Those who were in it for a quick buck are gone, yielding market share
When challenges emerge, it’s easy to miss the forest for the trees. The mortgage landscape is no different in its darkened state – what with high rates, low inventory and inflation – but there are positive signs all across the terrain.
Mike Alberico (pictured), branch manager at UMortgage in Raleigh, North Carolina, sees the downshifted market as an opportunity to educate and get educated and find ways to stand apart from the crowd when the gray clouds hovering in the 8% interest rate range finally subside.
“It’s given us an opportunity to be experts in educating our partners, to stay in front of them,” he told Mortgage Professional America during a recent interview. “The people who are referring us business are in the same struggle that we are – there’s limited inventory, a lot more qualified people sitting out – which makes lending more challenging. If you can set yourself apart as an expert and do the more challenging loans and get ahead of problems before they become problems, you’re going to gain market share.”
Alberico spoke to MPA while attending the annual FUSE conference organized by the Association of Independent Mortgage Experts (AIME) that took place in Las Vegas earlier this month. The three-day event featured panel discussions reflective of the more challenging times that have emerged but with the counterpoint of motivational speeches by AIME CEO Katie Sweeney, United Wholesale Mortgage (UWM) CEO Mat Ishbia and others.
Exodus of loan originators not all bad
The slowdown has had the effect of driving some out of the business – and that’s not entirely bad, Alberico suggested. Many got into the industry during the since-dissipated refi wave that occurred the previous couple of years. It was low-hanging fruit for many solely interested in making a quick buck in refinancing.
“Not to be negative, but it’s forcing out some of the people that got in when it was easy and didn’t learn the business the way they should have – which will end up creating a little more market share for us in the long run,” he said. “It’s a good opportunity to set yourself apart.”
The continuing exodus of loan originators in light of challenges will also yield opportunities for those who remain. Alberico sees more people in retail making the shift to wholesale – a leap he himself made two years ago after nearly nine years in the mortgage business.
“You have to have options and flexibility,” he said in describing the broker channel appeal. “Even the larger banks are starting to tighten up. I know somebody who works in a branch bank and they’re rolling back their portfolio products a little bit because they’re worried about liquidity and the new liquidity rules that are going into place in 2025. They’re planning and getting ahead of that.”
It’s primarily about choice, he added. “If you only have one product to work with and they take half of it away, then you’re even further behind everyone else,” Alberico said. “On the broker side, you can have as many lenders as you want. We work with about 15 or 20 now, and I’ve probably used five or six regularly. Their strength is in different programs. If you don’t like what UWM is offering or they have an overlay that you have to have a 620 to do a conventional loan, you can go somewhere else – you can do that. Talk about controllables. You’re not dictated by one rate sheet or by what one company is doing. We have the ability to make the lenders earn our business through their competition – whether it’s pricing, turn times, service, etc.”
A toast to AIME
Sometimes amid such challenging times, one merely wants to go where everybody knows their name – where there’s collegiality and support. With a more sobering reality than that of the old Cheers television show, AIME provides that much-needed support, Alberico said.
“AIME has done so much to help me,” he said. “It’s helped me become a better originator and plugged me into so many groups. If it wasn’t for AIME, I probably wouldn’t have gotten as highly involved with Vetted VA.”
Also invaluable is the networking. Hundreds gather at the annual convention, where partnerships and friendships are often forged. He’s been able to secure referrals and learn different products by virtue of the gathering, he said.
“The networking when you come to this event – the speakers are amazing – it’s that one-on-one with other professionals that is the biggest takeaway for me,” he said.
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