WE’RE HEARING that the comparison to plumbing I made previously can be extended further. Last week, I pondered some of the ways that the plumbing industry can act as a simile for aspects of our own business. I made a reference to plumbers, and also to “cracks” in mortgage systems. I would like to thank all those at the conference who provided positive reviews of my columns, although I am less appreciative of the guy who heckled me as “plumber’s butt” as I passed him in the hallway. But I am always willing to overwork a metaphor (I once gave an entire speech inspired by a highway sign I saw in Michigan) and so I am going to embrace my inner plumber and talk now about my perceptions of the tech conference.
I am happy to report that I thought it was a good conference overall, and I did not see a lot of sewage on the trade show floor. In fact, my team was in so many meetings with lenders during the show that I wasn’t able to spend much time in the exhibit hall. But I did hear a few common themes throughout the event that I’d like to share.
First, and this should be no surprise, I heard plenty of folks talking about their attempts to stay out of hot water. I saw evidence that compliance concerns were at the top of the agenda while we are experiencing volume showering down upon us. As we are in a hurry to get deals done, are we able to follow the tight restrictions that often seem to involve extra steps in the process? Before saying yes, let me ask you, Mr. Compliant Mortgage Banker, how you handled a basic instruction for the morning shower—did you rinse and repeat? I did not think so, and I am pretty sure that was clearly a described step in the shampoo process. Well, there are a lot of mortgage rules that could also be easily dismissed, and in an industry struggling with volume pouring down, there is concern that as the volume pressure wanes, the shower may suddenly go from comfortably warm to scalding under the onslaught of such regulatory pressures. (Bet you did not think I could create a metaphor of compliance involving a bottle of shampoo!)
Secondly, I saw quite a few people getting very excited about mobile technologies. Perhaps it’s because I did so many demos in hallways and late at night at the bar, and it’s easy for vendors to pull out their smartphones and show their newest tools. Some were interesting, but I have to wonder whether consumers will be as excited about it as we are. Proponents talk about the impressive rise of mobile banking as proof that now is the time to get mobile or get left behind. But I interact with my bank at least on a weekly basis, depositing money, checking balances and paying bills. When I take out a mortgage, it’s a month-long relationship (hopefully) and then it’s done for the next five to ten years. Am I really going to download an app for that and go through a complicated learning process? I think it could have an impact, but I’m not sure that the rate of downloading a mortgage app is going to be as strong as for other financial service apps.
I guess that’s like those fancy European bidets that plumbers are asked to install from time to time. A handy tool, I guess, but they haven’t caught on with American consumers other than those who want to get to the bottom of things. Now, real estate agents, on the other hand, might be a great target. These are the kinds of relationships the lender really needs to keep its business healthy, but that can get messy and downright smelly if not properly managed. Having a tool like mobile to keep in touch with these business partners at all times makes sense to me (although the image of my local Realtor sitting on a bidet with a smartphone checking on the status of a loan is not particularly appealing).
One thing was certainly made clear at this show: our industry is a complex system and there are a lot of pipes carrying a lot of information. Groups like MISMO are great for making sure that the data that flows through those pipes all conforms to the same standards, just like a municipal water company creates a standard water supply. But once it gets into those pipes, a lot of things can go wrong and every organization is structured a bit differently. Knowing what’s actually going wrong is the real key to success.
In our business the best way to know is to talk to your customers, something that has traditionally been very hard for us. From the consumer’s perspective, the ability to understand their level of satisfaction and what to do about it would be like a plumber with X-ray vision. He could see exactly where the problem is and what to do about it. And he would therefore be very successful. At the show, Stratmor’s new borrower satisfaction product, MortgageSAT, was released and very well-received. This online system lets lenders know how their processes and people are impacting borrower satisfaction, and may be just the lens that the lender needs to see into the complicated loan process through the eyes of their customers. Could there be any better use for mortgage industry plumbing? And while you contemplate this question, I’m going to use my bidet.
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.