The data-driven evolution of loan officer hiring

This article originally appeared in the MBA Newslink on August 11, 2022.

Let’s rewind time for a minute. Picture this: It’s 2015 and you’re sitting in your office, evaluating your next potential hire. You’ve just started building a relationship with a loan officer you think would be great for your team. They’re a top producer with a balanced book of business, plenty of mortgage industry experience, and a sales-driven attitude. In other words, they check all the boxes.

“What’s your average monthly production volume?” you ask. Production volume is one of the best ways to assess how an LO will perform on the job, of course, so you pose this question to each of your potential hires. “Three million dollars a month,” they reply. 

What now?

If you’re like most hiring managers back in 2015, maybe you’ll mentally divide that number in half – you’re talking to a sales person, after all! Perhaps you’ll ask your potential candidate to hand over their W2 and a copy of their compensation plan, knowing you might not get it. If you’re ambitious, you’ll attempt to look them up in your home-grown system of expensive third-party data and a giant Excel file. Or maybe you’re a true overachiever. In that case, you’ll go directly to the courthouse and collect the relevant records yourself (It’s true! We’ve seen it). 

For Josh Bayles, Branch Manager at Capstone Home Loans in Lynnwood, Washington, hiring without easy access to data was not only painful and slow – it had a measurable impact on his business. In fact, Josh recalls having hired one particular LO only to find out that their actual production was nowhere near what the LO had led him to believe it would be. This became apparent after several months of employment and thousands of dollars spent on IT, a workstation, and software, not to mention benefits. 

Josh Bayles and Capstone Home Loans are not alone. According to a 2019 McKinsey study, lack of production data is the number one cause of poor hiring decisions across the mortgage industry. Reflecting back on this period of time makes Josh shake his head in amazement. “We definitely made some hires that I wouldn’t have made after finding out what the facts were. Having data would’ve saved us that grief and expense.”

Now, let’s fast forward to today. You’re in your office, and you just got off the phone with a seemingly perfect candidate. They’ve told you they do three million a month in production. 

What do you do?

You turn to your computer, type a name into a search bar, and hit enter. Now, all the information you need about your potential LO – their production volume, loan types, work history, book of business of real estate agents and referral partners, and more – is right there in an intuitive, easy-to-use platform called Modex. 

Describing the transformation, Josh says, “Now we trust but verify, even if the candidate seems to be a fit. It’s been a real shift for the entire mortgage industry.” 

We built Modex to help branch managers save valuable time, resources, and money. It’s never been more important to make smart hiring choices, and we believe that having the right data at your fingertips is what will empower you to make the best decisions for your business. 

Learn how Modex can transform your hiring – get started with a free demo today.