Pricing exceptions are widespread in mortgage — and so are the regulatory risks

Read Now
MortgageServicing

Vermillion Consulting CEO on how to lead during COVID-19

This HousingWire Daily interview transcription features a crossover episode from HousingWire’s Housing News podcast. In this episode, Vermillion Consulting’s Dale Vermillion discusses how mortgage lenders can best adjust their businesses during periods of growth and how they can also support their staff during tumultuous times.

Listen to the full episode here and make sure to subscribe to the podcast on iTunes.

Below is the transcription of the interview. These transcriptions, powered by Speechpad, have been lightly edited and may contain small errors from reproduction:

Sarah Wheeler: Hi, I’m Sarah Wheeler, the host of the “Housing News” podcast. And today, we’re talking with Dave Vermillion, the CEO of Vermillion Consulting about very practical leadership skills for mortgage companies. Dale has decades of experience in mortgage coaching, and he is bringing some great tips for leading during this high-volume, high-stress time in our business. Thanks for listening.

Alcynna Lloyd: Hey, “Housing News” listeners, this is Alcynna Lloyd, and I’m the producer of this weekly podcast, which is a proud member of the Industry Syndicate. You just heard from our host Sarah Wheeler. But before we dive into today’s episode, here’s a quick word from our sponsor.

Victoria Wickham: For over 60 years, the private mortgage insurance industry has helped more than 33 million low-to-moderate-income borrowers access affordable low down payment home financing. This year, the private MI industry will continue to bridge the down payment gap for millions of more Americans and serve as the best option for low down payment borrowers learn more at www.usmi.org

Alcynna Lloyd: Thank you for listening. And here’s Episode 4 of Season 5 of the “Housing News” podcast.

Sarah Wheeler: Welcome to the Housing News podcast. I’m Sarah Wheeler, editor-in-chief at HousingWire. And my guest today is Dale Vermillion, who is the president and CEO of Vermillion Consulting, which is provided proven, practical and industry specific training to more than a million mortgage professionals. And it’s also improved production process and profits for more than 300 lenders across the country. Dale Vermillion is an in-demand guest and speaker. And we are thrilled to have him on “Housing News.” Dale, welcome.

Dale Vermillion: Sarah, it’s so great to be with you. Thank you so much. What an honor.

Sarah Wheeler: Oh, no, the honor is ours. So let’s jump in here. Before you became a mortgage trainer, you were a mortgage originator. And we always like to start out by asking our guests how they got into the mortgage business because no two stories are the same on that.

Dale Vermillion: Well, actually, the way I got to mortgage business… I was working construction, believe it or not. I was standing on a scaffold one day and the guy said, “You talk a lot, you ought to be in sales.” And I don’t think it was a compliment. I think he meant it in the wrong way.

And you know what? I took him up. I actually got a job selling pots and pans door to door as my very first sales job back in 1982. Did really well with that, didn’t want to make a career out of that, and got an interview with a mortgage company back in 1983. And that was the start of what’s now a 38-year career.

Sarah Wheeler: Wow, that’s incredible. Yeah, pots and pans to mortgages. I’m sure there’s lots of things that are the same there.

Dale Vermillion: There are.

Sarah Wheeler: What was the aha moment where you realized you were doing well as a mortgage originator? What was the moment where you realized coaching and training was what you really wanted to do?

Dale Vermillion: You know, it’s interesting, Sarah, because I think that we know when we have these things in us. I actually I played semi-pro baseball when I was young, when I was like 19 years old, couldn’t hit a curve, so that’s why I’m doing this for a living. But I started coaching kids in Little League, and I just absolutely love coaching 9- and 10-year-olds. It was one of my passions. I knew from a young age, as a young man, that that was something I loved to do.

Well, as I worked through the mortgage business, I started as a mortgage originator, you mentioned, but I actually moved into leadership very, very quickly. Within a year, I was managing branches, within three years, managing a district of about 250 loan officers. Within a year or two from then, I was running a region of almost 500 loan officers, and then ran a national mortgage company. And actually, the way that I got into what I do now as a speaker and consultant was, you know, I had almost 12 years of corporate America.

And I wanted to start a consulting career, actually, really focused on helping senior executives on how to understand how to run their business better because I’ve run several of them over the years. And I got invited to speak at a conference in Las Vegas, did a 20-minute speech and got hired by 5 companies within an hour of that to come work with their companies.

And that turned into us kind of building a training program that I had used for years as a leader. Because one of the things, Sarah, that I believe is the absolute, most important trait of a leader is being a great coach and a great mentor and a great trainer. You got to train your people to be successful or they don’t win.

