TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/172962
cover story Equity is considering doing servicing, which would provide still another stream of revenue. Not only has Equity diversified in finding new streams of income, Abrahamson said its loan officers are doing the same thing. "Like most lenders, they get referrals from Realtors and builders," he said, "but now they are contacting financial planners and even divorce attorneys to find some new clients." During the recession, there were several divorces, and as a result, homes had to be refinanced to get the husband or wife off of the mortgage, or perhaps the home had to be sold to divide the proceeds. In addition to finding ways to increase business, a major area of concern for lenders is adherence to the many new compliance regulations. "Compliance issues take up a lot of time," Abrahamson said. "It's almost like we're in the compliance business, and we do a couple of loans on the side." He feels the key to compliance is to stay ahead of the curve. "Those who learn to adapt and accept will survive," he said. "Those in denial won't make it." Abrahamson also feels it is important for people at every level of a lender's organization to constantly read industry publications to find tips for maintaining success and learn what regulators are saying. He feels that it also helps to find out what other companies are doing. In addition, he suggests that mortgage bankers let their congressmen know about the challenges they are facing regarding the compliance regulations. Long-Term Relationships Provide Foundation for Success "T he main focus of any mortgage loan business is to serve the customer and develop a long-term relationship that begins at the closing," advised Marcus McCue, EVP 18 | The M Report "Work with what you have. It's not about finding a magic bullet; it's about developing the contacts you already have on a daily and continuing basis." —Marcus McCue, Guardian Mortgage and CMO, Guardian Mortgage, Dallas, Texas. He believes that is the basis for a successful mortgage business. In 2013, McCue was voted one of Dallas' "Best Mortgage Professionals" by D Magazine for the fourth consecutive year. To accomplish this, McCue recommends that lenders investigate options for retaining servicing. Guardian Mortgage, organized in 1965, is unique in that it is an independent mortgage banker, but unlike most, services 100 percent of its loans. In doing this, McCue said this practice diversifies Guardian's income stream and has made the company very stable and capable of withstanding mortgage crises. "Servicing has some risks, but overall, we've found it to be a very worthwhile investment. If you can format a good strategic plan and focus on the quality of the loans originated for the servicing portfolio, it's like an annuity," he explained. Because Guardian has for many years established long-term relationships with its clients, the company's business development does not include advertising. "Our business development is 100 percent by referral," McCue said. "We don't buy any lead lists, advertise to the general public, or use any online sources to get leads." Servicing its own loans ensures that Guardian's customers are aware of its presence on a monthly basis. To reinforce this awareness, however, the company sends birthday and anniversary cards as well as greetings on holidays. "These touch points are very effective," McCue explained, "and each loan officer must complete a checklist of these types of high-impact points for every transaction." Guardian's loan officers do their best to attend all closings, which is another impressive service Guardian offers. The company also makes it a point to communicate with all parties involved in a transaction. When a Guardian loan officer receives a contract, he calls both brokers on the transaction, introduces himself, states that the borrower has been pre-approved, and explains what that means. McCue said this helps to create a compelling experience for all parties involved from application to closing, and that although this simple interaction may take only five minutes, it has a great impact. One broker told him, "I've been in the business for 25 years, and as the listing agent, I've never had a mortgage company call and give me information about a pending sale." McCue believes the secret of success is just to work with what you have. "It's not about finding a magic bullet; it's about developing the contacts you already have on a daily and continuing basis." Despite Demands of Compliance, Customers Still Come First "T he secret of success in the mortgage business is not a secret. It's just good old customer service," according to Amy Brandt, COO, Prospect Mortgage, Sherman Oaks, California. "A lot of people thought with the advent of the Internet, lending would become a self-service type of industry, but they were very mistaken. Personal contact and assistance is still paramount," she explained. She admits the complexity of producing a quality loan file today is quite demanding and requires a larger investment of time and finances. Nevertheless, Brandt believes lenders must make all processes as seamless as possible. "You can meet all the requirements with precision and still not satisfy the client," she said. "Although customers demand more from us these days, they still want excellent service levels to be maintained." An important service offered by Prospect Mortgage, one of the nation's largest independent residential retail lenders, is counseling to prospective homeowners concerning topics such as how to qualify for a loan, types of loans, and selecting a real estate agent, among others. Although Prospect offers a variety of loans, Brandt noted