Track 1: Your playbook for the 2022-23 talent recruiting & retention war

The dropoff of refi units is why our industry slowed, and this means 2 things: you need more loan officers and you must focus on realtors to get more purchases. This session covers how you're doing this, and also provides key trends on why LOs move between banks and nonbanks. This is a recruiting and retention strategy session you can't miss.     

Transcription:

Heidi Patalano (00:05):

Hello everyone. Thanks for joining us. I am Heidi Patalano editor in chief of National Mortgage News. So glad to welcome my panelists. Today we have Steven Majerus CEO of Synergy One Lending Jeff Walton CEO of Ingenious and Hailey Parker area business development manager in Scottsdale Arizona at Fairway. Yeah thank you all so much for joining us here today. So the panel topic is your playbook for talent recruiting and retention. I guess first I want to start off by giving everyone a sense of where each of you are coming from in this in terms of your own handling of this issue. So I guess we could just start from here out Steven if you want to begin.

Steven Majerus (00:53):

Sure. Obviously in a market that we are currently experiencing a lot of across currents about people pick picking up their heads and looking around. And so we are trying to balance like most companies are between making sure that we are retaining and keeping rabid fans in inside our company and retaining them as well as as reaching out and providing the exposure to additional opportunities or people might be looking around for a company. And we are a mid-size to small size independent mortgage banker. So we are a lot about innovation innovative approach to growing loan officer businesses and enterprise businesses. So I can expand on that a little later but that is kind of the kind of the backdrop for us. Yeah.

Heidi Patalano (01:47):

Great. And Jeff Yeah you have got a very interesting business. So tell us about that.

Steven Majerus (01:53):

Yeah no it is interesting despite being data but it is data analytics that is pertaining to recruiting retention diverse markets and realtor relationships right? Right. And so we see a lot of what is going on in the marketplace. It is pretty clear right now that there is a lot of movement in the marketplace today and you know there is many different ways to slice it to look at it to say how do we retain and how do we recruit and how do we zero in on the loan officers that best fit our company and match the strengths of our company? And that is what we try and do.

Heidi Patalano (02:39):

Right Right. And Haley?

Haley Parker (02:41):

Yeah. Hi everyone. I would say right now we are just focused on giving a platform for our loan officers to have the ability to grow and scale a lot of autonomy a lot of ability to brand a lot of ability to you know create the book of business that they want and desire and therefore it brings attention for recruiting. And we give so much support that you know they are really happy and they do not want to go anywhere. And Right. The number one goal is to just add so much support and value to our originators. And like Steve said too to make you know rabbit fans inside the company.

Heidi Patalano (03:16):

Right. I think it is really interesting to have you and Steve here together because you are both in very competitive real estate markets. Yes. So certainly you have os that have plenty of options in terms of where to go but well first I guess I want to start with the recruitment piece of this and identifying the people that you want. And so I know that in a time when it is mostly a purchase market you want the people that have the solid relationships with realtors. So I guess if each of you could talk about that. I know yeah I guess we will just actually Hailey I am sorry. I will start with you and then come in.

Haley Parker (03:52):

Yeah sure. Absolutely. It is interesting at Fairway our branch our model has always been purchased business. Pre covid, it is something that we have always dialed in on. So when we are looking for the right loan officers to fit you know to join us us that is just how most business is done in Phoenix to be completely honest. It is a very cut throat market. It is extremely competitive. And I think most originators that are even playing in the game in in Phoenix and the surrounding markets that I support they are already in that purchase driven mode. And so if they had not been and they have interest we have a ton of education and things in place to help them grow and scale. But I was happy to see the purchase market come back to tell you the truth cuz that is our bread and butter and that is what we've always done. So I was really kinda excited to get back to the basics and get back to doing what we know works. Yeah. Right

Heidi Patalano (04:54):

Right. And so Jeff I think it is interesting that your approach in finding those people it is data driven in terms of finding the people that would be most attractive to a certain lender. You talked about finding people who do business like you do. So how do you do that with using your data? Right.

Jeff Walton (05:14):

So we are further up the funnel Yep. Than Haley is and what we try and do is we try and use our dynamic filtering so that we can match the loan originator's strengths to the lender's strengths. So we do the filtering. So you can say I want somebody that does between 20 and 60 million in production. I do not necessarily want the you know $500 million a year producer. They are a culture killer and stuff and so that is our sweet spot. Maybe it is not but you can determine that based on your culture. And then we also want somebody that does more purchase like 60% purchase maybe 90% this mark. I do not know we will see how tomorrow goes. Right. But then you can also say I want profitable so I want doing at least 25 or 30% FHA and we are not a big jumbo lender so I just want somebody that is less than 5% jumbo and I want to look at their production for this time period from anywhere from January of 18 to current.