So that’s kind of what got me into that. I always had that passion. When I started to do that and got an opportunity to sort of train, we built that training program out and, you know, influencing people has been something, it’s just always been really near and dear to my heart.

Sarah Wheeler: So how long were you doing that? I mean, it sounds like you did a lot in mortgage before you did this. So how many years were you doing that?

Dale Vermillion: I was 11 and a half years to the business before I got in speaking and consulting 26 years ago. I was in management 10 and a half of those 11 and a half years. So I only worked as originator for a year, started running branches. I had a branch of 3, and then a branch of 7, and then a branch of 20, and then a district and just moved on up that corporate ladder actually running an escrow and mortgage company.

Sarah Wheeler: Wow, that’s incredible. You’ve been training mortgage leaders and actually just leaders, right, for a long time now, for several decades. How is the ideal of leadership changed during that time? You know, is it still the Lee Iacocca? Is it still the old school kind of mentality? Or do you really see a difference?

Dale Vermillion: You know, Sarah, there’s absolutely a difference. Now, look, some of those old school things absolutely still work very, very well. They are tried and true principles that you can ever get rid of in leadership: things like accountability, things like encouragement, things like making sure that you’re building good structure.

And to me, the most important thing a leader does is build a right culture within their organization. To me, that is number one. When I work with clients, the first thing we look at is, what is your culture? How is it built? What is your philosophy as a team? What do you build all the things around?

You’ll notice that we’re in a Dr. Pepper t shirt, not just because I love Dr. Pepper, but actually, there’s a message there. Dr. Pepper is very unique. It was the first soda ever created in America, which is kind of a cool thing. And the only one like it. And I teach leaders all the time to run an organization, you got to be unique.

But today, the difference is not only are we in a much more competitive marketplace, as we all know, but technology has changed the game exponentially in many, many, many ways. And today, you have to know how to not only manage people in the old school mindset of building the right structure, philosophy, culture, processes, all those things. But you got to learn how to temper that along with technology to bring those side by side. When you do that, you really manage at the right level that you need to be, to be successful.

Sarah Wheeler: When you’re asking about or evaluating a company’s culture so that you can coach someone through that, what are the tells to you? What are you looking for? And, you know, because obviously, you know, the guy that kept talking to me, “Oh, here’s my culture, I can tell you.” And it’s like, “Oh, do you really know what the culture is?” Like, how do you get to the truth of that?

Dale Vermillion: You know, that’s such a great question because, you know, everybody has a mission statement and everybody will say that their organization is built on that mission statement. And if you look at mission statements across the line, they’re pretty similar. So when you look at everybody having the same basic mission statement, you got yourself the question, are you really living it out?

Where I really look to is, if I were to go into your organization today and sit down with your frontline people, do they understand that mission statement? And how are they living their lives and working every day to really abide by that? What are they doing in the physical realm?

What I always work with clients on, when I work with leaders, is once we look at what your vision and mission are, which are critical to success is saying, “Okay, how does that permeate throughout the organization? How do we infuse that into every single aspect of everything you do from your products, to your services, to your internal culture, to the way that you communicate, both internally and externally? How does all of that work out?”

And what I find many times is, mission statements sound really good. But there’s no connection between the mission statement and the actual day-to-day activities. And if it doesn’t link it at the day-to-day activities, then there’s no power in it whatsoever. You’ve got to create it so people understand and know what that mission is.

And here’s the number one thing that I teach all the time, Sarah, when I work with leaders, at any level, or mid-level, or senior level is you’ve got to have roles, responsibilities and relationships defined. I call it the big R’s, the three R’s. If everybody doesn’t understand their role, as it works in relationship to that mission, if they don’t know exactly what their responsibilities is…

The most important message that I give to leaders all time, is don’t manage personalities, manage activities, in other words, metrics manage. Manage to the metrics of what your people do. If it’s sales, manage your sales metrics. If it’s operations, manage your operational metrics, so that the roles and responsibilities get you the productivity you’re looking for.

But then look at the relationship, what’s the relationship both internally and externally with each other to build a cohesive team, and externally, to really serve your customers well. Whether that’s your end consumer, which is the mortgage customer, or that’s the realtors and the builders and everybody else involved in the purchase side of the business, if you’re doing that. It’s really important, all of those things are connected so they work together in a really cohesive way.

