Bad actors from the last boom are now gone
In the aftermath of the last refi boom, the herd has been thinned in the mortgage industry and everyone is going back to basics. And that’s a good thing.
That’s the assessment of Shane Kidwell (pictured), CEO of Dwell Mortgage. The Seattle-based producing branch manager sat down with Mortgage Professional America during the recent FUSE conference staged in Las Vegas by the Association of Independent Mortgage Experts (AIME).
“Anytime you have a downturn in any market, it thins the herd,” he told MPA during the annual gathering. “There were a lot of people who got into this industry the last couple of years who misled people with misinformation. They were uneducated and caused a lot of misinformation to enter the marketplace. So that’s gone away – which is good.”
The industry stalwarts remain
Now, the professionals who remain are the ones who truly know the industry and whose mettle has been tested, he suggested. “The people who are good at educating consumers and agents are here,” he said. “They’ve stayed and those others have left. All the broker-owners I talk to – all of my friends – are focused on streamlining processes and procedures. They’re simplifying their tech stack. So they’re going from 30 technologies doing 20 different things down to three technologies to do 20 things, which is good.”
The order of the day, he said, is efficiency: “The more efficient you can be with your process, the better you’re going to be. And what I like about that is when the refi boom, or this new market comes around, we’re going to be so much better prepared.”
In the last refi boom, he noted, the sheer scale and speed left most everyone unprepared: “We were totally unprepared,” Kidwell said. “Coming after COVID, you’re already on your heels trying to figure out how to navigate that with staffing, then you had that refi boom and it was just so totally unexpected and now we’re prepared for it. I love that everybody’s streamlining, everybody’s simplifying, everybody’s getting back to basics.”
Still, little can be done about home affordability, which remains elusive. However, Kidwell utilizes tactics at his shop that help mitigate the overall cost of buying a home in light of soaring property values.
“The home affordability index is extremely low right now, which means affordability is tough for consumers,” he said. “We’re doing temporary program relief like a 2-1 buydown, 3-1 buydown, there’s permanent buydowns, so that will impact the interest rate. I have an insurance company as well, so looking at total home affordability, not just the rate and that part of the payment but property taxes – educating them on that. Educate them on MI [mortgage insurance]. Insurance is on the rise as well – significantly. The 2-1 buydown and 3-1 buydown helps a lot.”
Another thing to keep in mind in this downshifted market: Niches are where the riches are, Kidwell noted. “Your non-QM, your investment programs, your house hacking, your reverse mortgages, your HELOC. We’ve seen all of those uptick a lot since rates have gone up.”
A newcomer’s advice to newcomers
He urged industry newcomers to place a premium on social media as a key cog in their marketing efforts. Kidwell is something of a newcomer himself, having made the switch to broker after having worked retail for the first part of his career.
“It’s crazy,” he began. “Twenty years ago in 2003, the top three forms of marketing were print, radio and direct mail. Think about that! Now it’s social media, influence, and video – all go through social media platforms, all three. You had to pay to market in 2003; in 2023, you can get paid for marketing. But you have to understand how to market effectively, how to leverage those platforms. If you’re brand new to the industry and effectively navigating social media, you can generate free leads, get paid for your information and drive more eyeballs to your products and your company.”
Kidwell is deeply involved in AIME, serving as a so-called team captain as part of his advocacy efforts. In the volunteer post, he has traveled to Washington, DC to lobby for legislation designed to benefit his industry. He said that the opportunity to travel to the nation’s capital to add his perspective is one of the benefits of his AIME membership.
“They’re all about driving advocacy down to the local level,” he said. “I’ve been a broker since January, and all the questions that I had have been answered. When you’re in the retail space, they tell you what’s on the other side, but they’ve never experienced it.”
Conversely, his counterparts at AIME have not only welcomed him but provided narratives from their own industry experience to help guide his nascent broker’s career. “The things they lost money on and made money on, that’s been huge. You just don’t get that anywhere else,” he said. “You’ve got to have somebody who can corral all of us and [AIME CEO] Katie [Sweeney] and the team do a really good job of that with a consistent message and driving home what’s going to impact the market the most so we can really channel our collective voice, which has been huge.”
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