Episode Transcript
[00:00:00] Speaker A: Hello and welcome to the Mike Dupp show the Ultimate Hub where the hidden stories behind the mortgage industry come to life. I'm Mike Kelleher.
[00:00:08] Speaker B: And I am Michael Zhao.
[00:00:09] Speaker A: And in every episode, the Mike's dive deep into the entrepreneurial spirit, the strategic insights and the breakthrough innovations that build the world's greatest mortgage companies.
So whether you're advancing your career, scouting for industry leaders or exploring opportunities in fintech, prop tech, anything around mortgage or real estate, you're in the right place. Get ready. Unlock the story behind every mortgage.
Today's story that we're going to unlock is actually fun episodes for Mike and I. It's when somebody comes back and we're able to pick up from what their experience is, how they were able to get into the industry, what the industry means to them and really find out now the starting line were to start today what their vision is, what their strategy is and nobody on the national scene. I was lucky enough to have him come and speak at the Adopt the Brand conference where Mike and I were at. But everybody is talking about Ryan Grant because he has a unique model that is before disclosure. You'll hear me say it over and over again. Everybody focus on disclosure. To closing. The real winners gain market share. What are they doing before they get to the disclosure stage? For those listening, when you finally make your final decision, you say yes, they send you disclosures. That's what I mean. How do you find those people that are going from rent to own? How do you find those people that are having another kid and looking to maybe add another bedroom? How do you find somebody that is going to now come back from deployment and has a VA loan? Just all these different pieces are moving on. And Ryan has been a practicing loan officer who staked his career a 1.9 billion dollar personal originator over the years who has created a company around it where he co found and is president of Neo Home Loans, which is now part of Better Mortgage. Which beyond the clickbait articles you see about better Better has a really great way of attracting eyeballs. They've done it by having access to being on shows, people know who they are. And he has been able to use it not as an easy way to sit back and take orders, they call that an order taker.
He has found a way to provide his financial planning strategy and bring it to life and actually be able to serve more. So he's used it as a platform to serve more, I would say. So what is that platform?
Well, we have Ryan back here to talk to us about Really a future ready technology has with a trust built system. Thanks for coming back, Ryan.
So I don't keep going. Do you want to just dive in on where you are today and really what's changed since you were last on our show? About nine months ago, we'll say might have been six.
[00:02:59] Speaker C: Yeah, I really appreciate you guys having me back on and it was great being at the conference a couple weeks ago. An incredible conference. Looking forward to next year already.
Yeah, A lot has evolved since we spoke last and I think that my hypothesis is probably louder today than it has been because of the interest rate environment that we are in.
I think in a easier environment, a more emotionally stable environment for buyers and sellers, I think that our industry can continue doing what it's done for the past 75 years. But in an environment where everybody is very scared or nervous or curious, that is when the elevated mortgage advisor is needed now more than ever. And so I think that's why there's just a lot of curiosity around what we're doing, what we're trying to build and where we're trying to take the industry.
[00:04:03] Speaker A: With rates going up, you talk about being a builder and building systems and just I suppose building what, what a loan officer should think of them building themselves, like you kind of coach them to build. How has this rate environment changed your opinion of building? Meaning that maybe it's the speed to build, maybe it's a pivot on what we're actually building here. But how has it changed? Or what lesson can we learn from this?
Just for the listeners out there, the rates, they're about as high as they've been, I know since 2023. Really maybe since I got into the business in 2007, 2006. So when we mean change, sometimes you do have to change a little bit when the amount of people that can refinance are not out there or in your place. Brian, maybe the financial advice is changing.
[00:04:53] Speaker C: Yeah, I think our group has just very much doubled down on our philosophy of being the most important and the most valuable person in our clients lives when it comes to real estate or Finance. For 92% of America who doesn't have a financial planner or you know, a bunch of attorneys around them or CPAs or people that are just living in homes or want to buy a home that don't have information, our team is really proud that we can step into that space. We just need to be louder about it so more people can hear us.
[00:05:26] Speaker B: Brian, when I came in the business, I literally took a handwritten 1003, like by hand. And then I got introduced to Calyx Point and I was like, okay, computer, that's fine, I can deal with that. And then working and then moving from Point to Encompass was a big push for me actually.
And then for the last 25 years I would say they've dominated the industry. And now we're introducing a new technology in AI and that's.
There was an old way of doing business. And you think that way. I'm going to use the word could be antiquated soon.
What is the new way of being a loan officer today compared to the old way?
