DEC 2, 2013

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What We're Hearing

Mortgage Hunters, Gatherers Bring Us Back to the Roots

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WE’RE HEARING the holidays are a time of year to be thankful for what we have, to celebrate our good fortune with family and friends. Thanksgiving started out as an opportunity to give thanks to and for the hunters and gatherers (including those in the mortgage business).

During the pre-colonial period, it was these professionals who made it possible for us to survive the harsh conditions of the new world. Of course, for Americans, it has become an extreme celebration and the meaning of hunting and gathering has surely changed.

We are thankful for our food and sustenance, so we proceed to gather together and over indulge throughout the holiday season. We are thankful for our way of life and our good fortune, so we go on a Black Friday rampage, hunting for bargains and battling it out with our fellow citizens for cheap electronics or other presumably useful gadgets.

It may be time for us to return to our roots—or at least the roots of this particular holiday. So, this year, I will provide some commentary about hunting and gathering in the mortgage business and share a bit about what I am thankful for.

I am thankful for the best of the hunters among us, the professional loan officer, who is good for the industry. These are the sales professionals that have always focused on doing the best job for the consumer, who have strong and lasting relationships with referral sources and years of successful originations.

They have built their businesses on their ability to counsel consumers through a very complicated process, and their ability to communicate the requirements of that process to their borrowers. They have always helped the consumer choose the right product for their needs and not the product that generates the most profit for themselves at the expense of those needs.

These are the survivors, who know what it means to hunt for business and how to get that job done. These professionals are now truly in demand, as many companies that want to survive are trying to create a tribe of such hunters to keep bringing in the business as the industry makes its way through this serious downturn.

And I’m thankful for that other brand of successful hunter. These are the ones that have figured out a different way to generate business. These hunters run the companies that have learned how to engage consumers through different channels, how to leverage data, and how to do business in the new ways consumers are now demanding.

These are some great, innovative companies that have become far more crafty in their hunting, sort of like Katniss Everdeen in the “Hunger Games.” This kind of hunter knows not only how to survive on her smarts but also how to look darn good doing it.

(Let the record reflect that I have a teenager at home, so I have read the full “Hunger Games” trilogy as a way to engage my daughter and not because I find the stories gripping, suspenseful and actually thought provoking once you get past the part with the cute girl shooting arrows in a dystopian future. And I’m not ashamed to admit any of this.) I am thankful for those types of companies, not just because they hire the best hunters but because they hunt in a totally different way.

I would also like to offer a personal word of thanks to all those mortgage sales professionals that care enough to reach out to me, find me on LinkedIn, post on the blog, and engage in the conversation. I can usually spot the truly successful hunters from the “also rans” of the industry based on how they approach me, which usually reveals much about how they approach change.

The winners focus on the customer and how they can change their business to be more successful. They see opportunity where others see threats. They are the ones that consistently get high scores on their MortgageSAT surveys, and are focused on the future of the industry. They have given up on the lament of “how things used to be.”

The lower performers are also easy to spot, as they complain about the new rules, the level of change, and how they are impacted by market turmoil. You see, they don’t focus on the consumer; they focus on the impact of change on them. They cling to the past, rather than embrace a future that they can be successful in. After all, traditions may be great on Thanksgiving (how else can you explain the popularity of canned cranberry sauce), but clinging to age-old traditions in the business world is not a recipe for success.

So, my salute is to the successful hunter, who successfully generates the business needed to keep the rest of the supply chain fed.

In the past month, I have talked to dozens of mortgage companies that are considering how to adjust their compensation plans for the new market and the new regulations. These conversations are often about numbers, including how to model a new plan in a changing market. But they also tell us a lot about the individual company’s values, and what is important to them. It’s rather like the way conversations around the holiday dinner table can tell us more about relatives than just following their Facebook posts.

The best companies are not trying to work around the new rules, but to embrace them as a way to redesign their companies to be more successful in the future. They are figuring out how to pay LOs not just for originating business, but also for quality, customer service and other critical metrics of success. In this way, they are creating a breed of hunter who does not simply seek the kill, but rather acts as a steward who harvests the land with an eye toward future harvests and continued success in the future.

Next week, I will talk about the gatherers among us. These are the ones that help set the table of success by dealing with the paperwork, the process and the new rules needed to be successful. Just thinking of all the steps required to get a loan done makes me want to take a nap, yet another holiday tradition.

Garth Graham is a partner with Stratmor Group, and has over 25 years of mortgage experience, from Fortune 500 companies to startups, including management of two of the most successful mortgage e-commerce platforms. He was formerly with Chase Manhattan Mortgage and ABN Amro, where he was a senior executive during the sale of its mortgage group to Citigroup.

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