Transcript Document

STRATMOR | GROUP
We want your feedback REAL TIME
•
Please use your phone and browse to
the URL below
•
You do NOT need a login
•
You will be asked a series of questions
throughout this session
•
Answer on phone, and results appear
instantly
•
You can also ask questions through web
page
www.PollEv.com/STRATMOR
STRATMOR | GROUP
2
Who and What We Are
Practice
Description
Practice Leader
Benchmarking, and
Financial Analysis
• The type of work required by CFO’s, whether
independent or bank owned
• MBA / STRATMOR Peer Group Program (PRG),
with over 80 of the top lenders participating
• We use our extensive industry data, going back
years and through multiple rate cycles
• Build financial models for lenders – 5 year P&L,
Balance Sheet and Capital projections
Jim Cameron
Nicole Yung
Strategic Planning
Services
• Strategic planning and executive leadership
Dr. Matt Lind
coaching
• Consideration of entering and exiting channels and
markets, competitive positioning
IT Procurement and
Advisory
• Independent evaluation of 26 primary LOS
• Typically an exercise in reducing the list, and
assisting with procurement
• Executive coaching and IT readiness
•Implementation and rescue efforts
Len Tichy
STRATMOR | GROUP
3
“Torture The Data Until It Confesses”
Practice
Description
Practice Leader
Capital Markets
• From Best Efforts to Mandatory
• Agency delivery
• Alternate Investors
• Pricing strategy and execution
Rob Chrisman
Mergers and
Acquisition
• Buy side advisory
• Sell side representation
• Middle man for interested parties
Jeff Babcock
Sales and
Marketing
• Consumer Direct and Retail
• Lead generation and Lead Management
• E-Commerce and Direct Marketing
Garth Graham
Herding
• Making sure everything works well
• Making sure the partnership is moving in
the right direction
• Helping us meet the product needs of our
clients
Lisa Springer
STRATMOR | GROUP
We want your feedback REAL TIME
•
Please use your phone and browse to
the URL below
•
You do NOT need a login
•
You will be asked a series of questions
throughout this session
•
Answer on phone, and results appear
instantly
•
You can also ask questions through web
page
www.PollEv.com/STRATMOR
STRATMOR | GROUP
5
Projected Changes in the Population by Age
(2012 – 2022)
Millennials
Home Buyers
Gen X
Net Buyers
Baby Boomers:
Net Sellers
STRATMOR | GROUP
6
Owner and Renter Occupied Households &
Homeownership Rate
STRATMOR | GROUP
7
Sum of a Niche!
1. First time buyers
2. Millennials under 35
3. Minority borrowers
4. Evolving Product
Sum of Niches!
STRATMOR | GROUP
We want your feedback REAL TIME
•
Please use your phone and browse
to the URL below
•
You do NOT need a login
•
You will be asked a series of
questions throughout this session
•
Answer on phone, and results appear
instantly
•
You can also ask questions through
web page
www.PollEv.com/STRATMOR
STRATMOR | GROUP
9
How Do the Groups Compare?
1 Source: Ethics Reource Center, Ethics.org
STRATMOR | GROUP
10
World Events Drive Perceptions
Foreclosure!
Source: Ethics Resource Center, Ethics.org
STRATMOR | GROUP
11
Traits Of The Generations
Source: Ethics Resource Center, Ethics.org
STRATMOR | GROUP
12
Workplace Attributes
Source: Ethics Resource Center, Ethics.org
STRATMOR | GROUP
13
How many social media accounts do you
actively use?
STRATMOR | GROUP
14
How active are you in Social Media?
STRATMOR | GROUP
15
Do you have a formalized Social Media
program?
STRATMOR | GROUP
16
Social Media Presence
STRATMOR | GROUP
17
Millennials and Money
 Millennials keep more of their assets in
cash, less in stocks - UBS report described
them as “the most conservative generation
since the Great Depression”
 The average Millennial investor has 52
percent of their savings in cash, compared
to 23 percent for other age groups
 Accenture survey found high levels of
mistrust of financial institutions among
Millennials and a greater reliance on the
Internet, social media, and personal
networks for financial advice
 The ten least-liked brands among members of this generation include four of
the nation’s most powerful banks—Chase, BofA, Wells Fargo and Citigroup
STRATMOR | GROUP
18
Millennials and Money
 70 percent of Millennials thought that the way to pay for things five years from
now will be totally different and one-third said they didn’t believe that they will
need a bank at all in the future
 Almost all (88%) of Millennials do their banking online and half of those use
their smart phone to do so
 Three-fourths of Millennials (73%) to be “more excited about a new offering in
financial services from Google, Amazon, Apple, Paypal or Square” than from a
nationwide bank
STRATMOR | GROUP
19
Millennial Down Payment Issue
 40% of renter say “ability to generate down payment” would
change their willingness to pay
 Only 5% of renters said a 2% increase in rates would impact their
willingness to buy a house
 74% “know and understand the financial process of buying a
home”
 44% believe 20% down payment is required
 74% fear they wouldn’t qualify admit they have NOT taken the steps
to see if they would
Source: Federal Reserve Bank of New York
STRATMOR | GROUP
20
STRATMOR Originator Census and
Compensation
STRATMOR | GROUP
What percent of Retail Loan Originators are
less than 35 years old?