Sarah Wheeler: Wow. That sounds amazing. When you’re looking at leadership and who to put it in leadership, you know, we all know the owner operator model, where it’s like, “Oh, you’re so great at this. Now, we’re gonna put you in leadership.” You have none of those skills. You don’t know how to do that. You are a great operator, but you might fail at that next level. How do you account for that?

Dale Vermillion: Yeah, you know, that is one of the most common problems that we see, particularly in the mortgage industry, because, literally, loan officers who are great loan officers become the team leader, the sales manager for that team, and then they work their way up. If you’re in great operations, you become the team lead for that team. The bottom line is, and this is where a lot of companies fall short, Sarah, is that they’ll put people in these positions, and then they’ll try a mentorship approach of training, which is great as a secondary process.

But when you just try to give somebody the chance to follow another leader, what happens is, first off, that leader doesn’t feel like that’s a benefit to them. It feels like that’s a penalty to them. And they’re not necessarily doing it the right way. You’ve got to have a formal process that you teach people how to train.

So what I recommend to all my clients is part of your culture and part of your philosophy should be that from the moment somebody comes into work within the organization, you should have a leadership training program already designated, where people who want to get on that track can get on that track early. So that what happens is, you don’t just promote your top producers, and they have no idea how to manage, but you’ve actually worked them through a process to get them to that point where they already know how to manage. That’s the much better way to do.

When I came into business in 1983, the reason I took the job was because they had a leadership, a management training program. That was the big thing to me. That really got me attracted to that. And within a year, I was managing a branch. It actually paid off.

If you build a proactive culture that says, “We’re not just going to throw people in, but we’re going to build a leadership culture, or we’re going to create some kind of a training process to teach people how to manage and how to lead, how to create accountability, how to encourage others, how to organize their day, and how to really think from a teamwork standpoint, you build a much better system of leadership over time.”

Sarah Wheeler: How does that translate for smaller companies? I can imagine that bigger companies, you know, their training program. I work for a smaller company, we’re very lean, right? And we’ve grown a ton in the last year, but we’re still small. And so how do smaller companies, how can they do that?

Dale Vermillion: So I’m gonna give you a principle here that I teach leaders all the time, Sarah. And I ask this question to leaders, “If I were to give one word that would define what makes you a great leader, what would that word be?” And here’s the answer I give them, “It’s replication.” You became the manager because you were the best at what you did.

So a basic premise of learning how to lead people is to understand that your job is to replicate yourself through them. If you just keep reminding yourself of that, that your role is to get them to do the things you did that made you successful, it changes everything. It changes the way they hire.

You’re going to start hiring people with work ethic like yourself, with mindset like yourself, with intellect that can match up to the intellect that you have, with things, traits that tell you that they can succeed. Then you start to teach them through what’s called a simple best practices methodology. What does that mean?

Well, best practices methodology is simply taking the best practices of the processes that you’ve created and getting your people to replicate those by simply coaching, teaching and showing them how to do it. If you start to do that, you start to build a great team around you.

And then the key is to start to establish a structure within your leadership. You’ve got to define how many people do you want to have? What are the roles going to be? What are the responsibilities again? What are the relationships within those? And then define that.

And remember, if you’re a small company, if you’re an independent broker, or independent mortgage banker, and you’re just starting a company, remember, there are so many resources for leadership out there through podcasts, through books, through all kinds of media that you get access to help you learn how to lead people better.

The bottom line is, the more you think in terms of replication, the more that you start to replicate yourself out through the things you teach, you start to become a leader pretty quickly because you’re starting to create that accountability. That’s important. And you’re teaching people the best practices that will make them successful.

Sarah Wheeler: Now, I assume you’re brought into the training by executives. But what happens if you think the executives are part of the problem or the ones that need to be trained the most? How do you help effect change at that point?

Dale Vermillion: You know, it happens quite a bit, to be honest with you. And, obviously, the conundrum there is you can’t look at the person who hired you and say, “I hate to tell you, you’re the problem.” But what I do is I get them to understand that by using factual information, bringing that into them, and asking the right questions.

Look, the art of consulting and the art of getting people to buy into understand their weaknesses at any level, whether they’re a senior executive, mid-level person, or the lowest level in between, is not to analyze what they do and tell them what’s wrong. That is the worst form of leadership you can create because nobody accepts that, and they all reject it, they don’t believe that’s necessarily true.

It’s to identify the result of what’s happening and then sit down with them and start to ask questions that lead them into identifying that maybe they’re creating part of that problem themselves. It’s getting that ownership to a really good-orientation process, a really good process of asking them the right questions so they can identify the issues.

