STRATMOR: ‘Significant’ Competition for Seasoned Mortgage Loan Originators

STRATMOR Group, Greenwood Village, Colo., said significant competition exists right now in the mortgage industry for seasoned mortgage loan originators, particularly among independent mortgage bankers.

The company’s most recent Originator Census Survey, sampling nearly 17,000 retail originators, showed nearly 60 percent of originators had been with their current company for less than two years.

“This simply underscores what any industry veteran knows: originators like to change companies,” said STRATMOR Senior Partner Matt Lind.

Lind noted because of a “multitude of factors,” the mortgage industry today is smaller than in recent decades, and both short and longer-term growth prospects are smaller as well. “In this kind of environment, a key strategy for growing origination volume and market share is to recruit seasoned originators while, at the same time, retaining the productive originators a lender has on staff.”

As a result, Lind noted, recruiting has become a “competitive affair,” and retaining seasoned originators more difficult than ever, particularly for independent lenders. “This reflects the focus of independents on highly-prized ‘Hunter’ loan originators versus the focus of banks on ‘Gatherers’ who can work as well off of bank referrals,” he said. “In both cases, banks and independents were far more likely to pay incentives to recruit seasoned originators than to retain originators.”

Likewise, both groups agreed that increased commissions–along with non-refundable signing bonuses–were seen to be the most cost-effective incentives when it came to both recruiting and retaining.