a mortgage application. Doing this early on gives you the time to address and fix any errors prior to applying for a mortgage, which is key. Credit reports impact your credit score. And your credit score not only impacts approvals but also impacts the pricing of the loan. High credit score borrowers typically have a lower rate and pay lower interest over the life of the loan. Before you even begin your search, you should assess your credit with a professional.
Home buyers (especially first-time homebuyers) should have conversations with lenders about affordable product options that assist homebuyers right from the beginning. Many lenders offer various products geared toward first-time and other homebuyers. For instance, TD Bank launched TD Home Access Mortgage, an affordable mortgage option that includes a $10,000 lender credit for purchase transactions that doesn’t require repayment. This can really help first-time buyers with lowering their down payment or perhaps buying down their interest rate.
The product also offers more flexibility with greater debt-to-income (DTI) ratios, expanded underwriting requirements, and credit parameters that increase accessibility.
So, the simplified takeaway is that it is important to do your homework and find a lender that can identify offerings and options that work for you and your unique budget.
Q: In the current marketplace, what do you see as possible market corrections to alleviate the affordability crisis?
Scott Lindner: Major sticking points in this housing climate are low inventory and higher home prices, which are significant drivers for housing demand. When you add on the higher rates, it creates a tough housing market that isn’t likely to shift significantly any time soon. To give added perspective, in the spring of 2019, the 30-year mortgage rate was below 4% and then the pandemic happened. That drove historic rates below 3% for several months, and we didn’t get back above 4% until the spring of 2022. That’s almost three years of rates being below 4% and that has shifted the housing market for the foreseeable future. Those years provided a lot of time for existing and new homebuyers to lock in at such low rates that they aren’t looking to move and lose that low rate for today’s higher one. All this feeds into the affordability crisis. As an example, a 30-year $350,000 mortgage in 2021 at 4% would have a monthly payment of $1,909. That same payment today would be $2,661, 39% higher because rates are around 7%.
Additionally, if you look at the economy, it’s in relatively decent shape as it relates to employment and consumer spending. This should give the Fed the ability to reduce short-term rates, maybe as early as September. As a result of this Fed action, along with the expected subsequent rate cuts, we may see a more robust spring market as mortgage rates begin to ease.
Since rates and inventory are going to fuel affordability challenges, it is more important than ever before for potential homebuyers and existing homebuyers to do their homework. And also, speak with a lender. There are government programs that help with affordability as well as lender options. A trusted, experienced mortgage professional can help you navigate the challenges of the market and find solutions based on your unique financial situation.
Q: What suggestions do you have for renters who are on the outside of the home buying market looking in?
Scott Lindner: Purchasing a home is not about buying in the right market—it is about buying in the right financial situation. Overall, a home can be the single biggest investment vehicle for many in their lifetime, as homebuying builds equity and can lead to generational wealth. Renters should take initial steps to prioritize saving and build their credit before jumping into home searching.
If a renter decides that they are ready to begin the home buying process, they should speak with a knowledgeable, experienced mortgage professional, like a loan officer, early in the process. Mortgage experts can discuss homebuying options, weigh in on the interest rate environment, and help borrowers consider and think through different affordable mortgage offerings that might contribute to a lower down payment amount, better aligning with a buyer’s budget. They can also map out the process in general, to give potential homebuyers a frame of reference for next steps.
Finding a loan officer is not a daunting task. Check with your bank or financial institution to see if they have any local loan officers who are available to speak with you.
In summary, my best advice to renters or anyone interested in buying a home is not to count yourself out and sit on the sidelines because of the housing market.
There may be options out there that can help you get into a home. And as I said before, purchasing a home is not about buying in the right market—it is about buying in the right financial situation.
Q: According to the report, 43% of potential buyers felt they required the most education and guidance during the mortgage process. What can be done by the industry in terms of outreach to educate the general public on the homebuying process?
Scott Lindner: It is crucial for potential buyers to have a mortgage professional on their side through the process, because homebuying can feel intimidating to tackle on their own. Potential buyers who engage a mortgage expert will have a go-to contact throughout the process and will receive tailored guidance based on their specific needs and financial situations.
TD’s Mortgage Survey Index found that more than half of homeowners (57%) contacted Realtors for information, education, or opinions on the products or services offered by each bank or lender they considered. Other sources for guidance included family and friends (37%), bank or lender websites (36%), and in-person meetings at branches or lender offices (34%), showing that homeowners prefer learning about their options from industry professionals and loved ones.
At TD, we are always looking for ways to support our customers through the home buying process. An informed buyer makes for a smoother process, and we are committed to helping our customers understand the process and feel confident about their options.
Q: What do you feel rates will take for the rest of 2024?
Scott Lindner: As inflation wanes and consumer spending remains steady, we anticipate that a first rate cut in 2024 is very likely. Ultimately, for the homebuyer, this means rates will likely lower, but it will be a gradual reduction. That is why my advice is that homebuying comes down to the right time based on your unique financial situation, not the best market to purchase in.
