In a recent conversation, a mortgage coach told me she was asked to coach an experienced originator who was considered high potential for a sales team. When the coach met with the originator, she found out the individual was only producing two units a month and only worked four days a week. It was clear […]
As anyone in the mortgage banking industry knows, loan origination is a hard job. The emotional roller coaster that originators go through on a daily basis is not for the faint of heart. Today, in our more difficult marketplace, this is especially true. Whether it is coming from the company or the individual, the pressure […]
As 2018 comes to a close, the most popular strategy used by mortgage companies to address weak production numbers is to hire more originators. This strategy of hoping that more salespeople will increase total production is mostly a disaster. For whatever reason, the gamble of going on a hiring spree is a risk senior executives […]
After working with sales organizations for the past 20+ years, I am always amazed how accurate the Pareto principle (80/20) is when analyzing loan officer production. In every sales group, there is always a smaller number of originators (the vital few) who are successful regardless of market conditions, volatile pricing and the highly regulated lending […]
The recent announcement that General Motors will be closing plants has sent shock waves throughout the economy. The news seemed to be a surprise for many and was originally attributed to the tariff wars. However, a closer look reveals that GM had the wrong products and structure to face changing consumer preferences. In a New […]
A recent National Mortgage News article, “Ripple Effects,” observed that a new era in mortgage banking has emerged and that conventional wisdom no longer applies. While everyone can cite today’s challenges such as rising interest rates and low housing inventory, it seems management teams are still relying on old strategies that are no longer effective […]
In a recent Business Insider article, Mark Abadi discussed the difference between amateurs and experts in Scrabble. He said inexperienced players don’t utilize the option to exchange tiles for new ones, thus losing the opportunity to improve future moves which may have higher point values. In essence, Scrabble experts would rather play the long game […]
In my consulting practice, many mortgage executives who I speak with are very concerned about the rising cost to originate a loan in today’s marketplace. According to the MBA, the cost to originate has mushroomed to $8,500 per loan. Making a profit is difficult when originators are being paid large sign-up bonuses and […]
During a recent conversation, a manager discussed how his company was handling an underperforming originator. The lender’s solution was to take away the individual’s draw and benefits but compensate the salesperson for any loans brought in. The manager felt that this approach was a great way to reduce the lender’s costs and address the problem […]
In my opinion, placing an originator in a bank or credit union branch office is a sucker bet. For those unfamiliar with the gambling term, it is a wager in which the expected return is lower than the wager. An example of a sucker bet is the offer of insurance in blackjack. Why is the […]