Brian Hale of Mortgage Advisory Partners on the Current Market for Consultants

Brian Hale, a mortgage industry executive with more than 40 years of experience, recently launched a new consultancy business, Mortgage Advisory Partners, Newport Coast, Calif. He has grown several organizations into top-five originators. He has held numerous C-Suite positions for ClosingMark Financial Group – the financing arm of William Lyon Homes, Stearns Lending, MetLife Home Loans, MetLife Bank, Countrywide, Wells Fargo and Fleet Mortgage.

MBA NEWSLINK: So, what is Mortgage Advisory Partners?

BRIAN HALE: It is a consultancy offering guidance to mortgage companies of all sizes, home builders, realtors, banks, credit unions and fintechs who are involved in the mortgage industry. It is comprised of individual advisors who bring decades of experience and expertise having grown and run some of the largest mortgage franchises in the industry. All of us have actually led large organizations recently vs. some others in the space. We use detailed granular analysis, as well as talent assessment and acquisition, and partner with senior leaders and stakeholders to develop strategies to optimize results and improve profitability.

NEWSLINK: You’ve been in the business for more than 35 years? Why was now a good time to start a consultancy business?

HALE: Actually, in some ways the business found me. After leaving William Lyon Homes post the acquisition by Taylor Morrison, I began to get calls during the early Covid period from people I know and respect in the industry asking if I would be willing to work with them on a consultant basis for a variety of reasons from channel assessment, talent top grading, margin optimization, Joint Venture development, mentoring, offshoring, compensation design, report development and project management.

The industry has moved to an “outsource model” in many areas of the business and my partner advisors and I bring decades of experience on specific topics where we can lend a hand in strategy development and execution and then depart without the company having to hire executive talent for long-term costs.  Essentially it allows for “expertise-in-a-box” for a limited and defined time period. We are seeing immense demand and as the market and economics of the business get tougher going forward, we expect that interest to continue to increase.

NEWSLINK: Why is now an optimal time for lenders to think about new and different opportunities?

HALE: First, there is never “easy money” in the mortgage business but 2020 was as close as it comes. 2021 has seen materially tightening margins, higher costs, and challenges in growth (every company seems to say that they want to grow 30% and everyone cannot do that at the same time). Volumes are down and will likely be 50% of what they were in 2020 by 2022 / 2023 and the focus has to come back to managing every last basis point of revenue and expense, improving talent, entering new purchase volume-focused channels such as Joint Ventures, outsourcing to reduce costs and a variety of other strategies. Our team is uniquely capable of helping with all of those things and many more initiatives on an outsourced basis. We also offer executive recruiting for our engaged clients to help drive initiatives.

NEWSLINK: What do you see as some of those opportunities?

HALE: Purchased focused retail, Joint Ventures, outsourcing and offshoring costs, technology enhancement to improve delivery, improved marketing and brand enforcement, lowering costs per loan, improving margins through detailed analytics and many more.

NEWSLINK: Conversely, why is now a potentially precarious time for lenders?

HALE: In 2020, many in the industry focused on the refi boom that was and built cost structures and capacity to handle nearly $4 trillion in originations. We are headed back to a $2+ trillion per year market and capacity needs to come out and volumes need to increase from a shrinking pie. There are 5-10 very specific strategies that several of our clients are deploying to be ready for the new environment. In addition, Covid has ushered in new models such as remote work, a greater need for technology and the need for precise analytics to identify opportunities for optimization. Many of these models’ costs will continue to soar as revenues continue to contract. Bad things happen to good companies that do not make money.

NEWSLINK: Does being a consultant mean sometimes pointing out things clients don’t necessarily want to hear?

Every day. Having sat in several CEO chairs I understand the value of external views to challenge internal approaches. Sometimes the answers are obvious, but execution is lacking. Other times, new strategies are called for.

NEWSLINK: Where do you see the mortgage industry heading, in the short term and long term?

HALE: Because of Covid, all salespeople became some version of offsite sales and fulfillment deployed to remote structures that many are now embracing. Technology will be a key to the future.  For the last 25 years our industry had technology and workflows that could best be described as a horse and wagon. Technology improvement usually meant a slightly faster horse.  However, there are technologies today which can eliminate the horse and strap jet engines to the wagon, but senior leadership must lead from the front and be committed to the change.

Micro processing is leading the way, new sales models leveraging centralized sales and traditional loan officers are evolving, hybrid originators are evolving, compensation models are evolving, a tougher compliance regimen is likely ahead of us and smart players are assessing every aspect of their businesses.  The future is bright thanks to the demographics of housing, millennials moving to homes and new Covid-driven employment models allowing for remote work in many industries. And the future is incredibly bright for those who are prepared.

(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 msorohan@mba.org; or Michael Tucker, editorial manager, at mtucker@mba.org.)