In the final episode of Season 2 of Batting 1,000, Dale Vermillion chats with Melissa Langdale, the new President of The Mortgage Collaborative (TMC). With over 20 years in the mortgage industry, Melissa brings a wealth of knowledge and experience. She discusses the key challenges faced by lenders in 2023 and the strategies they are employing to overcome them. Melissa also shares insights into what 2024 holds for the mortgage industry and highlights the importance of leveraging technology and building strong relationships.

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In This Episode

About The Mortgage Collaborative (starts at 3 mins)

Melissa shares about TMC's collaborative approach and the benefits it offers to its members.

Key challenges of 2023 (starts at 6 mins)

Dale and Melissa discuss the rising costs of origination, operational capacity, and growing market share.

Solutions for reducing origination costs (starts at 10 mins)

Dale and Melissa discuss strategies for reducing origination costs, improving operational efficiency, and leveraging technology.

Looking ahead to 2024 (starts at 24 mins)

Dale and Melissa discuss their predictions for the mortgage market in 2024 and the opportunities they anticipate.

The impact of mortgage technology and AI (starts at 32 mins)

Dale and Melissa explore the role of AI in the mortgage industry and its potential impact.

The centrality of servant leadership (starts at 42 mins)

Dale and Melissa discuss the key traits of great leaders and the significance of maintaining strong relationships in the industry.

Melissa’s 2024 outlook (starts at 50 mins)

Melissa's final thoughts on what lenders should focus on to thrive in the coming year.

Resources

Become a TMC Member

Attend a TMC Event

Schedule a call with Dale's Team

Soundbites

• "Success happens with relationships and local markets that you serve."
• "You need a balance of high touch and high tech."
• "Leverage technology to scale your business without the swings of headcount."

About Melissa Langdale

Melissa Langdale is the President of The Mortgage Collaborative (TMC), bringing over 20 years of experience in the mortgage industry. She focuses on engaging with lender members and preferred partners, overseeing TMC's daily operations, financial management, events, team processes, and strategy. Melissa's extensive background spans business operations, sales, recruiting, marketing, capital markets, servicing, quality control, compliance, and risk management.

Connect with Melissa Langdale

LinkedIn → Melissa Langdale

Website → The Mortgage Collaborative

About Dale Vermillion

Having trained over 1,000,000 lending professionals and worked with over 600 organizations, Dale Vermillion has compiled the best practices of the nation’s top producers into a practical and proven system. Dale is a 3x HousingWire Vanguard, a member of the 2022 Global Mortgage 100, and the proud author of "Navigating the Mortgage Maze."

Connect with Dale

LinkedIn → Dale Vermillion

Facebook → Dale Vermillion Official

Twitter → @dalevermillion

Website → dalevermillion.com

Email → listen@dalevermillion.com

About Batting 1,000

Batting 1,000 with Dale Vermillion is a production of Mortgage Champions, a VCI company. Produced and edited by Jake Vermillion. Music by Envato Elements. Copyright 2024 © Vermillion Consulting, Inc., All Rights Reserved.

All right.

Hello everybody.

And welcome back to another edition of batting a thousand.

Um, this is our last edition for season two.

We've had some incredible guests and today is no different.

As you know, we interviewed the heavy hitters in the mortgage industry.

Uh, and today I've got an incredible guest.

Uh, Melissa Langdale is with us and Melissa is the president, the new

president, congratulations, by the way, Melissa, that's exciting news.

Uh, uh, the mortgage collaborative sometimes referred to as TMC.

If you don't know who the mortgage collaborative.

because they've been around for a long, long time.

I'll let her explain that to you, but just to give you a little bit

of credentials on Melissa, she'd been in the business over 20 years.

She has been in all kinds of different capacities and roles within the

mortgage arena from area manager to RVP, to being a, uh, basically

running the VP of operations for a very large lender in the country.

And she's got a lot of knowledge on.

What it takes to succeed in this marketplace and the challenges

that lenders faced in 2023 and the opportunities in 2024.

And that's exactly what we're going to talk about today.

So Melissa, welcome.

It is so good to have you.

Thank you

so much for having me.

I'm excited.

It's absolutely my honor to have you here.

And, um, let's begin, let's just begin by talking a little bit

about the Mortgage Collaborative.

And.

Uh, you know, what you guys do, what you stand for and, uh, help people

understand a little bit about, uh, the cause that you guys have and what

you're doing to change the mortgage industry on a, on a regular basis.

Yeah, I would love to talk about that.

I actually joined the Mortgage Collaborative as a lender as I was

building out a mortgage company for a community bank in North Carolina.

Um, and what, what kind of blew me away and what really got me

hooked was, uh, I walked into my first conference and I showed up

for this thing called a collab lab.

And if y'all don't know what this is, I'm going to tell you what it is.

It's really, really cool.

Everybody signs NDAs.

It's an executive kind of round table where you walk into the

room and you share everything and anything about your business.

It really helps executives across the country be able to bounce ideas off of

others that have either, um, you know, tried new things or, uh, maybe, um, you

know, looking to, to reinvent either workflow or, or kind of, um, looking

to optimize their balance sheet, you know, a million things, everything

and anything about their business.

They, they share it with each other to help each other to grow and.

That's one of the things that makes TMC so unique is that, um, we create

these experiences and, and these, uh, opportunities for executives across the

country to really get together and to help each other, uh, to grow their businesses.

And that's why we're called the collaborative, even though we are a

mortgage cooperative, um, you know, we're very intentional about saying that we're

a collaborative just for that reason.

It's.

It's our members, the information that they share, the, the network,

the relationships that they build, uh, that really makes us

unique.

That's awesome.

And we talked, uh, beforehand, I've got a couple of really dear friends and

longtime clients, Owen Lee, um, and Alison Johnson, who both served on your board.

Incredible people.

They can't speak highly enough about, uh, TMC.

And, uh, I love the, the, the Christmas setup.

You've got, you guys, uh, just went through the, the 12 days of TMC.

Talk about that a little bit.

'cause you do that every year.

It's a really cool event.

Talk about that and how people can benefit from that.

Yep, I don't have my Christmas tree up in January when this is

going to be here, so I'm not quite that crazy just for everybody that's here.

We do basically three conferences a year.

We do two in person conferences, and then we do one virtual conference,

which we call the 12 Days.

Um, we're also not crazy.

It's not 12 full days of conference material.