And when you start to do that, they start to recognize where those weaknesses are at. And by the way, I always make sure that with executives that I’m always offering myself up to coach them and consult them and mentor them. And many of them have taken me up on that.

I’ve mentored hundreds of executives across the nation, many of them CEOs or C-level executives. And that’s because the one thing I say to them, I say, “Look, it’s lonely at the top. You know, when you’re the top of the organization, there’s nobody to talk to. It’s why you bring a guy like me in is I can be that resource to you.”

And then what that allows me to do is start to train them on one side, where their weaknesses are at without them realizing that’s what I’m doing. And it starts to modify their behavior as they see the results come out. So I think it’s a combination of those things that really helps people go through that change process.

Sarah Wheeler: Well, related to that, you know, and you touched on a few of them already, what are some of the ways you get around people’s natural resistance to change even if that change will benefit them? I know, when we write stories about tech adoption, it’s so common that, you know, leadership has decided, “Hey, we’re gonna adopt this incredible technology, which really would be, you know, game changing for the business.”

And then you have the people who on the ground are gonna have to do it are like, they don’t have time, they don’t buy in, they don’t… And really, you’ve just wasted your money and your time at that point. So what are some of the ways you get around that resistance to change?

Dale Vermillion: Yep. You know, the very first thing that you have to do… Look, we’re all in sales to some extent, right? And if you’re in leadership, I say this to people all time, if you’re a parent, you’re in sales. If you’re in a relationship, you’re in sales. If you’re in leadership, you’re definitely in sales too because your job is to get your employees to see their needs, to see the things that need to improve.

So the very first thing you have to do is you have to identify what is the problem and how is this going to solve the problem. That’s the first thing you got people to do is they got to identify there’s a problem in the first place. Look, nobody changes anything, if they don’t believe there’s anything that needs to be changed. It’s that simple.

We have to first identify what the problems are by being able to show concrete evidence of the results of the behaviors or the results of the activities that are leading to the problem. Now, once you do that, you provide the solution, and get them to adapt and adopt into that solution by embracing it.

I’ve said this to a million people, I’ve literally trained over a million people in my career and I’ve said this to everyone I’ve ever trained, is that you have the power over changing anything you want in your life today. Nothing has power over you. There’s no bad habit, there’s no character trait, there’s no job issue, there’s no work ethic problem, there’s no communication problem, you name the problem, there’s not a problem that you are challenged with, that you don’t have power to control over and change.

But the key to that is you got to first identify and accept there’s a problem. That’s number one. Nobody’s going to fix something if they don’t want to. You then have to commit to making sure that you’re going to do what it takes to change the problem. And that’s nothing more than embracing a technology or embracing a new habit or embracing a new process. And then what you have to do is you have to continue to do that for at least 30 days, and it becomes a changed habit is what happens every single time.

So the key is really helping people see that they have a need or an issue they need to change, then showing them the solution, how this is going to solve their problem. And the motivation goes right through the roof instantly to change it immediately. Now it’s repetition, you got to build repetition in everything they do until all of a sudden it becomes second nature to them. And pretty soon, they feel like that’s what they’ve done forever.

Sarah Wheeler: Interesting. This past year, you know, completely crazy, COVID up ended everything since March. You know, teams are working remote. They might have kids that they have to school during the work day. They might have possible health challenges, they or their family. And they’ve had this huge volume. So, you know, even though it’s a great problem to have that huge volume, it’s pretty challenging in those conditions. And what are some ways that you saw that companies are really supporting their staff during that pretty terrible time?

Dale Vermillion: Yeah, well, number one, and this is where I’ve seen a lot of mistakes done in a lot of the companies that I work with is that first off, you’ve got to set up your people. If they’re working from home, you’ve got to set them up with the technology and tools at home that they can get the job done well. I see this constantly where they don’t have access to enough monitors, or they don’t have access to, you know, things like printers or faxes or, you know, technology they need.

I know there’s an expense that goes with that, but you have to do it. You have got to make them in an environment where they’ve got all the tools they need to succeed. That’s rule number one.

Rule number two. Okay. There’s never been a time, Sarah, that I’ve seen in my almost four decades in his career that organization is more important than right now. When you start talking about, you know, a massive part of your sales force or operational force working from home, which is the reality for most lenders out there today, you’ve got to start to understand that the key is they’ve got to be organized in what they do. And this is both for individuals and organizations alike. That you’ve got to build an organizational process.

Now, the biggest challenge of work from home is the lack of accountability. It’s the lack of motivation. It’s not having anybody around. So one of the things that I’ve been recommending, and this has been an absolute home run to the clients I’m working with, is create a virtual office environment.