[00:06:13] Speaker C: Yeah, I think to be, and I'm going to use the term mortgage advisor because I think we should probably call ourselves what we want to be known as. I'm not a fan of the term loan officer, so if you hear me say mortgage advisor, just know that's a synonymous thing that most people think of a loan officer.
I think that there is a recipe to be one of the most effective and valuable sought after and productive mortgage professionals in the market.
And technology is just a portion of that recipe.
Technology will remove friction, it will allow for increased scalability, meaning you can help more families.
It will keep our teams in their genius zones, which is where they get a high return on investment and a high return on energy. They could do those things all day long.
It allows us to stay in two operating modes, which is business development and lead generation, which is how can we attract more people to have conversations with homeowners, prospective homeowners, and then once we've have enough conversations with enough people, how do we get into consultation with them? How can we spend more time with them asking better questions, removing fear, uncertainty really like highly educating these people for one of two paths, which is buy or sell now or buy or sell later.
And that's what mortgage advisors should be. Right. And technology again will, will allow them to stay in those, in those lanes.
But there's a lot more to that recipe than just technology. There's, you know, product capabilities, there's the way that we help our agents and our builders market current state inventory.
There's first party, primary lead generation.
And candidly, the thing that really powers all of that is the mindset of the mortgage advisor that we are so much more than anybody has ever expected us to be. And when they really start to engage with the modern mortgage advisor, they'll never go back. You'll never go to a standard loan officer who's just pitching rates and terms unless you have a, you know, kind of de facto family office around you.
You'll, you'll expect that of your mortgage professional moving forward.
[00:08:30] Speaker A: And when you, you've always sort of had this theory, right?
[00:08:34] Speaker C: Like, and it's worked, not always since 2018.
[00:08:37] Speaker A: Since 2018. And I think what has happened now is not only do you have the audience where people can hear it more because of technology, and you also have now loan officers that are capable of doing it that may not have been capable before because of technology. Like I always say, own, own their zip code. They can really show their zip code that they can be a financial advisor, at least have your financial advising plan ready for them, trusts, you know, tax advice, et cetera.
I think what happens though is like, now that technology has caught up, now that it's possible, and on the other end, it's also been able to, like you just said, you can start to take out these tests that are really just time wasters to go to, you know, market share.
So when I think of you and you know, then you see some media say, like, or a headline will be like the death of the lo by Ryan. To me, that reminds me of, I think it's called the straw enemy. Right. Like, I know it's a part of the straw man. The straw enemy is somebody says, should reduce, you know, spending a little bit on defense so that we can invest more in the public schools than, you know, in any argument. Somebody will come by, create a straw enemy and say, oh, he doesn't want to defend, or she doesn't want to defend our country. We're going to end up getting invaded. Who cares about the.
To me, I think people, the old guard creates a straw enemy out of the idea that the loan officer is going away in your model. And that's not what you're saying at all. But, but you see it a lot. Do you want to maybe just help clarify that and bring light to that? These, these naysayers are really creating something that is not. You can prosper in here and technology can take out some of that basket so you can put it in where you think. Yeah.
[00:10:33] Speaker C: What was interesting is after the panel that I was on at the, at your conference, the New England Mortgage Bankers Conference, you know, a lot of people come up to me and ask me questions and, you know, a lot of people were giving me feedback. And about a week later, someone says, I, I talked to this guy after your session and he said, like, oh, that's all bs. Nobody can do that. Like, we don't have time to do that. You know, we're not trained to do that. The consumer doesn't want us to do that.
And I think those are the conversations that need to be had out loud. Right. We need to actually have those types of debates if, if that's what they are. Right. But we, we need to stop saying what will or won't work behind each other's backs. We need to quite frankly, stop worrying so much about each other.
Different companies, different platforms, different compensation models. Right. Like you look at everything mortgage related in the media as it relates to like the mortgage industry media, and it's all this company, that company, this acquisition, this technology, this plan, this strategy. But none of it from, from what I've seen is around the conversation.
How do we not lose to an AI chatbot as an industry?
And we absolutely will lose to an AI chatbot if we continue down the path of quote rates, close loans, if there's no other value to our clients.
And we, we start to wrap our head around the fact that money and real estate is more emotional than it is logical.
How do we as mortgage advisors step into that space?
How do we make a broader commitment to the people who are entrusting us with something so valuable in their life?
Well then, yeah, whoever builds the best technology to reduce cost and quote and deliver rates will, will likely win, but the consumer will lose.