It's just a few hours in the afternoon.

We, we have a keynote and then we have breakout sessions to

help people to collaborate.

In fact, this year we're doing something really unique.

We're doing a, our, our first ever solution sprint.

Um, and we're tackling some of the industries.

Biggest challenges, um, like for right now, um, you know, increasing day one

certainty and aim utilization without increasing costs as most, you know,

kind of mortgage executives across the country, uh, are, are realizing right

now, the cost of credit reports across the verification services, all those

things are just continuing to add up.

And so we're, we're tackling that, um, as a network and in

a very fun, competitive way.

Uh, we're going to talk about how to, how to open up inventory in the market.

that we serve.

And then the last one is around creating operational efficient

efficiencies to be able to really keep our team at highest and best use.

And there's a ton of technology out there that's, that's helping to facilitate that.

But so those are the things our solutions front is, is tackling, but

we have, you know, this is a unique conference in the sense that we have

everybody from a loan officer and a processor on the call all the way to.

C-suite executives.

And so, uh, we really have a variety of content to make sure that, that they

all kind of get something out of it.

And it's a fun way for, um, you know, our, our entire network

and, and their employees to get involved, um, in, in something.

So it's, it's a lot of fun.

In fact, this is our biggest 12 days ever.

We have about 3,500 people registered Wow.

For lots and lots of fun.

Wow.

Fun excitement going on around it.

That is awesome.

This is not up in January.

Well, and I saw that you had, uh, your keynote was

my dear friend, Brittany Hodak.

Yes.

Well, I love Brittany.

She's awesome.

Gosh, she's just amazing.

I love her story.

Um, she's just, she's this.

Brilliant mix of, of, um, you know, customer experience, uh, you know,

uh, brilliance and, um, and this kind of fun, uh, fun personality.

So she, she balances those two things really well, which is.

Now,

if we could just get her to be a little more enthusiastic, we'd

probably be, you know, she has a fireplug.

I love, love, love, love chatting with her.

All right, well, let's, let's dive right in.

Um, you mentioned some really key things a moment ago where I want to kind of

focus and channel this conversation.

You know, we, we, we just are finishing up 2023.

Uh, it's been a very rough year for the mortgage industry.

Uh, Uh, been a very rough year for a lot of lenders and originators.

Although I will tell you very honestly, you know, we, we work at mortgage

champions with 27 different lenders across the country, and some of them

are having their best year in 2023.

They've ever had, uh, most of them are only about 30 percent off of

2021 numbers, which is kind of crazy.

Um, and, and, and that just proves the point that there's plenty of opportunity

when you do it right now, 2024 is coming.

Everything's trending in the right direction.

Rates are headed down, the Fed's pulling back, inflation's improving, inventory's

getting better, house starts are way up.

So we're seeing, you know, more and more and more new construction happening.

Uh, we're seeing more of a buyer's market versus a seller's market.

All of these things point to a really great 2024.

And then I think a stellar 2025 and 2026.

So you are in the trenches talking to lenders.

Every day about their challenges.

Let's begin by talking about what were the biggest challenges that you saw in 2023?

Give me three of them.

And then what, what are those solutions?

What are the things that your members are doing to overcome those?

That's a fantastic question.

Okay, three biggest challenges for 2023.

Um, I'll, I'll chunk it down to rising cost of origination, um, operational

capacity and kind of, you know, ensuring that companies are kind of maintaining

that based on volume and that, you know, Really is, um, based on, you

know, their profitability right there.

They're kind of, uh, adjusting, uh, capacity needs based on volume

and that affects their bottom line.

So, um, and then the last would be.

You know, growing growing market share.

There's, um, you know, there's a lot of opportunities, I think, for for lenders.

You mentioned that you've got a ton of of your customers that are growing in this

marketplace, and there's just I think there's a lot of opportunities for for

lenders that are innovating that are that are looking at new ways of doing things,

both from, you know, an operational workflow technology perspective, but also

their sales model, how they're how they're helping their loan uh, at the same time.

So, uh, cost of origination, uh, working on their, their bottom line

and operational capacity as a result.

And then, um, you know, looking at growing market share.

So let's begin with that first one.

Let's begin with the cost of origination and improving, uh, the way that you've

got your system set up, you know, uh, I've had a lot of conversations

with a lot of executives and high level people about this very topic.

When you really break it down, there's really, to me, there's only three ways

that you improve cost of origination.

One is cut costs.

That's your expense reductions.

Well, just about everybody's done that one.

Um, we've seen major layoffs, we've seen a lot of cutback on things,

and sometimes people are cutting the wrong things and sometimes

they're cutting the right things.

I think the second is commissions.

You've got to reduce commissions.

That's a conversation I want to have with you to hear what

you've heard from lenders.

I had Garth Graham on this year.

We talked a lot about this beginning of the year that, you know, based on

where projections of production has been and is going, there has to be

a case in point that at some point we got to pull back on commissions

in order to create profitability.

Cause we're.

Last time I looked, it's over 11, 000 to originate a loan in the mortgage industry.

That is just not, you know, as the old saying goes, that dog don't hunt.

We got to make sure we understand that.

And then the last thing, and this is the one that we focus on the most with our,

our lenders is conversion is improving that conversion rate by improving sales

process, improving operational processes.

So let's walk through those for just a minute.

And let's begin with that first piece of a cost expenditures.

What are some of the great things that you have seen lenders do to

create cost cutting that has really helped their business to succeed?

That maybe is a little bit out of the box.

We've seen people rethink workflow altogether.

Um, right.

You know, that, that kind of traditional LOA processor model, for example, um,

we've seen a lot of people looking at kind of, adjusting that to fit their,

their existing workflow as technology continues to evolve and, and systems,

um, continue to provide efficiencies.

um, there, there are things like that, that, that lenders can do

to try to help, uh, create some, um, you know, some efficiency in

their, in their overall process.

In, you know, some of that even affects.

A better customer experience by having kind of one point of

contact throughout the process.

Um, so there are things like that, that, that, um, individuals

are looking at doing today.

You know, there's, you hit a lot of really important points of, you know,

there's, there's kind of workflow design.

Um, there's, you know, technology stack, there's LO compensation, all

those things go into, um, go into, you know, the cost of origination, uh, over

the last several years, um, technology has, has not quite evolved as much as

customer expectations have evolved.

Right.

Especially in COVID, right.

