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The State Of The Mortgage Operational Employee

Navigating the ups and downs of the market

Chrissy Brown
Chrissy Brown
A stressed employee with her head in her hands at her desk.

The mortgage industry has been experiencing some of the most challenging times we have seen. This is due to many factors, but mostly the dramatic swings in volatility. There are countless articles out there surrounding the impact of this market on borrowers, loan officers, fintech and companies. There are also countless articles out there regarding the numerical stats surrounding layoffs. 

The elephant in the room, or the topic no one is truly talking about, is the current mental state of the mortgage operational employee. The anxiety, the “quiet quitting,” the difficulty of the loans coming in, the burn out from 2020/2021 and the impact of the current mental state of sales. All paired with the incredible need for impeccable quality in this environment. 

What do you say? How, as a leader, do you stay transparent with many unknowns? How do you guide them to rise above the turmoil and maintain their jobs? How, as sales folks, do you help your beloved ops staff during these times? 

For many of the operational staff, this is their first rodeo with such a market. For those of us that survived the 2008 crash, this feels all too familiar but also very different. What feels the same? The uncertainty of the future of the mortgage divisions of your organizations, the uncertainty of income and the fear of being laid off. I emphasize “mortgage divisions'' in that last sentence for a specific reason. During the previous crisis, banks (depositories) had two-thirds of the market share. As of 2021, Independent Mortgage Bankers (IMBs) have two-thirds of the market share. There are major differences between the two during hard times. 

When I personally was laid off from a bank, in 2008, I was an underwriter at the time. It was very sterile in my organization. None of what was occurring to operational staff felt personal. In fact, I was listed on the layoff roster as #197. I realized at that moment I was just a number that had to be eliminated. It can be good and bad to work in such a sterile environment. Again, I didn’t take it personally, but I surely wished someone cared about me and my contributions. 

IMBs, for the most part, are privately held. They tend to be the product of the owners’ blood, sweat and tears. Owners of IMBs truly care about their employees and the culture they have created. If you look at the 2022 Q2 profit report, IMBs lost money per loan whereas banks made a profit. Why is that? They care so much about their employees. It’s hard to bear the realities and make the hard decisions. It feels personal. 

IMB Challenges

Some of the challenges that IMBs face, that banks do not, are in the fact that they do not have depositories to lean back on, higher cost to fund rates and truly at the end of the day, everything they have built and worked for could be dwindled down to nothing. Hard decisions must be made. 

This feels very inauthentic to the IMB cultures that have been built. Most IMBs have built a culture of care surrounding their employees and borrowers. Hence why they have been so successful over the years. The “vibe” as a mortgage operational IMB employee feels very “off” during this time. They are questioning the very core of the companies they work for. Who are these people I work for? I thought they cared about all of us. They seem so secretive. 

The operational employee sees what is going on in the industry. They feel the lack of loans coming in. They see the layoffs. They see some of their competitors merging or closing. They are watching their peers get laid off and wondering why them? They see some of the most respected operational folks in the industry showing “open to work” on LinkedIn. It’s scary. 

They are coming off a two-year stint where these folks dedicated their LIVES to closing as many loans as they could. Sacrificing nights and weekends. Balancing at home learning with the most insane market they have ever experienced. More dedication than I have ever seen in my 26 years. At the end of that rainbow, there wasn’t a pot of gold. Instead, there is intense worry and stress. The biggest concern is, if I get laid off, where will I go? If everyone in the industry is cutting, what will happen to me? The answer, like most things going on right now, is unknown. 

Demand For Perfection

Now let’s pair this with the rising demand for impeccable quality. Quality in this market is VERY important. If a loan is unable to be sold to an investor or an agency, it must go to the scratch and dent market. That market usually runs at anywhere from a 1-8% loss. Some loans right now are running at a 40% loss. We had a loan that closed, and the credit was expired at the time of closing. The S&D bid was a 30% loss. That is a lot of pressure on an already terrified staff. Unfortunately, it doesn’t matter. The average company cannot afford to eat that magnitude of loss, often. The demand for salable quality in a market where the origination/loan quality is down is also very challenging. I swear to you, in the last two months I have been brought into some of the most unique scenarios that I have ever seen in my entire career. It’s challenging for borrowers and sales right now. We need to make every loan that can work, work. 