Now, what does that mean? Simple. You’re setting up a Zoom meeting, just like we’re doing right now with your teams for periods of time during the day where you’re all working side by side and you’re seeing each other just like you’re in an office environment. Because here’s the biggest thing we lose in this work from home environment is we lose what’s called osmosis learning. Osmosis learning is where you learn things just by hearing and seeing the people around you doing them. This is especially important for newer employees or employees who are struggling with things.

But what you also lose is accountability. With nobody watching, it’s really easy to fall into a lag, and not be as productive as you normally are. And what I’m seeing is a lot of people working longer hours and working late at night, but they’re probably not as productive during the day as they could be because they don’t have that accountability. So virtual office is one great way to augment that.

The other thing is great communication. You’ve got to have consistent communication from leadership to the employees very, very important. The one thing that I find that we lose in this work from home is we lose the communication between the teams. So there’s not a constant process.

A couple things I recommend. Every morning, your team should have a sales or operational meeting every single morning to start the day right, get the team together. We’re in a social distant, separated world, we got to get our people together, make sure we see their faces on a Zoom, get them motivated, make sure they’re excited, make sure they’re prepared, have them bring their goals to that meeting for the day, so you know what they’re gonna accomplish, build a team mission in that morning, and then let them go.

And then check in during the course of the day. Have regular check ins via Zoom via text message via telephone. So you’re keeping that contact. And make sure your people are planning out their day and organizing every day.

And then the last thing is, create an environment, this is so important, create an environment that feels like work. You see it as much as I do, Sarah. I’m on Zooms all the time. And I’ll look in the background. And I’ll say to the person, “Tell me about the background.” And they’ll look behind them. There’s a blank wall, there’s no pictures there. There’s nothing there. They’re like in a corner of their bedroom. Like, “Oh, well, you know, this is just where I’m working from like,”

“Okay, let me ask you a question, what is around you, that is motivating you, that is encouraging you, that is getting your head in the right game, just making you feel like you’re at a place of work? It looks to me like you’re stuck in a corner. That’s not going to keep you motivated all day long, every day, during the course of the month. You need an environment that really sets you up for success.”

So build your environment so that it feels just like the office environment. Get up in the morning, take a shower, go to work just like you normally do. If it takes us something as simple as taking a, you know, a roll of tape and putting tape behind your desk, so that when you go past the tape, you’re home, and when you come back over the tape, you’re in the office. It’s really important to create separators each day. So you’re working with the same kind of rhythm and mindset you normally do when you’re in the office to keep that high level of energy and productivity.

And then take frequent breaks. It’s really important that you take frequent breaks to get away because it is Groundhog Day that a lot of us are living, day after day in this pandemic. Go outside, grab yourself a cup of coffee or a snack or something you like. Take a few minutes with your children to just, you know, catch up with them and connect with them. Get connection, establish accountability, you do all these things, you built a really great environment to work from that will keep you productive.

Sarah Wheeler: These are some great tips. So we’re onboarding a new reporter today, remote. I think he’s the fifth person we’ve hired for my team or my team adjacent, remote. I never met him. And you know, just integrating him into our culture and into our team is a challenge.

But even when we go back to normal, he’s in California, right? We’re a very distributed team now. And so these things are going to be important, ongoing, right? Remote work is not going away, at least not for us, and so I think anything that we can do to build those things now it’s just going to help us in the future.

Dale Vermillion: Yeah, you know, a great thing that leaders can do is, you hire a new person, okay? Have them identify where their workspace is going to be. And everybody’s limited to that. Like, I’m fortunate, I’m in my office actually, today. You can see I got all the things I love around me, you know, that keeps me motivated. But when I’m at home, I have a home office too. And I’ve got that all set up so that it keeps me motivated.

The first thing that we should do as leaders is have them show you where their workspaces and make them go to the task. Day one, I would have them set up their office. So it literally feels like an office, put up pictures of your goals, put up pictures of your family, make sure you’ve got your monitor set up properly. Make sure all of your technology is available before you even start a single day. I want you to already be in a position for success.

I don’t want you, you know, jamming your stuff into some corner somewhere. And you feel unorganized. Because when you feel unorganized, you become unorganized. That’s just the way it works. Have them set up their environment. And you can literally confirm it on a Zoom by just seeing what it looks like when they’re done.

If you’ll set them up that way and then start to build that virtual office. Set up times during the day where they’re actually connecting to teammates within the team. They’re learning from them. They’re growing with them. They’re working alongside of them. They can ask questions.