21
STRATMOR | GROUP
22
Millennial originators (less than 35 years old)
are less productive than older originators?
STRATMOR | GROUP
23
Background
 STRATMOR believes that the more you can understand and measure the
key attributes of your sales force, the better you will be able to
proactively manage them
STRATMOR Originator Census survey focuses on five key areas:
 Production Distribution - Consistent with conventional wisdom, do 20% of
your Originators close 80% of your volume?
 Productivity by Quintile - What is the average productivity of your top
quintile of producers versus peers?
 Originator Age - What is the average age of your originators overall? By
production quintile?
 Turnover - What is your Originator turnover overall? By Age? By production
quintile? Many lenders maintain that they keep their core group and that
turnover is limited to lower producing quintiles. Is that really true?
 Tenure - What is the average tenure of originators by production quintile?
Are your veterans out-producing the less experienced originators? How
does your average tenure compare with peer group averages?
STRATMOR | GROUP
24
Distribution of Originator Age
STRATMOR | GROUP
25
Key Findings from 2013 LO Census
 40% of the originators do 80% of the business
 Top 20% doing 55-57% of the total production
 Independent Mortgage companies originators top 20% do 61% of the
production
 The Top 20% of originators averaged 10 loans per month which is twice
the average production of the next quintile who originated 4.4 loans per
month
 The Bottom 20% of originators averaged less than one loan per month
 About 50% of the originator population is between the ages of 40-55
with an average age of 47
 There was no material difference in ages by quintile
 We had expected to see the Top 20% age to skew older than the average
and the lower production quintiles to skew younger
 The millennials productivity was the same as the older after normalizing
for tenure
STRATMOR | GROUP
26
Key Statistics from 2013
All Originators
Origination Dollars
Originator Statistics
# of
Companies
Count of
Originators
Turnover %
Avg Tenure
Avg Age
Annual Avg
Production per
Originator
% of Total
Monthly
Production per
FTE Equivalent
Origination Units
Purchase %
Annual Avg
Production per
Originator
% of Total
Monthly
Production per
FTE Equivalent
Purchase %
Independent Mortgage Company
Bank Owned/Affiliated Mortgage
9
12
2,756.0
4,072.0
29.3%
30.7%
2.7
3.5
47.2
47.9
7,621,111
11,484,877
100.0%
100.0%
768,339
1,112,148
49.9%
44.0%
32.0
57.5
100.0%
100.0%
3.2
5.5
51.5%
45.6%
Over $5 Billion
Between $2 Billion and $5 Billion
Between $1 Billion and $2 Billion
Under $1 Billion
6
6
3
6
3,718.0
2,166.0
349.0
595.0
33.9%
27.0%
8.3%
29.1%
3.2
3.3
3.6
1.9
47.2
48.1
50.0
46.9
10,556,731
9,743,958
11,040,492
5,986,104
100.0%
100.0%
100.0%
100.0%
1,037,614
906,265
1,150,508
688,406
47.4%
44.8%
44.4%
47.0%
50.1
47.8
48.0
26.6
100.0%
100.0%
100.0%
100.0%
4.9
4.4
4.7
3.0
49.1%
46.3%
45.0%
48.6%
12
3
6
4,276.0
871.0
1,681.0
6,828.0
32.7%
21.6%
28.3%
30.1%
2.4
5.7
3.8
3.2
47.3
46.7
49.0
47.6
8,842,044
11,929,307
11,642,589
9,925,337
100.0%
100.0%
100.0%
100.0%
906,701
1,123,163
1,060,293
971,707
50.0%
34.6%
43.1%
46.4%
38.9
66.9
58.1
47.2
100.0%
100.0%
100.0%
100.0%
4.0
6.3
5.3
4.6
51.7%
36.3%
44.3%
48.0%
LO Primarily Stand-Alone Branches
LO Primarily Bank Branches
LO Mixed Bank & Stand-Alone Branches
Overall
 Turnover averaged 30.1% for our sample in 2013
 Average age of our survey group was 48 years old
 An average originator originated 4.6 loans in 2013 with 48% of
