Guard Your Mind

By Stacey Harding, CML
Chairman of the Board

In preparing to write this month’s Chairman’s article for the CMLA newsletter, I have given much thought to the current state of our industry and how many changes have occurred over the past six months.  Hardly a day goes by without hearing someone tell me that they’ve never seen “it” like this before.  Foreclosures are on the rise, state and federal regulation are growing and business is declining.  Being a mortgage professional in today’s world is not for the faint of heart. 

It would be very easy for both a seasoned veteran and a new rookie in the mortgage industry to simply become a victim of the times.  Some would say that the “good old days have come and gone”.  I would like to suggest to you that the good old days are yet to be seen.   While things are certainly more challenging today than six months ago, there has never been a better time to differentiate yourself in the market, one customer at a time.  Don’t allow yourself to become a victim of the times or the market place.  Don’t allow excuses to creep into your way of thinking.  Every industry that has experienced a growth rate similar to what was experienced in the mortgage industry over the past several years is bound to see a correction.  It’s no secret that over the past decade people have flooded into the mortgage industry to participate in the mortgage boom.  It should not be a surprise to anyone that during this period of correction, many of those people have and will be exiting the business, as it should be.

Like a growing tree, for an industry to remain healthy, it must endure a pruning from time to time.  I have heard from many of you that this particular pruning is long overdue.  While in the short term many of us may and likely will experience a down turn in our production levels, brighter days are just around the corner.  I know that many experts and government officials are warning that the worst is yet to come for the mortgage industry and credit markets.  There is no question that foreclosures will continue to grow with the resetting of interest rates on billons of dollars of sub-prime adjustable rate mortgages.  And no one can argue that the price of a barrel of oil and the devaluation of the dollar against the euro will put additional pressure on the U.S. economy and on consumer confidence.  Yet, there is little doubt that the U.S. economy and the world economy we now live in will weather those challenges.  And should the “R” word actually happen, it is unlikely that a severe and deep recession in the U.S. economy will occur.

What will happen during this period of time is the mortgage industry is going to be pruned.  And when the pruning is done, it will be a better and healthier industry for consumers to benefit from and for mortgage professionals to prosper in.  The pendulum will stop swinging and the scales will balance out. 

So, how do you ensure that you survive and position yourself to thrive on the other side of these times? I would like to provide you with some suggestions on how to grow your business during these challenging times in the mortgage industry.  Here’s a list of 10 strategies you should consider:

1. Take care of your customers.  I mean really take care of your customers.  Deliver a Ritz-Carlton experience to every person who talks to you about a mortgage loan, regardless of whether or not they obtain their loan from you.
2. Make sure you have a written business plan right now for 2008.  Don’t “hope” that you can generate the business you need.  Hope is not a good strategy.  Be clear and concise in your business plan regarding your production and marketing initiatives and where your business will come from.
3. Master Priority Management.  You cannot afford to waste time and effort in today’s market.  You must be clear on the activities that will generate business for you and committed to spending your time in those activities.  Don’t allow things to interfere with your priority activities
4. Focus on building relationships.  The truth of the matter is, most people will do business with people they have a relationship with and that they like.  Develop relationships with people who can refer customers to you (without the expectation of compensation - that’s illegal).
5. Treat your business as a professional practice.  Step up your level of professionalism big time.  From the way you speak to people, to the way you dress, to the services you deliver.
6. Improve your professional knowledge.  Don’t be a mortgage transaction provider to consumers, be a trusted advisor.  Build your knowledge of the financial markets and the economy.  If you’re worried about the markets, imagine how confused and concerned less knowledgeable consumers are.
7. Set realistic goals. Nothing breeds success like success.  Set goals that will stretch you but that with the proper focus and effort can be achieved.  How’s the old saying go, how do you eat an elephant?  One bite at a time.  Achieving goals builds confidence and confidence is a must in today’s market.
8. Understand your value propositions.  When someone asks you why they should do business with you instead of someone else, know the answer.  You must create and be able to articulate your value propositions and uniqueness.  Ask yourself this question, does my uniqueness and do my value propositions eliminate at least 90% of the competition?  If not, go to work on this area.
9. Find an accountability partner.  There is no better strategy for achieving your business plan and goals than to have an accountability partner that cares about your success and will be strong enough to hold you accountable to the plans you have made.  Be wise about this partner, it could be the difference between success and failure.
10. Surround yourself with successful people.  You will find that successful people love to share how they have become successful.  You will also find that successful people refuse to be a victim to the times and will not allow excuses to creep into their way of thinking.  One great place to be around successful people is at every CMLA event. Click here to visit our Meetings and Events page.

