David H. Stevens, the former head of the Mortgage Bankers Association (MBA) had advice for the industry: Stop denigrating each other and show respect for innovation.
“Mortgage brokers, independent mortgage bankers, banks, REIT’s, credit unions, community banks are all part of this ecosystem of competition that finances homeownership,” he wrote. “Some may operate as retained servicer’s while others may sell their servicing on either a bulk or flow basis. Some may retain ownership of the MSR’s but sub service to help scale operational costs. Some hold loans on their balance sheets, others may sell all their loans to investors whether service retained or released. Some address the consumer through a more distributed retail model while others may operate off of a centralized, more digital, platform.”
Stevens also noted how the introduction of new and often radically different business models such as Amazon and Uber have impacted other industries, with the mortgage profession being “
on the precipice of real change, driven by innovators.”
“This latest broker movement stands out to me in terms of what their newest innovator has done for the broker business,” he continued. “It is led by a proud, unashamed, advocate for the support and expansion of mortgage brokers. This new team has forged important relationships with wholesale lenders and technology providers who will commit not to re-solicit clients of brokers in return for loyalty to them as preferred loan buyers and make the experience better for their clients. This has resulted in the development of some new and intriguing improvements and product options for the mortgage broker industry.”
Stevens added that today’s mortgage brokers “bring the potential to represent a diverse set of lenders all under one roof. Like an independent insurance broker versus one beholden to one large insurance company, this business model has a unique value proposition. I do believe that no single business model holds an exclusive to better terms of business or service to their clients.”
However, without citing specific examples, Stevens also lamented negativity within the different sectors of the mortgage profession.
“I abhor degrading others to somehow uplift one’s own agenda,” he stated. “Brokers should be clear about the value they provide to the market without denigrating the competition. Banks and other lenders should do the same as should all in this industry. Everyone in this business helps families achieve the American Dream of Homeownership.”
Rather than trash talk the competition, Stevens concluded, the industry should “package the positive about our value proposition versus the negative of the competition. Let’s applaud innovators and make a point to avoid denigrating others. This modest change in behavior can make this entire industry better, help consumer, and align us all in our efforts to be the best at what we do.”