(06:11)

And then when you filter for all that it is going to match your culture and who you are looking for. And that is who we try and deliver so that you are going after the sweet spot of those people instead of trying to go out find those people drilling down on them to find out and casting away the ones that do not work. It is make it much more efficient. And then what we also talked about was that you you have got this real culture of you know putting your arms around her right? 100%. And I have got a culture of finding the ones that fit you. The in between is that if you integrate into her CRM Yeah. And you go after them at scale you can be even more efficient and productive in your recruiting. Right? Yeah. Because if she gets a hold of somebody that matches her culture I get a feeling she's going to land them and do really well.

Haley Parker (07:00):

So well you got to definitely connect and be human. And it is really fun to be on stage with you Jeff that you are over here on this side of all this data and I am over here on this side. But how

Jeff Walton (07:11):

Do we translate that?

Haley Parker (07:12):

Right? Because it takes both. It does. It is not just one and I think that is anyway.

Heidi Patalano (07:17):

Yeah absolutely. Very cool. You want me to jump in? Yes. Yes. Sorry.

Steven Majerus (07:23):

Pardon? So I mean it is fascinating and I I love Jeff's business because we as a overall theme at the company we try and start to leverage data as much as possible and any number of use cases and use all we used analytics like Jeff's describing in all of our decision making in overall attraction for either individual loan officers or sales leadership roles of the company. And not only we do we base that on who we want and the profile of that person but really will also establish parameters most likely for an offer. Because that we that data assuming the data is valid and accurate we we want to always be in a position where we do not want to overpay for somebody versus or or frankly under offer somebody that that might warrant a more aggressive offer. So we use it not only just to match all the other things that you guys were talking about Yep. But make sure that that also ties in a transparent way that we discuss with them right from the very beginning about what this is all actually being based on. Yeah.

Jeff Walton (08:36):

And the data has to be accurate for you to be effective with that recruit or else you lose your Credibility a hundred percent. Very important.

Steven Majerus (08:43):

Yep. A hundred percent.

Heidi Patalano (08:44):

Right. Right. So Jeff where can you tell us I know it is probably a proprietary mix of course of how you come up with all this information but can you talk a little bit about where your data comes from and how how it is developed?

Jeff Walton (08:56):

Yeah. So we are not an aggregator of data. We buy data from different sources. There is national data and there is actually regional players that have very good data in certain regions of the country. Right. The part that makes us accurate right? Is that we take all these different sources of data like three different sources of deed data which tends to be messy and not always accurate. And then we match that against umls data hum to data MLS data. And then we take it and we blender blend it and we sequence it in what we have is a patent depending process it bounces it off each other and the result is very accurate and very granular data. Right. And then you start with that and then you also you have the dynamic filters and then you integrate it and it completes the circle and really drives really good results.

Heidi Patalano (09:51):

Yeah, that is fascinating that there is when you put it all together Yep. You can come up with something so accurate. We talked a bit about having a culture that where you really embrace the ello you want them to stay you create something that makes them really want to stay with you. So I guess could we talk a little bit about the non monetary the intangibles that you are bringing to the table that really both make it appealing as a way to recruit and a way to keep people there? him do

Haley Parker (10:25):

You want to start? Yeah. I would say the biggest the biggest asset right now that we have is we are not flinging an originator to any kind of webinar to any kind of website for any kind of training understanding tech how they are going to market. They are working with myself. I have a team of six girls designated straight to helping an originator onboard promote market and handle biz dev right out the gate. And the fact that you know my friend Alex is sitting here in sales Boomerang is one of our many tools that we absolutely love. And you know I am able to talk with them about the tool that is going to help them grow their business face to face one on one as opposed to sitting in a group setting or on Zoom. And that one on one time spent really teaching them how ends up saving me my team time in the end the recruit the new originator time because we are getting right to it.

(11:25)

And that kind of that creates a culture and they are happy because they are getting the help that they needed. Cuz usually at the last company that they were at they are getting put into some sort of portal or they are they have to wait in line or at 72 hours till somebody gets back to. And we are just you know we are speed to respond. We move quick we want to truly get them help to understand all these great tools and tech that is out there for everybody. But there is a gap right now and originator understanding all that. And so I think it takes people to help bring it together. And that has been a massive piece of retention and culture. And then that all you said the word it brings attention. Right? And so then other loan officers your competitors are wondering Oh my gosh what is going on over there? What are they doing? Yeah. And so then it just you know naturally leads to recruiting. Yeah. So it is been really exciting. We are having a blast. We the culture of just keeping everybody tucked in and happy the real way that all of us truly want to do business. And when we do it and lead from that perspective it just makes a makes a big difference. Yeah.

