Just about every mortgage company in America makes this amazing claim: Our loan officers are experts or expert mortgage advisors.
That is an important statement and certainly a significant mission for a mortgage company. The problem with this statement? The vast majority of loan officers are not experts in the industry. How do I know that? Besides being one of the leading educators of loan officers for the past 30-plus years through my books, articles, courses and schools, I have also recruited and supervised hundreds of loan officers during this time. Some were experts … however, the majority were not.
When I gave my live three-day advanced mortgage school across the nation years ago, I cannot tell you how many loan officers with 10 to 30 years of experience told me at the end of the course, “I wish I had learned this when I started.” If you don’t believe me on this point—I can provide plenty of quotes from loan officers who made this very statement. Twenty years in the industry and they did not have the knowledge they now knew that they needed.
The conditions for growing experts have never been present in this industry. For more than 25 years of my career, there were not even licensing and/or educational requirements to enter the industry in most states. And now that we have licensing requirements—it is quite obvious that the government is not interested in helping our industry become experts or even competent. But they sure want loan officers to learn the penalty for doing something wrong. How does the fact that RESPA regulations are called “Regulation X” help our clients? Someone please let me know, because I don’t get it.
When someone arrives within the industry, other than license prep or continuing education (more of the same), there is no requirement for someone to become an expert or even further their education. With organized learning systems not integrated into most companies, learning happens incrementally. It is passed down from those who might or might not be experts themselves. Why should companies invest the time and resources in education with the turnover we have within this industry?
And without such encouragement, most loan officers are more likely to seek the next deal instead of the next bit of knowledge. Being on 100 percent commission is not conducive to anything but producing. Feeding your family is more important than taking a course–I do get that concept.
What is wrong with this picture? For one thing, our loan officers deal with the most important financial decision most people make in a lifetime. And owning a home is also the most important non-financial decision they can make for their family and future as well. Shouldn’t we have experts guiding consumers with knowledge instead of just the lower rates? I get the impression that the Consumer Financial Protection Bureau (CFPB), our primary regulator, thinks that a mortgage is a commodity rather than an important financial tool.
In countless other industries, education and training required is extensive before a service provider can even speak to a client. In our industry, we encourage talking to clients as soon as they get their license and sometimes before. In other industries, one has to undertake months or years of education and training to qualify for a position and/or to do their job.
We do have solid education available in the industry. Unfortunately, the money is really in licensing preparation because it is required. Of those who go beyond license preparation or CE, some offer certifications and some do not.
And I cannot believe I am saying this, because I have offered the Certified Mortgage Advisor designation for years–but it is not about the certification. Certainly a certification has a marketing value. But it is really about the education and being able to deliver great advice to our clients. We are not selling light bulbs here. Our clients deserve the guidance of an expert. And after reading this article, I venture that you can guess why I use word “advisor” in our designation. Because that should be the goal of our industry–becoming the most qualified advisor that we can be.
Today, with affordable and flexible online courses available, there is no reason for individuals not to get the training they need. There is no travel or time constraints. And there is no reason that a company should not require such education for their loan officers, especially if their marketing department is going to make the “expert” claim that so many have adopted. Education is inexpensive. But the cost of uneducated loan officers can be devastating in many ways. That is a topic for another day.
However, these companies need to make the commitment to make education part of their mission. That starts by not just making the courses available, but by making them mandatory. And this commitment should include competency testing for present sales forces. If we want to change the image of the industry, we must do this by changing the foundation of our industry—our human resources.
Dave Hershman is a top author in this industry with seven books published, as well as the founder of the OriginationPro Marketing System and the OriginationPro’s online comprehensive mortgage school. Dave is also director of Branch Support for McLean Mortgage. He may be reached by e-mail at [email protected] or visit OriginationPro.com.
This article originally appeared in the August 2016 print edition of National Mortgage Professional Magazine.
