Lenders’ Biggest Dilemma: Invest in Training or Be Replaced


In the last few weeks, nearly every conversation I’ve had with senior mortgage executives has centered on one of two issues: finding sales and processor talent; and delivering an excellent customer experience throughout the loan process.

To be sure, getting the human capital side of the mortgage business right when volume is through the roof can be a challenge. However, personnel problems indicate a larger, more systemic issue.  More often than not, companies pay lip service to how much they value employees but their actions tell a different story. Is it any surprise that turnover rates are sky-high in mortgage banking? It doesn’t need to be that way.

Case in point: When lenders are asked to invest in training, they often take the easy way out and leave it up to employees to improve themselves. While lenders offer trips and prizes to engage their staff, these rewards do nothing to help employees improve their skills to better serve the customer.

Top producers and processors in our industry recognize that updating and developing their skills is essential to excel in their respective positions. Lenders that depend on local managers to fill in the knowledge gaps for average performers can expect uneven results at best.

According to Black Knight research, an astonishing 80% of borrowers who switch lenders do so because of a poor customer experience. This is a direct result of lackluster training and development. As an industry, we can — and must — do better!


The Training and Development Dilemma

In mortgage banking, it is accepted as gospel that when volume is strong, there is no time for training and development; and when volume is weak, there is no money for it. Training and development are viewed as luxuries versus a critical component for generating referrals. Unfortunately, pushing development to the back burner has put lenders in the perilous position of becoming a transactional business dependent on low interest rates. The bottom-line: mortgage bankers that are unable to retain customers and capture referral business will not survive the inevitable shift to a purchase money environment.

Furthermore, lenders that fail to provide employees with personal development and support are missing an opportunity to create a more meaningful connection with their staff. Employees know the score and whether the lender really has their best interests in mind.

As a sales trainer and consultant, what I see most frequently is sales leaders not supporting employees until something dramatic has happened to the lender. Waiting for the ax to fall as a strategy is dangerous when it is so clear that an extraordinary customer experience is driven by how well the production sales staff interacts with the borrower. Every person on the production sales staff needs to be top-notch and well-trained on delivering an outstanding experience or customers won’t be coming back.

I know that the last 18 months has been incredibly hard on mortgage banking staffs. But, the good news is that a portion of the record profits generated can now be allocated to help production sales groups improve their skill sets. Whether we are talking about originators, processors or closers, every mortgage banking professional who interfaces with consumers is challenged to improve their skill sets to succeed in a volatile marketplace.

It isn’t just about technology anymore, but prospects and borrowers want conversations that are helpful and engaging. If not, the borrower will go to another lender. Lenders, the choice is yours whether to train and develop employees or be replaced by the competition.