Mortgage Broker/owners - 10 yrs experience or less
In part, Saturday I said "... would be those owner/operators who themselves began in the industry since the Fall of '98 (when the last 'correction' began). That group has grown up in the atmosphere which developed since then. Most seem to have a similar attitute and view of the industry, and it's one that needs to be tweeked for them to continue on through periods in our industry that are not 'easy money' operating times." and I 've received several e-mails asking me what the heck am I talking about 'need to be tweeked'?
Hopefully, you've heard the story about the blind man who walks up to the front end of an elephant, and after touching his trunk all over for quite some time, then trys to describe the animal. I'm sure you'll agree that from his limited perspective, his distription won't be an accurate one, will it? That's the tweeking part I'm speaking about.
Today's (10 year or less) mortgage brokerage shop owner/operator who began in our business as an LO just after the last 'correction' begun, was raised in an industry that he/she saw was a business driven by sales commissions (a business concept that had just begun right before they got hired), easy big money, not all that much work, shallow training and industry education was the norm, back-office personnel were second class workers; everything centered on their EGO and sales/closing skills.
As owner operators themselves, they have run their firms that same way - and they got to enjoy paying out hundreds of thousands of dollars (millions in some cases) in commissons, baby-sitting all those LO's they brought on board, how they were treated when the LO's left their company (stealing company property - loans in pipeline, contact lists, suing for unpaid over-time, pirating employees to follow them to the promise land, etc.).
On the other hand, the animal doesn't resemble a snake at all! In the lead article of our August 2007 newsletter I describe what an LO actually is! And, that's not a commissioned sales/closer. If today's (10 year or less) mortgage brokerage shop owner/operators, hired the proper attitude/skilled LO's in the first place (shovel people) and invested(*) the time & effort training and educating them on issues of ethics, integrity and everything else that goes on in a mortgage brokerage operation ... NONE of the issues I mention above would happen!
And, what would they do with the (formerly paid out commissons) hundreds of thousands of dollars (millions in some cases)? They keep it in the company checkbook, pay salaries and small bonuses to the new LO's, increase and have a solid back-office staff (who carry the heavy load of operations anyway) and buy advertising to attract applicants - because to stay in business in our industry over-time is NOT easy; it's Hard Work.
This paradigm is what works, not the biz model they were taught and have been following. If you're one of them and have had many LO's, then you know exactly what I'm talking about. The way you learned WAS great when anybody could earn a six+ figure income - due to the fact that rates were at historical lows, property values were soaring, wholesalers were reckless with dozens of stupid loan programs to pick from, and it was easy street for everybody!
Today's the real world.
(*) they could also engage someone to handle those tasks for them, since most of them probably couldn't handle that range of tasks themselves.
Hopefully, you've heard the story about the blind man who walks up to the front end of an elephant, and after touching his trunk all over for quite some time, then trys to describe the animal. I'm sure you'll agree that from his limited perspective, his distription won't be an accurate one, will it? That's the tweeking part I'm speaking about.
Today's (10 year or less) mortgage brokerage shop owner/operator who began in our business as an LO just after the last 'correction' begun, was raised in an industry that he/she saw was a business driven by sales commissions (a business concept that had just begun right before they got hired), easy big money, not all that much work, shallow training and industry education was the norm, back-office personnel were second class workers; everything centered on their EGO and sales/closing skills.
As owner operators themselves, they have run their firms that same way - and they got to enjoy paying out hundreds of thousands of dollars (millions in some cases) in commissons, baby-sitting all those LO's they brought on board, how they were treated when the LO's left their company (stealing company property - loans in pipeline, contact lists, suing for unpaid over-time, pirating employees to follow them to the promise land, etc.).
On the other hand, the animal doesn't resemble a snake at all! In the lead article of our August 2007 newsletter I describe what an LO actually is! And, that's not a commissioned sales/closer. If today's (10 year or less) mortgage brokerage shop owner/operators, hired the proper attitude/skilled LO's in the first place (shovel people) and invested(*) the time & effort training and educating them on issues of ethics, integrity and everything else that goes on in a mortgage brokerage operation ... NONE of the issues I mention above would happen!
And, what would they do with the (formerly paid out commissons) hundreds of thousands of dollars (millions in some cases)? They keep it in the company checkbook, pay salaries and small bonuses to the new LO's, increase and have a solid back-office staff (who carry the heavy load of operations anyway) and buy advertising to attract applicants - because to stay in business in our industry over-time is NOT easy; it's Hard Work.
This paradigm is what works, not the biz model they were taught and have been following. If you're one of them and have had many LO's, then you know exactly what I'm talking about. The way you learned WAS great when anybody could earn a six+ figure income - due to the fact that rates were at historical lows, property values were soaring, wholesalers were reckless with dozens of stupid loan programs to pick from, and it was easy street for everybody!
Today's the real world.
(*) they could also engage someone to handle those tasks for them, since most of them probably couldn't handle that range of tasks themselves.
posted by Secret! at 11:54 AM
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