As if proof was needed, more than 70% of mortgage professionals say coffee bars and Wine Wednesdays will never be enough to keep them from quitting if timely compensation falls to the wayside, according to a new report released Wednesday by Everee, a payroll technology company.
In May, Everee surveyed 314 U.S.-based professionals in the mortgage industry who are paid commissions, 52% of whom have worked in the industry for at least five years. Of those mortgage professionals surveyed were managers (35%), loan officers and originators (27%), loan processors (18%), underwriters (8%), and assorted others.
Nearly 60% of mortgage professionals surveyed are living paycheck to paycheck as interest rates and low inventory continue to hammer the housing market.
All else being equal, 72.6% of mortgage professionals would choose to work for one company over another simply because they paid commissions faster, with 82.2% of loan officers more likely to stay with their current employer if they received their commissions within 24 hours.
Watch it on The Interest: Just Pay Me Already
A 23-year low, just 1.25 million residential mortgages were originated in the first quarter of 2023 in the United States, the land, property, and real estate data company ATTOM reported earlier this month.
Lenders issued $388 billion worth of residential mortgages in the first quarter, down 20% from the fourth quarter of last year and down 58% year over year.
Everee’s report may be just another sign of the times, but it underscores the extent to which lenders’ thinning margins are causing personal financial stress for mortgage professionals on the front lines who are choosing to stick it out.
Yet, not all who were surveyed are sure how much longer they’ll be able to weather the storm. More than 38% of loan officers reported being unhappy with how quickly they’re paid, a mismatch between employers and employees that threatens to increase turnover. Facing a challenging and uncertain market, 32% of survey respondents indicated they’re thinking about leaving the industry within the next 12 months, while 15% are unsure.
Last October, National Mortgage Professional Magazine columnist Dave Hershman wrote about how the mortgage industry is plagued with rampant turnover, especially on the sales side, due to a lack of vital communication between management and employees about job expectations.
Everee’s report would suggest that front-and-center for commission-based employees is an expectation of receiving their commission in a timely manner: 65% of commission-based mortgage professionals want to get paid in a week or less, but only 40% actually get paid that fast.
Taking workplace flexibility into account, respondents of the survey were also asked to rank their top factors when deciding where to work, which turned out to be:
- Commission rate
- Flexible working hours
- Flexible working location
- Company leadership
- Speed of commission payments
What lesson can employers glean by reading this report? By paying commission-based employees within 24 hours of a deal closing, Everee says, mortgage companies can increase retention, protect margins, and attract new talent.
On the survey's findings, Hershman says that though he understands “the plight of loan officers today who are trying to eke out a living, in the long run hopping from mortgage company to mortgage company for better pay structure and/or programs or pricing is a recipe for long-term failure. Those who are successful in this industry find a good company which provides stability in their career from which they can build a foundation of success. I know of no loan officers who are very successful who move every year or two.”