We, You know, Amazon completely blew up and they were doing fantastic, but

now, you know, everybody's like, I can just order something and have it

delivered to me in two hours on my phone.

You know, why in the world does it still take 30 days to get

through the mortgage process?

And so we, a lot of our lenders are rethinking their overall process

to try to shorten that time.

You know, significantly, um, to just better meet customer expectations and

they're looking for technology to help them to do that, um, in, in an efficient

way, I will tell you that the challenges you, you end up and I know you know, this,

a lot of your, your listeners know this.

You end up with your core kind of loan origination system platform, and then

you're like, Oh, well, our customers need this and we need, you know, we need

this extra thing on top of it to help it to be a little bit more efficient.

And so you end up with kind of almost band aiding, um, you know, your,

your kind of core platform to meet customer expectations, to kind of help.

Um, you know, provide efficiencies in your, in your workflow too.

And so that, that definitely drives up the cost of origination

to go back to our earlier point.

And so everybody's thinking about things like that.

How do we rethink workflow?

How do we rethink kind of customer experience?

Help give our loan officers tools and and how do we do it in an efficient way

from a technology stack perspective?

And so what does a lender need to do?

What is the process and what are some of the best practices to

create a better structure than that?

You were a VP of operations, you know this inside and out You know, I've

said to every client I've ever worked with as I consult C level executives

and mid level managers Look, your biggest cost within the operational

capacity is duplicative efforts.

Anytime you got duplication, you're paying twice for the same thing.

And you gotta, you gotta get rid of that.

You got to understand where your duplication happens.

You've got to create more uniformity in your application system.

That's where things like online applications are very, very beneficial

because they create a uniform process.

We don't have, as I always call it, the napkin application that, you know, a

lot of retail loan officers are, are.

Guilty of, you know, here's a name and a number.

They want a loan.

Here you go.

And you mentioned something I think that's really important earlier, and

that's the LOA processor relationship.

I can't tell you how many times I've sat down with clients and I've said,

show me the job description for an LOA and show me the job description, your

processor, and I look at them and go.

It's the same job.

It's just a little different that they're taking a little

more application information.

Why don't you merge that into one position and put a little bit more emphasis

on the originations team to get more documentation upfront so that there's less

of that they have to do on the backend.

So give me some thoughts on that, because I know this is a

great area of expertise for you.

Yeah, well that whole processor, LOA,

you hit the nail on the head.

The, but the, the reason that they're separated in a lot of

cases is verifications, right?

They, they want kind of this, you know, significant separation between

sales and operations and Right.

You know, it, our industry has had a ton of fraud over the

years and this, you know, helps companies to kind of mitigate that.

But as our, as our, um, industry continues to evolve and technology

continues to evolve that whole direct to data connection with,

you know, verification platforms really reduces a lot of that risk.

And so it's important to rethink, okay, we, do we actually need these kind of

check the checker, um, layers in our process that really slow down the process,

add extra costs from both it, you know.

Um, uh, an employee standpoint, you know, you're, you're having to have all

this, this extra, you know, head count in order to just get a loan from ABC.

Um, and so, you know, it, it, it's those type of things that lenders

are, are rethinking and, and you hit the nail on the head that, that

particular role, that, that LOA processor has traditionally been the.

The easiest thing, I guess, for people to see that that is really

a check the checker, um, moment.

And so a lot of lenders are just rethinking what that looks like,

uh, in the future now that they've got kind of a lot of direct to

data connections with verification platforms, even though those are.

Those are, uh, very costly right now.

Yep, no question about it.

So, talk a little bit about, you mentioned earlier something really

important, and that is the whole day one certainty and the costs

that are going up on credit reports, title reports, I mean, you name it.

It's everything is going north instead of going south.

And you said you guys had, uh, you know, a collaborative of people that were talking

about that, of lenders and executives.

Tell, tell our audience.

You know, what, what came out of that?

What were some of the solutions and ideas that came out of that?

Because that would be pure gold to the listeners.

Yeah, I, we're still in the midst of it.

So it's a, um, we, uh, our, our, our presentations will be December 15th.

Um, and I know this, this is going to air after that, but we'll have a

press release that goes through all of the solutions that were presented.

Um, and just to make sure that the, the industry is aware of.

of some things that people can do on a regular basis to help.

Um, that particularly is, is, I think has been a challenge for our industry

and has a lot of, uh, potential opportunities for improvements over time.

For, for example, today, Day One Certainty and AIM both utilize this kind of direct

to data connection that in a lot of cases requires the customer to log in to.

To some platform.

And so anytime this kind of layer of, um, you know, password, you know,

customers having to share their password with their lenders in the process,

they automatically get this, you know, kind of pause of, okay, well, how

much of my data are you gathering?

How often are you going to pull it?

Like, do I need to change my password after this?

Is this really safe for me to do in other words?

And so, you know, what's been, I think what's been holding back, you

know, uncertainty in AIM utilization is, is really the, the customer being

comfortable and confident in sharing their, their data throughout the process.

So I think there's, there's going to be continued opportunities for us to

find better systems for customers to be more comfortable, uh, with sharing,

sharing their information or lenders getting it directly, um, you know,

from sources without necessarily needing that, that customer layer.

And it could.

You know, reduce fraud for the industry as a whole too, right?

If, if lenders are going direct to data, direct to IRS, direct to payroll,

direct to, you know, all of those things, you, you naturally reduce the

risk of a customer, um, leveraging generative AI to create a pay, uh, you

know, a pay stub or a W 2 or, you know, all of those sorts of things that,

that are in our space right now and, and lenders are having to deal with.

It's a little mind boggling, isn't it?

You know, those layers have been in our space for, for so.

So long and less generative AI, you know, can, can help, uh, with creation of some

of those things, but frankly whiteout and, um, a typewriter could have helped

with those things back in the day too.

So those lenders will always be in our industry.

So you, you talk to lenders all over the place and you've

seen the same thing that I've seen.

You've seen the lenders who are doing very well in this market.

Okay.

And they're kind of like, well, I don't get what the problem is.

You see the lenders that are just freaking out and they

really don't know where to go.

Okay.

Here's my question for you.

The ones on this hand, the ones that are really doing well.

Okay, tell me what you're seeing in them that is making them successful and from

any vantage point, from mindset, how they think about the industry and the

business methodology, what they're doing to make differences, give us a little

bit of insight on what you're hearing from those top producing lenders are some

strategies and some things that they are implementing that is making a difference.