those being purchase loans
STRATMOR | GROUP
27
Key Statistics - Top 20%
Top 20%
Origination Dollars
Originator Statistics
# of
Companies
Count of
Originators
Turnover %
Avg Tenure
Avg Age
Annual Avg
Production per
Originator
% of Total
Monthly
Production per
FTE Equivalent
Origination Units
Purchase %
Annual Avg
Production per
Originator
% of Total
Monthly
Production per
FTE Equivalent
Purchase %
Independent Mortgage Company
Bank Owned/Affiliated Mortgage
9
12
548.0
809.0
6.5%
7.9%
4.1
5.3
46.5
47.0
23,656,251
30,491,591
61.7%
52.7%
2,118,118
2,663,041
46.7%
41.5%
88.9
135.1
55.2%
46.7%
7.9
11.7
48.1%
42.9%
Over $5 Billion
Between $2 Billion and $5 Billion
Between $1 Billion and $2 Billion
Under $1 Billion
6
6
3
6
741.0
431.0
69.0
116.0
6.2%
9.4%
1.6%
10.3%
5.0
5.2
4.7
2.8
46.2
47.4
50.7
46.4
29,895,989
26,211,558
30,789,378
17,730,567
56.4%
53.5%
55.1%
57.7%
2,587,658
2,249,452
2,855,911
1,908,957
43.4%
44.7%
40.4%
42.3%
123.3
116.6
117.0
71.2
49.1%
48.6%
48.2%
52.1%
10.7
9.9
10.3
7.2
45.1%
45.8%
40.7%
44.0%
12
3
6
851.0
173.0
333.0
1,357.0
8.0%
1.2%
8.8%
7.3%
3.8
8.0
5.8
4.8
46.7
43.9
48.8
46.8
26,509,344
28,227,204
30,596,289
27,731,262
59.7%
47.0%
52.1%
55.5%
2,395,103
2,358,311
2,603,623
2,438,854
48.1%
29.5%
39.2%
43.6%
104.9
140.9
133.2
116.4
53.7%
41.9%
45.5%
49.0%
9.4
11.8
11.2
10.1
49.7%
31.2%
40.1%
45.0%
LO Primarily Stand-Alone Branches
LO Primarily Bank Branches
LO Mixed Bank & Stand-Alone Branches
Overall
Turnover is significantly lower for top producers at 7.3% vs. 30%
overall
Average age is the same as the overall average
 This tells us that Top Producers come from all age cohorts and are
not always the older and more seasoned originators
The Top 20% average 10.1 loans a month or more than double the
overall average
STRATMOR | GROUP
28
Consumer Research
Online / Offline Behavior
STRATMOR | GROUP
29
REALTOR® Challenges
 Sixty-nine percent of REALTORS® reported
having a website for at least five years, 12
percent reported having a real estate blog,
and 61 percent are using social media.
 Realtors NEED more access to mortgage
credit – it’s a need that must be met to
expand their business
 Only 17% of REALTORS have personal assistants, and 1/3 of those are shared,
so they generally don’t have a lot of help in marketing and other lead
generation activities
 The typical REALTOR® is a 56-year-old white female who attended college and
is a homeowner, (Fifty-seven percent of all REALTORS® are female)
 They are absolutely desperate for the deal to close
 And there are 100k loan officers calling on 1M realtors --- if each LO can secure
10 relationships, and can convert every referral, that is only 50 deals per YEAR!
STRATMOR | GROUP
30
Lengthy research period provides multiple
opportunities to connect
 Typical buyers search for 12 weeks
 Buyers who use agent, typically contact agents after 3 weeks
(which means the keep searching after that)
 78% of home shoppers visit 3 or more sites prior to taking action
on real estate site
 Only 24% take action (generate lead) the same day they begin
search
 36% take up to 60 days
 And 40% do not take action for up to 120 days
STRATMOR | GROUP
31
Age of Internet User Much Different than
Typical REALTOR®
 86% of those who take action on site are LESS than 55 years old
 67% of those take action are less than 44 years old
 And average age of Realtor is 56 years old!
 Understanding Realtors is key to being successful AND
 Diversify the bet into evolving Realtors or direct methods of
communication?
STRATMOR | GROUP
32
Home Search in the Information Age
1.
Look at online listings
2.
