Innovation In Lending? Look Around, You Are Experiencing The Future!

Many of you remember the hit movie “Back to the Future” and may have thought “Wouldn’t it be amazing to know the future and live it out today?” I submit that in the mortgage lending area you doing just that! While I recognize many in the lending industry are raising a skeptical look at the screen and have concluded that the writer has lost his mind, read on and become one of the enlighten ones.

I have been in the mortgage lending business for some time now. In fact, I had been working for a few months at a savings and loan in downtown Chicago when “Back to the Future” was released. Since then, I have been fortunate enough to have held several managerial positions with great companies and had ever increasing responsibilities always with an eye on working with exceptional people and understanding trends as they develop. In my position as President and CEO of a national company I am fortunate to talk to business leaders across the country from various backgrounds every day. From loan processors to company presidents, from individual state regulators to federal regulatory leaders, one question that seems to be on most of their minds is “ Why haven’t the first time homebuyers come back into the mortgage lending industry in increasing numbers?” The consensus is that there seems to be a lack of motivation and demand to pique this market segment’s interest or economic market forces had driven them out. From loan processors to senior executives I hear about the problems in our industry which tend to keep even the experienced mortgage applicants out of the market for homes let alone the first time homebuyer.

This idea seems to transfer into the area of industry employment as well. At trade association conferences related to the mortgage lending and banking industries, the vast majority of their members are seasoned executives. While I agree that these observations are true in general, I disagree with the suggested future outcome that first time homebuyers or young mortgage industry employees, for that matter, are not going to swell the ranks of the mortgage business now and in the immediate future.

I’m here to say that they already are making a substantial impact and most people are not seeing it because they are distracted by a multitude of what I call “the distraction of market noise, misunderstandings and general trending chatter.” The common focus on all the problems and hurtles in the industry leads to not identifying and using the immense positive ideas showing success among the people surrounding us. But what does that mean? In the following paragraphs I have identified the ideas, people, companies and trends of the future that are taking advantage of capitalizing on these ideas, employing many people and building mega-businesses. You only need to pick those areas which interest you and prepare to move yourself ahead at breakneck speed in light-years instead of our current real-time years.

Most of today’s innovators are have gone through high school and graduated from universities with various degrees. However, the one thing in-common is that they have grown up in the era of smartphones and effective use of time management along with the use and growth of computerized artificial intelligence. We are now living in an era where these concepts have been refined to the point where they are revolutionizing all industries. But how does that affect me you ask? I submit that it already affects everything you do from the everyday business and retail decisions you make every few minutes to entertainment in the apps and gaming industry!

The innovative new leaders of today have forever changed the way we do business in everything. Mortgage lending is no exception, companies like; Lending Club, SOFI, Carnegie Mortgage, LLC, Envoy Mortgage, Quicken Loans, to name a few. They have employed technology enabled account representatives and have used computer generated artificial intelligence programs to streamline the loan application process in all aspects of the loan application from an electronic loan file to a standardized electronic mortgage security. They are changing the loan process to accommodate the consumer in many ways which complement their mobile lifestyle. They have changed the distribution model to one of efficiency and predictability. One which is transforming the current negative perception of the loan process to one which is almost effortless and enjoyable. These are the keys to capturing this market segment’s share and building a sustainable lending industry in the future. These ideas are being employed now. The combination of well-educated employees, new technology and super computers captured in a smartphone or truly mobile laptop computers are revolutionizing all industries, mortgage lending is just one example.

Now that you know the future and I suspect have begun to understand the possibilities it’s time to put them to use for you. You have stayed with me this far which means that you are open minded and seeking direction yet, I suspect that the answer will surprise you. Go out and talk to any academically successful high school student or college undergraduate. Ask them what is important to them and how they intend to live while growing in their careers. Staying in school and getting good grades today is very difficult. They have already figured out how to use their devices and new technology to build on their successes. Identify the resources that you need in your company to capture these same successes in the marketplace. Namely, employees with a winning attitude, software which makes your job easier at less expense and new technology which allows a mobile capability. If you do not move in this direction quickly, in a few years, you will probably be working for a company started by one of those students mentioned earlier.

About The Author

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Russ Haraus is President & CEO of First Look Appraisals, LLC an national appraisal management company licensed in all 50 state plus the District of Columbia. As CEO of a startup and national company, he is familiar with nation trends and leading economic indicators which affect the real estate market and economic growth. He has assembled and trained junior to senior executives in project and team management and has been involved with senior management, mortgage banking, residential appraising and operations management for more than 25 years.