Some of this probably won't be rocket science to

you, but we, um, you know, a lot of our lenders that are growing right now

are doing it with really experienced purchase focused loan officers.

Right.

And, and we've talked about that as an industry for years, but

that is the, that is the kind of.

Um, the foundation that that a lot of mortgage successful

mortgage companies live on it.

And that's where, you know, we've seen our lenders continue to grow

is that they're, they're really focused on hiring some of the best.

They have a fantastic recruiting program.

They have a fantastic marketing platform.

To be able to support those loan officers and they have reasonable expectations

from a compensation perspective.

Most of the loan officers that are out there today recognize that they,

there's a balance of being competitive in the marketplace with kind of,

you know, compensation models.

Um, At lenders and they want the lender to be reasonable.

I, I don't think anybody's, you know, coming out of the gate these

days and saying, Hey, I want to make 200 pips on a, on a loan and

be priced out of the marketplace.

Right.

So, you know, I think most everybody right now, as long as compensation is

reasonable, um, in the marketplace.

They're going to be fine, but they're really looking for tools.

They're looking for tools to be successful.

They're looking for a fantastic operation team behind them that they,

they can call on at any given moment to give answers, give updates, move the

process through really, really quickly.

Um, so again, I don't think any of that's rocket science.

Those are things that, you know, top producing retail and officers

across the country have been doing for years and years and years.

Well, and you're right, it's not rocket science, but

you said a couple of very important things there that I want to unpack now.

So, you started by saying, very experienced, purchase loan officers, okay?

And the thing that I pick up in that, and I talk about this all the time, in

fact, I just did a speaking engagement, um, both at AIM, uh, FUSE, and, uh,

the month of November and then did something again at the Lenny Tree Summit.

And I talked about this on both places, specialization.

It's so important today.

You know, the, the companies that I see that do well, they

don't have a loan officer that handles purchase, refi, HELOC.

All of it, you know, it's the jack of all trades, master of none.

Um, and that's not what referral partners want.

They want experts.

They want specialists.

So the fact that, that companies that are doing well have purchased specialists,

they also have refi specialists that are experienced in that product.

They're not crossing over.

They're, they're focusing on doing it right.

How much is that playing a role in them being successful?

You think?

I mean, I think you hit the nail on the head.

I mean, obviously, everybody in the marketplace today is looking at is looking

at purchase business with the kind of rare exception of maybe a cash out refi,

um, or, you know, an equity line, like you mentioned, but the majority of the

market, obviously, today is purchase.

And so, you know, Referral partners, realtors, um, you know, in some

cases, financial planners, divorce attorneys, those sort of things are

all looking for individuals that can help them to ensure that their

customers are well taken care of.

And it really does take somebody that's in that space all the time

to understand all the layers that goes into the purchase cycle.

Um, you know, all the, the layers that the realtor has to deal with

all the layers that, you know, if they're going through a divorce, for

example, that they have to deal with.

And it takes somebody to understand that whole process.

Um, you got to be in it every day to understand it.

So I totally agree with you that the, the, you know, focusing in on, on one

particular area can be really, really helpful and is really driving a lot of.

Uh, you know, top producing loan officers across the country to continue to be

successful, right?

And I think it's important we define what experience is because, you know,

if, if a lot of times when we think about the experience, for example,

purchase specialist, a lot of those people are close to retirement.

Now, if you look at the average age of mortgage originators, particularly

in the distributed retail market, it's close to 60 years old now.

That many of them are and they've made a lot of money in years.

They don't necessarily have to work.

So you got to find the people that are still hungry.

So got that fire in the belly, you know, no matter what their age is, they've got

a, they've got a runway ahead of them still that they're going after, because if

you're getting them in the twilight of a career, they might not, even though they

may have been very successful in the past.

It doesn't mean they're going to be very successful in the future.

You need somebody in this market.

Who's very driven because it's a market where, you know, the realtor's business

is much slower than it used to be.

You have to have a much bigger network than ever before.

The, these are all essentials to, to this process.

So when we talk experience, experience might only be five to 10 years.

It's five to 10 years of high production where they've done

it again and again and again.

And they're proven entity.

And I think you said the most important thing there, because I get this question

a lot from leaders about recruiting.

Okay.

When you're recruiting, who are you looking for?

We have, you know, I hear a lot from leaders.

Well, you know, I get guys who want big signing bonuses or I get gals who want

to come in and you know, they, they, they want this high basis point percentage.

I don't see that very much in my conversations.

What I hear a lot is, I want the tools.

I want the technology.

I want the marketing support.

Uh, I want the education.

I want a great ops department that backs me up.

These are the things that seem to matter more.

Would you agree with that statement?

100 percent agree.

And I, I want to go back to one thing that you said to you, you mentioned all of

the, All of the things that loan officers have to do today to be successful.

Um, you know, in this cycle, particularly not unlike, although it is a little

different, um, not unlike 2008, 2009, loan officers are having to do more in

order to get the same amount of business.

And, and I have seen, you know, that, um, kind of.

Either younger generation or, um, kind of, you mentioned like five to 10 years

of, of experience, those that have enough experience that they're knowledgeable,

they're driven, they're willing to pivot and do, you know, try new things.

And they're the, the hustlers, you know, in this case, you know, for, for lack of

a better word, those are, it may not even be that they're working 90 hours a week.

Right.

They're, they're just.

They're leveraging technology to do more with less.

They're, they're, um, creating great marketing platforms.

They're, um, in systems.

They're creating teams behind them that can keep that, that kind of

wheel churning so that they're constantly at highest and best use.

And so, um, the companies that figure out how to support those loan officers.

It's going to be a lot of fun to watch them grow.

Yeah, it will.

So let me ask you a question.

Then let's talk about a different perspective on personnel.

Um, you know, I started in the business, I've been 40 years doing this gig.

I started in 1983 years, I managed all the way up to running a national

mortgage company with 900 loan officers and 2, 300 employees.

So had a little experience before I got into training consulting on Dealing

with salespeople and operations people.

And interestingly enough, my philosophy of hiring was the same for all 12 years.

If you had one day mortgage experience, I wouldn't hire you.

I only hired people off the street.

I only hired people that were go getters, hustlers, that wanted

to learn, that wanted to grow.

And in those days you could do that very effectively.