Check out Mortgage rates
3.
Look at more information about homes
4.
Find an agent (after several weeks)
5.
Look up agent on internet, AND social media
6.
Talk to agent
7.
Receive referral, Pre-Approval encouraged
8.
Search online for comps
9.
Check out neighborhood stats
10. Send link to house to influencer
11. Drive through neighborhood
12. Look at house
13. Listen to Realtor spiel about mortgage
14. Look up loan officer on social media and internet
STRATMOR | GROUP
33
33
STRATMOR | GROUP
34
Customer Satisfaction
 MortgageSAT survey system launched August 2013 with over
~45,000 customers surveyed
 We provide lenders insights into how their customer service
performs across a broad range of transaction, demographic, and
organizational aspects
 This reveals details in overall satisfaction




Critical points in the process
Preference of how contacted
How applied
Millennials vs previous generations
STRATMOR | GROUP
35
Millennial Satisfaction
 Based on 45,000 surveys, Millennials (those borrowers under age
34) have roughly same satisfaction then older borrowers (88 vs
89)
 They are even less likely to recommend (87 vs 89) but more likely
to comment on social media (74 on a 100 point scale)
Survey Size
Survey percent of Total
Satisfaction
Likelihood to use again
Likelihood to Comment
Likelihood to Recommend
Under 34
12706
28%
89
88
74
87
Over 34
32797
72%
89
90
71
89
TOTAL
45503
100%
89
89
72
88
STRATMOR | GROUP
36
First source of information
 For purchase borrowers, millennials are far more likely to seek internet and
friends/family for information
 23% friends and family vs 14% older borrowers – highest satisfaction
with 91
 11% internet vs 7% internet from older borrowers
 Millennials less likely (7%) to contact a branch office
Millennials
Pct of Total
Sample Size
Satisfaction
Likelihood to use again
Likelihood to Comment
Likelihood to Recommend
Previous Generations
Pct of Total
Sample Size
Satisfaction
Likelihood to use again
Likelihood to Comment
Likelihood to Recommend
Internet
Realtor
11%
1172
87
88
68
87
42%
4681
88
89
71
88
Internet
Realtor
7%
1362
88
89
70
89
46%
9090
89
90
72
90
Other personal finance Family or friends
professional
5%
23%
538
2517
86
91
86
92
67
74
86
91
Branch office
Other personal finance Family or friends
professional
5%
14%
1064
2803
87
91
88
92
68
75
88
92
Branch office
7%
758
92
93
81
93
9%
1758
91
93
76
93
STRATMOR | GROUP
37
Relationships can be established
via Internet or Phone
 Less than 10% of purchase borrowers completed the application
face to face, but have slightly higher satisfaction
 19% completed it via the internet
 69% completed via phone
 Customer satisfaction in all three methods was very similar
although face to face is more likely to comment on social media
Face to Face
9%
Pct of Total
Sample Size
2900
Satisfaction
90
Likelihood to use again
90
Likelihood to Comment
76
Likelihood to Recommend
90
Internet
19%
5807
88
89
72
89
Mail
2%
712
89
89
72
89
Telephone
69%
21447
89
90
72
89
STRATMOR | GROUP
38
First Time Home Buyers
 44% of completed purchase surveys are first time home buyers
 They are actually MORE satisfied than move up buyers, and far
more likely to comment on social media
 Best practice is to ASK them to comment and drive referrals
Sample Size
Satisfaction
Likelihood to use again
Likelihood to Comment
Likelihood to Recommend
First Time Buyer
45%
13270
90
90
77
90
Not a First Time Buyer
55%
15999
88
89
68
89
STRATMOR | GROUP
Importance of Alerts
• MortgageSAT
automatically alerts
lenders when customers
are dissatisfied
• Quick call back from
Senior Mgt has a huge
impact on turning
around satisfaction
• Having that push
notification is a key to
driving the quick call
• Note – Interaction with
originator is a key driver
of why choose a lender,
AND big driver of
satisfaction
Satisfaction Segment
Satisfaction 1-6
Satisfaction 7-8
Satisfaction 9-10
Number of Respondents
Reason for choosing lender
Interaction with originator or loan
officer
Lender of my previous mortgage
Other
Ability to close loan on time
Good reputation
Have other financial products
Material that was mailed to me
Good web-based tools
Response Count
Percent
Frequency Satisfaction
8%
1,405
24
10%
1,718
72
82%
14,651
97
17,774
Response Count
Percent
Frequency Satisfaction
59%
18%
11%
5%
4%
1%
1%
0%
4,037
1,245
784
355
264
72
85
27
94
85
73
89
92
83
83
89
STRATMOR | GROUP
• Higher satisfaction
appears to exist
when consumer only
talks to one person
• Providing a checklist
at application is a key
driver of satisfaction
(33 point difference!)
