TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/172962
cover story the company closes a lot of FHA loans because they offer loans for lower FICO scores. She explained that the company has developed an affordability matrix that provides an accurate understanding of what borrowers can pay. The company can also close loans in-house without contacting investors or outside underwriters, thereby controlling the entire transaction. Prospect is the second largest 203K lender in the nation for this specialty loan that allows additional money to be borrowed to renovate a home. "We help people who live or want to live in redeveloping neighborhoods and other areas where many houses need repair," Brandt explained. "The 203K loan allows buyers to remodel or restore a home to its full potential. This is good for the community, it protects lenders, and it protects the homebuyer's investment," she added. Brandt's formula for continued success in lending is to be creative and think out of the box, especially in the current regulatory environment. "Although we must take on the costs of increased regulation, we have to find ways to keep costs low, service levels high, and offer maximum value to the consumer," she explained. "This involves a trick of execution, and it's definitely a challenge." Personal Attention and Communication Make the Difference D uring his successful 20-year career as a loan officer, Kevin Watson, Branch Manager for Churchill Mortgage, Brentwood, Tennessee, has seen the results of personal attention and effective communication with clients. "Letting the client know in the beginning what to expect in obtaining a loan is key to having a successful transaction," he said. "It's important to set proper expectations up front and give an overview of the entire process." This includes discussing fees and the need to keep the loan officer informed of any changes in income and assets, unusual deposits, "We felt we were somewhat limited in that we only had one or two investors . . . and so, we started a wholesale channel, which provided us with an additional revenue stream." —David Abrahamson, Equity Loans or inquiries after the time of preapproval so that there will be no surprises before closing. Watson also believes communication with all parties in a transaction is important. He said that he always makes weekly calls to buyers and real estate agents to update them on the status of the transaction. Fast response times are also important and contribute to the satisfaction or dissatisfaction of clients. "I tell my loan officers that fast response times are important to the client and to our referral partners," Watson said. "Most people would rather hear a 'no' now rather than wait a week to find out." The company does its own underwriting, which contributes to Churchill's fast response time. Nowadays, handwritten notes are almost a lost art, but Watson has found this to be a very helpful tool. "After each application, I send a handwritten thank-you note to the applicant, saying 'Thanks for an opportunity to earn your business,'" he said. "I also enclose a couple of business cards. When beginning the process of obtaining a loan, people are more likely to refer us to someone at that time than after they close." For the past 12 years, Watson has kept in touch with previous clients through a quarterly newsletter and another letter telling news about him and his family. He estimates that 40 to 50 percent of his business comes from this source. Recently someone came in that he had not talked to in seven years to sign up for a 15-year refinance loan. Churchill Mortgage has an enviable record of processing more than $1 billion in loans during 2012, and Watson has obviously been responsible for part of that. The company operates without debt, its loan portfolios have lower default rates than average, and the company has never had to repurchase a loan. These are all factors that other lenders could emulate to create continuing success. Tips from Origination's Finest 1. Diversify revenue streams. 2. Look for exceptional talent when hiring loan officers. Hire only the best. 3. Perform your own servicing on loans. 4. Develop long-term customer relationships. 5. Maintain constant communication with everyone associated with each transaction. 6. Create new and unusual referral sources, i.e., divorce attorneys. 7. Educate and counsel your clients. 8. Attend closings. 9. Apply a personal touch such as handwritten notes. 10. Send newsletters about your business and family on a continuing basis. 11. Send birthday, anniversary, and holiday cards. 12. Put clients into the right home at the right time with the right product. 13. Offer and deliver fast response times. 14. Do your own underwriting. 15. Keep your expenses down. 16. Utilize your own funds to initiate and close loans. 17. Stay informed by constantly reading publications about the mortgage industry, compliance, and changes. The M Report | 19