Predicting the future of the mortgage industry with Shant Banosian
Author: Shant Banosian- The nation’s #1 loan originator
Author Bio: Shant Banosian is a Guaranteed Rate loan originator with a staff of 40+ people in Massachusetts. He has been in the loan business for just 17 years, and has amassed an impressive list of credentials in that time. Among other accomplishments, he has been the top originator in MA since 2013, and was the top originator in the US since 2018, funding $1.7 billion in mortgage loans in 2020. Shant emphatically credits his success to being disciplined, consistent, and committed to providing a world-class customer experience. We were lucky enough to get the chance to share cocktails with him as he mapped out his approach to loan officer success in the future for our industry, and this is what he had to say.
Where we’ve been
2020 was a sink-or-swim year where lenders saw huge growth potential, but also had to meet unfamiliar challenges. As business transactions moved fully online, my team met these challenges by developing a new strategy to connect with customers in meaningful ways. Everyone was working from home, we were conducting mortgage applications over FaceTime, Zoom, and Skype, and people were buying homes sight unseen. Those adaptations were necessary for buyers to be able to compete in such a tight market. It was a little uncomfortable changing at that pace, but being forced to go completely digital moved our business forward 5 years on the technological front over the span of 2 months. We had to onboard digital and automation tools and become quick experts in utilizing them to keep up with our client’s needs, and to differentiate ourselves.
Where we’re at
It might feel like the market is starting to calm down, but we still have massively low inventory, and massively high demand. Consumers are trying to navigate a fast-moving real estate market, and they need expert help. A combination of speed and excellent service are needed to provide a great customer experience. We’ve met that demand and leveled up our game by implementing digital mortgage technology. Our clients want information and data, and they want it right now, and we need data and automation services to provide that to them in real-time. That’s the new reality. That’s never going to change, so we’re embracing it. We’re constantly testing new digital products to see which ones will help us stay ahead of the game. As we try and test digital services, we’re basically functioning as a mortgage tech incubator, as well as a loan originator.
Borrowers are using the information available to them through our new digital sources to educate themselves and answer their own basic questions regarding to-dos and deadlines. That leaves us more space to be very responsive answering questions that require more personal attention. Communication is becoming more meaningful and more efficient. Conversations that used to take me an hour now take me 15 minutes because clients have so much information available to them. Additionally, the way we deliver and communicate our process is much more effective and efficient. Every stage of the mortgage process is becoming more efficient as we move to a fully digital mortgage. We’re at the point now with some of our clients where the whole process moves along through a totally touchless system:
- The client completes an online application
- They eSign all their disclosures
- We get a digital appraisal waiver through Fannie Mae or Freddie Mac
- We verify their income and assets through digital verification tools
- Everything comes into underwriting already verified, and we send them to a digital closing
- We use smart tech options to stay in touch with them going forward so we can recognize when they’re making strategic moves in the future, and it’s time to reach out to them again
Where we’re going
The Fed is using low interest rates to stimulate the economy, and it’s working. This means that more consumers will be looking to buy a home, even as inventory continues to be low because the builders can’t possibly keep up with the demand. The housing market will remain bullish for 3-5 years and we’re going to see loans closing in 7-10 days, and getting clear to close in 2-3 days. This has to happen in order to give consumers the certainty they need to buy a home in a highly competitive market. A short close allows buyers who are getting a mortgage to compete with cash buyers. Loan originators that want to keep up in this new environment will have to adopt digital technologies to get their close time down, improve efficiencies, provide proactive and responsive communication, meet borrower expectations, and create life-long customer relationships.
One of the questions I’m most asked is, “Will loan officers be replaced by technology?” The answer is no. We’ll still need top-performing experts to provide borrowers with that personal touch. For a lot of consumers, buying a home is the most important transaction of their lifetime. They need to have access to real people as they navigate that decision. Loan officers who stay relevant and responsive won’t be replaced by technology, but loan officers who don’t embrace technology will be replaced by those who do.
The professional hockey player, Wayne Gretsky says you have to skate to where the puck’s going. Right now, the puck is already headed towards fully digital mortgages. The technology already exists; it’s just a matter of addressing legal changes and updating policy to get digital practices approved, and we’re there. The days of borrowers patiently waiting out a long closing process are coming to a quick end, and a more efficient process is already becoming the expectation. A 60-day closing where the customer has to scan the same documents multiple times just doesn’t compare with a 7-day eClose with all the digital bells and whistles. It just doesn’t. The good news is that we have the tools to facilitate a digital mortgage, while giving consumers the data and information they’re expecting. Don’t fight these expectations. Deliver on them.