I just figured out what was missing. We’re not getting mad enough.
I work extremely hard to try to make my customer’s experience a good one. Everyone else in the industry says that is their goal too, but real world experience seems to belie that claim.
In our highly dysfunctional industry, miscues, missteps and mistakes are the norm, not the exception.
Communication breaks down between origination and processing, and between processing and underwriting.
There is no communication at all between origination and appraisers. In an ideal world, appraisers should ask the fundamental questions “What is the value of this property today?” and “How do I document that?” Instead, they are more concerned with minimizing underwriting conditions and making sure they aren’t appraising a property too high than they are with the value of a property. Miss it by a mile on the low side, but don’t come in high.
Consequently, we end up with badly reasoned appraisals with values that are often clearly wrong.
Underwriters should ask the fundamental questions “Does this loan meet the guidelines of the investor?” “What is the clearest, simplest way to document that it meets the guidelines?” and “Can and will this borrower make these payments?” Instead they are more concerned with having to buy back a loan if they make a mistake. Consequently, if they don’t understand the intent of a guideline they over-condition just to be sure. We end up with ridiculous conditions that are onerous for the borrower to provide and frankly embarrassing to ask for. Do we really need the borrower to write a letter stating that they don’t live in their PO Box? I’ve had to provide that.
Lenders now have multiple QC gates – understandably. I get that they don’t want to buy loans back. But if each of the QC gates – underwriter, doc drawer, funder – were properly trained and understood the purpose of each guideline and were trained to be consistent with each other, additional conditions after underwriting would disappear. And yet, they don’t.
And that’s why I’ve come to believe – we’re not getting mad enough.
Am I naïve to think that our mission as an industry should be to serve the client really well while making as many good, salable loans as possible? Shouldn’t we be mad as hell when incompetence or apathy ruins a client’s experience or kills a perfectly good loan?
We are not getting mad enough.
When an originator submits a loan that cannot or should not be done, we’re not getting made enough.
When a processor misunderstands the originator’s intent, makes assumptions, and packages a loan in a way that can’t be approved, we’re not getting mad enough.
When an underwriter misinterprets guidelines or misunderstands documentation and so asks for ridiculous conditions, we’re not getting mad enough.
When doc drawers and funders add conditions either because they, or the underwriter don’t understand the loan or the guidelines, we’re not getting mad enough.
And when management does not give everyone in the chain the proper training and support to provide competent, thoughtful and efficient service, we are definitely not getting mad enough.
Our industry has become a joke. Worse than that, the butt of jokes. Deservedly. Do you want to change that? Then let’s start getting mad. When incompetence or apathy rears its ugly head, let’s get really angry. Let’s let management know that it isn’t acceptable. And let’s bring dignity back to our profession by bringing back competence and a focus on serving the consumer.
Let’s get really mad.
I’m Casey Fleming. I originate mortgage loans throughout California and am located in Silicon Valley.
DRE 00889527 / NMLS 344375
(408) 348-3442 / firstname.lastname@example.org / www.loanguide.com