Okay, now fast forward 2023 2024.

Okay, I hear from a lot of clients, you know what, I don't think that's

the way you can hire anymore.

And I, I always push back on that and go, I don't think you can

hire a hundred percent like that.

That would be a challenge.

However, if you have a core of experienced leaders that are in your Originations

team, and you can bring in people who are hungry with today's technology

that helps aid a lot of what they do.

Uh, with today's opportunity to network so much easier than you used to.

And with their understanding of things like social media and how to communicate

in different ways, video, video is a huge way to communicate today for today's

marketplace, because that's what people are used to with all of the, you know,

the reels that everybody watches and tick tocks, the biggest thing on the planet.

So do you hear or much from your lenders about.

Bringing in new people and training them from the ground up because at some

point you're going to have to do that.

You can't always hire experienced because then you're just

cannibalizing your own business.

Talk to me a little bit about that mindset and that thought.

You know, that, that's always, it's always a struggle.

Um, you know, there, there is.

There is a space for those, those hungry individuals to definitely

partner with top producers.

And I have seen some of our lenders doing it.

In fact, we've had a lot of requests.

We have a platform called TMCU, um, which is our, um, TMCU university.

And that, you know, we're, we're building out kind of a mortgage

essentials products within that.

because we, we keep hearing, um, from our lenders that they really would

love to be able to take advantage of that opportunity to bring in new to the

industry folks for a lot of reasons.

Um, you know, our, our, the speed of innovation and in our space today is

really, really fast and having individuals that can come in with a different

perspective and have different, you know, insights on, you know, like you said, how

to, how to leverage social media, how to.

Um, you know, uh, do video and do reels and, um, you know, shift kind of the

marketing strategy is really important and really valuable to organizations.

But there has to be kind of a, a way for them to have a baseline

knowledge build in the process.

And so partnering them with, you know, with folks, like you said, that are,

that are experienced leaders that can see the opportunity to grow as a, you know,

as they bring in this next generation.

Could be really, really impactful for organization and for that

leader that's bringing them on.

That's good.

Building a partnering mentoring kind of philosophy, having, uh, utilizing

resources like you guys have, and we have, where you're training, we're

training loan officers every day from the ground up how to do this.

And, and I'll tell you something that will kind of shock you.

Uh, um, and you know, I've worked with over 700 lenders

in the 27 years I've done this.

And we're usually working with about 30 in any given year.

And, um, this year in 2023, The top three clients that I have that have

made the most money, produce the most business and have the highest units

and dollars per loan officer are all refinance only, believe it or not.

And they are all three consumer direct.

And they all three have gone by the philosophy of we're bringing

people in off the street.

We're not hiring experienced people and we're training them from the ground up.

So there is a case for that that says it can work.

Um, if you really have specialists who are well trained, but each of them also

has a mentoring program, just like you're talking about, where they have experienced

people that have done it, that they can.

put them side by side.

They can coach and mentor them.

Uh, you know, and what they find is that those mentors actually do more

production, not less because they're kind of showing off in front of the

rookie is what it comes down to.

So there is a case for that.

And I think You know, the, the services you guys provide, uh, and hopefully

we provide are very valuable in doing that because that's where I think the

market's going to go in the future and certainly consumer direct, it's easier

to bring in people off the street than our distributed retail, because you're

talking about long relationships that have been forged with partners, referral

partners, that's a little different game.

Although I will tell you, you know, I love to share the story.

There's, there's a lady that I trained a year and a half ago at a large

bank, fresh, fresh off the street, never been in the mortgage business.

And.

I trained her on just open houses.

I said, just go do open houses and, and, and you'll be successful.

Lo and behold, in, uh, the, I think it was August or September of

this year, it was her 11th month.

And she had 4.

6 million in production in her 11th month.

And I said, how'd you do it?

She said, I go to six open houses every Saturday and that fuels the

fire for the entire rest of the week.

So there is business out there if you go after it and do it.

All right, let's talk about, um, let's talk about technology

a little bit more for a minute.

Um, AI is coming.

We know that.

What do you think?

It's here.

Yeah, I should say that, but it's coming more and more and

more to the mortgage industry.

What do you think the impact is going to be?

And what do you see as the pluses and minuses of AI?

Gosh, that's, there's a lot in that.

So, you know, obviously AI is here.

There, there's a lot for lenders to think about both from how

do I, how do I leverage it appropriately, um, in my organization?

How do I understand really the risk that our organization has?

Um, and then, you know, how do we.

How do we continue to innovate at the speed that consumers want and

leverage that to be able to do that?

And it's, but, but also not just build a front end engine.

Um, that's really, really fast.

How do I leverage it to produce quality loans and to sell them faster?

Um, and so, you know, there's, there's ways to, to use AI

for all of those things.

You know, I, I see it today as, um, there's, there's processes that mortgage

has built, for example, underwriters, um, you know, you bring in a brand

new underwriter, what do you do?

Uh, you, you put them through a QC process, of course, you don't tell

them they can underwrite, you know, FHA loans with no guidance, um, there's

things like that, that, that lenders are really starting to think through,

how do I leverage AI in a way that.

Um, that keeps my team at highest and best use, but also allows me to keep a pulse

on, on, um, what's working and what might not be working from an AI perspective.

Not a lot of lenders are considering kind of decisioning, um, through, through AI.

They're, they're mostly considering how do I create kind of operational efficiency

scenario desks, for example, for their, their underwriters or their loan officers.

Um, there are some technology providers that, that are in our network that

are looking at ways to either create, um, transparency in the process with

consumers as they're going through a mortgage, um, with, with kind of task

creation and, um, document review, uh, faster and, and things like that,

that, um, Um, you know, it's fantastic.

They're improving customer experience, but they're not really

relying on it for decisioning.

They have kind of human and loop processes or QC processes where

they're kind of testing the systems.

I think the probably our regulators, our GSEs, um, are a little nervous

about AI because there are so many things that it is capable of.

Especially as it learns more and more and more over time.

And really, you know, there's, there probably will be eventually expectations

of lenders that they're going to be kind of held accountable for the decisions

that they're allowing systems to, uh, to have, but we'll, we'll see where it goes.

Um, you know, they're, they're held accountable today

to underwriter decisions.

Right.

Um, and so, uh, you know, I, I think there's.

There's going to be a lot that's evolving.

It is evolving really, really, really fast.

