Train Them Right and They Will Produce

“It’s a fact that quality training takes time and money, two things some managers and companies are not willing to provide.”

“Jamie” started her career as a mortgage originator six months ago. With a strong work ethic and a background in retail sales, she made the decision to give mortgage lending a try. Immediately after joining her new company, Jamie was placed into an extensive weeklong training program. There she learned about the business, mortgage programs, procedures, guidelines, and how to sell and market herself. Jamie’s manager clearly discussed his expectations of her performance, and together they mapped out a six-month development plan that included weekly one-hour meetings to review sales call plans and learning initiatives. Jamie’s boss also escorted her to several industry and client events to introduce her to top producing loan officers and real estate professionals who encouraged her success. Jamie was assigned to a mentor—another good originator in her office who would “show her the ropes” of the day-to-day business and allow her to shadow him on sales visits, application appointments, and loan closings. For the last six months Jamie has been reading, studying, asking questions, meeting people, making sales calls, and writing loan applications. Today, with a solid foundation in a new career, she is enjoying her job, making good money, and emerging as a future superstar.

“Keith” began his career in the mortgage business about the same time as Jamie. Fresh out of college with a business degree, a resume of good jobs, and strong references, Keith was ready to make the kind of money his manager promised was available if he was willing to work hard and apply himself. Unlike Jamie, Keith received no formal training. His boss showed him to his office, piled up a stack of manuals and guideline binders, and said: “Read these. Come and see me if you have any questions.”

Keith did have questions, a lot of them. What’s a temporary buydown? Who is Fannie Mae? Where are all these forms they keep referring to? Unfortunately, Keith’s boss was a producer himself, busy with his own customers and pipeline, and could afford little time with his new recruit. Keith looked for answers, but with no one to guide him, he soon got lost and frustrated. The other originators told Keith he needed to get out of the office and make sales calls. “But to who?” Keith asked. “What do I say? Where should I be going?” Focused on their own production, the other loan officers tried to help Keith as much as they could but time just wasn’t available. Keith did go out to see some real estate agents and with dismal results. Unsure of himself and what he was selling, Keith retreated back into his office and tried to make sense of the mountains of information and skills he needed to learn all by himself. Weeks went by and Keith was getting nowhere. After six months, Keith packed up his personal things, told his manager he was quitting, and walked out. Keith’s boss sat back in his chair, frustrated and lamenting: “Oh, well. I guess he just wasn’t cut out for this.”

In the movie Field of Dreams, Kevin Costner’s character was haunted by the voice: “If you build it, they will come.” Today, managers and mortgage companies hear another voice: “If you train them, they will produce.” But many managers are still investing little in their new loan officers. “Nobody trained me and I did all right,” they say. What they forget is that originating on the streets in the year 2000 is quite different from passing out rate sheets to Realtors in 1985. Today, those loan originators who are well trained, well skilled, and personally motivated, are writing loans. The rest are left behind.

It’s a fact that quality training takes time and money, two things some managers and companies are not willing to provide. “What happens if we spend the time and money to train them, they become successful, and they leave to work for another mortgage company?” they ask. It is true that if you don’t take care of them this could happen. The bigger question to ask is: “What happens if we don’t train them, they are not successful, and they stay here with us?” Now that’s going to be expensive.

While some managers and companies are still in the dark ages about training, it is exciting to see more and more lenders today investing in the success of their sales force. The following are four good examples.

First Horizon Home Loans
First Horizon Home Loans of Dallas, Texas (formerly FT Mortgage Companies) began a new initiative last year when they launched First Horizon University and their two-week program: The College of Loan Origination. Week one of the college introduces new recruits to the company, its products, procedures, and key support people. Students learn from the ground up about how a mortgage company operates, how to work with and qualify homebuyers, and the critical role originators play in bringing quality loans in the door. Week two is a series of workshops on professional sales and marketing with role-play training on making contacts, conducting meaningful sales calls, and building a personal marketing plan. Delivered every other month, the college has graduated over 100 energetic new originators so far who are equipped with the tools to get off to a successful start in the business.

This year First Horizon added another school, The Masters Program, as a three-day crash course for experienced loan officers joining the company. The Masters Program focuses on advanced sales skills and company-specific mortgage programs. These more experienced originators are also given a forum for sharing successful ideas they have used to build their mortgage lending practice.

