SAN DIEGO, Calif., November 7, 2019 – ClosingCorp, a leading provider of residential real estate closing cost data and technology for the mortgage and real estate services industries, today estimated that the residential mortgage industry has more than $7 billion in loan value and more than $60 million dollars in service fee and transfer tax revenue at risk as a result of recent California Wildfires.
ClosingCorp based its estimate on “in-flight” residential mortgage applications in the FEMA designated affected areas for the Easy, Getty, Kincade, Saddleridge and Tick fires. An “in-flight” mortgage application is defined for this analysis as mortgages that are due to close between October 24, 2019 when the initial fire was declared by FEMA and the end of the year.
When events like these occur, many lenders have broad and prudent policies to suspend loan closings until the event has passed and damage assessments can be completed. At a minimum this means the income associated with loan closings is deferred. In many cases, new inspections and often new appraisals will be required before the mortgages can be approved and the sales completed. In some instances, the damage will result in significant delays or cause deals to fall apart.
ClosingCorp is proactively notifying its lender clients about transactions within the affected areas and will be working with them on expanded reviews as requested.