Steven Majerus (12:34):

If I could just pick up on a couple of points. I like the way Haley is thinking about those things that she does in terms of providing training and education that bolsters either a new person or existing person their confidence, yeah. Around the tools and technology and things like that. Because if the better they understand it the more they know how to utilize it day in and day out

Haley Parker (12:56):

And their agent partners.

Steven Majerus (12:57):

Exactly. And their agent partners then it becomes more mainstream for them. It becomes habitual. Totally. And now they are more confident to go out and slay the dragon that they want to go slay every day. And as we were talking about earlier makes it much more much easier for them to cut out the noise of the market that might happen on any given day. Yeah. And focus on the things that really really matter. I would also say overall and I love the way you said about just making that cultural it just turns into a cultural thing. I would also say that today particularly transparency and being honest with our all employees sales people included about the dynamics of the market today the effect that it has on the company what drives our decisions during this time period is really really valuable.

(13:48)

We find that those you know sometimes you have to say okay this is an adult conversation what we need to have about this that in the end those are building blocks for trust and helping that retention piece which I think is really really important for all of us running companies these days given the dynamics of the market. And then the other thing honestly that I could talk about other things but operational excellence today which I know Fairway embraces as well is really it speaks to some aspects of the consumer experience, but in the end the operational excellence meaning consistency and being able to deliver for partners and clients because every loan is more valuable today because there are not 28 behind them. Yeah. they really want to know that you care at that level at the loan level to make sure that you are doing everything possible for that to succeed. So I think focusing on narrower bucket of important items and not being so spread out on multiple things is really valuable on the retention piece that you are talking about.

Heidi Patalano (14:57):

Right. Right. Well you know there is some interesting issues popping up in regards to hiring and regulation and we did briefly talk about this in a our in earlier conversation preparing for today. There was a recent enforcement against Trident Mortgage where they were the CFPB and the DOJ alleged Trident redlined in a majority minority neighborhoods through its marketing sales and hiring actions. And so that is something that is important to keep in mind when you are doing your recruitment. And so I just wanted to know how you are thinking about this in a human centric way in a data driven way. How do you tackle an issue like this and ensure that you are compliant?

Steven Majerus (15:46):

A avoid it

(15:50)

I mean for us it is a little daunting to have you know enforcement actions like that. Of course. Yeah. Because you feel like you have a sense about where the arrows might be coming from and you are not looking that direction. Certainly for those things I would say one of the things that we already do that may we may benefit from for things like that is the more we deploy on social media we have influencer strategies that where we target markets before we get to those markets. And so when we do eventually recruit on those markets people have a sense that they know Synergy one lending even though we have not been there and they are not exactly sure why they know about Synergy one Landing. But that kind of can solve that problem because when we target those through data analytics and otherwise you can be there before you are there. And also it makes it a more fertile environment to be able to potentially address those issues prospectively as opposed to in a reactionary mode which nobody wants to ever be in.

Heidi Patalano (16:52):

Right Right. Well that is a really interesting piece of this just social media in general in terms of awareness in first time home buyers. That is certainly something that we have been talking a lot about over the past two days. There is something else I wanted to ask, in terms of the actually circling back to the intangibles one of the things that I thought was really interesting was discussing the ESOPs. So I wondered if you could talk about things like this things that you want to when you are reaching out to someone and really trying to get them on board what are some of the other things that you are offering them?

Haley Parker (17:33):

Do you want to Yeah I mean we have one at Fairway and I tell you what being a private lender it is huge. You know we have a lot of loan officers that have joined us from previous companies and I mean obviously joining us from previous companies but it is kind of towards the end of the day right. In this middle of the week. But I No it is it is massive. I mean when you hear that the company you are working for is private they are not going to go public that the people matter everybody has a voice. I mean it just turns ahead in the recruiting meeting immediately. Yeah, and then we just kind of let it organically go from there. It is very powerful to have in our corner.

Steven Majerus (18:17):

Yeah. We certainly utilize components of any ESOP in the recruiting process. To attract people whether those be stock grants and we also allow not only new recruits but existing employees to earn stock appreciation rights that are performance based every year. And there is an aspect of that the company that we have found over time just amplifies the alignment between the sales force and the company at large. And hopefully over time that only builds. But those are aspects of an ESOP that and we were lucky enough when we bought the company a couple years ago that most of our top influencer loan officers actually invested in the company along the side with us in common shares just like I have and so that again reemphasize that but if you can keep that going over time I think that does that is one component of value that helps both the recruiting and retention aspect.

