Positioning for the Purchase Money Market

By Kevin Crichton, President and COO, EMM Loans, LLC,

The mortgage industry is moving from an environment dominated by refinance mortgages, which the Mortgage Bankers Association (MBA) estimates accounted for 69% of all loans in the first quarter of this year, to one that is going to be driven by purchase money. The MBA estimates refinancings to decline to 48% of all loans in Q4 of 2021, to 44% in Q1 of 2022 and declining steadly to the mid 20%’s in 2023. This shift doesn’t come as a surprise, rather it is expected after the waves of refinancings and expected rise in mortgage rates. The key is to make sure your company is positioned to take advantage of the market shift. 

As in any time of transition, lending executives must shape a clear strategic vision that is easy to embrace. A recent study released by Fannie Mae quantifies some of the things that lenders are prioritizing in their business. Here, I put some of these findings into context and offer my own opinions on what lending executives should be focused on given the ongoing market shift.  

Steps to Prepare Your Lending Business  

Create a Great User Experience – There were 329.48 million inhabitants in the U.S. in 2020. According to Statistic.com 227.5M were digital shoppers. We have become a nation that looks online for purchases and many people value personalized, easy to use, integrated websites, tools, and processes. The mortgage experience you offer clients should fit this mold. Show the customer you know them, that you have dealt with numerous people just like them and had very successful results, and never forget that they are unique and have unique needs that you can address and fulfill. While people who have refinanced have been through the process previously, homebuyers might not have, so be upfront and tell them what is expected of them, this way there aren’t any surprises, and you foster a partnership approach. Throughout the process try to offer choices. For many it’s about learning about the options so they can make an informed decision. When communicating these points make sure you use a communication method the client is most comfortable with, whether that be text, email, phone or some other method. 

Streamline and Integrate Your Processes - Whereas some refinance options were very streamlined, purchase mortgages often require increased levels of validation. If not addressed, these increased requirements can lead to longer (close) times, a more complex, and potentially less than satisfactory, customer experience. The goal here is to make things as easy and fast as possible without losing efficiency. Streamline your processes by pulling data, not documents. This will reduce the need to reenter information and thus, the potential for human error. Integrating things like your CRM, LOS, data verification, appraisal management, closing and other services helps reduce the close time and can be key in presenting a seamless and very user-friendly experience. This, in turn, helps drive referral business. 

Evaluate Your Support System – During the refinance wave there was a shortage of qualified people. Many lenders hired inexperienced people to fill the gaps. On top of that, due to Covid many of these people had to be trained remotely. As the adoption of technology accelerates and business processes change, even existing employees must be retrained and shown the value of doing something, something they might have been doing a certain way for a very long time, differently. You want to make sure you have a buy-in from these employees. After all, technology often doesn’t do much good if people don’t adopt it. As volume tapers lenders should take time to fully address the training needs of these employees. Retention is hard enough these days, you don’t want to have employees who feel they don’t get the needed support. 

Expand Your Reach – As refinancing’s dry up, the overall level of originations is expected to fall. If you want to continue to grow, your lending business will need a larger share of the pie. Expanding your origination efforts into new areas is a logical way to increase your share. Some companies will do this by hiring more loan officers and branches, some might partner with builders, others will look to add more loan programs, some might look to develop new channels (wholesale, correspondent, direct to consumer) and others might grow through acquisition. There is no right or wrong way to grow, rather how you grow should be a function of your existing resources and how they can best be leveraged. For those with obvious gaps in their loan portfolios adding programs might be the answer. For those with expertise in other channels that haven’t yet been developed perhaps that is the way to go. For those with abundant contacts, expanding the existing model might be a good idea. For those looking to grow quickly and can manage transition, acquisition might be the best option. 

Financial Management – When origination levels shrink competition for loans heats up. While it might not be part of your strategy, you should know what kind of margin compression you can tolerate and develop a pricing strategy to address competitive moves. If origination levels drop, how can you be prepared to build business in a smart way without cutting jobs? As a cyclical industry, we should be prepared to adjust business size in more of a proactive rather than reactive manner. 

