Dave: This is a question many are contemplating. Actually, there are two questions here: Will there be a recession? And if there is a recession, how will it affect our business?

Before I answer these, let me be clear: both questions require me to predict the future and that is not possible. Thus, I am just going to lay out possibilities.

So, will there be a recession? Certainly, a recession is a possibility. It could happen at the end of this year or sometime next year. Or we may not see a recession for several years. I do believe with the real estate market slowing down, higher interest rates and the end of pandemic-induced stimulus, the economy will slow down. The two quarters of the year saw a decrease in GDP and the definition of a recession is two quarters of negative growth.

However, the reason for the negative growth revolved around supply chain issues and inventories. Thus, most believe we are not in a recession yet. But clearly the economy is slowing down. We have yet to see a slow down in the growth of jobs. I believe two sectors of the economy will tell us whether we are heading into a recession: job growth and the real estate market. If these sectors hold up, the economy will slow, but avoid a recession. If these sectors falter, a recession is much more likely. And how might such a recession affect our business?

For this we will assume that a recession is coming so we can address the question of what a recession might do for our business. Keep in mind that every recession is not the same. The last two recessions were a complete contrast with regard to the real estate market.

During the Great Recession of 2008, the real estate sector fell off the cliff. Housing prices fell and there were massive foreclosures. This affected the markets for a full decade afterward. The dam-age was so bad that the government had to take over Fannie Mae and Freddie Mac as the secondary markets collapsed. Despite this damage, the mortgage markets came back pretty quickly, because lower interest rates and special government loan programs spurred refinancing. In my next column, I'll write more about today’s economy.

Dave Hershman is Senior VP of Sales of Weichert Financial and the top author in the mortgage industry. Dave has published seven books, as well as hundreds of articles and is the founder of the OriginationPro Marketing System and Mortgage School – the online choice for expert mortgage learning and marketing content. His site is www.OriginationPro.com and he can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..