• Not asking for
additional document
drive satisfaction
from 87 - 93
SPOC for origination?
Response Count
Worked with person other than
Loan Officer
Worked with someone else
Worked only with Loan Officer
Number of Respondents
Provided Checklist
Provided
Not provided
Don´t remember
Number of Respondents
Asked for additional docs
Asked
Not asked
Don´t remember
Number of Respondents
Percent
61%
39%
Percent
88%
4%
7%
Frequency
4,172
2,697
6,869
Satisfaction
87
93
Frequency Satisfaction
15,735
91
737
58
1,331
81
17,803
Response Count
Percent
Frequency Satisfaction
39%
6,214
87
45%
7,063
93
16%
2,458
92
15,735
STRATMOR | GROUP
• Customers are
most satisfied
when lender
proactively
provides status
to lender
• 67% of
customers say
they want status
by email or
outbound phone
call
Customer preference
Response Count
Method for receiving status
updates
Email from lender
Lender called me
I called
Other
Text message
Logging into website
Mobile app
Letter mailed to home
Number of Respondents
Percent
59%
24%
7%
6%
2%
1%
0%
0%
Preferred method for receiving
updates
Email
Phone call from lender
Text message
Other
Placing a phone call
Logging into website
Letter mailed to home
Mobile app
Number of Respondents
Percent
67%
24%
3%
3%
2%
1%
1%
0%
Frequency Satisfaction
4,062
91
1,680
94
508
67
393
80
116
93
73
83
8
88
29
88
6,869
Response Count
Frequency
4,580
1,618
216
214
136
50
42
13
6,869
Satisfaction
90
88
88
84
81
88
81
87
STRATMOR | GROUP
People matter
• Benchmarking
performance by
all four primary
individuals (LO,
Processor,
Underwriter, and
Closer) and
• Benchmarking up
to all levels of
management (i.e.
branch, region,
area, division)
STRATMOR | GROUP
43
Power of Big Data
 Data gives you ability to predict likelihood of consumers taking
action
 So, a consumer who is qualified for a mortgage is a better lead
than one that is not…
 But it’s a better lead if you know they had a life change event …
 If they are doing online search for real estate …
 If they recent listed their home for sale …
 Had a recent credit pull ….
 Are active on social media …
 Have a valid email address
STRATMOR | GROUP
44
Monitor Households
Corporate Campaign Management
- 3rd party Data to drive marketing efforts
- Monitor for life change events, such as marriage and divorce
- Monitor for property events: change of address, recent home listing, increase home
value
- Monitor for credit events, such as recent mortgage inquiries
Corporate Lead Management
- Create corporate standards regarding lead assignment, including involvement of
retail and consumer direct loan officers
- Recruit and retain better LO’s through a commitment to retail marketing support
using best of breed consumer components
- Protect relationship with consumer when LO departs
- Leverage corporate systems for lead management and referral management
- Ensure compliance with regulatory standards, including CFPB, FCRA and Fair
Lending13.5
Retail Leads
Call Center Leads
50% of total leads
50% of leads
STRATMOR | GROUP
STRATMOR Executive Survey: Most Important
•
•
91% said that enhanced tools for lenders to monitor regulatory compliance during the loan
cycle and/or to minimize the risk of regulatory non-compliance were “extremely important
Both document management and system security tied for the next most important
consideration. Overall, 82% of respondents said that greater use of document management or
enhancement to imaging technology (e.g. OCR, data extraction, etc.) to improve the efficiency
of the staff and the quality of the loan files was “extremely important.”
STRATMOR GROUP – PROPRIETARY & CONFIDENTIAL
NOT FOR EXTRNAL DISTRIBUTION
STRATMOR | GROUP
46
Technology Developments – Less Important
• Innovations such as mobile devices (46%) and CRM (41%) and
Self Service tools (41%) all were considered less important by
lenders.
STRATMOR GROUP – PROPRIETARY & CONFIDENTIAL
NOT FOR EXTRNAL DISTRIBUTION
STRATMOR | GROUP
47
Questions and Comments --
STRATMOR | GROUP
Strategies to Generate Millennial Mortgage
Opportunities
 Hire and retain millennials




Consider mentoring by successful older staff
Creating meaning and inclusiveness
Recognition and feedback – “catch them doing something right”
Patience – accept the differences, and give them time to grow
Millennial Outreach





Hire millennials
Focus on their needs – down payment for example
Embrace their tools – mobile, text and online
Self service is expected
Use alternative referral sources
 Embrace Data
48
STRATMOR | GROUP
What You Can Do
Garth Graham,
Managing Director
954-325-7816 Direct
[email protected]
1.
