Chrisman Talks Thriving During Margin Compression And More
The April 28 episode of the Mortgage Leadership Outlook featured Robbie Chrisman, host, The Chrisman Commentary Daily Mortgage News Podcast. Chrisman and series' host Andrew Berman explored the technology that lenders are using today to win, what it will take for lenders to keep winning, new business models emerging in the industry, thriving in the current margin compression and more.
Chrisman started his mortgage industry career with internships during high school and college at Peoples National Bank in Colorado, RPM and Bay Equity in the San Francisco Bay Area. After graduating from The University of Texas at Austin with a degree in finance in 2014, he went to work at SoFi, where he rose to director, capital markets, assisting in the creation of SoFi’s residential mortgage division before leaving to work for TMS in Austin, Texas. From there, he went to work for FinTech startup Riivos in San Francisco and then to Mortgage Capital Trading in San Diego. He currently writes a large portion of the Chrisman Commentary daily email.
Highlights From The Interview:
- Chrisman had strong words about the recent margin compression woes within the industry. “Shame on you if you weren’t prepared for this. We knew it was coming and many of you who have been through the market cycles before should know that the mortgage industry is arguably one of the most cyclical industries out there,” he said.
- “Regardless of the industry you’re in, whether you’re making hamburgers or mortgages, there’s three things you focus on; product, pricing and service. You can never have all three, so pick two. When it comes to mortgages, know what you’re good at, hone in on that. At the end of the day, it’s about putting borrowers in homes and if you sacrifice that for the sake of selfish means or whatever it might be, your referrals are going to dry out, you’re going to wither on the vine. It’s not going to be good. This is a referral-based business at the end of the day.”
- “The way I look at mortgage banking, there’s four main channels essentially. You have your direct-to-consumer, retail, wholesale and correspondent and it’s about cutting your cost down. You know people are seeing the same prices out there when they go to sell a loan. It’s what did it actually take for you to produce that loan in a compliant manner in a way that is going to create a quality product at the same time as minimizing your cost.”
- “One thing that gets overlooked a lot is, a lot of these lenders have great tech. They have a good tech stack; they’re constantly being sold on the latest greatest thing but what they have is pretty good. It’s about actually training your employees to know what you have and know how that tech stack plays with itself.”
- Chrisman predicts that down the line the speed and cost to close will be more beneficial for the borrower.
- “We talk about these technologies and at some point they are going to become ubiquitous throughout the industry and those that weren’t early adopters or those who were stuck in their set ways and said, ‘This worked for me in a couple of market cycles ago.’ The world is constantly changing and so being able to be flexible and adaptable to that I do believe, hopefully, a new normal is coming and hopefully, it means less than a 14-day close.”
Check out the full conversation between Chrisman and Berman below.
See all the interviews from the Mortgage Leadership Outlook series on its YouTube channel.
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