Mortgage Originators

How much is a good loan officer worth? How much does a bad loan officer cost you? When you think of “how much” with each question, don’t just think in financial terms. Money is a big concern, but it’s important that you consider time, energy, stress and “fit” as well. How much time are you spending with high-maintenance loan officers? How much energy are they costing you? How much stress? Do they “fit” within the culture of your company? Are they aligned with what you’re trying to accomplish? If you don’t put some thought and work into these questions, you’ll find the path to mortgage success very bumpy indeed.

Recruiting, hiring and retaining talented people is a difficult job. The first step toward success is to understand the nuances between recruiting and hiring. Recruiting to seek out talented players who will support your business’s outcomes, getting them onboard, and aligning their personal outcomes with those of the company is the trick. You may have someone in your company who is excellent at recruiting yet falls short in the hiring process. In the restaurant business they have a saying, “Get ’em in…get ’em out… get ’em back!” We certainly don’t want to take that approach in the mortgage business. We could say, “Get ’em in… get ’em going… keep ’em!”

If you invest and commit to a recruiting effort, you must also invest and commit to the implementation of the hiring effort as well. I have seen many mortgage companies make great decisions, while falling short on the implementation process. This has a tendency to remove most of the value of a great decision. While managing, mentoring and keeping talented mortgage originators are important to success, the purpose of this article is to “Get ’em and get ’em going.”

Have you ever wondered why some managers always seem to attract talent? Some managers seem to attract top achievers like a magnet. When you look at the manager and the leadership, isn’t it sometimes difficult to see at first glance what makes the difference? If you look at the internal makings of a great leader, you will find that they are effective communicators, have an incredible work ethic and are masters of managing themselves. In addition to that, they are skilled at connecting the dots of any plan; the dots of getting from point A to point B. These traits must exist in order for any manager or company to recruit and retain top people.

I recently had a mortgage-banking president ask me how to recruit because his company was having a problem landing good people. After I asked a few questions, I immediately saw the problem. I told him that the first step toward expanding his organization was to commit to and invest resources into its growth. A decision and a commitment both in time and money must be invested to get the kind of players who can do the job. You can’t expect to attract top producers to your organizations if you’re not deliberately and diligently seeking them out and tracking your results. Define what you’re looking for and go after it, then track and measure the results you’re getting. The following steps will guide you through an effective and proven recruiting strategy.

1. Profile your ideal candidate. Write a job description. What are you looking for? What type of loan originator? What volume level do you want person to achieve? The more details you have about what you are looking for, the more accurate your end result will be.

2. Develop a hiring plan. Once you know what you’re looking for, you can develop a plan to achieve your desired outcome. This plan must include a timetable for your outcome, the personnel involved in this recruiting process, an all other aspects regarding territory, type of originator, and so on. My recommendation is to have three different recruiting plans. Plan one is for recruiting new loan originators. These would include, but not be limited to, college graduates, UPS drivers, sales route drivers, real estate agents, title company reps, medicals sales reps, insurance sales reps, or anyone else you would approve to train. Second, is a plan to recruit mid-range originators. These include all mortgage originators with some experience and background in mortgage lending, i.e., hard money background, minimal mortgage background, minimum productions background, and other such areas. Plan three would include medium to top mortgage originators who are currently active in the marketplace. These are the players who have existing production and can hit the ground running when they transfer to you company. It’s important that you have completely developed systems for all three plans to ensure the successful integrations of the new hire with your company.

3. Develop a source list. Sourcing is a process of identifying as many probable targets from which you can draw candidates. To make good decisions on hiring the right people, it’s critical to have several sources to contact for leads. To get the type of candidates that you’re looking for, you need as many leads as you can get.

4. Work your leads. Maybe a better way to say it would be “networking your leads.” By networking both your sources and candidate leads, you give yourself a solid foundation of planting the kind of seeds that will reap a great harvest. You’ve got to be out in the marketplace talking to Realtors, builders, and other in order to originate mortgage loans.