Haley Parker (19:18):

Yeah absolutely.

Jeff Walton (19:20):

I do not have any data on ESOPs. Yeah. But if I could just go back and answer the question on compliance. Absolutely.

Haley Parker (19:26):

Yeah. Okay.

Jeff Walton (19:27):

Cause I have got a lot of data on that.

Haley Parker (19:29):

Yeah. All right. Gosh

Jeff Walton (19:30):

I missed my chance and I am diving back in.

Haley Parker (19:32):

No I am glad.

Jeff Walton (19:34):

What we are compliance what we are seeing in the marketplace with the CFP B? Yeah. And particularly the Department of Justice is they have got a initiative on majority minority neighborhoods. Right. And they use that as the measuring stick today to say Are you digitally redlining? And that is what Triton got caught at 24 million fine. Put out of business. And we have clients now coming to us saying Hey majority minority neighborhood is the next hottest thing. This is what we are being looked at. And it is really tough if you do not know how you are doing in those neighborhoods. We know how to measure that against your peers and where you stand. And then we also am helping people put in place how to recruit to those neighborhoods and those people that are in lending in those neighborhoods both on the realtor side and on the lender side. And I think it is going to be a very hot topic soon to come along with states. There is seven of now that have passed CRA requirements for independent mortgage bankers. And that like to me that is the next big news that is going to hit our industry that has not hit yet. Right. And so stay tuned.

Steven Majerus (20:53):

Yeah. Great.

Jeff Walton (20:54):

Good. Good. Bumpy. Wait it is already bumpy. It is bumpy. It is already bumpy.

Heidi Patalano (20:58):

All right. Oh that is interesting. Well you know another thing that is just more on a broad scale that I think we are still wrestling with is just being in an office or not being in an office. It is still that is still something that you know is really up in the air. I was wondering if you know can you talk about what your policy is? What do you hear from people that you like? What what are your prospective employees want? What are you hearing? Steve you want to start?

Steven Majerus (21:30):

Yeah sure. You know we are, I would say on the liberal end of of the scale. Yeah, in terms of allowing work from home etcetera. I will tell you though over time I think we are between our HR group and a couple of other groups within the company I have asked them to really dive in deeper to figure out a how do we measure employee engagement for people that are working from home Yeah. To make sure that they are in a good place and also serving the needs of their role and responsibilities of the company. Because I do fear that over time some people who might have started out well in that situation may not be thriving either from my view or from their own. Yeah. As time goes by, circumstances change dynamics change at home things like that people are wrestling with. So I do not have a good answer except for it is continuing to evolve and we are trying to evolve with it and be as flexible and fluid for our employees as much as they would want from us. And I you know it is certainly not at the end of the chapter or yet.

Jeff Walton (22:41):

Yeah for sure. Definitely not.

Steven Majerus (22:43):

Do you guys have a perspective on that?

Haley Parker (22:45):

Yeah I mean same when it comes to operational excellence right? Cause it is so important. So I would say majority operation side they are home. They are loving it they are enjoying it. They know they are welcome to come back into the office. But from the sales perspective and we were just having this conversation Steve is that I look at numbers and I see the people who are coming back into the office every day showing up getting out with their agent partners creating relationships doing all the events getting back into the emotion a rhythm. Their numbers are making a difference than or are you see the difference versus the originator who still kind of is in this tucked in Zoom world at home gets out when they think they need to. And so we just had one of our sales meetings yesterday talking about that it is the originators who are trying to do more business that are sitting there going what should we do?

(23:44)

But they are also the ones that are paralyzed they are scared they are looking at every tech that I do not know if I could use that. I do not know if I should social. I can not do that is not going to work. I am too old. I can not do that. Right. And I am like but the ones who just like push all that aside and they are keeping their heads down and they are getting back into the office and they are showing up in the office. And I think the comradery of being back in the office for sales is important. Yeah. And so I agree. Our top producers they are in the office probably four days outta the week you know? Yeah. It used to maybe be two three but now it is pushing back to four or five. I mean Phoenix is an extremely cut throat competitive market and you have to be out and about and you need to be sharing and creating events and hosting events and teaching agent, letting your agent partners know that we are here. And that is what you talked about with this panel is how do you get more purchase business? Well you have to be out with your agent partners. Yeah.

Steven Majerus (24:44):

We were born in a pandemic. We do not have an office we have no plans to have one.