[00:12:35] Speaker B: How do you take the emotion out of it? I know, for example, like I was on, I'll just say my cell phone provider's chat box where the voice recognition began to frustrate me because I wasn't getting the answers that I wanted yet. Consumers who are price conscious on fees and rate, they'll just upload whatever they can. And DU and LP it has effectively for the agency, cookie cutter borrower, they effectively can just run through it and cut out the loan officer. And I'm going to say that tongue in cheek because you, you've effectively said mortgage advisor. Because if, if they're just running through it and uploading documents, they don't need an advisor as perceived versus what they need.
And I think there's a difference in the mortgage advisor being the financial parent and telling the borrower who could be an intelligent doctor, CPA lawyer, but fiscally speaking, they could be totally immature in their effective thought process.
And so how do we bring the education from the mortgage advisor as an industry so that we can, regardless of what profession, you could be a construction worker, or you could be a physician or a lawyer so that you can say, look, you guys are just immature as borrowers, fiscally speaking.
And yes, AI is good, but it's just a tool and not actually what you need.
[00:14:16] Speaker C: Well, I think you probably need to back up a little bit and ask why they're there to begin with.
Right. So if somebody's at the stage where they are uploading their documents into a mortgage lending portal, they have likely already made the decision that they are going to buy or finance a home.
And if we are just meeting them there, then we need to be the lowest cost solution for sure, because they've already done all the mental gymnastics to get themselves to that place.
But I'll bet you if you surveyed 10,000 prospective or current homeowners and you asked them what is their plan in a 7.5% interest rate environment with their current home or the home that they want to go into, you would get less than 1% that would give you any substantive plan.
And they don't feel good about that. It doesn't make them feel like they are taking advantage of opportunities. It doesn't make them feel like they are living a life with a plan and a strategy for their finances or their real estate. But who do they go to?
Like, can we answer that question for once in this industry? Who do the 99% of people who don't know what to do, who do they go to for advice on mortgage planning, real estate, selling a home, buying a home, accessing their equity, paying off debt?
The answer is no one, except maybe a family member because they're sure as hell not going to call a realtor or a lender.
Right, because they don't call us until they're ready, because they know we're salespeople.
I think that's why, you know, it's not a tech thing, it's a messaging thing, it's an availability thing, it's a value thing.
If we can start getting the consumer to realize that a modern mortgage advisor will help you years in advance of your transaction in a way that is effective, in a way that is holistic, in a way that is supportive and not sales oriented, then we have a real opportunity to make a difference.
But if we're just talking about tech and somebody who's already made the decision, yeah, we got to be cheap, real cheap.
[00:16:31] Speaker B: Is it time then for individual independent mortgage bankers, each individual company, not to police, but to test mortgage advisors on how to actually be an advisor. Not about equal housing, not about fair lending, not about, you know, about, about
[00:16:55] Speaker C: how long your jail sentence is if you break the rules, which basically testual
[00:16:59] Speaker B: but actual advice based lending that, that I've seen a lot of Originators lack in. So is it time for the independent mortgage banker to individually, because of the. Because each individual corporate culture is going to be the same.
Is it time for testing at the corporate level so that.
[00:17:18] Speaker C: Yeah, I think this is largely. This is largely a leadership problem. And I don't say this to belittle or speak down to any mortgage leader.
I think that if you just look at historically like I started in this business in 2005.
Nobody on the planet in 2005 was mentoring a mortgage professional on financial literacy and advice and guidance and strategy. It was literally close. Every single loan you can sell, every refi you can. Subprime mortgages, right?
And then you look at some of the largest organizations that exist today.
They were largely great originators. In the early to mid 2000s, they started mortgage companies.
And if you look at the main mortgage companies in existence today, they were relatively small in 2009, 10, 11, but they've grown to become massive. But who mentored those leaders on this?
Nobody. We just didn't have any. Like, nobody was trying to lead the charge on creating a more valuable mortgage professional. So this is an industry problem that has now turned into a current state leadership challenge.
And I will tell you from experience, it is nearly impossible to change the DNA of an organization once it is already in flight to a certain degree. Like once you get to a certain scope or size of mortgage company, you realize that 99% of the people joined your company for different reasons, right? They didn't all have the same mission, vision, just cause or approach.
But if the brand is all rallying around one opportunity, one change agent, then everybody is there for that reason, right? Everybody starts to lean in. And so I think that, to answer your question, probably more succinctly, yes, as an industry, we need to elevate the standard of the mortgage advisor. And my recommendation is we create something similar to the CFP for financial planners.
