Calling India (or China or Ireland) for a Home Loan

These aggregators are likely to be the biggest banks, which are already the biggest lenders. Of course they won't want to pay much because they know the smaller institution has already cherry picked the best loans and is only selling the ones it feels are riskier. Sooner or later, the president of the community bank is going to figure out that mortgage lending isn't worth the trouble. So, the dream of the little guy taking all that mortgage loan business away from today's largest lenders is not too realistic in my mind.

They can't call the mortgage broker because they're probably selling other products at this point. They can't call the lenders because every living human that can talk on the phone is in the servicing shop trying to talk a troubled borrower off a ledge. I figure they'll call India, though they may not know it.

Not that there's anything wrong with that…inherently. I have a number of friends in the off-shore outsourcing business and they're fine folks who work hard for a living. Cost of living is cheaper over there and so labor arbitrage can make savvy executives a fine percentage if they work the numbers right. The people are affordable, smart and motivated, as pockets of work forces tend to be in emerging market countries.

The business will come back

The business will come back. People will wake up one day soon with new jobs and renewed ambitions and they'll want to trade in their little house for a new home. I suspect that's going to be a painful day for lenders and for borrowers who suddenly find themselves sliding down a VoIP line to a foreign land.