Market Street Mortgage
Clearwater, Florida-based Market Street Mortgage (MSM) has taken a slightly different route to its training needs. MSM’s Web University is a “distance learning” network accessible through the company’s Intranet system. The Web University offers the Market Street Mortgage sales team more than 80 self-study training programs and resources. Loan originators in the field use their laptop computers to “dial up” training modules on topics such as Introduction to Desktop Underwriting, Telephone Selling Skills, and Compliance and Credit. Originators study and learn at their own pace, allowing salespeople to select the titles most beneficial to them.

This year, Market Street began a new library of sales marketing ideas in a program called Street Smarts. This series of white papers focuses on topical business development strategies such as How to Build an Affinity Business Relationship and Selling to Realtors Successfully—showing loan officers how to implement each concept step-by-step. Market Street hopes to expand their web university to a menu of over 100 different self-paced training programs by year’s end.

HomeBanc Mortgage
HomeBanc Mortgage in Atlanta, Georgia heavily recruits college graduates and successful salespeople into its nine-week introductory training program. This five days a week, 11 hours a day curriculum intricately covers every aspect of mortgage lending. To complement the program, real estate agents serve as guest speakers to talk about working with agents and students to complete a list of over 100 names they plan to contact as potential clients during the span of the program.

After completing the 500 plus hour course with its intensive series of exams and assignments, new originators are assigned to a mentor who acts as a personal guide and helper for another three months. Their retention rate of new hires has been remarkable and so has their performance. These rookies produce an average of $12 million their first year in the business with some outstanding achievers exceeding $20 million. HomeBanc complements its initial hire training with advanced sales training seminars and roundtables throughout the originator’s career.

HomeSide Lending
HomeSide Lending in Jacksonville, Florida generates sizable loan production via its consumer direct lending unit. A full time staff of eight training professionals is assigned to the 60-person telephone origination sales force and back shop production support group. New hires participate in a three-week classroom “boot camp” that covers mortgage products, paperwork, guidelines, sales techniques, and more. From there, a follow-up week of one-on-one mentoring with an experienced originator is completed before they take or make their first phone call.

HomeSide’s consumer direct training team is also closely involved in the production unit’s day-to-day operations. From product updates to procedure changes and compliance to credit and fair lending, HomeSide’s originators are schooled continuously in mini workshops, self-study manuals, and on-site seminars with the skills and knowledge it takes to do an effective job.

We’ve relied far too long on “seat-of-the-pants” and trial and error training to teach our loan originators what they should be doing. It’s no wonder that 30 to 50 percent of most company’s loan officers turn over every year. It is hard to expect people to do a good job when they’ve never been shown how.

Perhaps you feel you don’t have the resources like these companies to provide quality training. Keep in mind that training doesn’t have to be done on a grand scale. With a belief in the value of training, these same basic ideas can work for any size shop. Here are some recommendations:

Hire or appoint a training manager. Even if your sales team is small- to medium-sized, a good training manager who can design and deliver valuable skills programs will pay for his or her salary 10 times over in increased loan production over the course of the year.

Take advantage of vendor resources.United Guaranty, RMIC, GE Capital, and other MI companies have some outstanding training programs available to their clients. Partner with your MI rep to get this training in the hands of your originators on an ongoing basis.

Contract for speakers. The mortgage industry is blessed with several talented trainers and speakers who will work with you and your sales force to improve their marketing, sales activities, business knowledge, and personal motivation. Get them in your shop regularly throughout the year.

Leverage your wholesale alliances. If you broker to national wholesale venues, they can assist you in locating (and may even pay for) quality trainers to help your originators learn and your loan business grow. They want you to be successful for good and selfish reasons. Let them help.

Investigate local colleges. While mortgage specific topics may not be readily available, most local colleges and universities have continuing education courses on sales, marketing, finance, consumer lending, and banking. Fund your loan officer’s participation in these programs.

Tap the power of your industry associations. The MBA and NAMB offer many state and local presentations and workshops on a variety of mortgage topics every month. Be certain your people are actively attending these events to expand their knowledge and exposure to new resources.

They say that knowledge is power. But in this business, knowledge is money. The more your loan originators know, the better they can sell. The better they sell, the more profitable your business becomes. If you train them, they will produce.