And then, you’re creating that daily ritual of the morning meetings and the checkpoints, you know what happens in a very short period of time? They’re very successful because it’s very much like an office environment. It’s just at their own home. And you’ve got that connectivity that is so necessary and vital to create teamwork, and really help your people to be successful.

Sarah Wheeler: Great ideas there. You know, we mentioned this a little bit earlier. We’re coming off an incredible year for originators. Lenders saw huge volume, huge profits. But at some point, we note that the refi part of that volume is going to cool off, right, just from the sheer fact of like, there will be less people to refi at some point, you know, even if we continue to see these pretty low rates, which we think we will to the next year. So how should lenders be adjusting their business right now in light of that, that’s definitely going to happen this year?

Dale Vermillion: Yep. So number one, if you don’t already have your sales force starting to drip purchase transactions, if you’re one of those that flipped 100% to refi, which a lot of lenders have, and you’re not starting to bring purchase leads back in right now, you’re making a major mistake, I promise you that.

Because what’s going to happen is, we could see, like we saw many times in previous years, I remember back in 1987, 1993, 1998, we had major market shifts, where rates just jumped literally in a day or two, and wiped out the refi side of the of the business and, all of a sudden, it was 100% purchase. That’s what you were dealing with or home equity. That’s really the only two options you had. You still had, obviously, some refi, but is very limited.

And those companies that weren’t already prepared with their sales force where they were used to purchase transactions, they didn’t make it a lot of times because you can’t recover fast enough in a changing market. You can’t go 90 days without production because people are trying to figure out.

So you’ve got to be really tempering your business right now that you’ve got a mix of a percentage of purchase to a percentage refi, no matter how many refis you’re getting. So that you’re keeping that balance all the time, and you’re never getting 100% on one side or the other. That’s really critical.

The second thing is that also get your ops team in that process. So they’re also very familiar with that process because it is different and they’re prepared for that. And be ready for a boom. We know we’re going to see a purchase boom this year. We’re already seeing it. It’s already happening.

But the anticipation is this could be the biggest purchase year in the history, according to the Mortgage Bankers Association. My friend Anthony [SP] picked this as being the best year he thinks we’re ever going to see. You’ve got to be purchase ready, and you’ve got to make sure you’ve got that set up.

The other side of that is, as the market shifts, Sarah, it’s really important that people are also well trained on cash-out, debt-elimination-type refis because when rates go up, that doesn’t mean refis go away. That means rate and terms go away for those who no longer qualify because they already got rates that are too low.

And by the way, study tells us there’s like 90 million people right now who still could refinance and benefit from that. They haven’t done it yet. There’ll be plenty out there in that first wave that we’ll be able to get.

But that second wave, you’re going to be doing all cash-out stuff. That’s what it’s going to be looking like. So you’ve got to prepare your people for a cash out. You’ve got to really be ready for purchase. You’ve got to be building that mix right now.

The other side of that is, if you’re working with realtors, you better be checking in with them right now. This is the time in January and February to make sure that you are reconnecting with your realtors, establishing a plan for this year, rebuilding those relationships and make sure you got it right.

And by the way, I’ve never seen, Sarah, in 38 years in the business, I’ve never seen a better time to solicit realtors than right now. Because they were very disenchanted in 2020 with a lot of their lenders. And it may not even have been the lender’s fault. The market was brutal. You know, there was turn times of 40,50, 60,70 days. And it was because it was just so difficult.

This is an opportunity for every lender to pick up realtors they’ve never worked with before, and to build a strategy around purchase. And don’t just focus on realtors, focus on all forms of referral for your purchase business. You know, go after builders, if you have a building-type product. Talk to CPAs, financial planners, insurance agents, these are all great resources for purchase business.

And make sure you’ve got a massive social media campaign going on and you’re really making sure that you’re building out social media opportunities on the purchase world. If you do those things, you’re primed and ready for 2021 because it’s going to be skewed towards a purchase market by the end of the year, if not earlier.

Sarah Wheeler: Great advice. Last question. You know, we have a lot of people kind of new to the industry that just got in last few years. And they’ve only seen like one cycle. They don’t know what the other cycle looks like. You’ve been in this business a long time. What are the challenges when you’re training leaders who are young in that way?

Dale Vermillion: So do you want it from a leadership standpoint or from a salesperson standpoint? Where would you like me to answer that?

Sarah Wheeler: I think leadership.