We make it a challenging test. We make it a legitimate test of financial literacy, generational wealth, holistic personal finance.
And we don't say like, you have to pass this test to stay in, right? Because there's still always going to be a place for the, you know, kind of the lower discount person.
But we put real marketing dollars and visibility behind the mortgage professionals who stood up and raised their hand and said, I've invested time, money, energy, resources into being this type of mortgage advisor, and this is what you can expect from me.
[00:20:00] Speaker B: There's a saying that says if you want to go fast, go alone. If you. But if you really want to grow, you grow as you go along with the group.
So instead of calling you Jerry Maguire and saying that you're going to be the pariah and go at it all alone, last week we had Mortgage Collaborative, we just had New England, which group of professionals And I don't want to call out names right at the second, this is not the platform to do that.
So how as an industry, either the MBA or the Mortgage Collaborative or another group, how does that happen in Fleet ers?
[00:20:41] Speaker C: Well, I think we could do it as individual organizations. Right. It doesn't have to be industry related. Right. There could be organizations that do it, but I think to create the differentiator that the consumer should be understanding of. If the three of us are all licensed mortgage professionals, let's make it very clear to the consumer what they're getting in their choices.
One of us has a CFP like designation, meaning that we've, we're a fiduciary which no one in the mortgage industry is, which is a problem.
Meaning that we are, you know, we've taken tests then we've passed those tests and we've invested time and technology and energy and money into being this person which itself in itself is a barrier of entry to kind of be in that space year after year.
Maybe one of us is somewhere in the middle and then one of us is a part time 1099 independent contractor who does mortgages once every four months, which is like 80% of our industry by the way.
And that should be really scary to the rest of our industry because if 80% of the time somebody engages with a part time, financially illiterate, likely financially strapped loan officer, then that's what they're going to expect the next time. And that's when they never call any of us, that's when they just ask Chat or Claude and I would encourage them to do that as opposed to the alternative.
[00:22:15] Speaker A: That's a real breakdown that I didn't think of. But the inability to classify in some initials acronyms the amount of effort put into educating and differentiating and not saying don't work with those but they the type of person that wants to work with a certain type of professional, it can start to at least segment it. And I think the segment with a lot more of that teaching will be the one that survives where, where the world is going. And that's what I love about you, I think, and I always said this with my mobile app, it often felt like the leadership in mortgage was like that scene from Shawshank Redemption where the gentleman gets out of jail and he just can't understand the new world and actually finds it easier to go back to jail. Right.
And I think you're like financial planning model is certainly one that passes what you're saying about like AI, Like I think at the end of the day, I think the industry is blind to the fact that real estate agents will have bots like Muse that just came out for Facebook. So now we're all like, okay, now I get what it is.
It's the fastest growing app. So it's like, okay, now I get how adoption happened so fast when I was saying it wouldn't.
When the agents have bots that can read that just talk to lenders websites and the new ability to bot, to bot talk, there is going to be so much activity that the loan your loan officer still might get. I'm not saying it's an extinction model, but it's going to screen, we'll call it. A lot of the people that just don't want humans, they want fast and cheap and so the pool gets smaller. But then those, the rest, the leftovers get more informed and they'll be looking for those type of designations. They'll, they want that. Where do they find it? And I think the way you move it is it's probably through loan officer migration. The neo home loan loan officers don't think they can live without that model. So even if they wanted to leave you, they have to, they have to try and teach the new company to slowly adopt it. I think that's really how we make any change, unfortunately in our industry is through loan officer migration requiring it at new company because it was, they couldn't live without it at old company.
I guess that's my, my long winded way of saying I really like what you're doing. I think it's, it's going to be super effective. And I think that's the one thing AI can't replace. Even if it could. Technically, nothing's more frustrating. When you get too deep on a string, right? I mean like a chat, then you kind of lose focus. So that's where you need the human to constantly sum it up for you.
And can you talk about how it translates though? Like we're talking at the transaction level.
One of the more compelling parts you talk about Ryan all the time that I can see is look outside of some interesting models.
This is the most legitimate way to have residual income. Even though it's not tied to a loan, it's tied to the relationship of giving the financial advice. Can you Talk about the lifetime value of how this would work out, too, for a loan officer.
[00:25:39] Speaker C: Yeah. At the Housing Wires Mortgage Banking Summit on Thursday. I'm actually talking about this specifically because I'll be there. Yeah, we are. We are. As an industry, it feels like going down the path of whoever is the debt collector or the payment processor of that person's mortgage is now anointed the lifetime lender.
