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   ARTICLE   |   From Scotsman Guide Residential Edition   |   May 2014

Making the Jump

When switching companies, there are several important factors that loan officers should consider

Making the Jump

If you’re considering making a leap to a new company, one of the first things to cross your mind may be a simple question: What are they paying? After taking a look at a company’s commission structure, the typical loan officer may then look into the company’s stability.

But in today’s market, loan officers need to take a different approach. They still need to evaluate whether or not a company has strong financial backing and ethics, but in addition to that, loan officers must be sure that a company has a long-standing track record of closing purchase business, an extremely solid marketing platform and great numbers when it comes to loan-officer retention. Looking into these factors can mean the difference between a successful transition and a pure leap of faith.

In making the switch to a new company, mortgage brokers should know that commission structure is not the first thing to look at anymore. Certainly, commission structure is still important, but there are numerous other factors in today’s market that must be taken into consideration. Let’s take a closer look at three in particular: stability, marketing and employee retention.


First and foremost, a loan officer must look into a company’s stability. What makes a company stable? There is no hiding the fact that the company must be well-funded. If a mortgage lender does not have access to significant capital in the market, it will likely be out of business in the near future.

The other important factor to look at is volume. Loan officers need to look past a company’s volume over the last few years and focus instead on the average volume over the last 10 years. Most companies had big numbers during the recent refinance boom, but to have solid numbers through the preceding difficult years is a real sign of corporate stability.

"If a company does not give its loan officers the support they need, it can destroy those loan officers’ credibility and ability to do business."

In the mortgage industry, stability in volume primarily comes from a large amount of purchase business. If you are looking at a new company with little history, research where the company plans to build its business. You’ll likely find out right away where its corporate focus is centered — the purchase market or the refinance market.

Although interest rates are still comparatively low, they have been rising. This will be a major issue for companies that concentrate solely on refinances. The Home Affordable Refinance Program boom is over and loan officers must move on. There will always be refinance business, but maintaining a steady supply of it will eventually become a problem for many. Make sure that you’re not caught up in that problem when it occurs.


With refinance business slowing down, loan officers have to hit the streets and pick up purchase business. What kind of support and resources do you need to gain new Realtor and builder partnerships and drive the purchase share of your portfolio? Obviously, loan officers must be confident and knowledgeable in their products and industry standards, but they also require a solid marketing platform provided by their company.

For veterans of the mortgage banking business, it can be very difficult to change your way of thinking. Oftentimes, not only do you have to come to grips with taking an upfront cut in commission, you also have to wrap your head around the fact that this may still be the right way to go. The deciding factor in that respect can sometimes be a company’s marketing platform.

Marketing platforms should work for you with limited effort, allowing you to be out of the office doing what you do best: bringing in loans. Loan officers must remember that people now turn to the Internet not only for information about a company’s validity, but also for a lot — if not most — of their shopping, and that includes shopping for real estate and mortgage services.

Today’s loan officers must be sure that their chosen company is tech savvy and uses technology to the full extent of its capabilities. This can be extremely expensive for a company, and should be considered when looking at its commission structure.


Finally, mortgage professionals should know that loan-officer retention can say a great deal about the level of support a company provides its employees. High-quality corporate support is the backbone of success for many loan officers today. The kind of support you’ll receive is evident in a company’s philosophy on how it works for and with its employees, customers and referral partners.

If a company does not give its loan officers the support they need — whether that support is in marketing, technology or just plain customer service — it can destroy those loan officers’ credibility and ability to do business. Many veteran mortgage professionals would admit that, throughout the last 10 to 15 years, very few companies have consistently provided their loan officers with a high level of service. Companies offering this support often have retention records that are simply amazing.

If it looks like a company has a “revolving door” of employees, there is usually a problem at the corporate level. In these cases, loan officers should certainly take note and make their decisions accordingly.

•  •  •

Loan officers have a lot to consider when choosing which company to work for. It’s important to realize that the days of the basic corporate inquiry are over. Today, you must ask yourself several key questions. Is this company stable? Does it supply its loan officers with a solid marketing platform? How are its loan-officer retention numbers? Support from your company can be invaluable, so before you argue about pay, get the full scope of what a company offers.  


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