Some of the greatest in the nation Wholesale lenders spent most of the last month arguing over who is a better partner for brokers. It was a battle sparked by United Wholesale Mortgage’s ultimatum against Rocket Mortgage and Fairway Independent that had an impact across the industry. While conversations swirled in the media and here on the pages of Mortgage Professional America The question of who would be the best partner for brokers has been less talked about about what brokers need now as the market moves from a refi boom to a hot buy market.
Phil Shoemaker (pictured) wants to change that dynamic. The President of Originations at Homepoint believes that the best a lender can do for brokers right now is to give them insight and advocacy into the current market conditions we are in. After a record year of volume and market share growth for brokers, Shoemaker sees new challenges that come with the opportunities of a shopping market. He believes brokers need to take proactive steps now to ensure strong volume and consistent performance through 2021 and beyond.
“When people or companies have these great years [like 2020] It can get into their heads and people start to believe that their performance was the driver, ”Shoemaker said. “The reality is there have been a lot of top performers last year, but it has been one of the best markets we’ve ever seen and likely will see. As the market shifts into a buying dominated environment, I’m excited because I think this is really the time that brokers will shine. In this environment, we focus on helping brokers see the bigger picture. “
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The Shoemaker noted that due to the adrenaline rush of individual transactions and the brokers’ focus on their individual clients, it can sometimes be difficult to see the forest from the trees. In his opinion there is a Wholesale lenders can come in and give brokers directions on where the next strategic growth opportunities lie, and drive that growth with service and price.
Despite the challenges that will come with tougher sales, Shoemaker believes that brokers still have a competitive advantage. He pointed to recent tough markets such as 2017 when rising interest rates were accompanied by growth in wholesale purchase transactions. The shoemaker explained that this is because brokers offer scalability through their lender partners and personalized service through their local networks.
While confident that brokers will grow, Shoemaker hears a lot of fear from the brokers he has spoken to. Brokers, he explained, seek stability and consistency, which is hard to find in this rapidly changing world. He also sees fear of where the loans will go after they are closed. Shoemaker acknowledged that Homepoint stands out as an integrated servicer, noting that working with lenders who service their own loans, brokers get a customer loyalty benefit for the life of the customer, not just the life of the loan. When comparing Homepoint with some of the larger wholesalers, Shoemaker said their models don’t make it easy to store either.
“A lot of wholesale lenders say, ‘We don’t care about your customers,’ but they either sell those customers to someone who buys the service and really doesn’t care about that broker, or they keep quiet,” Shoemaker said. “Maybe they don’t chase the customer, but they have such a strong brand because they advertise in Superbowl commercials that the customer will really think more about that lender than the broker.”
Shoemaker’s Pitch is intended for a platform that offers brokers scalability and service, but comes about as a partnership without introducing another service party or a wholesaler with the same level of awareness as Rocket or UWM.
The purpose of this platform for brokers is to provide a means by which they can market their business across cycles. He believes that focusing on achieving consistent business during lean months and tough times will result in sustainable success, regardless of market conditions. Even as Interest rates plummet and lure brokers back into the refi businessShoemaker believes they need to focus on retaining customers in the long run.
“When refi booms happen you want to take full advantage of it, but you can’t do it by sacrificing the longevity of your company’s long-term buying relationships,” Shoemaker said. “So I find it incredibly important that brokers stay grounded in their communities, continue to build relationships with referral partners like estate agents and builders, and work with lenders who will actually support them over the long term rather than using an opportunity to bring clients into their own portfolio . “