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M R EP O RT | 21 EXPERT INSIGHTS Paul Gigliotti is a veteran mort- gage leader with more than 20 years' experience in the financial services and technology industries. He has held executive roles for multiple mortgage lenders and has a distinguished track record of growing lending platforms and streamlining internal and external operational processes. Gigliotti currently serves as Chair of AXIS Lending Academy, a nonprofit education program that offers free hybrid education training to people seeking a career in the mortgage industry while helping home lenders diversify their work- force and lower costs. Previously, he served as COO of Pinnacle Home Loans, and EVP of Operations for West Coast Mortgage, where he led several technology initiatives. He also serves on the board of directors for the California Mortgage Bankers Association. Gigliotti spoke with MReport about challenges facing lenders in terms of staffing, industry shortfalls regarding automation and training, and why one key to the industry's growth and ongoing success may rely on looking beyond traditional areas of recruitment. M // What impact has the pan- demic had on mortgage firms' staffing needs and strategies? GIGLIOTTI // From a staffing perspective, the pandemic has put lenders through the ringer. As refinance volume reached epic levels, lenders scrambled to recruit fulfillment staff, including loan originators, underwriters, and other production employees. As demand for talent soared, many lenders ended up in bidding wars, offering higher and higher salaries and large signing and retention bonuses. Now, with refinance originations slowing, lenders are left with rising per-loan costs and bloated human resource expenses. M // Has the pandemic exposed any industry weaknesses? GIGLIOTTI // One glaring weak- ness is how the mortgage busi- ness falls woefully short of most other industries in terms of au- tomation and digitization. When the nation went into lockdown last year, lenders had to quickly adopt a patchwork of different processes to close loans remotely. Because they were ill-equipped to make the transition, there was a lot of wasted time and money. Even after all that, in many ways, our industry is still operating in the dark ages compared to other areas of the economy. The pandemic also exposed how poorly trained mortgage op- erations teams were. Most people who work in loan fulfillment are taught to do one or two things well and aren't cross-trained in other areas of the business. As a result, when the market shifted, lenders had trouble transitioning people into different roles. Yet another factor in play is the industry's overall lack of diversity—not only its lack of racial and gender diversity, but a lack of diversity in professional experiences and mindsets as well. Our industry has been led by the same people using the same ideas and strategies for decades. That has to change for our industry to improve. M // Why is the mortgage sec- tor so technologically impaired? GIGLIOTTI // There are several reasons, but one of the biggest is that most lenders do a poor job of upgrading their systems. As a result, most people working in the industry today are using outdated software and processes. Even while navigating through COVID-19 and record loan pro- duction, few lenders bothered to upgrade their systems or retrain employees. All their resources were focused on closing the volume at hand with the same tools and processes they've used for years. M // How can the industry over- come these obstacles? GIGLIOTTI // Frankly, we need to bring in talented people from other industries who have differ- ent experiences and perspectives. There are many talented people who lost their jobs during the pandemic and are looking for a new career. It's time to bring in folks who have developed skills and expertise in other fields that can be applied to the mortgage industry. Our industry needs diversifica- tion. Attracting a more diverse group of folks who come from different backgrounds and have fresh ideas and new ways of doing things can only make our industry better. M // How would new industry entrants learn the mortgage trade? GIGLIOTTI // There are many ways to learn the trade. Most large mortgage companies have their own proprietary training programs. There are also orga- nizations that, for a fee, provide training in mortgage processing and underwriting. At AXIS Lending Academy, we take a different approach. We target people who need to find a new career, whether they've lost a job or are simply unhappy with what they are currently doing. Then we do more than train them for a specific role or task—we pro- vide a comprehensive education about all aspects of the mortgage banking business. We also expose them to the most current technolo- gies, so they are prepared for long- term career success. M // How do you determine who gets accepted into the academy? GIGLIOTTI // We focus on the in- dividual. We developed our own predictive index profile that gauges someone's aptitude in mortgage lending operations. For individuals who rate high on the index, we ask them to write a moving essay explaining why they're looking for a new opportunity. If they dem- onstrate the ability and passion for a new career in the mortgage industry, they're in. M // How much time do these applicants spend getting their education? GIGLIOTTI // Our educational program lasts three months. Candidates go through a 30-day live online education program, a 30-day hands-on interactive lab, and a 30-day paid internship at PJ Operations, an innovative loan fulfillment provider. Class takes place three times weekly from 4 to 7 p.m., which enables candi- dates to keep their current job while they learn. By making education, hands- on training, and mortgage careers accessible to more people, we're trying to build a more diverse industry and help lenders over- come some of the obstacles I just mentioned. As Nelson Mandela said, "Education is the most powerful weapon which you can use to change the world." Paul Gigliotti, President, AXIS Lending Academy