On the Sept. 28 episode of the Lykken on Lending Internet radio show, we had the opportunity to discuss a number of issues going on in the mortgage industry with MBA President David Stevens. One of the things that came up in our conversation is the difficulty the Consumer Financial Protection Bureau (CFPB) has in granting lenience to organizations that don't really seem to be trying. For example, when vendors aren't performing well, why do some organizations still stick with them?
Mr. Stevens pointed out that switching vendors is often easier said than done in the mortgage industry. The technologies and processes for which we rely on our vendors are often woven into the daily fabric of our businesses. Disrupting relationships with vendors can be extremely risky in interfering with our capabilities of delivering to customers. Changing vendors isn't as simple as flipping a light switch; it's typically more like dismantling an entire power grid. It's a complex process and doing it wrong can destroy everything.
As we reassess our vendors and try to partner through the right people with the implementation of TRID, we need to look at this as a change management issue. In the mortgage industry, we've dealt with a lot of changes in the past few years. Changing vendors for TRID readiness has become one of the most challenging of them all. Not only are we dealing with the typical challenges of brining on new vendors, but we're also entering into a new environment with new regulations and new expectations. This isn't going to be an easy process, and we need to brace ourselves for the complexity. As TRID implementation officially begins this month, the work is just getting started.
David Lykken, a 43-year veteran of the mortgage industry, is president and chief transformational officer of Transformational Mortgage Solutions (TMS), a management consulting firm that provides a full-range of advisory services to owners and “C-Level” executives involved with mortgage lending. David has garnered a national reputation, and has become a frequent guest on FOX Business News with Neil Cavuto, and has had additional guest appearances on CNBC, The CBS Evening News, Bloomberg Radio and NPR. He hosts a weekly a weekly podcast called “Lykken On Lending” as well as a consumer facing video called “Today’s Mortgage Minute.” He can be reached at (512) 759-0999 or e-mail [email protected].