The STRATMOR Group, a leading mortgage industry consultancy, recently released the October edition of its STRATMOR Insights report. The “In Focus” section of the report features STRATMOR Senior Partner Garth Graham exploring the steps lenders should take to make the best decisions about their digital investments, according to a press release.
In the report, Graham said he has observed that many lenders struggle with a clear sense of the problem they are trying to solve with digital technology, beyond the general idea of “making the mortgage process better.”
To help lenders as they evaluate digital solutions, Graham offered five tips that can serve as a pre-investment assessment for making the most of digital technologies. Among those tips, he recommended that lenders take the time to define the business case for any investments they are planning.
“Without a very specific business case, it is difficult to generate the additional revenue or lower expenses to the level necessary to generate a return on investments in new technology,” Graham said in the report. He also shared in the report important insights on current market realities and future market scenarios lenders should consider as they create a specific business case.
“Of course, it’s fine to want the mortgage process to be better in general, but lenders should get very specific about how they want the process to be more efficient, lower cost, and/or provide higher revenue per loan,” Graham said.
Also included in the report are Graham’s tips for making the most of digital technologies. He said that lenders make sure that any solutions they consider will work well for their high producers. The latest STRATMOR Originator Census Survey indicated that about 40 percent of originators generate 80 percent of the business.
“What this means is that if lenders can increase the production of their top-tier originators by 25 percent, this production increase would equal the volume generated by the bottom 60 percent,” Graham said. “With such productivity gain potential, lenders should consider how the digital technology tools they are evaluating can help make top originators more productive.”
Additionally, the report features highlights from the latest STRATMOR Originator Census Survey, which provides lenders with valuable insights into the makeup of their sales force and how it compares to peer lenders. Looking at how originator age varies between retail and consumer direct originators, the survey shows that, on average, consumer direct originators are ten years younger than retail originators. The average age of consumer direct originators is 37 years versus 47 for retail originators. While there are retail originators under the age of 30, their numbers are not proportional to the under 30 bracket in the consumer direct origination space. More Millennial hires are occurring in consumer direct call centers where they work in a centralized environment that facilitates training and coaching.
The report also announced that the next STRATMOR Originator Census Survey will open in January 2018. Survey participants receive a report that includes 15 pages of individualized results.