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Stop Playing The HARP and Remove These Roadblocks!!!

Old Dogs vs. Puppies

You’ve heard me lament (maybe just influenced by my own inflexibilities and infirmities) about our aging population of mortgage peers. Attending MBA events these days is like attending 25 year college reunions, and I’m being generous on the “25”. (On a quick side note the NEMBA Newport conference was very well done in its offerings of speakers, panels and content. It was more driven to the principal, manager or executive but worth every penny).

I am more convinced then ever that there is room and a need for new blood in this industry.  We humans are a habit forming group. We find a ritual that works for us and we find it hard to stray from. Like a college psych experiment, we ran through the maze a particular way and were awarded with significant cheese. We will keep going down that path for years being rewarded for short periods after long stretches of starvation. Looking from above, easier, faster, smarter routes are available if we rats were motivated to explore; but the curiosity isn’t there.

Logically our industry should be full of long term professionals who have grown their business exponentially. Every month you create a new convert to your flock of loyal believers. Each new customer has the power to be an influencer but a minority of them are super influencers who aggressively affect all those around them. People listen to them and trust their opinions. This is why you need to be creating as many relationships weekly as you can. (Gladwell describes these folks well in Tipping Point)

The fact we hate to admit is that this is a numbers game. As Tim Braheem would say. “Those with the most friends wins”. I didn’t like this phrase when I first heard it as it seemed to reward insincerity and spurred visions of cookie carrying loan officers pathetically ingratiating themselves. But I’ve reconsidered this thought with the focus on the MOST aspect. If you are doing two loans a month versus 5 a month you have a 250% greater chance of meeting the super-influencers .  If you are always adding more influencers and retaining those from the past, how can your business be dropping? Maybe you are looking for immediate gratification and being transaction oriented? Maybe you have gone to maintenance and reaction as opposed to growth and catalyst? If you don’t believe me look back at your past loans and think who those people know, and think of all the people involved in each transaction and whether you truly leveraged the opportunity presented.

Instead of keeping the numbers in their favor, I see correspondent and broker loan officers trying to find ways where they can preserve their max income with the minimum amount of customers. They spend much of their time griping about the government, management, TBTF banking conspiracies, Realtors etc. as opposed to looking at their own business. They are doing fewer loans every year and not systematically leveraging their old customers and contacts. Of course volume is down, but your share should be growing. If every year you had been adding new customers instead of solely refinancing the old ones, you would have exponential growth.

During refi booms it’s a double whammy because you lose months of seed planting and you are over-rewarded for a passive activity. After 3 months of refis there is usually the “I need a rest period and lets count the money period”. After 6 months of no planting or leveraging, panic and blame sets in usually targeted at the market, realtors or the employer (who is to blame for not being built to take all 75 of the past customer refis at once after getting 2 loans per month).

As I mentioned in a previous Blog, I was very impressed with Tampa Bay versus the Red Sox this year. I ask myself where would I rather work and where would I rather manage. They don’t have to be the same answer. It’s not a clear decision either. The intoxicating position that a Red Sox organization can offer of a historic brand, unlimited payroll and built in fan-base is hard to resist. But the idea of a team built upon the future and the best potential today with some wise veterans playing leadership roles all backed by a supportive but demanding coach sure can be appealing upon deeper inspection.

Like the appraisers, we are dying off and not replenishing ourselves. Most of us are dying prematurely due to the choices we are making. So what choices do we have? As leaders we need to find ways to grow our own, standing them on our shoulders and learning from our mistakes. Testing for call reluctance upfront is crucial. That is the one thing you can’t teach.

As senior producers we need to be mentors and then we can replicate ourselves and become managers over time. The problem is that most good producers end up hiring neighbors, friends, relatives and worst of all offspring of their top referral sources. It is normally a knee-jerk hire with little forethought and it ends poorly with the producer swearing off hiring, trusting or replicating.

It is no longer an option to stick our heads in the sand or fight over depreciating experienced assets. The future of our industry lies with those who aren’t even it yet and it is up to us to find, welcome and support them.


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In 1981 here in New England, the mortgage industry consisted of John Souza (CMC) and the various Community Banks, Thrifts and Credit Unions. Bank of New England, Fleet, Bank of Boston, Citizens etc had yet to ramp up their Mtg Departments or separate Mortgage Company subsidiaries. With MetLife pulling out, Wells yawning, BAM bleeding, it appears that we will come full circle back to Community Banks and well-heeled Mortgage Lenders with continuing abilities to produce loans for less cost than the bigger lenders.

Tom Phinney
Mortgage Banking Recruiter
Arthur Blair Associates

Yeah, I saw some of the pictures from the convention and it's the good ole boys that I recognize when I was attending those events 20 years ago.

The MBA, NAMB and the other one with Marc Savitt might consider "scholarship" programs to bring in new blood.

Mortgage COmpanies could consider providing "interships" thru their local universities. Or campus recruiting.

These are the people who are social media savvy and will rule the industry....if we teach them the basics and the rules.

Thanks for a great post.

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