Expand Marketing – Another way to gain market share is through investing in marketing. As companies become more competitive, marketing will likely play into most strategies. Competitive noise is likely to increase, driving up price of marketing efforts. Still, for the creative marketing team, driving homebuyer engagement can help meet both short and long-term goals. 


As the industry moves from a refinance market to a purchase money market, companies should be taking steps to adjust to the new marketplace. In some cases, this might mean starting new initiatives, for others it might be just accelerating things you are already doing.  In either case there will be a new sense of urgency because the market is about to get more competitive, and a larger share of our audience is going to need an increased level of assistance.


On Q Financial appoints Marketing and Customer Experience Powerhouse Pamela Herrmann as VP Marketing

On Q Financial, Inc., a mortgage lending solutions provider, today announced that Pamela Herrmann has joined the company as VP Marketing reporting directly to Juan Rodas, On Q Financial's Executive Vice President. Herrmann will be responsible for aligning national marketing strategy and programs with corporate priorities. Central to her mandate will be optimizing demand generation, deepening borrower and Mortgage Consultant engagement, and amplifying brand visibility to fuel corporate growth.

With over 25 years of marketing consulting experience spanning B2C, SaaS, B2B2C, Herrmann has a proven track record in driving brand value and customer loyalty. She brings deep expertise in data analytics to transform marketing strategy, monitor end-to-end customer journeys, business process improvement, and deliver an exceptional digital customer experience that drives loyalty.

"I am delighted that Pamela will be stepping into this role," said Juan Rodas, On Q's Executive Vice President. "She will be pivotal in driving the success of our brand. I know her unique ability to focus on what is most needed to drive our business forward and support our people will take our brand and customer experience to the next level of growth and performance." 

Prior to On Q, Herrmann served as VP Marketing & Customer Experience for Mortgage Cadence, an Accenture company. In this role, she drove the company's brand identity, digital marketing transformation, and customer experience. Herrmann has also consulted on clients' brand, marketing, and customer experience strategies, including Denver Community College, the City of Grand Lake, and JetBlue. 

"Mortgage lending is in a perpetual state of evolution with market forces, technology, and consumer behaviors constantly changing. On Q Financial is perfectly positioned to extend its market leadership as mortgage originators digitally transform how they lend," said Herrmann. "I am honored to join this amazing organization and excited to enable the next levels of innovation needed to meet borrower and market demands."


EMM Loans Announces New Leadership Appointments

EMM Loans, a nationwide mortgage lender, announced that it has expanded its management team by appointing Jeremy Frey to National VP, Retail Sales and welcoming Brad Miller to the company as SVP, Consumer Direct. 

Frey will be responsible for expanding the retail sales force while supporting current sales professionals. His EMM tenure spans over 13-years and as a Top Producer and Sales Manager, Frey built a vast referral network program, gaining the trust of Realtor’s who continue to refer business. Jeremy will be sharing his knowledge and support current and future sales partners. 

As a US Navy Veteran, Miller’s focus on delivering excellence is commendable. He brings over 15 years of Consumer Direct and Servicing Retention expertise, and is charged with leading consumer direct efforts to further develop the company’s online digital mortgage experience with an easy and simple customer journey platform. 

Kevin Crichton, President and COO stated that the company is expanding it’s reach to the consumer while also expanding its Retail Channel and that Dan Williams, EVP of Sales started his search for the role of National VP of Retails Sales through the standard practice of first, searching within the company for opportunities to grow from within. Jeremy was identified as the perfect candidate and was excited for the growth opportunity, When looking for the perfect candidate to fill the role of SVP of Consumer Direct, Miller was selected for his leadership qualities and extensive background in mortgage lending.

EMM continues to grow and hire leaders that are making a difference. Come grow with us joinemmloans.com



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