Which of the following is a consequence of churning in the mortgage industry?

Churning in the mortgage industry refers to the practice of repeatedly refinancing loans, often for the purpose of generating additional fees for lenders or brokers rather than benefiting the borrower. One of the key consequences of churning is the increase in loan origination fees. When borrowers are encouraged to refinance frequently, they often incur new fees each time, which can add up significantly. This practice can lead to situations where the borrower might not be saving money in the long run and could even be paying more due to the accumulation of these fees.

Higher interest rates could occur if a borrower’s financial situation deteriorates or if market conditions change, but this is not a direct consequence of churning itself. Increased consumer trust typically diminishes in the wake of churning practices, as borrowers may feel exploited once they realize they are being refinanced for the lender's profit rather than their own benefit. Pathways to homeownership generally imply helping consumers achieve stable mortgage terms conducive to ownership, which churning contradicts, as it often undermines long-term financial stability. Thus, increased loan origination fees is clearly the most relevant and direct consequence of churning in this context.