Dale Vermillion: Okay. So let me tell you that the two biggest… No, I’m gonna give you three. I’m gonna give you three of the biggest challenges that 2020 created within the mortgage arena, you need to be very cognizant of as a leader going into 2021. Okay.

Number one, we became massive order takers in the business. And that is a massive issue. Because when rates change, and they’re not record lows, and borrowers aren’t knocking down your walls to get access to loans, you better build relationships. And you better go back to the old way of selling.

You know, I said earlier that some old school stuff works. Well, the one old school thing that always works is good old-fashioned relationship, building trust and loyalty with your borrowers. I don’t care how much technology you’ve got.

One of the biggest mistakes I see in the mortgage arena today is we’re so tech focused, we lose sight of the importance of the consumer. And that this is the single largest, most personal financial transaction they’ve ever made in their lifetime. They want to make it with a trusted advisor. They want to make it with a person they feel good about. You got to make sure that you’re cognizant of that order-taking mindset.

And if your people have shortened their app times down to 5, 7, 10 minutes just to try to plow through all the opportunities, they got to expand out and start building relationships again, and make sure they’re nurturing their customers properly. So that’s number one.

Number two is you got to remember quality is the key. When you have order taking, you lose quality in the files. That caused some of our problems, by the way, in 2020, with long-term times, is that they just weren’t good loans going in. They weren’t complete applications. They didn’t have full documentation. They weren’t done the right way. And as a result of that, it jams your system up on the back end. So not only can you not order take, you’ve got to make sure that you focus on quality.

And here’s the third thing we become rate quoters. This is probably the single biggest thing you see in a marketplace like we’re coming in right now is everybody gets to have just a quote a rate, quote a rate, quote a rate, quote a rate. You’ll get killed when the market shifts, if you’re doing that. You will not last a week doing that because the minute rates jump, you’ve got to be able to build a value proposition for that borrower that is going to be beyond your competition.

So I teach managers all the time. In this kind of a marketplace, make sure your people are not just focusing on price and product, but they’re actually focusing on how does that loan benefit the customer? What are we doing different than our competition? How can we provide a better customer experience, better service? You know, these are things that all matter exponentially to the consumers. The better you can do that, the better off you’re going to be.

Those are the three big things that we can control very simply as leaders and make sure we get them right and that will make a massive difference in the results that we’re going to see. Because if we go into 2021, and we’re just quoting rates out, and we’re not doing high quality, and we’re just order taking, you will literally obliterate an organization doing that.

You’ve got to shift your mindset back to, “Okay, it’s time to slow back down, do it right, invest in relationships, make sure you get a good quality application, put your files in well, build those relationships right? If you do all of those things, you’re gonna win in a big way.

Sarah Wheeler: Love it really, foundational things that can, I think, get lost in the shuffle when you have so much volume, right?

Dale Vermillion: They do. I mean, and look, technology doesn’t help things. Because today, we have all of these technology systems where we can have a, you know, point of sale system application, where we can have the customer fill everything out on their own and, and complete the process. And then we just get it and we price it out and we make them an offer.

That’s really not the right way to sell it for most borrowers. Now, some borrowers will do that all day long. And they’ll love that. But look, Millennials are the biggest portion of our purchase business coming in 2021. They’re the biggest generation of people we’ve ever seen. And you know what? I know a lot about Millennials because I own four of them. So, I’m pretty well…

Sarah Wheeler: So do I. Yes, I get that.

Dale Vermillion: The one thing I know about Millennials is my kids are all very community minded. They’re all very relational. Like they don’t understand a mortgage. That’s not taught in college or high school. You got to slow down and take your time with them and really make sure you do it the old way.

Look, technology’s great. I love all these technologies. But let me say this, and I think this is a great analogy, okay. You don’t want to create a self-service environment for your customers. You want to create a full-service environment with a self-serve option.

So I’ll give you a story to bring this into play. Okay. I worked at a gas station when I was in high school back in the 1970s. All right. And in those days, there was no self-serve gas stations. You know, when you pulled up, I walked out and I washed your windows, and I checked your oil and I filled your gas tank and I washed your headlights and you know filled your liquids and all that stuff. I did it the right way.

So 1980s, self-service gas stations come in. Today, you couldn’t find a full-service gas station if you drove 10 states because they don’t exist anymore, hardly anywhere.

Imagine this for a minute. Imagine, Sarah, that you pull in today to a self-serve gas station, the one you always go to. And all of a sudden, it’s cold, it’s winter, like today, and it’s, you know, cold outside. Somebody comes walking and go, “Sarah, stay in your car, you’re fine. I got you.” You’re like, “Got me? What do you mean?”

