Many mortgage managers consider their companies to be originator-centric. These senior executives believe that sales employees drive success and they feel that their lender’s originator support is a competitive advantage. I certainly understand this viewpoint, especially in such a difficult recruiting environment. However, I would argue that focusing entirely on the originator experience can lead an organization in the wrong direction. Let me explain.
Recruiting top originators has long been the preferred sales strategy for mortgage banking lenders that want to advance their position in the industry. Unfortunately, maintaining an originator-centric company often comes at the expense of the customer experience. At many lenders, providing an exceptional customer experience is all talk and no action.
Top originators are in high demand because they are excellent at marketing their own personal brand. In these instances, the lender’s brand takes a backseat in order to keep the above-average originators happy. But, this strategy can have unintended consequences. One of the obvious problems is that top producers can be recruited by competitors that offer better commissions, leaving the old lender with reduced volume and revenue. The other issue is that mortgage companies dependent on top originators have typically spent their capital resources on large payouts and not enough on promoting their own brand or implementing technological improvements.
There is no question that this sales strategy has increased the demand for better quality originators. The dynamic is not unlike when a sports team is looking for the right quarterback to get their organization to the Super Bowl. Finding the free agent who can perform like Tom Brady becomes the primary solution to a sales team’s sub-par or average performance. But, even Tom Brady needs a great supporting cast. The “superstar” syndrome has led management teams to put the lender’s long- term interests aside which can have lasting repercussions. Lenders that fail to adopt new technologies such as Day One Certainty or the latest social selling techniques will be left behind.
Sales Strategy for Future Success
So, what should lenders do to ensure future success? In my opinion, a more effective strategy is to focus on process because it recognizes that selling has changed dramatically and the salesperson doesn’t rule the show anymore — the consumer does!
Borrowers have more options than ever before to shop for a home loan. There is an unprecedented amount of information online to help buyers make a purchasing decision. Similar to other retail shopping, home loan prospects expect fast, easy and accurate transactions including automatic loan status updates and electronic closings. Lenders who want to win and keep customers need to get serious about improving customer interaction and the loan process.
Companies that deliver an inconsistent experience will lose customers and their referral business forever. Just read the complaints on the Better Business Bureau and Yelp sites to understand how upset customers are with service that doesn’t measure up.
As we move into 2021, it is time for managers to ask the hard questions about the quality of their lender’s customer interaction. Are borrowers happy enough with their experience that they’re sending referrals your way? Or, is your company still relying on low interest rates to satisfy customers?