MBANow: Radian’s Derek Brummer on Mortgage Risk Factors


The Mortgage Bankers Association released a new MBANow video featuring Derek Brummer, chief risk officer with Radian, Philadelphia, who discussed key risk factors in the mortgage market at the recent MBA Annual Convention & Expo in Denver.

The video can be viewed at

DerekBrummerBrummer identified several risk factors for the mortgage market in the near future, including increasing interest rates. “The market has priced in a certain number of interest rate increases, which is below what the Fed is forecasting, so there is a potential impact from a macro perspective,” he said. “So when you have rates going up, and a lot of liquidity provided by central banks for a number of years, when you see rates go up, the question is, what impact does that have? It could have an impact in terms of a stock market correction, bond prices and that can have a contagion effect.”

More directly to the mortgage market, Brummer said how the market responds to increasing interest rates. “It’s been a number of years since people in the industry have seen increasing interest rates,” he said. “The question becomes, are institution properly hedged from a risk perspective? Is our modeling picking that up from a risk return perspective?…we could also see a movement toward adjustable-rate mortgages, and probably see a bigger impact on home price appreciation.”

Other videos in the MBANow series can be viewed at the MBA YouTube channel, The videos are also available on the MBA Insights landing page,