5. Interviewing the candidate. Up to this point, all of our efforts have been toward recruiting. The “hiring” aspect comes into play at this stage. While we are still recruiting and selling our value, we are now focusing on making sure that this candidate will benefit our particular team. In addition to that, keep in mind that the candidate is interviewing you as well. It’s important here to establish a rapport by making the candidate feel comfortable. Ask a lot of questions and then listen, listen, listen. You will also want to have the candidate interviewed by other company staff. It’s wise to put a candidate through this because it will give you a more detailed and accurate profile of the candidate.

6. Checking and confirming references. Here is where we want to conduct an investigation to find out the good, the bad and the ugly. Even if you’ve taken the candidate through four different interviews with four different people, it’s important to check references and confirm information.

7. Extending an offer. This is where some negotiating talent never hurts. The toughest types of questions usually revolve around money. Before you make a firm job offer, you should know clearly and specifically what expectations the candidate has about the compensation plan. It’s important to discuss the candidate’s past and current compensation plans and how they want to improve them.

8. Setting the stage for your new hire’s success. Now that you have successfully recruited your top choice candidate, you need to conclude the process by completing the administrative details. You owe it to your newly hired superstar to have all of the paperwork to get him/her started correctly and promptly. Let me emphasize the importance of taking care of people every step of the way. One of the reasons I’ve been so successful in recruiting is by simply practicing “the golden rule.” Respect everyone and treat them the way you want to be treated and it works. I also hold another cardinal rule: If I receive a phone call or receive a resume in the mail, at that point I am doing business with that person and I treat them accordingly. Remember, people always appreciate communication. They will remember and appreciate you for being honest and considerate with this process. This will create a tremendous long-term benefit for you and your company. This takes the old saying, “never burn bridges” to a new level. This new level might read, “Always build bridges.”

Now that you have closed out the process of recruiting and getting the candidate on board, it’s time to really show them that we both made the right decision. You can do this by celebrating their arrival. Make sure that they have a proper place to work with a phone, pager, business cards and office equipment. It’s critical that you set some time aside on their first day to introduce them to the office personnel, show them around, show them how to work the office equipment, and make sure that they get settled as soon as possible. The quicker they get settled and aligned with you and your company, the quicker the loan productions starts rolling in.

By following these eight steps consistently, you will be able to expand your mortgage business in a deliberate and controlled manner. The key word here is consistency. Consistency rules; never stop recruiting. The successful managers at the top are always looking for talent. Make recruiting an ongoing part of your business. Once you master the art of recruiting, you’ll be rewarded accordingly.

Recruiting and hiring talent, managing and motivating talent and getting ordinary people to do extraordinary things are all critical to a manager’s success. If you want great sales people, be a great manager.

You know what business is like—the best plans don’t always work out. Unexpected issues arise, requiring midcourse corrections. New opportunities pop up but there’s no time to pursue them. Does this sound familiar? We all see and experience it. We also see people who make things happen despite all the chaos, time commitments, and obstacles. Some folks even make it look easy. How do they do it? There are hundreds of theories and books about how to better use time, how to overcome obstacles, and how to better exploit opportunities. Many of them can work. But whatever theory followed or techniques used, there is an element often missed. It’s the ability to accomplish multiple things at once. It’s being able to multitask or, as one ad campaign put it, it’s the ability to walk and chew gum at the same time.

However we develop and execute our business strategy, none of us can afford to have an unclear vision about where that strategy is taking us. A lack of clarity wastes time and squanders resources. We must know what we want our business to look like today and tomorrow. The possibilities are endless, which is exactly why we need a vision to guide us and our team members so everyone knows exactly where we are going.

Let’s assume we know where we want to go. Our vision is the starting point; it’s the ante if we want to play in the game. But, we must be prepared to execute each element of the plan sequentially and each element of the plan simultaneously. Sounds easy enough, but several interrelated activities must work together effectively, including an abundance of preparation, focus, organization, and accountability. Let’s consider each of these elements.

Preparation: It makes sense that the bigger the investment, the more preparation required. But whether we spend a few hundred or a few million dollars, the effective accomplishment of any task or initiative requires preparation. If the initiative or action is important to your business, write-up a brief one-page description of what you want to happen. Too often we see failure because we were not clear on what we wanted to do and what was required to make it happen. If you cannot get down on one page what you want done, then you don’t really know what you want. Bigger goals may need more detail, but too often what you really need is to be very clear about the objective or opportunity, the obstacles or significant points to consider, the basic steps to get it done, who will do it, and when.