That we're, we spend a lot of time talking about it with our lenders.

In fact, I created a, um, a group that is an innovation focused

working group, uh, that spends a lot of time talking about AI.

It's called SparkLab.

Um, and, uh, you know, just.

Helping everybody to understand the difference between kind of basic

business roles that you build in your, your system that, that creates kind of

a little bit of operational efficiency to, you know, AI and then generative AI

that really needs kind of large language models that you're using for, for some

level of maybe income calculations or, you know, but it's not like full

decisioning, but it, but it has the ability of, of digesting information and

providing significant data to the process.

Okay, good.

It's interesting because I've got a very good friend of mine.

I've known for 25 years.

He has been the head of, uh, some very large lenders, technology departments.

He is just a whiz when it comes to all the technology.

And we had a conversation about AI and I learned something from him that I never

knew that there's different about him.

Places, I guess you can get AI from and what their company does, he's, he's

now running, running his own company.

What they do is they go in and they'll take questions and they'll put them

in and they'll match the four and.

A lot of them are incorrect, not even close to correct.

And then one is closer and then one's the actual number that you'll get.

And, and they're constantly screening through to get the right

and best answer all the time.

So, you know, there's a lot of efficiencies that we gained by AI, but

lenders will have to be really careful.

Cause I know this was the number one conversation that I heard at the

Lenny Tree summit when I was speaking at that, you know, that, that's it.

That was a tech.

a tech conference for all intents and purposes.

And AI was the rage of the conversation.

And some people were really excited and some people were scared to death.

And, you know, it was such a wide scope that I saw.

Yep.

It's

you hit the nail on the head.

It really is, um, data in, like, you've got to have a big enough

language model and a really good system for helping AI to learn.

Yep.

Um, and, and I think that's where the, the.

You know, evolution needs to continue to go in the mortgage space is that

we have to be able to ensure that these platforms are learning the

right way for a lot of reasons.

You don't want, um, you know, a part of the process to unintentionally

discourage a customer to, to not move forward because, um, you know,

they don't have the full picture or they're making the wrong decision or,

you know, whatever the case, there's.

there's like fair lending implications in some of this too.

And so, um, yes, you, you have to be able to understand the data that's going in.

You have to have a good test process, um, you know, to ensure that it's learning

the way that you, you want it to learn.

So

2024 for a minute.

Um, uh, what do you see from the mortgage collaborative?

What, what do you see and kind of, you know, what is your, um,

What is your outlook for 2024?

Give us the good, the bad and the ugly.

Well, if we all had a crystal ball.

Good point.

That's a good start.

You know, I'll just preface that, right?

Hopes and dreams and wishes and unicorns and rainbows.

I think that, um, you know, Look, our, our industry has been challenged

over the last couple of years.

I think challenges, um, are, are actually kind of cool because they

allow for, um, lenders and, and our industry to kind of rethink things.

And, um, you know, I, I think they've spent a lot of time rethinking things

and those that have really built a good, solid foundation of, of, you

know, innovation as well as support, um, are, are going to be really.

Poised in 2024 is that market starts to shift and I think that

it will, um, you know, that, that they're going to be able to take

some market share when that happens.

Um, so it'll be, it'll be interesting.

I mean, you know, look at the end of the day, there's a significant

portion of the, um, of homeowners across the country that have interest

rates that, uh, even if rates go down to, you know, 6 percent won't be.

percent won't be refinanceable.

Um, and so, you know, I, I don't think we're going to see a giant

surge of refinance opportunities.

I could be wrong.

Um, I, I, you know, hope for our industry that I am, but I think

there's going to be a really solid purchase market in the coming year.

I think you're going to see inventory, you know, open up some of these,

um, Um, Some of the builders that, that you've mentioned have kind

of increased starts are going to start to hit the market in 2024.

And so this, I think all of those things coming together is

going to make for a good year.

Yeah.

I mean, in the month of December or month of November, the statistics on new home

starts was annualized million new homes.

That's a lot of new inventory.

When you consider where we're.

Our numbers are at right now, so that should lag into 2024.

We've still got some supply chain issues and other things that we're

dealing with, but you know, overall, I think that's going to be good.

And look from a refinance perspective, if we do get down in the low

sixes, high fives, I mean, we've, we've made a fair amount of loans.

I mean, 325, 000 approximate loans will close in 2023.

Um, and an average probably of 7.

25 percent coupon.

If you average them all out, you get down to six there, there's some

opportunities, especially when you include in the fact that the average

credit cardage straight is up to 27.

8 percent right now.

That's the average.

That's not, that's crazy.

That's, that means we got 35 percent credit cards out there,

you know, home equity lines are 13, 14 percent a lot of times.

So when you start looking at all those blended rates and putting all that debt

together and consumer debt is by far the highest it's ever been in us history.

While at the same time, equity is the highest has ever been in us history.

So there's opportunities there, I think for 2024, but, uh, I'm with you.

I think that, I think we're going to see much better trending, Uh, from what

we saw this year, we, we had some major things that happened this year that

we thought we were going to see that.

And then we had the debt ceiling problem.

And then we had the downgrade from Fitch, you know, just, it seemed

like one thing after another hit 2024 is an election year.

That's always a good thing.

Good things happen in election years, generally for the mortgage industry.

Melissa Langdale: Historically, you're right.

There, there is generally a lowering of interest rates in an election year.

So we can all, we can all

look forward to that.

Let's hope that really happens because we don't, yeah, I don't want to hear any

more reports in 2024 of hawkish comments.

I'm so tired of that phrase, hawkish comments.

I've seen that so many times.

All right.

So give us, um, to kind of wrap this up, uh, from your perspective.

Two or three things that you think are critical for lenders to really be

doing in the coming year and really be focusing on to improve their businesses.

Um, uh, straight, straight from, from your book, from your playbook, this

is some Melissa wisdom for everybody to, to have no pressure at all.

We, we know, we know you, we know you've got the experience and the,

and the wisdom to share with that.

So give lenders an idea of what you think should be happening in 2024.

You know, I, I think, um, the, with the market looking to shift,

um, you know, in the coming year, I think it's going to be really, really important

for leaders to understand what their teams really need in order to navigate

something like that, um, especially when staffing levels have been low and have

had to be, you know, lowered over the last, you know, couple of years, right?

Um, it's going to be important for the, You know, leaders to step up and realize

that their teams are going to need different things in a growing market.

