The 2026 Lending Landscape: 5 Trends We’re Preparing For

As we look ahead to 2026, one thing is clear: lenders are entering a year defined not by rapid market swings, but by a steady push toward smarter operations, better workflows, and more intentional relationships.

From conversations with credit unions, banks, and industry partners, five themes consistently rise to the top, and they reflect where the industry is truly heading.

Here are the five trends we believe will shape lending in 2026, and how they are already influencing planning across the industry.

1. Refinance Activity Will Rebound and Home Equity Will Remain a Key Priority

Economists expect mortgage rates to ease into the low -6% range in 2026, which could unlock a meaningful resurgence in refinance activity. Redfin forecasts a 30%+ increase in refis, driven by the 20% of homeowners carrying rates above 6%.

But even as refinance demand returns, home-equity lending is positioned for another strong year, especially for credit unions. Many homeowners remain firmly “staying put,” locked into low first mortgage rates and choosing to improve the homes they have rather than trade up. Combined with a deep pool of tappable equity and excess capital in credit-union portfolios, the set up for 2026 strongly favors continued home equity growth.

This environment opens the door to more flexibility in meeting borrower needs, including higher- LTV lending where appropriate. As institutions explore these opportunities, many are also revisiting risk-mitigation tools, such as valuation warranties and equity-default protection, which helps lenders lend confidently without taking on unnecessary exposure.

The Result is a dual-track 2026 landscape:

• A meaningful rebound in refinance volume

• Continued strength in home-equity lending, fueled by borrower immobility and sustained renovation demand

For lenders, preparing for both means strengthening workflows, supporting disciplined decision-making, and leaning into partners who help reduce operational strain while improving risk management.

2. Consolidation Will Continue Across the Industry

Consolidation is reshaping the financial services ecosystem, from credit unions and mid-sized banks to appraisal firms and fintech vendors. Rising operational costs, elevated compliance demands, and technology pressure are pushing smaller organizations to merge or be acquired. This trend is not slowing down; if anything, it’s accelerating.

For lenders, consolidation can create new opportunities but also introduces transition challenges: new leadership teams, new processes, and new system requirements. For vendors, consolidation brings a different pressure point — the need to maintain strong communication, clear expectations, and reliable service even as clients navigate change internally.

In a consolidating market, the partners who stay close to their clients — locally, consistently, and proactively will be the ones that retain loyalty through organizational shifts.

3. Vendor Compliance & Readiness Will Matter More Than Ever

Regulatory expectations continue to evolve, and in 2026 lenders will place even more emphasis on vendor compliance, data accuracy, and audit readiness. Requirements around reporting, documentation, and valuation data standards are becoming more complex, and institutions want assurance that their partners can keep pace.

Questions like “Are your integrations ready for MISMO 3.6?” and “What does your vendor due-diligence process look like?” are no longer occasional, they’re becoming routine. Vendors must now demonstrate not only competency but consistency: a repeatable approach to compliance reviews, structured quality checks, and transparent communication around changes.

This is also where vendor aggregators play a critical role, simplifying oversight by giving lenders a single point of management for multiple vendor relationships and reducing the compliance burden that often comes with juggling separate systems and providers.

Partners who can reduce compliance friction and prevent last-minute surprises will naturally rise to the top of lender priority lists in 2026.

4. Borrower Experience Expectations Are Rising

As consumers grow accustomed to fast, intuitive digital experiences in other parts of their financial lives, their expectations for the lending process continue to expand. Borrowers want the same clarity and convenience whether they’re applying for a mortgage, a HELOC, or a personal loan.

For lenders, this means the borrower experience is becoming a competitive differentiator, especially in valuation-heavy workflows. Delays, hard-to-follow instructions, and unclear timelines can quickly erode confidence. Conversely, streamlined communication, predictable turn times, and well-orchestrated vendor processes create trust and reduce fallout.

Lenders entering 2026 are increasingly seeking vendor partners who help remove friction instead of adding it, particularly in appraisal, title, and verification workflows. The institution that communicates best and moves the fastest will win more borrowers — even in a lower-volume market.

5. Digital & Document Workflows Will Accelerate and Modernization Will Extend to Energy Efficiency

2026 will be another year of steady progress toward cleaner, more automated lending workflows. Lenders are prioritizing systems that reduce manual document handling, streamline vendor routing, and strengthen LOS integrations. Even partial automation like improved document intake or digital verification will create meaningful efficiency gains, especially for small and mid-sized credit unions with limited lending staff.

But modernization isn’t just about better data pipelines.

In 2026, lenders and appraisers will begin seeing clearer guidance around energy-efficient home features as part of the modernization movement. Solar installations, home battery systems, upgraded insulation, heat pumps, and EV-ready infrastructure are becoming more common, and borrowers increasingly expect these attributes to be recognized in the valuation process.

As appraisal data standards evolve and structured reporting becomes the norm, lenders will benefit from:

• More consistent documentation of green home features

• Reduced valuation disputes involving solar or energy upgrades

• Better alignment with investor and regulatory expectations

• Smoother underwriting review thanks to clearer data fields

Lenders who understand how these features are captured and analyzed will be better positioned to support borrowers making long-term, sustainability-driven upgrades.

Final Thoughts

2026 is shaping up to be a renewed activity and rising expectations. The trends ahead ask lenders and their partners to adapt thoughtfully, strengthen their operations, and make decisions with clarity and confidence. These same trends challenge us at ThinkLattice to reflect on our own direction and how we can better support the clients who rely on us.

We’re excited for where these conversations will take us, and we look forward to helping lenders navigate the year ahead with stability, insight, and strong partnership.