Nomi Smith of PMI Rate Pro: How to Build a Stronger Mortgage Business Now

Nomi Smith is Co-Founder and CEO of PMI Rate Pro, a company she founded after spending years as a mortgage loan officer frustrated by the difficulties involved in quoting private mortgage insurance for borrowers. She can be reached at

Nomi Smith

It’s time to make a decision. What will you be doing in 2022? If you’re in the mortgage industry and you think you’ll still be in the business next year, there’s a good chance you’re wrong. The business will shrink next year and many who are working here now won’t be here by the end of the year.

There are a number of reasons for this. From falling business, rising interest rates, the end of much of the refinance business and increased competition due to historic levels of M&A activity, this business is going to be a lot tougher in 2022.

But not necessarily for everyone.

There will still be a lot of real estate selling when 2021 has slid into the history books. Most of those deals will need financing and so some mortgage lenders will still be doing well in 2022. Do you know which ones?

Here’s a hint: the lenders that stay in the business when it gets tough will be the ones who have a strategy for winning borrower trust.

Trust is viral and it will bring the lenders who earn it repeat and referral business. Even more important in the short term, it will increase their pull-through by holding borrowers tight so they don’t leave for another financing source before the loan is closed. Finally, it will allow them to build stronger relationships with the business referral partners they depend upon for new purchase money mortgage business.

Trust isn’t typically a metric that lenders track when managing their business. So, how can you tell if your institution is building trust? You have to look at some other metrics.

How to tell if you’re winning borrower trust

If you’re a mortgage loan officer, loans closed is pretty much the only metric that matters to you. Fail to be in the top half of the LOs in your firm and you won’t be in that firm by the time 2022 slides into the history books.

You can pull the lever on this metric by doing certain things: find better mortgage leads, make more outbound calls, visit more real estate agents. Let me tell you about another way.

Today’s home loan borrowers are savvy. They get technology, they expect frequent communication and they want more information and better customer service. In short, they want to find someone they can trust. Lenders who give them better information will earn their trust, especially when it gets them a better deal on their next mortgage.

Failing to give borrowers sufficient information is the fastest way to get them to go to your competitor. And the information better be accurate. When a loan officer shares information about loan pricing with today’s borrowers, it must be accurate or they will take their business elsewhere.

When borrowers figure out which loan officer they can trust to get them the best deal, they will abandon the others and close the loan with that LO.

This means it’s more important than ever for the loan officer or broker to provide the borrower with information that is both accurate and capable of helping them save money on their mortgage every single month?

That’s how you win borrower trust and it’s more important now than ever before.

Succeeding in a fast-changing market

Things happen quickly in the home finance industry. The COVID crisis in the spring of 2020 launched a historic rise in mortgage loan volume that lasted for the remainder of that year.

Even though early estimates showed a decrease in overall loan origination in 2021, with interest rates for the year expected to average 3.1% in 2021, Freddie Mac is now predicting $3.9 trillion in volume this year. That will make it one of the best years for the mortgage industry in history. But it won’t last. Freddie says loan volume in 2022 will fall to $2.6 trillion. Other forecasters are predicting a similar future.

This means that front-line loan originators will be competing for a shrinking pool of mortgage business. Competition will heat up, but that’s not the worst of it.

At the same time mortgage business will get harder to find, the business mix will shift away from refinance mortgage loans to more purchase money business. The Mortgage Bankers Association has predicted that refis, which accounted for more than 70% of the average lenders production in 2020 will only account for about 25% in 2022.

Meanwhile, purchase money mortgage loan volume is already on the rise. MBA has predicted that new purchase money loans will rise over 16% in 2021 to a record high of $1.67 trillion.

Purchase money loans are harder to originate, they take more time and cost more money for lenders to close. In a purchase money market, every loan counts and you have to make it easy to bring in new business.

Finally, increased M&A activity is resulting in larger combined firms that have larger marketing budgets to spend on taking business away from other lenders.

If you’re going to succeed in 2022, you need to find an edge that will win you more business. You can do that by communicating more and providing more accurate loan cost information to your borrowers.

(Views expressed in this article do not necessarily reflect policy of the Mortgage Bankers Association, nor do they connote an MBA endorsement of a specific company, product or service. MBA NewsLink welcomes your submissions. Inquiries can be sent to Mike Sorohan, editor, at; or Michael Tucker, editorial manager, at