The consumer is central to the process –
produce happy customers NOT just
compliant loans
2.
Embrace transparency – Millennials don’t
trust!
3.
Need to hire younger and need to mentor
be successful
4.
Invest in technology that enables you to
connect with consumers
5.
Big Data can generate big results
6.
Measure and manage to high customer
satisfaction
www.stratmorgroup.com
Check out my weekly column in National Mortgage News
STRATMOR | GROUP
50
Questions and Comments --
STRATMOR | GROUP
51
STRATMOR | GROUP
52
Women and Marriage
 Women are as satisfied as men
 They are also more likely to comment on social media
 And borrowers who are separated are happier then the others
Gender
Percent
Frequency
Satisfaction
Male
67%
3,917
90
Female
32%
1,879
90
Information Not Provided
1%
69
86
Number of Respondents
Marital Status
5,865
Percent
Frequency
Satisfaction
Married
63%
3,672
90
Unmarried
37%
2,162
90
Separated
0%
26
92
Number of Respondents
5,860
STRATMOR | GROUP
53
The importance of Social Media
 A way to engage for professionals to engage other professionals
and build brand
 So, use linked in, twitter and facebook to find Realtors and other
referral sources
 Provide value added information – something happens nearly every
day that is deserving of commentary
 Make it professional and personal – how do things make you feel?
What do you think about changes in the market
 Engaging consumers in a compliant way – not “offering” loans, but
sharing your experience in the industry
 Use what you are good at – not being phony
STRATMOR | GROUP
54
Power of data aggregation
 Outlook has plug-ins for facebook and linked in (FREE!)
 Let’s you see picture and immediately link to social media page
for those you are connected to
 Let’s you immediately look up people on social media based on
email – new borrowers (before you call them), or new Realtors
before you walk in office
STRATMOR | GROUP
55
Power Tools - HootSuite
STRATMOR | GROUP
56
Sales Activity may not be a Funnel
 Old model was a funnel, with the
opportunities always flowing down,
with fallout reducing the amount
that comes out the bottom.
 New Model is more like a flight path,
with customers bouncing from spot
to spot seeking out information.
 Data analyzed by Google (search
history and behavior) and Compete
(click steam behavior) reveals the
trend
STRATMOR | GROUP
57
New Sales Funnel
 90% of home buyers rely on the
internet as one of their primary
research sources
 52% turn to internet as their first step
 Our MortgageSAT data for last month
showed Realtors the first step for
financing less than 40% of the time
 Real Estate search up 50% in the past
year, and up 253% in the past 4 years
 40% of Real Estate search on mobile
devices, an increase of 120% in past
year
 89% of Real Estate Consumers ALSO
use a Real Estate Agent
STRATMOR | GROUP
Do you have use texts to communicate with
borrowers?
58
STRATMOR | GROUP
Share borrowers age 25 - 30 years old
with new mortgage originations
18%
no student debt
with current student debt of 100K+
with student debt, current or delinquent
16%
with current student debt
with 90+ delinquent student debt
14%
12%
10%
8%
6%
4%
2%
0%
2005:Q4
2006:Q4
2007:Q4
2008:Q4
2009:Q4
2010:Q4
2011:Q4
2012:Q4
2013:Q4
Source: New York Fed Consumer Credit Panel / Equifax
MGIC.com/social
STRATMOR | GROUP
60
Background
The STRATMOR Compensation Connection is an annual survey of compensation
amounts and structure.
Survey is set up in modules:






Executive Management
Retail Sales
Consumer Direct Sales
TPO Sales
Fulfillment (All Channels)
Production Support
Results are available to participants and include:
 Cross tabulation based on:
• Independents vs. bank-owned lenders
• Production scale brackets to differentiate between large and mid-size lenders
• Relevant position-related metrics (tenure, management scope)
 Key executive, sales, and back office roles within your organization
 Compensation structures along with compensation levels
STRATMOR | GROUP
61
Positions Surveyed for CD Sales
Senior Consumer Direct Production Executive
 The top sales position in the Consumer Direct channel
Call Center Manager
 Responsible for recruiting, hiring, managing, and training call center personnel including loan officers in a particular call center
Campaign Manager
 Coordinates and assists with the marketing activities, including database and direct mail marketing, and ecommerce marketing
campaigns.
