The Evolution Of The Mortgage Banker

*The Evolution Of The Mortgage Banker*
**By Ted Hicks**

***Who is the mortgage banker of the future?  It’s the mortgage broker of today.  The mortgage banking industry is seeing a return to basics. The future is becoming the past on a rocky path to recovery.  It’s cyclical as we’ve seen in the past.  We’re seeing more borrowers having to come to the table with 20% down which makes the number of qualified buyers with adequate funding less than optimal.  Competition for this smaller business pool is fierce, allowing borrowers a choice on a more personal level who they would prefer to do business with.  It’s the basics—customer service—that can make the difference.

****Rates will go back up, the economy will grow, and the cycle will begin again.  The trend is cautionary with a hope for stability.  As the industry cycles upward for mortgage bankers, opportunities for brokers begin to decline.  So what we are seeing now, and what we will continue to see in the next few years, is an increase in the number of brokers moving toward mortgage banking.  We’ll see them joining existing operations or branching out on their own.  We’ll see them shift focus from primary to correspondent and beyond to direct lending.

****With the shift to direct lending, we’ll see more sophisticated products and a move from best efforts to mandatory.  Because of this, they’ll learn how to hedge and how to pool the loan to create mortgage backed securities.  And for each step of the evolution, there will be a new wave of mortgage bankers taking it—one at a time.  Learning the process is the first step.  But what can these new breed of mortgage bankers do to be successful as they keep the evolution going?

****Technology is undoubtedly on the forefront of giving them a competitive edge.  Technology is a necessary tool for business effectiveness.  Being able to market online through websites and social media is a large part of today’s growth strategies.  Having an LOS that helps enforce compliance and allows control and oversight for growing businesses is a must.  Being able to access data and files on-the-go is also very important for evolving lenders.

****But as important as technology is during the process, getting back to the basics of personal business interaction is even more so.  All the technology in the world would be insignificant if there is no new business coming in.  Tech-savvy professionals cannot focus solely on the benefits of sophisticated technology.  What will become evident is that honing their technique, not their technology, will give them the edge they need.

****Getting back to the basics means building relationships in person rather than just online.  Form business alliances with industry vendors and help each other grow.  Refine your database and find new ways to grow your business.  Building relationships with your borrowers, your builders, realtors, and other vendors or potential clients gives you the edge that depending on technology simply cannot—service that gets you noticed.

****So while technology is indeed relevant to the evolution process of tomorrow’s mortgage banker, it’s customer service that will bubble to the top in the most successful business.  It’s not going to be enough to have the most efficient business technology.  Technology takes care of business but it takes customer service to grow it.  Lenders at any stage of the cycle need to be competitive in both the front end and the back end to maximize revenue and take the next step.

Ted Hicks is the Director of Product Management at Calyx Software. He started working for Calyx over 4 years ago and is responsible for the research and design of all Calyx products including all issues related to compliance and forms. Ted has spent the last 14 years working as a product management professional in small and large firms providing enterprise software solutions across a variety of industries including Siebel Systems (now Oracle), Aspect Telecommunications, and Epiphany.