Unfortunately, the names of most mortgage providers in
Georgia are now different than those who were here pre 2009. Experience navigating a few recessions will
clarify what is going on.
First of all,
everyone does well in this segment of the economic recovery as long as they
focus on good core beliefs and are diligent in a few key areas.
The best thing management and a company can do during
this type of expansion cycle is to get out of the sales teams way and manage
service and the balance sheet.
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| Stimulus / Recovery Creates Crowded Waves |
The reason everyone with any plan, good or challenged,
are setting volume records is because of the economic consequences of an
expansion fueled by stimulus. This
brings me back to those taking credit for merely riding a wave in Hawaii that
was created by a tsunami in Japan.
Anyone with a piece of wood or pretty shinny fiberglass
board can ride these waves. Either with
style, too fast, too slow, or on their backs as the wave carries everything to the beach
or rocks. The key is which companies can
ride the smaller waves in the future with the same efficient board. Refer to my post http://southeastmortgage.blogspot.com/2011/12/low-country-view-of-recessions-from.html .
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| Very few can ride a recession |
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| Bad Strategy |
The skill for any company and or their management is how
they end the ride. You will either be
taking photo ops with your board intact for the next season of tsunamis or not
pay attention and destroy your board or even worse hurt yourself and others on
the rocks.
My Advice:
Manage the balance sheet to ensure it is not stripped. Cash is king, keep debt and other funding
liabilities low. Keep COGS and Operating
expense variable. Be a steward of our
industry by only placing sustainable product. Volume does not pay the bills, converting volume to profit is what pays the bills.
IMO this is the best course of action during this wonderful cycle we all
are enjoying.
My Advice to Licensed
Mortgage Loan Originators and
Non-Licensed Bank Loan Originators:
As volumes build for the reasons above and as the waves get smaller,
look deeper into the company you work for to ensure the reputation and brand
recognition you built for yourself does not hit a rock due to poor optics. The client's you serve today are the people
who will keep your volume up during the next downturn. If your company does not have an automated
awareness system that will keep your image and brand in front of your closed
clients monthly, find one that will.
This is you and your family's hedge to a stable constantly growing
standard of living. Chasing the next new
client each month is great during this type of cycle but when it ends and it
will, organic growth built during this time stabilizes your income. Southeast Mortgage’s profitable navigation of
past recessions is a direct result of this strategy. Of course the best service in Georgia helped
tremendously.
As it has in the past, all of these similar cycles end
the same way and this one is identical to the last 3 except it is has higher
octane fuel. The when is what changes
each time.
Cal Haupt
Chairman and Chief Executive Officer
Southeast Mortgage of Georgia, Inc.