[00:26:04] Speaker A: Don't get me started.
[00:26:04] Speaker C: Which is like the most depressing thing I can think of. And that's not a world I want to be a part of at all.
Right. But there was an aha moment for me in 2018 when we finally made the decision that we won't be a dollar more expensive than the cheapest lender in the country unless we can quantifiably show our clients how valuable we will be in their life.
And so we just went all in my personal production team and we realized in a transaction or leading up to a transaction, people are hyper emotional.
Right. And it's all very much on, like, black and white figures. So they're hyper emotional on the cheapest rate, the cheapest price of the home, the cheapest monthly payment. Right. All the things.
And it's a really scary time because people don't want to do something dumb.
And I just realized, hooked on the.
[00:27:02] Speaker A: When I used to originate, they were hooked on the rate so much more than the payment. Is it still. Just. That's the psychological motivator, or is it both?
[00:27:10] Speaker C: Nowadays, the payment is the. The logical one. The rate is the emotional one. Right. Because the last thing you want to do is go to a barbecue and you know, everyone's talking about, oh, I just bought a house, Ohio. I got a seven and a half, I have a four.
Like, you just feel dumb. You don't know why. Right. You don't have any context because your loan officer didn't teach you anything.
Right.
[00:27:31] Speaker A: We always said that's why firefighters are tough, because they're around other firefighters 24 hours a day and.
[00:27:38] Speaker C: Yeah. Just talking about their life. Yeah.
So we said if we can just show people the difference between owning a home and becoming a very successful, well rounded, generationally wealthy homeowner, we could really start to tell our story.
And so we developed our entire presentation to our clients off of this premise, which was, Michael, if you buy a home today, you'll own a house.
But do you know what to do for the next 30 years to create real generational wealth for your family, to avoid pitfalls, to make sure you're safe and protected, to Take advantage of opportunities as they come. Are you prepared for that?
And every person will say no.
99.9%. Yeah.
So we just started mapping it out for people, right? Closing day is this.
But talk to me about estate planning. We don't know anything about it. Cool. Talk to me about all the appropriate insurances you want and how life insurance plays into this. We don't know.
Okay. What are you going to do as your family's life changes and evolve? Death in the family. Inheritance, college, Investing in real estate for your children.
No plan for that. What about tax strategies? Not sure.
Okay, well, I think here's the difference, right? The difference is that 99 out of 100 people believe that's their responsibility as a homeowner to figure those things out.
We believe it's ours.
And so here's what we are going to do for you, Mr. And Mrs. Smith.
Here's what you can expect from us every day in year one, every day in year two, all the way through year 30 and beyond.
And our clients are not choosing us because we are the cheapest.
They are choosing us because we are the most valuable.
And I literally had a client turn and look at her husband and she goes, this is after a mortgage broker beat me by three eighths of a point.
And she says, if this team's going to do all that, we're not shopping anyone. Because you could see the light bulb go off and they realized, oh, this is just one part of an infinite number of steps.
But no one else has made that commitment.
[00:30:04] Speaker A: Yeah, I could even break it down to. I've always been a fan of arbitraging. I try to articulate the. My clients like my ability to see arbitrage is. Or stacking is. Is where you can win even a credit card.
If I go to the airport 50 times a year and it comes with the lounge, and my experience is better.
It might not be the lowest rate on the credit card. Right. Or. Or the longest zero percent, but it's. It's like stacking those benefits you get. And people have now come around to buying credit cards that way. They're still stuck on just the rate in mortgage. And it's awesome that you're going to change it. And you say just how important partners are. And we, we believe that too. That's why we align ourselves. We couldn't do this without some of our sponsor partners. We think they help lenders with their. As a partnership as well. So we're going to listen to those sponsors that we're thankful for. And on the other side we're going to talk to you Ryan. Just some action plans on how you do this, what other loan officers should know about it, and how you brought it to life. And again, where it's going to go from here. See you guys on the other side. And please reach out to any of these sponsors.
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[00:35:55] Speaker B: And thanks to our sponsors because without them we're just not able to be able to speak to not only our guests but also to to our audience as well. So thanks to them for the for the capacity and ability for us to be able to bring this valuable insight from all of the leaders in housing Ryan if you ever meet a financial advisor who's taken either the Series 7 or the securities Industry Essentials exam recently, one of the things that they ask on the exam is about the term selling away.
And the term selling away means if you are an investor with a financial advisor, Series seven, past financial advisor, or a registered investment advisor and you want to take someone from stocks into housing according to FINRA regulations, you actually can't do that because that's considered selling away.
