Opinion: The elasticity in mortgage employment

Is there a new way to address the truth about staffing in the mortgage industry? When will we learn to be more transparent to our employees — people with families and bills — and stop the endless flow of layoffs?

While taking with Clayton Collins, CEO of HW Media, he used the term “elasticity” when describing the housing market and mortgage employment. Elastic. It can stretch to a point and go back to the original size, but if it gets stretched too many times, it loses it’s elasticity and must be thrown away.

In 20 years, I have been laid off about 18 times. Some of the companies are known for their growth — hiring and then layoffs. Some closed in 2008 crash. Some just got too big, so when markets changed, they didn’t have a way to support the staff.

I’ve been in mortgage for more than 25 years. My ex-wife is an underwriter and layoffs were part of the process. This confounds my non-mortgage family. They ask, “How is a layoff part of a process” and “How are so comfortable losing your job?” Valid questions. 

We are elastic, that’s how.

I spoke with a recruiter not long ago, and he said my LinkedIn algorithm is slanted to lean into the high layoff posts.

My question is when will we be honest with our staff? I have hired 50 or 60 people during my time in this industry. I chose them out of hundreds of great people. I made them part of my team. My dream. My vision. Our culture. They were family. I saw marriages fail, they called sick or came in sick, and I sent them home to get well.

We talked behind close doors when parents died, kids had cancer, they had COVID-19. One called me crying as she said she just needed a friend who wouldn’t judge her. I was that friend.

Sadly, I laid a lot of them off. When the market changes, some people don’t make it. We have a few who have seniority or work extra hard. The rest receive 30 days of pay. Some hate me.  I chose them, because they were really good, smart, dynamic. I fought for them, because they were people to me. My company chose them for the chopping block for valid and financially solid reasons — management changes and choices (good or bad), pricing, market, fear, plans that didn’t work, training, etc.

We are hiring people for temporary employment positions. All operations staff is temporary.

This is the truth. We hire people for today’s market knowing full well that some won’t last through even a small bump in the market. We know that every person at every mortgage company supports the sales teams through housing bubbles, rates, fees, crazy new products, market crashes and a billion variables in their elastic process.

What if they were all hired and told, you are a temporary full-time employee? Any rate increases or market changes, and you will be the first removed from our payroll. Would they accept the position? Would they have left when they saw the rates at 4%?

How can we provide security in this industry?

Could we offer tenure? Can you earn tenure with time and service? That’s a big risk to take for a lender. The lender that does this will be saying we have faith in ourselves and you. The company that doesn’t, well, aren’t they telling you what your hard work is worth? I have worked for some amazing companies but even they can’t say this.

What would work? Who would have a solution? It turns out a lot of big companies have contract workers. A lender has a budget for the year or quarter and calls an agency that has short- and long-term contracts with licensed, certified processors, underwriters, closers, and more. Imagine a bank with no processors, underwriters or closers on staff.

Time to throw away the old elastic and start fresh.

We must build our next model of staffing on a foundation of honesty about what a mortgage career can be. The employees would know their contract length and plan budgets. They could plan major purchases, vacations, surgeries and more based on their contract end dates and renegotiation. The salary, raises, increased certification, human resources, training and more can be handled by the contractor. They can be mentor programs to build new managers and move people into higher paying positions that are challenging and empowering.

How can this can be leveraged into a business model that could change the landscape of hiring support staff? With tech moving in and automating some of the processes, this sliding scale of elite talents to plug and play without all the overhead and uncertainties sure seems like a tantalizing idea.

This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.

To contact the author of this story:
BJ Witkopf at [email protected]

To contact the editor responsible for this story:
Sarah Wheeler at [email protected]

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