Producing Team Leader
 Manages the activities of a call center team, including training and managing loan officers; Also acts as a loan officer by originating
loans
Non-Producing Team Leader
 Manages the activities of a call center team, including training and managing loan officers; Does not originate loans
Loan Officer
 Located in call center; receives incoming calls (leads) and attempts to convert to application; may make outbound marketing calls;
counsel borrowers, recommend loan products ; Takes original application directly with borrower and coordinates with loan processors
and underwriters in obtaining information necessary to close the loan.
Call Screener
 Assists the sales consultants by taking inbound calls from clients including providing clients with product, program and rate
information
STRATMOR | GROUP
62
Sample Results – CD Loan Officer
Loan Officer - Non-Exempt
Job Description - Located in call center; receives incoming calls (leads) and attempts to convert to application; may make outbound marketing calls; counsel borrowers, recommend loan products. Takes
original application directly with borrower (over the phone or in person) and coordinates with loan processors and underwriters in obtaining information necessary to close the loan. Classified as Inside
Sales under Department of Labor guidelines. Typically classified as Non-Exempt employees and are eligible for Overtime.
2013 Survey
Average
12
Using the average for the year, how many Loan Officers Non-Exempt did your organization employ in 2013?
What was your Loan Officer - Non-Exempt turnover for
2013?
How many loans, on average, did an Loan Officer close per
month?
What was the average compensation for the Loan Officers Non-Exempt for 2013?
Base Salary
Overtime
Incentive / Variable Compensation
Total
83.7
64%
Type of Company
Bank
Independent
6
6
35.7
40%
131.7
87%
Cross-Tabulated Results
Annual Volume
Under $1B
Over $1B
6
6
15.7
100%
151.7
27%
Source of Loans
Retention
New Customer
7
5
62.2
84%
113.8
35%
2012 Survey
Average
8
49.8
33%
14.5
11.6
16.9
9.0
20.8
9.9
21.7
25.2
24,407
2,039
63,450
89,895
26,594
2,805
58,499
87,898
22,219
1,272
68,401
91,892
26,403
2,070
56,890
85,363
22,410
2,008
70,010
94,427
27,454
2,295
62,007
91,755
20,141
1,680
65,470
87,291
27,582
928
55,679
84,189
What was the average compensation for the Loan Officers Non-Exempt for 2013?
Base Salary
Overtime
Incentive / Variable Compensation
Total
27%
2%
71%
100%
30%
3%
67%
100%
24%
1%
74%
100%
31%
2%
67%
100%
24%
2%
74%
100%
30%
3%
68%
100%
23%
2%
75%
100%
33%
1%
66%
100%
Is the monthly Base Salary paid to Loan Officers -NonExempt a recoverable amount?
Yes
No
0%
100%
0%
100%
0%
100%
0%
100%
0%
100%
0%
100%
0%
100%
0%
100%
STRATMOR | GROUP
Loan Officer - Non-Exempt
Job Description - Located in call center; receives incoming calls (leads) and attempts to convert to application; may make outbound marketing calls; counsel borrowers, recommend loan products. Takes
original application directly with borrower (over the phone or in person) and coordinates with loan processors and underwriters in obtaining information necessary to close the loan. Classified as Inside
Sales under Department of Labor guidelines. Typically classified as Non-Exempt employees and are eligible for Overtime.
2013 Survey
Average
12
Please enter the percentage breakdown of the variable
portion of Cash Compensation paid to the Loan Officers Non-Exempt for 2013.
FLAT % based on production VOLUMES
TIERED % based on production VOLUMES
Based on FLAT $/loan
Based on TIERED $/loan
HYBRID commission equal to greater of % or $/loan
Based on the achievement of quantitative and/or qualitative
OBJECTIVES
DISCRETIONARY
OTHER
Total
Type of Company
Bank
Independent
6
6
Cross-Tabulated Results
Annual Volume
Under $1B
Over $1B
6
6
Source of Loans
Retention
New Customer
7
5
2012 Survey
Average
8
23%
37%
15%
15%
0%
33%
19%
30%
15%
0%
12%
55%
0%
15%
0%
33%
37%
30%
0%
0%
12%
37%
0%
30%
0%
0%
31%
26%
0%
0%
36%
46%
0%
36%
0%
24%
21%
0%
24%
0%
10%
1%
0%
100%
3%
0%
0%
100%
17%
2%
0%
100%
0%
0%
0%
100%
19%
2%
0%
100%
15%
0%
0%
71%
2%
2%
0%
122%
18%
13%
1%
100%
Loan Officer - Non-Exempt commissions vary by:
Purchase vs. Refinance
New vs. Existing Customers
Other: Lead Source - Capture Rate - Customer Service
25%
0%
8%
17%
0%
17%
33%
0%
0%
0%
0%
17%
50%
0%
0%
0%
0%
14%
60%
0%
0%
13%
25%
13%
Do your offer more than one compensation plan to Loan
Officers - Non-Exempt?