Recently, I read a terrific book written by retired Army General Tommy Franks that had an unexpected benefit. A Soldier’s Story is about the General’s life, starting as a Private, and what he learned as he faced his growing military responsibilities. The unexpected benefit was a tool he discovered following a devastating helicopter crash, killing key members of his team for which he felt personally accountable. He decided from that day forward to write down on a 3” x 5” card the five most important issues and the five most important opportunities he faced that day. He wanted to be prepared for the most significant events he thought he could encounter. He used this daily technique for the rest of his career and over 5,000 cards later, he remains convinced that it was crucial to his success.

Preparation is the key to executing each element of our strategy. Make sure everyone knows what is expected, why, and when.

Focus: The benefits of adequate and thorough preparation are huge, especially when it comes to focus. The one-page document suggested will help the team zero in on what needs to be done. The devil is always in the details, and without a clear understanding of the direction and what is expected, it is difficult to focus on the necessary human and financial resources to get initiatives accomplished.

It is important to focus clearly on four areas to drive results: people, processes, systems, and money. Just like the one-pager, being focused doesn’t need to be too complicated. If the task is important, you need to ask yourself if you have the people to get it done; what operational processes are impacted (and do they need to be changed?); if systems or technology are involved will they do what is required and if not how can we change the system; and what will we need for investment and where will we get the money? If you cannot answer these basic questions satisfactorily, don’t move forward until they can be answered.

If you are able to focus on the people, processes, systems, and money needed to achieve the expected results, you are well on your way to successful execution of important strategies.

Organization: Potentially terrific ideas often fail because there is simply not adequate organizational support to get them done. Once you are focused enough to know what it takes to make a key initiative or opportunity happen, you must make sure there is proper organization to achieve the expected or anticipated results.

Sometimes, because we talk about what needs to get done, we think it will happen—it doesn’t. It takes specific actions properly scheduled that bring together the required people, processes, systems, and money. These required actions need organization and organizational commitment. It sounds simple enough, but it takes creating an action plan. It requires at least a simple set of steps to be followed. Write it down, and make sure everyone knows what needs to be done and when.

We need to create specific action plans that clearly spell out what needs to be done and when. If it is important, write it down.

Accountability: The best-laid plans require accountability. Even if well-planned, those plans must hold people accountable to deliver. You may think that a new assignment can’t be all that hard, so you just add it to your or someone else’s other jobs. It might work in some cases, but often it doesn’t. You can assign individual team members specific assignments, but you must hold someone accountable for the results. It doesn’t have to be their only job, but if it is really important, perhaps it should be.

Accountability for results requires both monetary reward and recognition. The reward must be meaningful and important compared to other compensation.

We can accomplish more when we set stretch objectives. Don’t be afraid to undertake concurrent projects. We can do more things simultaneously if we are smart about it. It requires first a vision and direction, and setting priorities for what’s important. Then, with preparation, focus, organization, and accountability, meaningful results can happen.

Roger Staubach was the featured speaker at a university sports luncheon I attended recently.  He is more than just a Heisman Trophy/all pro ex-jock.  Staubach  heads a highly successful national commercial real estate business.  In his remarks he described two football teams he played on that had both been at pivotal points in their respective seasons.  One team was at the Naval Academy and the other was when he was with the Dallas Cowboys.  Both turned out to be championship teams, but neither season started out that way.  Apparently, too many players were approaching the season as though it was all about them personally, and the team was secondary.  The teams had a lot of talent but it was not a “one for all” environment.

How many times do we see this in business?  In striving for excellence, individuals focus on their own success and do little or nothing to improve the team or teamwork.  The view can often be that a branch’s monthly production volume may be “interesting” but how everyone else is doing, from producers to support staff, is not my concern.  I celebrate my own success.

