The materials available in this article are for informational purposes only and not for the purpose of providing legal advice. You should contact your own advisors with questions regarding the mortgage lending software content herein. The opinions expressed in this article are the opinions of the individual authors and may not reflect the opinions of MeridianLink, Inc.
In our recent MBA article, we explored a powerful truth: two things can be true at once. The housing market can be full of opportunity and still have some volatility. Lenders who understand both sides of that equation are the ones winning in today’s environment.
What does that mean?
CPI is rising moderately, but we’re still shy of the Fed’s 2% target. Interest rates climbed from their lows during 2020 to 2022, but they’re still average by historical standards. In fact, mortgage rates just dropped to their lowest level since mid-October 2024. Inventory is increasing, but affordability remains tight. Sellers are holding out for 2022 prices, while buyers are hoping for 2008 deals.
And yet, homes are still being bought. Life events, demographic changes, and renewed buyer confidence are fueling demand. And for lenders, that’s a window of opportunity worth leaning into.
The lenders capitalizing on it aren’t relying on aggressive pricing or broad-stroke marketing. They’re leveraging modern mortgage lending software to move fast, engage the right borrowers at the right time, and deliver experiences that build long-term loyalty.
So, what does this mean for your mortgage lending business? Let’s take a closer look at current market dynamics, the opportunities on the horizon, and how the right mortgage lending software can help you capture them.
Originations are climbing.
In 2024, mortgage originations reached $1.69 trillion—a 12.9% year-over-year increase. And halfway through 2025 we are continuing that upward trend, with originations already up another 9.4%.
At the same time, home prices have dipped 4% nationally from their peak, inventory is at its highest level since January 2020, and seller activity is outpacing buyers by 34%.
Financing is back in focus.
More buyers are choosing mortgages loans over cash purchases and the trend is picking up speed among certain generations:
- 96% of those aged 25–43
- 86% of those aged 44–58
However, boomers are flexing their buying power, with more than half of those aged 70–78 and about 40% of younger boomers paying cash for their homes.
Meanwhile, the spread between the 10-year Treasury yield and mortgage rates remains unusually wide—currently about 249 basis points. This gap suggests there’s room for mortgage rates to decline if spreads return to more typical levels. Even if the Federal Reserve leaves its benchmark rate unchanged. In other words, we could see some rate relief regardless of what the Fed does next. It’s also worth remembering that a Fed rate cut doesn’t automatically translate to lower mortgage rates. Just look back to the third quarter of 2024, when the Fed reduced rates yet both the 10-year Treasury yield and mortgage rates moved higher.
Source: https://www.mortgagenewsdaily.com/mortgage-rates/30yr-treasuries
Who’s buying right now?
Today’s homebuyers are well-qualified and increasingly diverse in age and income.
- Roughly 80% of buyers are super-prime, meaning they qualify for the most competitive rates and terms.
- Millennials make up 29%, followed by Gen X at 24%, with most turning to financing options.
- Baby boomers currently lead the pack, accounting for 42% of all home purchases as of June 2025, with a significant numbers making all cash purchases.
Interestingly, millennials continue to build momentum in the housing market despite holding just 9.4% of total U.S. wealth. More than half already own homes, and their collective wealth has grown by 49% since 2019. Even more impressive, younger millennials and older Gen Zers quadrupled their median wealth between 2019 and 2022, setting the stage for a new wave of first-time buyers.
Meanwhile, the average homebuyer age has climbed to 56—a record high. While most first-time buyers are still between 26 and 34, today’s market is increasingly driven by buyers aged 39 and older. Income plays a big role too: households earning between $100,000-$124,999, as well as those making $200,000 or more, represent the largest share of new mortgage activity.
Why are they buying?
Rates, affordability, and inventory all matter, but for most buyers, the biggest motivator is personal. Nearly half of recent buyers say they purchased simply because it felt like the right time
And despite economic uncertainty, 75% of Americans still believe that homeownership is part of the American Dream. For many, it’s about life goals, long-term wealth, and major life changes—like marriage, starting a family, or relocating for work.
How can you best reach these borrowers?
Most buyers aren’t just reacting to market shifts, they’re acting on life goals. So, lenders who speak to those motivators will connect more meaningfully. You can start by focusing on these areas:
Get granular with geography
Use tools like HMDA data, USPS migration trends, and insights from your own LOS to identify your next best markets. If your lending footprint includes growth areas like Austin, Denver, or Harrisburg, align your campaigns and outreach to match local demand.
Segment by life stage and intent
First-time homebuyers, primarily aged 26–44, are highly likely to need financing. In fact, more than 95% of this group used a mortgage loan for their home purchase. Meanwhile, Gen X and Boomers are increasingly repeat buyers, often driven by life changes like retirement, downsizing, or health considerations.
Speak to real motivators
Borrowers are buying because of life events: marriage, growing families, job relocations. And over 51% of millennials say they’re still buying to achieve the American Dream. Tap into that emotion, not just the math.
Reconnect at the right time
Data shows that buyers expect to stay 8–10 years but often move after just 4–5. Lenders who track tenure and re-engage past borrowers around year 4 are positioned to win the next deal.
Modernize the experience
Digital-first lenders have set a new standard: the mortgage process should be fast, intuitive, and accessible from anywhere. To stay competitive, traditional lenders must match that level of simplicity and flexibility.
This is where a modern solution like MeridianLink® Mortgage really sets you apart.
It’s built to help you meet today’s borrower expectations and give your team the insights and automation to stay ahead of the curve.
Here’s just a glimpse of what’s possible:
Mobile-first engagement
Let borrowers start and finish applications, upload documents, and track their progress—all from their phones. No friction, no delays—just a seamless, modern experience that keeps things moving forward.
Multi-language support
Expand your reach by offering language options that truly reflect the communities you serve. It’s a simple way to connect with and retain fast-growing, diverse markets.
Automated underwriting and self-serve tools
Boost your team’s efficiency and speed up approvals with automated prequalifications and underwriting. Plus, give borrowers secure self-service portals so they can update information, sign disclosures, upload documents, and more—whenever it’s convenient for them.
Fully integrated workflows
Eliminate silos and manual handoffs. MeridianLink connects your LOS, POS, PPE, and key steps like verification, title, appraisal, and e-signature into one streamlined system. That means faster cycle times, fewer bottlenecks, and a better experience for everyone.
Data-driven insights that drive action
Stop guessing and start anticipating. With built-in analytics and reporting, you can segment your audience, tailor outreach by life stage or location, and proactively spot new opportunities—so you always deliver the right message, at the right time.
The market isn’t just open, it’s moving fast. Do you have the tools to keep up?
With MeridianLink Mortgage, you can reach the right borrowers, in the right markets, with messages that speak to real life stages and needs.
Learn how MeridianLink Mortgage is helping lenders lead the way.
