Dallas: Brokers Must Face 'Brutal Facts'

Mortgage brokers will have to face some "brutal facts" about the business in the next year, Ownit Mortgage Solutions chairman and chief executive Bill Dallas told attendees Dec. 6 at the Business Plan 2006 meeting in Las Vegas.The challenge is for mortgage brokers to change while their business is still good, according to Mr. Dallas. Comparing mortgage brokers to the boiled frog parable, he said, "I think what's happening to you and me is, we are being boiled alive," explaining that most originators keep doing the same things even as rates rise. It's been a great run, Mr. Dallas said, but "the party is over, [it's time to] go home, but we don't want to leave." Another challenge is that "everyone wants a piece of your pie," including Realtors, builders, and the retail units of mortgage bankers, he said. But the mortgage is a commodity that nobody wants -- what everyone wants 100% of is the "customer's wallet," Mr. Dallas said. To survive, mortgage brokers need to exploit their competitive advantage of being able to "touch and feel" the customer at the point of sale, he said. Business Plan 2006 is being sponsored by LoanToolbox in conjunction with Broker magazine and Origination News.