I certainly don’t profess to know all of the answers for achieving success in today’s mortgage industry environment.  However, I do know that allowing yourself to be a victim to foreclosures, the credit crunch, declining property values, rising oil prices, a deflating dollar and increased regulation are guarantees for you that the good old days have come and gone. A much better strategy is to believe in yourself, have a plan and don’t let excuses creep into your way of thinking.

Be well.

Click here for answers to November's Question of the Day: What is the best marketing technique you've used when working with your strategic partners to obtain business?

TJ Kennedy
Owner/Partner, Meridian Lending Corporation

CMLA: Tell us a bit about your background in the industry and your work at Meridian Lending.

TJ: I got my start in the mortgage business fresh out of college in 1993 working for Interfunding Financial Services as a loan officer. My father had a banking background, my mother was in real estate, and my brother was working for a title company, so I had several people close to me who were “in the business.” Although my degree is in accounting, I really like interacting with people and wasn’t sure a job in the accounting field would afford me that opportunity to the degree that I wanted. After a year, I started IFS Direct with two partners. We developed and marketed interactive kiosks called Loan Origination Centers. We placed the kiosks in real estate officesand builder sites. Buyers would pick up the handset on the kiosk, it would automatically dial into our call center, and then a Loan Specialist would interactively qualify them for a loan.  It was cutting edge at the time both from a software and origination stand point. All this was before live chat rooms or high-speed wireless was available!
In 1999, we sold IFS Direct to First Colorado Mortgage Corporation, which exists today as LenderLive. I worked for Universal Lending in their wholesale division for about a year before I started Meridian Lending in April 2001 with my partner Blair Weed.

CMLA: What changes have you seen in the market over your career? Considering the changing market today, how is Meridian Lending set up to thrive today?

TJ: Since 1993 I’ve seen a lot of ups and downs. Basically, we’ve had a good 15-year run with a few hiccups along the way. I’ve learned to focus on the right things and to build relationships, and also to take advantage of what is driving the market and capitalize on it. It’s important to be prudent about what you’re offering in any market and to educate your borrowers so that what you’re offering matches your client’s whole financial picture. I’ve always found that it’s really easy to get business when you treat people the way you would expect to be treated. Meridian Lending will thrive because we've built our business on strategic, long-term relationships. We’re both a correspondent lender and a broker shop and we’re primarily a purchase money lender. We offer our clients a high quality, high-touch experience – people keep coming back to us for that. Plus, we get a lot of referrals. Market pressures and the liquidity crunch are providing for a real cleansing time in our industry. Six months from now those who are still in the business will be the ones who are here to stay.

CMLA: What is the reason you got involved with the CMLA and what do you think are the advantages of being involved?

TJ: Back in the late 1990s Kim Starley got me active in CMLA; in 2000 I was on the E-Commerce committee. I’ve become involved again because the need for the quality and professionalism is at its highest ever. Mortgage lenders are not looked on very favorably in many cases today and we all need to be involved to do what we can to improve that image. Being active in the CMLA is a big part of that to me.

CMLA: You’re involved in the new Future Leaders program. How is that beneficial to you?