Yes, Loan Officers can choose among a variety of plans
Yes, but compensation plans vary by geography/branch
No, we only offer one Loan Officer plan
0%
17%
83%
0%
0%
100%
0%
33%
67%
0%
17%
83%
0%
17%
83%
0%
14%
86%
0%
20%
80%
13%
25%
50%
Loan Officer - Non-Exempt plans have the following
features:
Minimum Payout
Maximum Payout
Quarterly volume add-on
Annual volume add-on
Quality Control Components
33%
33%
0%
17%
50%
50%
33%
0%
33%
67%
17%
33%
0%
0%
33%
33%
50%
0%
17%
50%
33%
17%
0%
17%
50%
29%
43%
0%
14%
43%
40%
20%
0%
20%
60%
25%
13%
25%
38%
50%
STRATMOR | GROUP
64
Consumer Direct Percent of Units
 High of 46%
of units in
2012
 35% of units
in 2014 and
actually rising
YTD 2015
 By state is
very
interesting…
 Highest
percent of CD
volume
VT OK MS LA NH
RI AR ME AL NM
STRATMOR | GROUP
65
CD is rising for both Refinance and Purchase
 Refinance volume was over 50% of units 2013-2014
 Purchase units have risen from 12% of units to over 21% of units in the past 5
years
STRATMOR | GROUP
66
Value Proposition For CD
 CD refinance loans typically have higher rates than traditional retail while…. (4
bps higher in 2015, avg 3 bps over 7 years)
 CD purchase loans are typically offered at lower rates than retail – 14 bps
average over 7 years
Traditional Retail
Consumer Direct
Average Delta
2008
5.87
5.84
(0.03)
Refi & Cash Out Only Average Interest Rate
2009
2010
2011
2012
4.93
4.67
4.36
3.77
4.96
4.71
4.39
3.81
0.04
0.04
0.03
0.04
2013
3.70
3.73
0.03
2014
4.18
4.24
0.05
2015
Average
3.87
4.42
3.91
4.45
0.04
0.03
Traditional Retail
Consumer Direct
Average Delta
2008
6.10
5.96
(0.14)
Purchase Only Average Interest Rate
2009
2010
2011
2012
2013
5.12
4.76
4.45
3.71
3.85
4.93
4.60
4.34
3.59
3.74
(0.19)
(0.16)
(0.11)
(0.12)
(0.11)
2014
4.14
4.00
(0.14)
2015
Average
3.83
4.50
3.66
4.35
(0.17)
(0.14)
STRATMOR | GROUP
67
 36% of eligible voters are Millennials
 $1.6T (Trillion) home purchases by 2018 (in a market that is only
….)
 More racially diverse - Minority young householders = 28% in
1995; 41% in 2014
 Married later - Young adult householders living with a spouse:
60% in the 1980s; 50% during housing boom; 42% in 2014
 Higher education - Young adult householders that are college
grads: 32% in the 1995; nearly half in 2014
 12% of renters or 5.2 million renters nationwide plan to buy in the
next year
STRATMOR | GROUP
68
Power of the Checklist
 When Millennials receive a checklist of required documents, they have a
satisfaction score of 91 (100 point scale) which drops to 51 when they are not
provided a checklist
 When they are then NOT asked for addition documentation not on original
checklist, it rises to 95
Sample Size
Satisfaction
Likelihood to use again
Likelihood to Comment
Likelihood to Recommend
Sample Size
Satisfaction
Likelihood to use again
Likelihood to Comment
Likelihood to Recommend
Provided
4721
85%
91
92
75
91
Not provided
288
5%
51
49
42
47
Don´t remember
576
10%
85
86
64
86
Asked
1898
40%
86
86
68
85
Not asked
1798
38%
95
96
81
96
Don´t remember
1025
22%
93
94
75
93
STRATMOR | GROUP
69
Mobile Messaging
 Younger generations over 100 messages per day, and growing
STRATMOR | GROUP
70
STRATMOR | GROUP
71