About a year and a half ago, Rick Elmendorf was pretty appalled at the state of relationships between originators and real estate agents. MSAs were getting publicly scrutinized, and although Elmendorf admits it may have been a well-intentioned method of building partnerships from a corporate standpoint, relationships were disintegrating on the ground.
“When it filtered out to the real estate agent, it was like, go get money from loan officers: pay for my happy hours, write a check for this, write a check for that, and it became a very ‘pay-to-play’ mentality. Quite frankly, it disgusted me,” Elmendorf said. “It was more about a money game: ‘how do I generate more leads that I can't handle anyway?’ It doesn't make sense.”
Some people write op-ed pieces when they’re disgusted. Elmendorf, Loan Consultant and Certified Military Lending Professional at Caliber Home Loans, wrote a book: “The Loan Officer Revolution.” In it, he shares his strategies for building a successful business by creating and adding value to the right relationships.
Elmendorf is one of the top 50 loan originators in the country. He knows a little something about creating strong partnerships, which helped him get to more than $150 million in closed loan volume last year. Part of the issue with originator partnerships is due to how originators market themselves to their partners. If that isn’t done correctly, there’s no added value at all.
“There's two inherent problems in the loan officer's business: Number one, we’re at the bottom of the [sales] funnel. We're way down there at the bottom waiting for the realtor to do all the work versus being part of the conversion process,” he said.
To create a true partnership for the sake of the borrower, Elmendorf says that both parties need to realize that the vast majority of borrowers aren’t working on a two-to-four-week timeline. The education phase is much longer, and although everyone wants to work with borrowers who are ready to jump on a home purchase immediately, the process for most people takes several months.
“I think that’s where the big disconnect is for the loan officers and the realtors—identifying that that’s where the money is made, being able to capture them during that time, having a relationship with them during that phase and then helping them trigger to buy a house. And I found there's two things that trigger people: There's mortgage numbers, and there's the perfect house. So agents are shooting themselves in the foot by not getting a loan officer involved literally at day one,” Elmendorf said.
Elmendorf’s main focus is on loans for active military personnel and veterans. He holds a Certified Military Lending Professional designation from Caliber, which requires further education and testing on the ins and outs of VA financing, VA benefits, and qualification requirements. Many originators, even those who have worked extensively with military members, are unaware of the intricacies of the options available to service members, resulting in the spread of misinformation.
Elmendorf began his mortgage career working with military members. After his father retired from the military, he became a financial advisor for one of the largest financial planning firms to military families, and as Elmendorf gained experience as an originator and started working with military families as well, he “got a heart for them.”
After 9/11 Elmendorf’s business ground to a halt. As he saw the ramifications of the attack on his clients and their families, it further cemented his commitment to providing military personnel with the same kind of service that they give to their country.
“[I’m] there to answer questions, to direct them. I give advice, and I think everybody should be like this. Give advice, don’t expect anything from your time or efforts. Just give it and it'll come back to you. So that's where I've always tried to be.”
Since reading the book “Business @ the Speed of Thought,” Elmendorf has also tried to concoct every element of his business around the two concepts of a speedy response and professionalism in presentation. The rest is just window dressing.
“Those simple things, grassroots stuff, is what business is still all about. Yes, there's automation, but automation should do nothing but get me in front of the right people quicker. It still takes speedy response and professionalism, presentation, and a real live body. Robots aren’t doing mortgages—yet. Maybe Quicken will, who knows. But until Alexa does my mortgage, we're still going to need to talk to people for things,” he said.
The mortgage market transformation is far from over. Still, there’s great potential in upheaval, and for new originators who are starting their career at this moment, it’s an open playing field. An aging industry means that there’s a desperate need for fresh faces and new perspectives on how the seasoned pros can reinvent themselves in this new landscape. New times call for new skills, and new people can really make a killing.
“It's a great time to get in the mortgage business. Baron Rothschild said, ‘buy when there’s blood in the streets.’ Loan officers are starting to drop like flies, and as the industry truncates even more, you’re going to see more of that happening,” Elmendorf said.