Haley Parker (24:50):

You

Steven Majerus (24:51):

do not have to change anything. Yeah you are go ahead. We are good. I am jealous. what is an office

Heidi Patalano (24:56):

Yeah. Right. But that is fair. I have heard that one thing is just really hearing your colleague on the phone talking to their client and taking that on and listening to that. Like there is a lot to learn from being in person with people. Yeah. but it is an interesting struggle. Cause you want to remain flexible but you still want to have those touch points where okay let us all agree to be in the office on this one day you know so that you can actually create those moments for people. Yeah. Right.Yeah.

Steven Majerus (25:27):

And for us that happens literally location by location. Yeah. Everybody just tries to figure it out what the right cadence is, but you are right. Being around other people usually more often than not particularly with sales people that is more oxygen in the room for them that they feed off of it. We see the same thing. Right.

Heidi Patalano (25:46):

Right. Well we have a little time for questions if there are any. But I just wanted to throw that out there. I also wanted to just ask you all about like what you see ahead. I always just like to ask everyone like what do you see coming down the line than the next year in terms of hiring in terms of the mortgage landscape? Maybe if we could go down would give me your predictions.

Steven Majerus (26:18):

Yeah. I think in as it relates to recruiting and retention I think that kind of the the state of play today is going to continue for a while. It is going to be very very competitive. And I think a lot of people are going to be looking around. A lot of it is because the force change that companies are having to go through now a lot of sales people or employees want to blame the company first for those force changes instead of looking in the mirror. But that so that will force them to look around and determine whether there is any a better fit for them. And I would encourage and I do in recruiting meetings encourage is to make sure that they are seeing the situ the circumstances in the right light. So that whoever they do end up with is actually a truly better situation for them.

(27:08)

Versus a different slightly different version of what they already have because moving is tough. And so I do think that hopefully there is some rationality comes into the recruiting world in terms of transition comp and things like that. I think the market is going to do some of that work for us. But I think it is a lot of people are going to look to change over the next six months because of the things we have been all talking about and the realities of the market today. And I think people are going to have to start to figure out once we get through this time period that sometime in 2023 if there is a normal what does that look like for them? And are they at that right company to be able to thrive in that environment there?

(27:54)

And I think a lot of people for us because we just for us we are about a $4 billion a year originator. We recently brought on about 50 or 60 million a month in run rate business. And really that what resonated more than because we did not outbid any company who they were also looking at we were offering less in terms of transition but innovation more than and transparency really was a proxy for them about where the company where our inertia was going and they wanted they they felt like they had to position themselves with a company that valued that. And they were going to take a bet on that more than anything else.

Jeff Walton (28:36):

Yeah. So our data tells us somehow it was going to be about data. Right. You are right. Our data tells us that the top 10% of the loan originators in the country are doing 56% of the volume. Wow. The top 30% are doing 88% of the volume and the top 50% are doing 97% of all volume. Right. Wow. That means the bottom 50% are doing 3% right? Yeah. And further what our data shows us is that those people at the top are increasing the amount of volume they are doing at the expense at the people in the middle and the bottom. Hmm. Right? Yeah. And so to quote my famous philosopher Sue Woodard Oh I love her.

Steven Majerus (29:26):

Yeah

Jeff Walton (29:26):

Absolutely. Technology is not going to replace you. Right. The loan officer that uses the technology is going to replace you. That is a brilliant so brilliant line. I gave credit to credit too.

Haley Parker (29:43):

Said like what you are saying I mean the other 50% Right. Doing 3% it is stunning. It is stunning. And I just think that there is a lot of opportunity for mortgage companies right now that want to double down triple down on support and true education and true mentorship. And honestly just like culture are really going to thrive next year because so many people are going to be looking. Yeah. And I believe it just comes down to using the right data having the right people there and not just following suit into the canned content of pushing out your culture and your message that is so over and done with and taking the social the right way to get the message out. More face to face more video more energy and it is just going to attract more originators to come to your company. I just believe it is kind of that simple right now because things are off.

Heidi Patalano (30:46):

Yeah.

Haley Parker (30:47):

Are off. And there is a lot of opportunity to be had.

Heidi Patalano (30:49):

Yeah.

Haley Parker (30:50):

Absolutely. Yeah. We are excited about it. I mean it is hard times right now. Everybody knows you are just like drudging through the snowstorm we are going to get there. But when you keep your head down you stay focused you align with the right partners you have the right people in place and it is an it is an exciting time. I mean it is hard. Yeah. But but it is exciting. Yeah absolutely. We are all in this business because we love it honestly. Right. We are super passionate about what we do helping people helping originators grow and scale and their families. It is just we just have to stay the course.

Heidi Patalano (31:22):

Yeah. Absolutely. All right. Well thank you all for being a part of this panel. I really appreciate it. Yeah. And thank you all for joining us. Thank.