Photo Credit:Andrea Nigels
Survival of the digital fittest
The effects of the financial crisis on housing have been covered; but little is known about it as affected the mortgage origination side. When business was booming, many young people jumped into mortgage lending; including those who saw past the ‘easy money’ aspect of it and truly desired a career. As expected, many left after lenders downsized.
Today the average age of a mortgage originator is 54, said MBA Director of Education Sales, Barbara Hanson during a panel discussion at the 2014 MBA Annual Convention and Expo. Underlining Barbara’s point, Michael Jones, National Sales Manager for Union Home Mortgage, stated in another MBA panel, “I have exactly 10 loan officers with 10 years of experience or less. When my 10-year-old son defeats me in every aspect of technology, it tells me that we have to start making changes in the way we approach new customers.”
If mortgage companies want the next wave of originators to be more effective in the future, they must hire and train originators to understand and be able to interact with Millennials. Although loan officers may have the skills to fulfill Millennial customers’ needs, their mindset must change. Alex Schumacher, Vice President of Marketing, Experian Marketing Services tells Marketing Daily, “Marketers should be aware of the changing expectations of their customers as the Millennial generation enters peak adult spending years. Millennials are omni-channel consumers with mobile being their primary channel of choice. Given that this is a generational reality, marketers should be accelerating their investments in creating and integrating brand experiences incorporating mobile by design.”
The Millennial “always-on” tech and socially-oriented lifestyles call for loan officers to be in tune with mobile platforms which allow consumers to reach them anytime, anywhere. In addition, Millennials are an information-driven generation. Keeping in mind that Millennials are adept at researching homes and interest rates online; this requires loan officers staying ahead of the curve by being more knowledgeable than their clients.
The loan officer who’s able to capitalize on the relationship-driven nature of the mortgage origination business and integrate technology will be able to cultivate those relationships and become more successful.
Gene Lugat, the Executive Vice President of New York-based PrimeLending, A PlainsCapital Company said that the loan officer needs to be a “technician”. Today’s sales people need to add digital marketing skills on top of their ability to create relationships with customers and referral sources. While social media is a tool many sales people use in most industries, those in the mortgage industry shy away because of legitimate concerns over violating federal advertising rules. Lugat said to protect the business, a lender’s compliance department must scrutinize any social media posting which contains an offer.
Debra Killian, president of Connecticut-based Charter Oak Lending Group LLC said, “Part of the concept of what we’re dealing with this new generation is that they are fearless. They have fewer filters; they don’t always understand the consequences of social media. It’s called ‘social media’ for a reason, and it doesn’t always align with business models, particularly in today’s compliance environment.”
Gregory Sayegh, the MetroWest Area Manager for Minnesota-based U.S. Bank Home Mortgage said there were companies at the MBA convention that displayed technology which scrutinized keywords and could block a loan officer’s outgoing social media post or send it to the compliance department for review. Saying sarcastically that it’s the “marketing geniuses” who do not adhere to the compliance rules.
See Millennials Don’t Trust Financial Institutions
Sayegh noted that during the past 13 years, the originator’s role has changed. Loan officers need to be more informed and this includes being more focused on compliance issues involved in originating a mortgage.
Job descriptions may also need to change in order to attract that next generation of originator. Killian said, “I think we are mixed up about what we are trying to attract”, referring to prospective employees. Jones of Union Home Mortgage inferred that it may be a good idea to separate some of the traditional functions of the loan officer between a person who can bring in business and one who have the skills to process the applications.
See How Easy Is It to Get a Mortgage?
See Exploring Millennial Home Buying Hesitancy
Finally, another separating element from other generations is that millennials prefer a salary plus a bonus rather than the traditional 100 percent commission according to Sayegh.
Resources:
National Mortgage News. Recruiting the Next Generation of Loan Officers
MBA NewsLink. Competition, New Demographics Challenge Lenders in Originator Hiring
Marketing Daily. Millennials Most Digitally Connected Generation
101st Annual MBA Convention & Expo. “Next Generation Loan Originators: Planning for the Industry’s Future Workforce”