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What Soccer and Mortgages Have in Common

JUL 3, 2014 10:39am ET
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I am a pretty big soccer fan, and actually played the game in my younger years. I was not able to compete at the college level because UVA has one of the best soccer programs in the country and I was apparently not big, fast or talented enough to compete. I still think they should have let me on the team for my good looks, but the rules must be different at the college level. Naturally, I watched a fair amount of the sport during this year’s World Cup, thinking "what if" as I pondered my truncated athletic career.

Traditionally, Americans have been cool to the idea of soccer as a sport, for the most part. Some have taken a rather aggressive stance over the fact that the rest of the world calls it football, which we say it's not. Still, every time the World Cup rolls around, a core group of Americans tune in to follow the action, though I would venture to say that most of these folks make up what we used to call "emerging mortgage markets" in our industry. That all changed this year.

According to The Wall Street Journal, the game between the U.S. and Ghana scooped up almost 16 million viewers between ESPN and Univision, and the ratings are likely even higher for the tough loss to Belgium. The two networks that carried the game had one thing in common and that was that none of the announcers spoke "American." I say that because during the game the England-born announcer referred to the contest as a "tasty match." Tasty? Is that adjective really used in conjunction with a sport where men run around in shorts?

Of course, the coverage on Univision was in Spanish, which is hard for me to follow since the only word I recognized was "atras," which they sure do with a lot of passes. In fact, I have not seen so much back passing since I looked at a lender’s recent underwriting process, where the typical loan is passed back from underwriting to processing four times. I don’t remember many other words from high school Spanish, but I am pretty sure the Spanish announcers did not use the term "tasty."

One thing that was better with the Spanish-language version was the half time announcers. I was pleased to see Univision continuing the tradition of using beautiful Latinas for the most important stories, like sports and weather.

Could this mean that we’ve caught the fever in this country? Are we doomed to become a nation of soccer fanatics who abandon everything when a "tasty match" is on? Can the metric system be far behind?

I have mixed feelings about this since I see some concerning similarities between soccer and the mortgage industry. First off, in the race to get a loan closed, you either win or you lose. Like the World Cup knockout rounds, there are no ties in the mortgage race. In soccer, you keep playing and in mortgage banking you keep processing until you are done, but ultimately it’s the customer who decides who the winner is.

We are hearing from a lot of lenders that the dreaded "double app" is back in vogue, with borrowers choosing to apply with more than one lender, and then let them battle it out until the end. At Stratmor, we recently analyzed data from over 75 lenders, and actually found that jumbo loan pull through was consistently lower than that of conventional and government loans. Much of this likely has to do with the fact that an application fee (or upfront appraisal fee) is a small ticket item when comparing rates on a big loan. And lenders are willing to take that second app knowing that they still have a chance to steal the loan away from the first lender.

A positive part of the soccer experience is that the time of the game is pretty predictable. In fact, I heard many of my friends (nuevo fans) refer to how nice it was that 45-minute halves were almost exactly 45 minutes. This is really a benefit because our own research shows that meeting the expectation for how long something is supposed to take is almost as important as how long it actually takes.

We do a lot of research on customer satisfaction, and we consistently see that when you meet the borrower’s expectation you get higher satisfaction. So, telling a borrower that it’s going to take 45 days to close a loan is OK if it ends up taking 45 days. That is what soccer viewers get as well, the ability to know how long something is going to take, so they simply prepare themselves to sit and watch for that period of time.

Of course, this does not help the beer and auto insurance advertisers, but it does make for happier viewers and our mortgage satisfaction research shows the same thing.

Finally, there is the issue of "fake injuries." We all got annoyed when these world class athletes get bumped and then throw themselves down on the ground like they have been assaulted. They do this for competitive advantage, to get the referee to give them a free kick or even get an opponent kicked out of the game.

Well, I too often see mortgage executives doing the same thing. They come up with all sorts of reasons that they are being hurt, and sometimes use these to explain lack of performance.

This is why benchmarking is so valuable. It allows you to see, in real numbers, how your company is doing in relation to the others. This would be like a soccer ref being able to ignore all the screaming and playacting and just know who is really hurt, and which competitor should be allowed to continue the game.

I guess soccer does share a lot of features with the mortgage industry, with the possible exception that most of the players in soccer—at least according to my wife—are the hottest thing since male underwear models. Maybe that is another reason the UVA team did not take me. Anyhow, I haven't heard that comment about our industry yet so perhaps I picked the right career after all. Maybe I'll tune into Univision at half time to hear what the hostesses have to say about that. Muy bonita!

Have a great holiday.

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