Whereas in housing, if you're a mortgage advisor, you can. Although you're not licensed to sell securities like stocks, bonds, mutual funds or whatever, you're licensed to originate debt mortgage loans.
You still can, without license and provocation, provide some sort of friendly advice as if it was a barbecue.
And I think the value in the mortgage advisor allows them to provide some information and insight on housing that the financial advisor or registered investment advisor just can't by regulation and doesn't also by habit.
So how does how do we regulate ourselves either through the Mortgage Bankers association or through our state regulations?
How do we provide value as an advisor? In the past it was the cmps, but that's not as proficient or popular or whatever you want to call it now. So how do we do that to where we can provide testing or better advice rather than sales?
[00:38:02] Speaker C: I think the question is do we want it to be industry regulated or do we? Because if it's industry regulated, it can also be industry promoted, right? So I was talking with people the other day, I'm like, there's does no good for any of us to obtain these designations without the consumer having a frame of reference on what it means.
Right. If I, you know, if you guys show up on a webinar with me and I'm talking to you about buying a home and I say, by the way guys, I'm ABC XYZ designated.
And they go, what's that like? Oh, it means I'm a the best mortgage advisor in the world. Okay, right. Like where is that corroborated? Where is that truth?
Right. And so I think a lot of these things, you know, these designations were largely marketing and business generating or income generating businesses.
[00:38:55] Speaker B: Sure.
[00:38:57] Speaker C: But if we really do want to regulate it as industry, we just change the test.
We actually create financial standards, credit score standards and we create a world where, you know, we feel confident in the mortgage advisors that are giving this type of advice. Because you said, you know, we can, but I would take that a step farther and say we should.
Right. Because wealthy people aren't wealthy because they have money. They're wealthy because they have information.
But who in most people's lives is supposed to give them that information when they don't have enough wealth to pay a financial planner or wealth manager to do that?
And the answer is, unfortunately nobody. And so this is why we have this massive gap between the haves and have nots. And I believe our industry is uniquely suited to solve that.
We just have to ask the question, do we want to elevate the standard and really showcase what's possible and fill in a massive information gap or do we want to just continue to have a misaligned system where we let anybody in as long as they can essentially fog a mirror and then they get to go give pretty disruptive advice to people which is largely one sided in my opinion.
[00:40:16] Speaker B: So how do you roll the, the, the Neo, the NEO home loans type of system where you can roll this out for the originator so they can have clients for life, so they can have their team, so they can have, so we can create this corporate culture. How do you roll this out for them?
[00:40:33] Speaker C: Yeah, it's really prescriptive in our process.
[00:40:35] Speaker A: Right.
[00:40:36] Speaker C: So when people join nio, we, we make it very clear as to why we exist and we almost challenge them to say like, look, we will kind of pass on. Right now probably 80% of the people who are reaching out and a lot of people are just reaching out to us because we're getting to the client first. Right. We have 10,000 people a month going to the, going to our website, applying directly for a mortgage or our economic model. Right? Because our economic model is very aligned with their business.
But we just challenge to say, like, look, here's what we do. We record everything, we watch everything. And then because we have a team of client success managers, they will tell us, like, let's say Michael is the mortgage advisor at neo, right? He's been here for six months.
And well, you're both Michael. Let's say Mike Killer is the client and Michael, you'll be the, you'll be the client success manager. You could come to me and say, hey, Brian, like I've now had 10 client or closing calls post call, we call them launch calls, which is basically right at closing, we explain the next 30 years to the consumer and what they can expect from us.
If that consumer continuously says, like, I've never heard of any of this, like, I don't know what you're talking about. Like, who are you? Why are you calling me? My loan closed.
That means that Mike Kelleher is just selling loans. He's not actually committing to what we have committed to as an organization. And so then we, that's an opportunity for us to coach Mike and mentor him and help them understand it. So we have training mechanisms. When you start, in order for, in order to engage in our lead generation platform, you have to, you know, watch videos, you have to pass tests and then you have to submit videos of what we call game film.
So our mortgage advisors submit their game film of their dreams and goals, calls of their client consultations of their contract meetings.
[00:42:27] Speaker B: Wow.
[00:42:27] Speaker C: And then our leadership is reviewing those calls and we're scoring those calls saying, like, okay, you're ready to like, you can now go out in the world and, you know, be a NEO mortgage professional, knowing that like, we can put our weight behind you. And now we drive a ton of leads to you and you can go take market share with realtors and builders.
