There are plenty of things you can do which will allow your business to stay running in the near term.
I get the opportunity to attend and deliver seminars at a number of mortgage conferences and banking conventions around the country. I enjoy hearing other speakers and learning from their insight and expertise. As I listen to the market "gurus" and economists at these events, the common message is that we are still in the midst of nothing less than a "crisis" in our industry and that it will be quite a while before a full recovery is felt throughout the financial world.
Community banks are still going under, giant lenders continue to post operating losses, and government oversight will pervade our day-to-day business practices. In short: don't let the recent uptick in the stock market fool you. This calamity in the housing sector is far from over.
The last mortgage meltdown I experienced was in the mid-1980s. In the height of the recession we saw interest rates climb to about 20%, builders go belly up, mortgage companies fold by the thousands, and the savings and loan model literally get wiped out. If those who fail to learn from history become doomed to repeat it, what can we learn from our history? What can loan originators do to make it through this mayhem and come out the other side strong? Here are a few suggestions:
1. Take a proactive approach. Instead of a "wait and see what happens" attitude, get busy and get to work. This downturn actually started back in the summer of 2006. It's been four years now. What are you waiting for? It could be another four years to prosperity. Implement new marketing ideas, install new technology systems, make sales calls and reach out to potential borrowers. Don't wait. Take action. Move forward. Now.
2. Build a plan. This is not the environment for coming into work every day to "see what happens." Invest one hour (today would be best) to build a written business plan for the second half of the year. Include your income, closing, application and contact goals. Calculate your pull-through; how many people do you have to talk with every day to achieve your monthly closing goal? Having a grasp on your business helps you better run a better business.
3. Work with clients who are working. Many real estate agents, builders and other referral sources have pulled back and are suffering. Make sure you are targeting and aligned with serious business professionals who are working as hard as you are. Jettison those who have given up or are sitting on the sidelines waiting for business to come back. Connect with successful people, provide outstanding survive, keep in touch, and you will make money right along side them.
4. Try new products. We are now in a purchase mortgage market dominated by first-time homebuyers. The Federal Housing Administration program could be your meal ticket for the next 12 months. Learn the product inside and out and stay current on the guideline updates. If you are not selling in an FHA market, identify the best loan programs you need to be promoting based on what is selling in your community. Times have changed. Buyers have changed. You need to change as well.
5. Stay away from the nay-sayers. There are people out there that are totally negative. These people may be in your office, working for your company, or on your referral partner client list. Avoid them at all costs. Their bad attitudes will have a detrimental affect on your attitude and outlook. Walk away from office pity parties. Steer clear of "woe is me" people. Whether we like it or not we become the company we keep-so keep good company. Call on, associate with and hang around optimistic, proactive, successful people who will have a positive influence on your life.
Our industry will survive, that's a fact. The market is slowly rebounding and we'll all get back to making more money and having more fun in due time. The question is: Will you be around to see it? The answer depends on what you as a loan originator are going to do today to give yourself a tomorrow in mortgage lending. Be proactive. Have a plan. Work with busy referral clients. Learn and sell new products. Stay away from negative people. Most importantly, have faith-faith in your industry, faith in your country, faith in yourself. As Abe Lincoln himself once said: Without faith all hope is lost.
Douglas Smith is president of Douglas Smith & Associates, a training and coaching firm based in Asheville, N.C. He can be contacted at 877-430-2329 and his website is