Uh, it's also going to be important to, to not, um, to, to manage kind

of expectations as the market, uh, shifts and, and try to leverage

technology as much as they can to.

scale businesses, um, with, without necessarily having the swings of, of

headcount, um, that our, our industry has seen over the years and needed to

have seen, uh, to keep loans moving.

Um, so leverage technology, be fantastic leaders.

Um, and you know, I think continue to build relationships in the markets

that they serve at the end of the day, you and I know we've been in

this industry long enough that.

you know, success happens with relationships and local markets

that you serve, put you in front of the right customers that are really

ready, willing, and able to buy.

Um, and so, yeah, build relationships, be great leaders and, uh, try to scale

as much as possible with technology.

Okay.

So let me ask you two final questions then on that.

Let's talk about being a great leader.

Define that.

For me, but from, from your perspective, you meet leaders all the time.

You see the great ones.

What are the characteristics that you see in them that somebody can

say, man, I need more of that.

Yeah.

Gosh, that's such a good question.

Uh, everybody defines leadership a little bit different.

I, um, am a, a servant leader kind of mentality at the end of the day is

about kind of bringing vision, being the compass for your, your team that they

need, kind of showing them the direction the company has to go and helping them

and guiding them along the way to, to keep moving in the right direction.

And I think as long as you're You know, you're, you're one step ahead of

where your, your company wants to go.

And you've got this really fantastic vision.

You're a great communicator along it.

And you, you are understanding and caring of the people around you.

Um, I don't know that that to me is a great leader.

I love what you just said there.

That was pure gold.

When you said be a compass for your organization.

I think, I think the mortgage collaborator should get a t shirt.

That says that I think that's a great, great, because it's, that's

a great visual right there is you got to be the North star as a leader

and couldn't agree with you more.

If you're not a servant leader, you're not a leader in my book, period.

Because if you're not serving your people, then they think you're in it for yourself.

And the moment they think that they're not going to follow you anywhere.

And I loved how you talked about the power of the importance of communication

to have a vision communicated effectively and make sure you're keeping that

really positive mindset going forward.

Because the thing that I see the most common in the best leaders

is you just can't get them down.

I mean, it doesn't matter what the market does.

They understand, you know, what it's, it's what I call the pivoting concept.

Okay.

So that's a problem.

Nothing we can do to change it.

Let's solve it.

Let's now take that problem.

Let's turn it into something good.

Let's work through this and not look backwards.

They're always looking out the front window.

They're not looking in the rear view mirror.

That's right.

And I, I think you just hit the nail on the head that kind of perfecting the art

of the pivot, um, can, can absolutely help leaders, you know, be that compass, right?

Um, maybe the, the direction needs to, to move a little bit, but you

Uh, just recognizing the fact that, you know, the same things you did

yesterday and changing work won't be the things that are necessary

needed for your team in the future.

And so,

uh, I love it.

It's good.

And then let's talk, the last thing is about relationship.

You talked about that too.

And, you know, this is something that, that I talk about.

All the time, you know, I, I've been a partner with ICE, uh, mortgage technology

and that whole group for a long time.

And I've spoke at their conferences year after year.

I'm speaking again, uh, this year in 2024.

Um, and what I've really focused those speeches around is high tech, high

touch, you know, technology's critical.

You, you gotta have it.

You've got to be up to date on it.

You got to use it for efficiencies, but what you can't use it for.

is building relationship and loyalty.

You need people to do that.

You need conversations with your customers, conversations with

your partners that are value based conversations where you really build

deep relationships, really understand their needs, understand their

goals, understand their challenges, and then solve those things.

Give me a little bit more of your thought process on the power and importance of

relationship in today's marketplace.

Because a lot of people think, Oh no, Just build a great technology and go to town.

But we've seen a lot of fintech companies fail miserably where their

whole mindset was all tech for the consumer, no personal relationship.

And what I'm seeing is my top clients, it's all personal relationship.

You know, I think there's a balance of it.

I'll kind of play devil's advocate a little bit.

Yeah, I do.

I think there's a balance and you hit the nail on the head, but what

you were talking about at your ICE conference is the balance of

kind of high touch and high tech.

Um, there, there, there are places for technology to allow customers

to have transparency in the process.

To be able to self serve as they have the knowledge and skill

set and ability to self serve.

And, um, and also have a high touch person that's coming along

beside them and helping them to get through one of the biggest financial

decisions that they're having to make in their lifetime, especially if

they're doing it for the first time.

Right.

And so there is that, that balance, I think of.

Allowing them to self serve where they can and being that resource, um, to

help them to think broader beyond.

I just need an interest rate.

You know, um, you know, I had one of my, my loan officers, you know,

years and years and years ago, and he would have, you know, this is like

an age old question where customers call and they say, Hey, what, what,

you know, what's your interest rate, what's your 30 year fixed rate today?

And he would always answer it with, well, What rate do you need?

I, I have all of the rates and it was such a brilliant way to just.

Just, just flip the conversation and say, what's really important to you.

And I think as long as loan officers are taking that approach and being

really, um, consultative to customers as well as their real estate partners

and referral partners, the key is, is you gotta have both sides.

You can be fantastic on the customer side, but if you're not building

relationships with your realtors, your builders, your financial planners,

your divorce attorneys, those, Those people that are continually, um, you

know, providing you with referrals.

You're, you're going to miss the boat.

Cause somebody else is going to do it.

That's right.

That's right.

Yeah.

And just, just to clarify, in case I didn't make that clear, I am a huge fan of

technology and, and you have to have both.

You're absolutely right.

Couldn't agree with it more.

But, but as I look at today's marketplace, it feels to me like

you could survive better with.

lesser tech and higher relationship than you would with higher

tech and lesser relationship.

A hundred percent.

Yeah.

And, and, and you said something earlier that was important.

You said, you know, you got to know those customers that want to self serve.

And, and what I see in the industry a lot, and, you know, this year

alone, I probably listened over.

400 sales calls with my clients.

Because part of what I do, I'll train their loan.

We'll train their loan officers.

We'll train their leaders.

We train their ops team.

We work with the entire company to build a uniform selling system,

operation system, and leadership system.

It's all built around that servant leader mindset and serving your customers.

Well, but then what we'll do is we'll do shopper calls on the

backend to make sure they're doing the things that we want them to do.

And we've listened to call after call, after call, after call,

where the borrower was sent a link.