And we're not perfect and we have a long ways to go, but it's a standard that we uphold and it's largely the reason why we exist.
I was just, I was tired of being celebrated for doing a lot of loans and selling a lot of debt when not actually helping anyone.
[00:43:07] Speaker A: What has been your understanding of the connectivity of this model, especially in a digital future? For example, in the past, the Costco program was considered the greatest program to ever hit mortgage, possibly ever.
The amount of loan lenders that went from 300 loans a month to 900 loans. Like, we all watched it then lenders one launches a program with Walmart and I think a larger lender also has worked with Walmart in the in the past.
Just didn't work at all.
I think there's another example of another retailer that you could argue the clientele the median income was closer to Costco but it didn't have that membership piece. So as you're starting, you know as better starting to work with Credit Karma. I know Sage Home Loans is working with Robin Hood is and then your financial planning model. Can you talk a little bit about what you're seeing in the market and what you think the future? Which connections will be more like Costco and which ones will be more like Walmart in the future?
Yeah, that might not be a brand to partner with. Could be a financial planning strategy. Like what, what connects people and what do people think is not the same love that they get when my mom talks about Costco all day long.
[00:44:36] Speaker C: I think what people love about Costco is they do feel like they're you know, they have membership into something that is genuinely valuable. Right. I think you'd be hard pressed to say that you don't get good value from Costco. I think most people would say they do Walmart. I don't know if that same thing is true.
You know I think you can say you get low price which is different than value.
But I think the future in my opinion of really where the consumer meets the mortgage advisor is mortgage as a platform.
So mortgage as a platform is what you're seeing with us in Credit Karma and us and Coinbase and us and OpenAI.
Right. Where if you just ask your phone on OpenAI right now it's chatgpt what's the best online lender for me to get my mortgage approved? We come up number one every time.
Right. And so then you click that and then you get introduced to one of our local mortgage professionals in your market.
So key is like who has a broad audience of people who are interested in real estate or finance. That could be an entry point.
[00:45:44] Speaker B: Right.
[00:45:45] Speaker C: And that could be any online real estate company. It could be any financial resource center. It could be influencers. Right. We partner with a couple large influencer CPA firms and the, the question is how can they add value to their clients?
But then we run into the same problem that a lot of people run into today, which is most people today are not excited about a 7 and a half percent mortgage on their home they're about to buy, but they still want to buy a home. So what do they. Do they go online and they DIY the experience?
And we are still figuring this out with our 10,000 plus people a month coming to our platform. A ton of them still say stop when we try and engage them as a human, because they didn't ask to be engaged by a human. They just wanted to do their diligence. They wanted to kind of go online and be anonymous in their search because they have a healthy.
And I think disdain is probably too hard of a word, but they see us as salespeople and they don't want to talk to a salesperson. And we have tons of chats with our clients that are like, stop, not interested.
And then we'll send them a link that says, like, hey, if you're just early in the process, here's some things that are helpful to know. And then you see them engage, right? Because we took the sales culture out of it, right? We took the pull your credit, run your app, you know, sell your loan off of the table.
So we have to a find the consumer where they are, which is largely online. Coming from trusted places like they trust Costco, they trust Credit Karma, they trust whatever platform they've started on, meet them where they are, and then just offer them something very different. We're not offering you a mortgage. We're offering you the opportunity to connect with an advisor who will give you advice, guidance, answer questions, give you a strategy. But at no point will you be sold alone.
I think that's the future. It's just we have to be loud enough to get people to realize that's true. And we have to get out all the other people who, quite frankly, like, if you look at that 80% of the mortgage industry, they're in such financial peril themselves, personally, that when they get someone on the phone, they don't have the financial bandwidth to say, you know what, Michael, let's just ask you something. Let's just ask questions. You don't have to buy a house. You don't need a mortgage. Let's help you, right? And if buying now makes sense, cool, we'll go down that path. But if buying later makes sense, we can go down that path too. But if I'm 60 days away from missing my mortgage payment, you better believe I'm selling you a loan.
[00:48:27] Speaker B: Is buying a home today because of the increase, or I'll call it inflation, of. Of pricing, of housing pricing in the last four years?
Is buying a house today a luxury product? And as a result, should we be providing luxury experiences? I know, I live in Southern California, where in the area that I live in, the median average price is $980,000.
And you know, so whereas in other parts of the nation, median price is going to be significantly lower.
