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The technology lens

Why and How You Control the Future

Braving the Great Waves of Change

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MISSOURI MORTGAGE PROFESSIONAL MAGAZINE  SEPTEMBER 2010

Finally, and most importantly in my mind, is the technology lens, the ability to see the transaction not as simply a pile of paper, but as an orderly progression of processes that speeds the loan in a compliant and quality fashion from lead to post-close. There is no way that mortgage professionals of the future can act on what they learn by looking through the compliance and marketing lenses without good technology. It’s more vital today than ever before. Lenders of the future must be fast, agile, lean and affordable, all of which determines how effectively they can implement the proper technology. But it will not be technology, as we have known it so far. Lenders of the future will need much more flexible systems that can easily and quickly be deployed to sell new programs to new classes of

borrowers. This will require a true partnership between the lender and the technology provider. The technology that lends itself to this kind of relationship and offers this kind of power does not come in a box. Technology that can adapt to the everchanging needs of the mortgage marketplace of the future can only be proBy Gibran Nicholas vided through Web-based solutions. It will be a template-based solution that is easy to customize, very fast to deploy Who controls the future of mortgage few years once the massive financial banking? Regulators? Secondary market reform law is implemented. The govinvestors? Fannie Mae, Freddie Mac and ernment-sponsored enterprises (GSEs) “It is critical that we learn from the the Federal Housing Administration are fighting for their lives, and their past, but the pathway to the future (FHA)? fate will be determined within the next will not be discovered if we keep No my friends. You control the year. The FHA has risen up like a strong looking into the rearview mirror.” future. Your future in mortgage bank- giant, only to fall dangerously ill and ing is what you make it to be. Allow me fight for its own survival by constantly churning out guideline changes. The to explain. and seamlessly connected to analytics You’ve survived the Great Mortgage only way to survive this Second Great for compliance and audit trails and Meltdown of 2007-2009. You’ve kept Wave of Change is to draw on the dashboards for effective management. updated on all the industry and regulatory strength and skill that you acquired during the First Wave. The software will live “in the cloud,” changes. You’ve built flexiYou can do it, because whether it is a public cloud or a private ble, yet functional, systems you’ve been here before cloud, which gives the bank full control around the new underwritand you know the landover the data. It will be updated in real ing realities. You’ve probascape. time on a near-continuous basis. It will bly taken counsel and inspiI started by asking you a not require large IT teams to main- ration from at least one simple question: “Who tain—at least for the originator—and therapist, pastor, rabbi, controls the future of mortwill allow business users to get under priest or spiritual guide to gage banking?” The future the hood and make changes without cope with the constant of the mortgage banking is fear of losing critical information. It onslaught of changes in change. Therefore, the real will be an extension of the originator your business and life. question to ask here is, and will enable compliance and mar- You’ve made it through that “Who controls change?” keting without requiring high levels of great wildness of life called “If I asked you to The answer is that resources to run. It will probably also “change,” and you are better change happens, but you be available at a variable cost that and wiser for it. If I asked articulate the one control the pace at which changes with the originator’s business. you to articulate the one quality about youryou adapt to the change. Finally, it will enable full customer rela- quality about yourself that self that has helped Therefore, you control the tionship management (CRM) before, has helped you survive the you survive the last future. If you don’t adapt during and after the transaction with last few years in the mortfew years in the well to change, the data that threads through. No more gage industry, what would mortgage industry, Hurricane of Change that importing and exporting of data, which you say? what would you is the future of the mortis a quality nightmare. My guess is that you say?” gage industry will burn would probably say, “The you out. It will chase you The future will be one in which spe- ability to recognize, cialization is taken to the extreme. respond, and adapt to change.” After out of the industry even as it chased out Successful mortgage banks will be made all, the ranks of “former loan origina- many of your former colleagues. If you up of Jedi Warriors who specialize in tors” are lined up with many of your adapt slowly to change, you will be compliance, marketing and technology, colleagues who could not adapt to the pushed to the sidelines of mediocrity and as it will take all three, plus strong lead- enormous Hurricane of Change that frustration. The Hurricane of Change will ership to succeed. But before these pro- keeps flooding our beloved industry. So slowly chip away at your income, and fessionals can be deployed, the future you, like a lone warrior in an epic drain the joy out of your professional must be visualized. We can only do that drama, have heroically survived the career in mortgage banking. However, if you adapt well to effectively by seeing the landscape First Great Wave of Change in the mortthrough these three lenses. gage industry. Take a moment to change, the future will be way better If we do that, we will be in a very appreciate where you’ve been and than the past. The “good old days” of mortgage banking look like a dry desert good position to succeed in the future what you’ve accomplished. mortgage business. Okay, so what about right now and of poverty compared with the blossoming garden of wealth that awaits you in the future? Rene F. Rodriguez is chief executive officer of The Second Great Wave of Change is the future. You can transform the Austin, Texas-based MortgageDashboard. here at our doorstep. The regulators Hurricane of Change into your best He is a renowned behavioral, leadership have returned with a vengeance, alter- competitive advantage while your comand organizational change expert, world- ing compensation structures, and re- petitors are preoccupied with survival. class sales trainer and dynamic keynote writing all the rules once again. Some Sounds interesting; but how can this speaker. He can be reached by e-mail at of these changes will take hold within work in real life? rene@mortgagedashboard.com or visit the next several months, and other continued on page 32 www.mortgagedashboard.com. changes will take hold over the next

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how, is the purview of the marketing department and it’s going to be increasingly important in the future. As financial services firms continue to focus on niches, competitive pressures will increase and the firms with the best handle on marketing and promotion will emerge as the strongest in their geographical markets. In the future, a successful firm will be perceived by the rest of the market as a leader in its niche. Goodwill and trust is a hard-won commodity that can no longer be obtained easily with traditional media. Banks must find a way to rise above the sludge left over from the crash and brush off the image of the Wall Street fat cat in favor of a more personable and trustworthy service provider. This will be very challenging for large national lenders to accomplish, as they just cannot move and adopt as fast. With that being said, I see, ultimately, a return of the mortgage broker. But, and I mean a big “but,” not the mortgage broker of the past. I’m referring to the local professional businessperson who understands the business, truly cares about their clients and is willing to take the time to explain the process to a borrower at a kitchen table, will eventually be a hot commodity again. But to capitalize on this opportunity when it returns, brokers must take the time now to hone their craft by becoming experts in lending guidelines; improve their skills by learning how to communicate and present complex financial concepts and be able to clearly outline what it means to the borrower; and harness the right technologies that enable them to increase productivity and prevent non-compliance in realtime versus waiting until the end of the process to check for it.

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