TJ: The Future Leaders program has been great. For example, our October conference call focused on developing a unique value proposition for your company. My partner and I are in the process of re-defining that for Meridian, so that call was very timely and the information shared very helpful. It’s important to know for yourself what differentiates you from your competition, especially when we go to the same sources for many things. I’ve been really impressed with the other Future Leaders class members. There is a great deal of consensus in that group when it comes to participating in the CMLA and in the industry to help advance a positive image in these challenging times. I also appreciate the willingness of so many people so share information in this business. We learn from each other and that team spirit really pays off for all of us. I’m also active on CMLA’s education domain and I’ve been impressed with the desire of other domain members to educate mortgage professionals and come up with topics of interest to everyone in the industry.

CMLA: Any other comments?

TJ: The main thing I want to convey is that my career in mortgage lending has been so good to me. I’ve had the opportunity and good fortune to have my own business for a number of years, take care of my wife and five children, and have a good life. I don’t think there’s any better way to give backto the industry than to be involved with the CMLA.

Stop Doing to Start Doing More
By Jerra Ryan, CML
Director, CMLA
Branch Manager, Cherry Creek Mortgage Company, Inc.

Do you focus on the tasks you need or want to do and create a “to-do” list to manage getting it all done? What gets in the way of getting everything on the list done? For many of us, if we carefully evaluate what we do on a daily basis, we find our time diverted away from what “to do” by doing too many “other” things.

Many business coaches and managers actually suggest that the most important part of your “to-do” list is what “not to do”. Jim Collins, the best-selling author of Good to Great says a “stop doing” list can help the unproductive trend of working on activities that impede our success.

The best way to get a handle on what you should be doing is to record the activities you currently perform daily and evaluate those that waste your time, don’t generate revenue or don’t fuel your passion. For the next week, keep a time record in 15-minute increments of what you do, you might be surprised at what you find on the list!

Here are some stop-doing list examples:

• Taking incomplete loan applications – do it right the first time!
• Associating with Negative People
• Reacting to emails – schedule certain times to read, review and respond to your emails and stick with the plan!
• Excessive socializing, chatting and gossip
• Procrastinating database management, prospecting and marketing – call everyone in your database this quarter and meet new referral partners weekly!
• Dwelling on market conditions and competition
• Working without a business vision and plan

After you take an honest assessment of your daily activities, focus on the things that will move your forward—only you know what you need to stop doing in order to start doing more to propel yourself from good to great!

 

Stacey Harding, CML, Chairman of the Board (far right) presents CMLs to (L to R): Norma Andersen, CHFA; Roger Linn, GE/Genworth Financial; Dan McMahon, CHFA; Former Chairman Cathy Stroud, CTX Mortgage (renewal); and Former Chairman Jay Wilson, National City Mortgage (renewal).

 

Mike Rosser (far left) speaks about the value of the CMB designation as CMBs Julie Piepho, Cornerstone Mortgage; Cindy Bradley and Karen Harkin, CHFA; Bronwyn Morrisey, PMI; and Jeff Grebe, Crescent Mortgage, listen attentively.

Julie Piepho, CMB, CML and Mike Rosser, CMB, CML, welcomed Bronwyn Morrisey, PMI Mortgage Insurance Company, as the newest Coloradoan to hold MBA's Certified Mortgage Banker designation. The CMB designation is a national designation that signifies to the real estate finance community an individual's superior knowledge, understanding, and comptency in both residential and commercial real estate finance and distinguishes professionals for their commitment to excellence and high ethical standards.
Only 16 invidividuals in Colorado have obtained the CMB designation.
Congratulations Bronwyn!

 

Jim Lewis, former Chairman (L), presents E. Michael Rosser with the Jay Wilson Award at
CMLA's November 1 luncheon event. The award is presented each year to an individual who has completed their term of service, yet continues to give selflessly to our association, our industry, and our mission of a world of homeownership. 
Congralations Mike!