The moving interest rate market and the restructuring of loans during this environment makes it very challenging to maintain that impeccable quality. As an operational employee, when you are hyper focused on not making a mistake, you tend to lose the forest for the trees, over condition and become fearful to make a risk decision. That kind of decision making tends to add to the stress of sales.

Stressed Sales

The last factor contributing to their strained mental state is the stress that sales are under. Most operational employees truly care about making their sales partners happy. Most are pushing through these fears to ensure they are taking care of their sales partners and borrowers. Unfortunately, sales folks are under more pressure and stress than they are used to. 

In a very generalized statement, I would say that the average Ops employee is more of an introverted personality. They are detail oriented, diligent, organized, factual, reliable, supporting, trusting, objective, consistent, considerate, etc. This is what makes them great at their jobs. In the same generalization, most salespeople are extroverted personalities. They are dynamic, interactive, bold, fast-paced, action oriented, sociable, focused, friendly, bold, etc. Again, it’s what makes them great at their job. 

What we fail to ever talk about is the difference between these two generalized personalities when they are under stress. Under stress, the average operational employee becomes bland, suspicious, reserved, cold, indecisive, stubborn, docile, etc. Meanwhile, the average sales employee, under stress, becomes controlling, overbearing, intolerant, dramatic, hasty, aggressive, frantic, etc. 

The operational employee doesn’t understand those characteristics as stress, as they do not personally deal with stress in that way. They tend to view those characteristics as “personal attacks,” which compiles everyone’s stress. (Disclaimer, there is a difference between natural stress responses and abusive behaviors. We will not tolerate abusive behavior from anyone). Same with sales. When sales see the “stress qualities” from ops, they see them as “not caring”. If both sales and ops could understand how both sides show up when stressed, we might be more gracious with each other and probably more efficient. 

Operations Struggles

The operations employee is feeling all those things. In some cases, they have experienced a loss of income, the perceived “personal attacks'' from sales, anxiety about their future and their company’s future, pressure of quality, challenging loans, and the feeling as though they do not feel like they are working for the “same company” they once prided themselves on. 

So, what do you say, as a leader, to an ops employee during this time? I would say that most companies will make it through this storm. People will always buy/sell houses and mortgages will always be needed. We are an industry that provides one of the three basic human needs: food, clothing, and shelter. Everyone will not lose their job during these times. 

As hard as it is, I encourage every operational employee to wake up every day and remember that they are professionals being paid to do a job. As an op’s employee, it is our job to extend amazing customer service, despite how the client or sales partner is responding. It is our job to read our AUS feedback, look at the documents, restructure loans and ensure salability and ability to repay. 

It is our job to show up and give that 100%. It is our job to continuously improve and demand excellence out of ourselves. It is our job to realize the difference between sales stress and ops stress. To understand your clients’ needs and frustrations. To understand your sales partners’ needs and frustrations. 

‘Read The Room’

As I say to my team, read the room. That is your job. If you find yourself with an abundance of free time, ask to help even if it’s outside of your department. Ask for educational classes and opportunities to learn more about your industry and various positions. Go the extra mile. I know pushing yourselves to go the extra mile, after what felt like a marathon for the last two years, is hard. Unfortunately, no company is choosing hard right now. The market is dictating the hard and it is completely out of our control. 

Remember, the market will stabilize, and life will return to a new normal. The anxiety will, once again, dissipate. This industry has unique ebbs and flows. Some refer to it as a feast or famine industry. That is the reason this industry pays very well. 

So, try and put the anxiety aside. Rise up and push through that final mile. On the other side of this, your beloved cultures will be restored, and life will finally balance out. If sales and ops could appreciate and respect the simultaneous stress, we are all under, we could truly help each other through these times, instead of harming each other. 

As for those of you who are leading an operations team during these times, my heart goes out to you. I have never felt pressure and stress like I have this year. Keep making the hard but necessary decisions, keep leading in confidence and keep acknowledging the daily realities of your operational staff during these times. As an industry, let’s show our leaders some grace. These are some of the toughest decisions they will ever have to make, and I believe everyone is truly doing their best. 

This article was originally published in the Mortgage Women Magazine November 2022 issue.
Chrissy Brown
Chrissy Brown,
Chief Operations Officer, Atlantic Bay Mortgage
Published on
Nov 21, 2022
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