And they go back, “How much gas you need?” They put the gas in, they clean your windshield, they check your oil, they check your fluids, they put air in your tires, they take your credit card, they swipe it and go, “You’re good to go.” Be on your way, you never get out of the car, you’re toasty warm. I’m gonna ask your question, “Will you ever go to another gas station again?”

Sarah Wheeler: No, I would go to that one every single time. I would love it.

Dale Vermillion: Forever. Like that would always be the place you go. That’s the description of a perfect mortgage company right there. That’s how I teach mortgage companies. We teach this thing called others first. My whole philosophy is others first. It’s built on my life verse on the book of Philippians. It says, “Do nothing out of selfish ambition or vain conceit. But in all things, with humility, value others above yourself, looking out for their interest and not your own.”

That’s my belief system. As leaders, we’ve to value our employees more than ourselves. As employees, value your customers more than ourselves, our colleagues more than ourselves.

Well, if you can build that full-service mindset with a self-service bent to it. So if somebody says, “No, I’d really rather pump it myself. And go, “Fine, no problem, will let you do that. But we just want you to know we’re here at whatever level of service you need us for.” And they might go, “You know, how about if you put air in the tires while I pump the gas?” “We’ll work that way.”

Well, if I’ve got a point-of-sale-system type of technology, and the customer says, “Well, I can fill it out,” but we stay on the phone with them, and we say, “But let’s talk about your family. Let’s talk about your goals. Let’s start what you’re trying to do, while you’re filling it out.” You’re doubling down on both technology and relationship the same exact time. And you’re separating yourself from everybody. They’re never going to another mortgage lender. It’s that simple.

Sarah Wheeler: Great analogy and, something, I just love that idea. That’s amazing. And really, just gold nuggets for looking towards this next part of the market. But even if it stayed right now, to your point, like if all you’re doing is quoting rates, you know, how are you building a customer for life?

Dale Vermillion: Yeah, you know, I teach something, Sarah, that I’ve taught for years called the triangle for success. It’s three simple components. And it really is the formula for success.

It’s value. What’s your value prop? How are you valuing your customer beyond your competition? That’s the question.

Second is realationship. I spell it R-E-A-L-ationship, realationship. Are you really building a realationship or are you just going through the motions and order taking?

And the last one is differentiation. How are you differentiating from everybody else? How are you setting yourself apart? If, at the end of the day, you’re just a rate quoter who can close a couple days faster, who cares? That not going to win you a business. That does not build you repeat and referral business.

One of the most important things that I teach, something called the 9-10 rule. The average homeowner, it’s been proven, will go through nine mortgages in their lifetime. So if you’re a mortgage lender or a mortgage loan officer, you want every one of those nine. That’s called repeat business. They also have access to 10 other people that’s referral business.

So how do you get repeat and referral business? Well, you don’t do it by just quoting a rate and closing a loan. You do it by creating an incredible relationship, incredible customer experience. So they’re like, “Oh, my gosh, wow, that was amazing.” They’re gonna tell everybody they know about you. And they’ll keep coming back to you. That’s the secret formula to success.

Here’s the funny thing, Sarah, it’s not really a secret. We’ve known it all of our lives. We just stopped doing it because technology comes in. It’s like, “Oh, let the technology do the work.” Well, some of it, yes. All of it. Never.

I want my people involved. This is the biggest transaction people go through. Let’s make it personal. Let’s make it relational. Let’s make it powerful. Let’s do it the right way. Let’s give them a full-service experience every time.

Sarah Wheeler: Great tips. Thank you so much for coming on today, really appreciate this great conversation. And then, at our spring summit, you’re going to be one of our speakers, very excited about that. Anyone listening to this, I know we’ll be like, “Want to get more.” So thank you so much, Dale.

Dale Vermillion: Well, Sarah, HousingWire is the bomb. We are so honored to partner with you guys. You guys are the best and I say I appreciate you having me on and great questions. Love this. This was fun. I can’t wait to do it again.

Sarah Wheeler: Let’s do it. Thanks so much.

Dale Vermillion: Thanks, Sarah.

Alcynna Lloyd: Well, thank you for listening to the “Housing News” podcast. Please don’t forget to give us feedback and rate us on iTunes. Also, make sure to check out HousingWire’s daily podcast, “HousingWire Daily,” which is a wrap of HousingWire’s hottest stories and now available on iTunes, Spotify, Google Podcast and more. And we’ll see you next week.

Leave a Reply

Your email address will not be published. Required fields are marked *

Most Popular Articles

3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please