Does your lender know how to navigate changes in the market?

by Jon Reed27 Feb 2018

The longer you work in mortgage banking – the more you notice that the industry goes through periodic cycles. Change is an inevitable part of doing business in the mortgage world. The question is – are you working with a lender that anticipates these changes long before they arrive?

Your longevity in the industry heavily depends on your ability to recognize a shift in the market early enough so you can redirect your business before it happens. If your lender doesn’t have a forward focus or if they perceive change too late, it could mean your business takes the hit.

This is what happened in 2017. Many lenders had to downsize or close their doors altogether because they did less volume. During this time when the industry as a whole was down by 9%, New American Funding was up by 4%.

How did your business fare? As a Loan Originator, you should be focused on building relationships with customers and referral partners, not worried about the stability of your company. When you work with a lender that can successfully navigate change – your business reaps the benefit.

How did we do it for our Loan Originators? It’s all about knowing how to time the market. We noticed a change coming long before it arrived and we knew that refinance was not going to be the bulk of business. As a result, we guided our sales force to shift their focus to purchase transactions, which accounted for 65% of our business volume by year’s end; whereas in 2016, purchase loans were 49% of our business.

By staying in tune with the trends and having a good purchase strategy in place, we not only navigated our Loan Originators through the market shift but they outperformed the industry by 13%. Did your company help you boost your business like that? If you’re going to succeed in a changing climate, you have to be working with a lender that stays ahead of the curve. It’s vital to your ongoing success.

Your leadership has to keep their pulse on the market, be aware of potential risks and trends; and constantly look five years down the road. Otherwise, it will be difficult for you to weather the cycles and find long-term success.


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