Staubach went on to say that after the poor initial start to the season, some of the leaders got the team together to have a real heart-to-heart.  We can imagine the frank locker room conversations that probably took place.  I doubt it was a Knute Rockne “let’s win one for the Gipper” speech.  They demanded renewed thinking about the team, teamwork and team-focused effort.

Staubach’s message was that football, like business, is a team activity and everyone must be with and on the team.  He said it was just like entering the HOV lane on the expressway: every car needs passengers.  When someone is going it alone or is in it for just himself or herself, even a team with abundant individual talent can’t win.  We have to get everyone on board and take them along for the ride, just like in the HOV lane, so everyone gets to the destination.  He also meant that if people are not prepared to execute as required and ready to maximize each individual’s performance, then we need to grab them and bring them along.

Getting people involved and taking them along for the journey helps create the spirit of teamwork necessary to turn what could be mediocre performances into unforgettable ones. As we think about this simple HOV analogy, there are at least five possible actions that come to mind.  It starts with managers and concludes with the idea of raising the bar.

Start with Managers: It should be logical that managers or leaders need to first recognize the importance of teamwork and making sure everyone is on board with a clear understanding of the game plan.  Every once in a while the leadership must take an assessment of how well things are working.  From time to time we need to ask the questions about what is working and what is not, and take an objective look around.  At times we all forget the interdependency that exists within a mortgage branch or sales team and the connection to other parts of the company that support them.

This interdependency must be clearly recognized and understood.  Clear expectations must be set for behavior and results.  The leadership must continually work on resolving issues or removing barriers that get in the way of allowing everyone to be prepared and be able to do the best they can.

Stars are Included: It should also be reasonable that everyone must understand the vision, plan, and direction, and be an active and proactive part of it.  This means everyone, including the star performers.  Most superstars are good because they understand the importance of working with others.  They may want to “over-control” because they want nothing to go wrong.  In time we hope they learn that they can do even better when they help train the team and set clear expectations for others to focus on their own key roles and become freed-up to be even more successful.

But, there may be some superstars that can’t or won’t get this important message.  If they are disruptive to the team and limit the ability of the whole team to be successful, then management and leadership needs to make a decision.  Sometimes it is better to take a step backward in order to leap forward.

Identify Weak Spots: Everyone on the team is important.  Everyone’s role is there for a reason.  If that is not the case the position is not necessary.  You cannot afford to have anyone on the team streaming down their own personal HOV lane oblivious to what is going on around them and what is required.  Managers, leaders, and superstars need to identify every area requiring improvement and focus on fixing it.

This does not have to be a negative or disruptively critical exercise.  But, it must be focused and must be done.  This is not a “hey you, stop screwing up” message, but when you see someone struggling or someone not using a “best practice,” you need to help them get better or change the process.

The focus is to not allow poor performance or poor practices to persist, simply because it is “not directly my job” or you are “too busy with my own stuff.”  Take the time to explain thoroughly how to make things better or right, and have learning sessions where the A-players are coaching others how to do the job better.  We also need to set the right expectations so that everyone has a clear understanding of the performance level required.

Changes May be Necessary: Sometimes people have to leave for the good of the whole. There are predominantly two reasons for change.  The easiest to understand is when the employee either can’t or won’t do the job properly.  It may be skills, motivation, or personal issues, but if after training, support, and expectations have been clearly communicated the performance doesn’t measure up, then a change is necessary.

The other reason for change, which can be difficult, is when the person performs well but their approach or style is divisive and disruptive.   Some people are too negative and so self-interested that they adversely impact the team and teamwork.  It takes too much management time to the detriment of others.  When this occurs, sometimes the only solution is to make a change.  It may seem like a step back because of the individual’s performance, but results after the change is made are often surprising.  Others on the team usually blossom and the overall team results improve substantially.

When the team really starts functioning as it should, it is time to raise the bar and set expectations higher.  Chances are pretty good that until we really start getting into the HOV lane we do not know how good we can be.  Once we have identified weaknesses, both with processes and people, and energized everyone to make changes and have the patience to wrap their arms around the people who need support, the effect on the team and overall results can be 25 to 50 percent, maybe even 100 percent.  The power of a team committed to teamwork and excellence is a substantial force.