Tom Gillen is senior vice president of capital markets for
Churchill Mortgage. He has more than 20 years of experience as a financial services executive, with expertise in
business development, product innovation and organizational leadership. Churchill Mortgage is a privately owned
by its more than 350 employees. A full-service and financially sound leader in the mortgage industry, the company
provides conventional, Federal Housing Administration,
Veterans Affairs and U.S. Department of Agriculture
residential mortgages across 46 states. Reach Gillen at
Tilt the Playing Field Your
Way by Going Beyond Rates
Borrowers ask about interest costs, but yearn for deeper
advice in the challenging homebuying process
By Tom Gillen
Traditionally, spring is when the mortgage industry sees a spike in the number of bor- rowers looking to buy a home. Even in a tightening market like today, this will likely
continue to be the case. As one would expect, the major
consideration for potential homebuyers is interest
rates, or more specifically, how high is the current
rate and how much higher — or at what pace — is it
expected to rise.
While it is true that interest rates have increased over
time to prevent our robust economy from overheating,
it’s entirely likely that the industry has experienced
most of the expected increase, and any further ones
will be less dramatic. This upward trend can be concerning for borrowers, but it is important to remember
that from a historical perspective, rates on a 30-year
fixed-rate mortgage are still close to where they were
in 2005, prior to the Great Recession.
The truth is that the mortgage industry has survived
(and thrived) off of a low-rate environment for years
now, with many mortgage originators and the lenders
they work with building a respectable business on
refinance loans and other similar products. In the
coming years, however, mortgage originators cannot
remain competitive simply by marketing low interest
rates, or they risk becoming just another provider in
a commoditized marketplace.
With a more level playing field in place, borrowers
will more than likely tend to evaluate originators and
lenders alike based on the additional value they bring
to the table with each and every deal. Moving forward,
originators will need to focus on serving less as facilitators in a process and more as mentors and teachers
capable of guiding borrowers through the mortgage process and building that all-important lifelong
The mortgage process is a highly emotional experience
for most borrowers, but especially for first-time homebuyers. This is why open, honest communication is critical to the success of any borrower-lender relationship.
In order for originators and lenders to provide proper
guidance throughout the entirety of the mortgage
process, borrowers must have faith that their originator is looking out for their best interests. By practicing
skills like active listening and using open-ended questions, originators can better demonstrate to borrowers
that they are being heard and understood, and tailor
their advice to suit specific borrower needs.
Education is perhaps the most significant aspect of
the borrower-lender relationship today. NerdWallet’s
ers who do not fully understand the mortgage process
are much more likely to face potential obstacles. This
additional stress on the borrower’s part often bleeds
into their relationships with friends and family as
well — all of whom are important as potential key
sources of referrals.
While it is important for originators to explain the
entirety of the lending process in detail and to outline
specific borrower responsibilities, it’s also critical for
the originator to evaluate the borrower’s long-term
financial wellness and help them understand the role
a proper mortgage plays in achieving their goals. This
helps them see the mortgage as a key component in
their overall investment and wealth portfolio for the
future. Doing so can help the borrower feel good
about their mortgage, and more comfortable working
in tandem with an originator who cares about their
long-term financial health.
The focus of a borrower-originator relationship
should extend well beyond interest rates, and also
allow the originator to prioritize achieving borrowers’
goals and determining the unique advice or insight
needed to fulfill long-term goals. The best, and only,
way to achieve this is to actively listen and develop a
relationship founded in honesty, integrity and trust.
In order to engage borrowers and distinguish themselves in the market, originators and the lenders they
work with should offer additional services tailored to
assist borrowers in their search for a home. This helps
simplify the borrower’s journey, and sets the originator up as a trusted adviser — one the borrower can
rely upon well beyond closing. Some initial strategies
to accomplish this may include:
■ n Pre-underwriting loans to ensure borrowers can
close on their home sale quickly and seamlessly.
■ n Offering programs that “lock” borrowers into
today’s current interest rate for a pre-determined
amount of time.
■ n Adding homebuyer workshops, such as eBooks
and blogs, to educate members of the community.
Rising rates require a new
approach to reach borrowers
■ n Serve as a mentor to the borrower.
■ n Foster open, honest communications.
■ n Educate the borrower about potential obstacles.
■ n Listen to a borrower’s long-term concerns.
■ n Distinguish your business by tailoring services.
■ n Incorporate technology to engage borrowers.
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