Some lenders are now training their loan originators on how to take a complete, compliant mortgage application (Training). Well, it’s about time. For years the problem with our industry has been poorly trained loan originators, especially those brought on board during the refi boom of not so long ago.
Lender’s needed people to take applications so in most cases that’s what they got; order takers. Processors, underwriters, closers and secondary market people screamed about the lack of information, the incomplete applications and lack of product knowledge but it all fell on deaf ears as long as the originators were bringing in the business.
If there were problems, somebody would fix them. Lenders were making so much money back then that the additional time, effort and money went virtually unnoticed, or if noticed, ignored. Then came the crash, repurchase demands, and new rules and the CFPB. All of a sudden, everyone is concerned with the rising costs of compliance.
Fannie, Freddie and FHA now want zero defect loans. Originations are down and margins are thin. So lo and behold, someone comes up with this new concept, like some new revelation, it’s time to train the loan originators to do what they should do, the right way, because when they don’t it hits the bottom line hard.
This should not come as any new idea for most lenders. Successful lenders, and businesses, know a well trained staff, at any level, will pay big dividends in the long run. Just by the mere fact of having well trained people you can do more with less.
You’re not spending valuable time undoing and correcting mistakes, or losing money from misplaced or mispriced loans. So, I applaud those who are now realizing its time to train their people. Let’s do it and do it well. Plus, to ensure success, lenders should also invest in the systems and technology needed to support their staff in not only taking complete, accurate and compliant applications. But, to also help ensure these applications are monitored closely to move quickly through the processing, approval and closing process.
This will help ensure the manufacture and delivery of quality loans which will perform better and provide the returns and stability needed to maintain a strong housing market (by the way, at a profit to the lender). Training…Brilliant!