Why mortgage leaders are betting on home equity through 2027

At this year’s Mortgage Bankers Association (MBA) Annual Convention & Expo, mortgage executives identified home equity lending, borrower retention and technology as key priorities heading into 2027. Homeowners are increasingly using second-lien products, including home equity loans and home equity lines of credit (HELOCs), to fund renovations, consolidate debt and finance real estate investments while keeping their existing mortgages intact. “More and more folks are really wanting to renovate, not relocate,” said Joey McDuffee, vice president of sales and marketing at Blue Sage Solutions. Some of Blue Sage’s clients have increased monthly home equity production from about 200 units to 2,000, McDuffee said. Although purchase lending will remain central to the market, a meaningful refinance recovery could still be years away.

Tom Davis, chief sales officer at Deephaven Mortgage, expects home equity originations to reach about $150 billion in 2026, compared with roughly $180 billion in nonqualified mortgage (non-QM) lending. By 2027, home equity could surpass non-QM lending by loan count, he said.