But the borrower actually never asked for the link.

They didn't really want to be self serve.

What the loan originator said was, well, I could take an application or I can

send you this link, which is much easier.

And the borrower was like, well, okay.

And then I look at studies that tell me again and again, and again, about 30

percent want to do the link and about 70 percent want to talk to a human being.

And I think that's where we're missing the boat in the industry a lot.

Yep.

I a hundred percent agree.

In, in fact, I, I.

Um, there's, there's a lot of ways that loan officers can do that.

And I think you hit the nail on the head that, but they got to ask the question.

Uh, they got to ask, like, what, what's important to you?

Yes.

Uh, what's important for you to, for, for us to have a 15 minute conversation

and walk through this, or are you strapped for time and you can do this

on your own and we'll, we'll sync after you fill out all your information.

But I also think there's another layer where we really can leverage technology.

To help our customers to know that we actually know them, you know, the, the,

um, at the end of the day, like there, there's a lot of industries that, um, that

keep customers for a really long time.

Mortgage has not been quite as successful.

And for a lot of reasons, really it's, you know, there's a giant

period of time between their last purchase and the one that they're

doing, you know, the next time.

But, but I do think there is an opportunity for, uh, for For lenders

to continue to think about how do I, how do I keep a lifetime customer?

Um, and there's, there's ways to leverage technology to pre populate applications

for them so that all they have to do is kind of go in and, and, you know, just

check and make sure that the information has not changed since the last time

that, that you did a loan for them.

Making that process, there's, there's barriers of going through the application

process as easy as possible, whether they're doing it online or you're, you're

doing it on the phone, um, breaking down those can, can make a big difference.

Well, that's a great way to end the, the, the interview

because that was gold right there.

You're absolutely right.

I mean, the reason we as an industry have not.

done a great job at retaining our customers because we don't stay in

contact after the sale, after the close, I, this is, this is probably

one of the things that I harp on the most with loan officers is look,

you're not going after one transaction.

You're going after a lifetime relationship if you're doing it right.

And all of those experienced loan officers we talked about earlier that

have had, you know, incredible careers.

That's what they did.

Um, you know, I just recently, uh, for our clients, we do a monthly

video every month on sales, right?

Bring a market update.

And then we talk about things that we think are important in the market.

And I did an interview with a, a realtor who did over 500 sales in 2022.

Uh, that's a big time realtor and he actually worked with one of the loan

officers that I trained and he said, you know, interesting fact, that loan officer

has stayed in touch when we've worked together for 10 years now and we sat down

a couple of months ago and we looked at a loan that we closed and we went down the

family tree and it turned out that that loan was the 51st loan originated from

the first person that this loan officer had gotten a loan from with that realtor.

Um, 51 loans because she stayed in touch month after month, year after year.

She said, I'm going to be your loan officer for life.

And she meant it.

And you know, today loan officers think they're too busy for that,

but technology can prompt them and guide them so that look, here it is.

It's right in front of you.

Just make a phone call.

No matter what you say, Hey, how you doing?

How's things going?

That's good enough.

Just keep it in touch.

We'll make a big difference in that longevity.

Yeah, absolutely.

And I love, yeah, the phone call, just, just, hi, how you doing?

How's your family?

How are your kids?

What's, you know, are the same things that are important to you?

You know, when we first talked important to you today, um, yeah, all

of those things make a huge difference.

Yeah.

How'd

the home improvements go?

Did you put the addition on?

Simple question.

You'll talk for 30 minutes with them about that.

And next thing you know, you're saying, you know what, I'm thinking

about, I need more money to do this.

And here we go.

You're right back into it again.

Awesome.

All right.

So let's, let's close out with, um, how do people reach out

to the Mortgage Collaborative?

Tell us a little bit about, uh, membership, what that

entails and provides.

I'm a, I'm a huge fan of what you guys do.

I certainly, anybody that's watching this, if you're not part of TMC, I

recommend you become part of TMC.

Talk to our audience about how they can do that and what do they get when they're

part of the Mortgage Collaborative.

Wow.

Thank

you so much for that.

Um, by the way, they can always reach out.

They can, they can, uh, we have, we have links on our website,

the mortgage collaborative.

com, um, that they can, they can reach out on.

They can always email me directly too.

And, and, um, I'll provide your, my LinkedIn profile and they

can reach out that way too.

So lots of different ways to get in touch with us.

Um, membership is really simple for our, our lenders across the country.

Um, you have one membership for your entire organization, um, have access

to, you know, two in person conferences, one virtual, like we talked about, but a

plethora of events throughout the year.

And I say plethora, um, and it probably doesn't even do it justice.

Every single week, we have four to five events that we put on for our members.

Every week we have working groups, lab labs, we have TMC connect sessions.

We do, you know, the rundown, um, with Rob Christman every Friday and last weekend

mortgage day, so you can keep in touch on, on, you know, the top news, um, Articles

that are happening throughout the week.

Like there's, there's a plethora of information that we provide

to our members on a daily basis.

Um, and then, you know, those in person conferences and the virtual

conference where we put people into groups and help them to.

To help each other to grow, uh, is, is really pretty special.

Um, and you know, outside of that, we, we actually have started just, just recently,

um, an advocacy committee where we're building really strong relationships

with agencies and regulators.

So that as you know, guideline change as, as policy changes, that

we can be a voice for our lenders.

Uh, as those sort of things happen and we can put them at the table with

the decision makers that are, that are changing policy, that are changing

guidelines and help them to understand regulators and agencies to understand,

um, what that means actually to consumers.

Cause a lot of our lenders, they're.

boots on the ground with customers every single day.

Um, and it's really important for our regulators and agencies to, to

have a good sense of what, what their policy changes mean for new customers.

Um, so all those things are in membership.

I could talk about it forever.

I know you want to wrap things up.

Uh, so just reach out, uh, on LinkedIn, our website.

We would love to chat with anybody.

Awesome.

Well, Melissa, you've been a delight.

Thank you so much for, for being on batting a thousand, uh, great,

great, um, advice and wisdom.

We really appreciate that.

I want to wish you a very Merry Christmas and a Happy New Year.

Uh, and, uh, look forward to, uh, to working with you again, hopefully in 2024.

That sounds fantastic.

Thank you so much for having me.

This was a pleasure and an

honor.

You're welcome.

God bless.

And we'll see you soon.