And so is it a luxury experience by and large, in Los Angeles, Seattle, New York City, Chicago, Miami, or do
[00:49:09] Speaker C: we take it that way? I think it's pretty market agnostic in the sense that what the average person realize they get for their money has drastically changed.
Right? You could be in the middle of the country and, you know, not a coastal market, not a high value, high target market.
You know, a place like where I grew up. I grew up in a small little rodeo town in northern California with 4,000 people.
But when I go look at what 400,000 gets me there today, I'm shocked, right? So I, I, it feels luxury, right? But it's to the rest of the world, it wouldn't be, but it's all relative to my income, my demographic, right? And I think that's the unfortunate truth is that most people feel like it is only for the wealthy or the people who already have money, who can get into the real estate game.
And that couldn't be farther from the truth. It just requires curiosity, openness.
It requires somebody to sit down and say, hey, I know this might feel far away, and who knows, it might actually be far away, but you shouldn't have to figure that out, right? We're professionals. This is what we do.
But who in their right mind would ever make that phone call to a loan officer and say, hey, I'm really curious. It feels like homeownership's super far away. It feels overwhelming. Feels like I'm never going to get there.
Can you spend some time with me and I can tell you my situation? I can talk to you about, like, my family, my parents, their situation, my life, my job.
And can you just like, give me some advice on if you think this is right? Like, is anyone in America going to do that to a loan officer? The answer is no. Why? Because we have not told them that we will do that.
So what, we get this percentage of people who have already decided and gone through that themselves, and then they say, okay, I'm ready. And we're all competing against that for that one person, which is crazy.
[00:51:17] Speaker A: But we've given them the feeling and I kind of see it now, that I don't originate, where if they give us a little bit, there's like this obligatory way that they have to work with us for a while, an attachment, where when you go into, say, a car dealership, you can always just blame it on the car because the car deal, the, the car salesman can't go sell you the other car at the other dealership. So it's in. The more you know them too, I think it makes it harder. They don't know. We have not like you said, articulated well enough like it's a numbers game. The more advice I give, the better I do. Please let me give you advice. And then that's part of maybe the message you've been saying throughout.
My question for you as we're coming here to an end is you said earlier this year, the people who gain ground in difficult markets usually aren't doing anything better. They figured out where they have the advantage and they keep compounding it or they keep doing that part better. They're not overall, quote, better.
So you grown your salesforce while the rest of the industry has been contracting.
You've made a strategic bet on the advisors.
I heard a naysayer like you said, kind of say, yeah, if I did a thousand purchases last year, 900 of my clients just want to know the rate and the payment. They don't want to buy financial advice. Even if they were, even if they were interested, you know, they're never going to implement it anyway.
I guess I'm asking two questions here. So like that's the hard market. That's the hard part. Everybody's saying against.
There are loan officers though that are looking to double down on something and do it great when they come over to Neo Home loans. I guess I was saying are they getting into the system? Are they getting into you teaching them? Are you finding out what is best about them and helping them discover what they are?
Is it a whole financial planning package that they're doing or are you finding out what they're most talented in within that financial. And you're telling them double down on that part trusts or, or tax advice?
[00:53:25] Speaker C: I think, you know, first of all, a lot of that is done before anybody would come on board because we want them not only aligned from a business and economic perspective, but we want them aligned from a philosophical perspective.
Right. We've had plenty of people leave because they just felt out of place.
I like they didn't want to be an advisor. They just wanted to sell loans. And that was our fault, not their fault. We just didn't set the right expectation.
And we've learned that over time. But you can't give away what you don't have.
You can't tell someone how to manage their cash flow, how to Consolidate debt, how to plan for their next real estate purchase, how to create maximum tax advantages through cost segregation, how to plan for estate planning, how to create generational wealth with parents and children.
If you're not at least pursuing it in your own life, I'm not saying you have to be Warren Buffett to give away advice, but you have to at least be pursuing it.
And I think that's where most of our industry fails, is that they feel somewhat of the imposter syndrome of saying, hey, let me help you understand what to do when no one's pouring that into them.
I say this a lot, but I believe, and you can call this egoic or prideful or whatever you want. I just, I believe it because I've been in this industry for 21 years.
I am constantly around the top mortgage professionals in the United States because I put myself in those rooms.
I believe that we have some of the most financially literate, highly intelligent, emotionally engaged mortgage advisors. But it is because we work our tails off to be that every week we train on it, right? We share game film, we watch game film, we dissect the conversations, we ask, how could we have been more valuable? And then we get feedback from our clients and our. We have a whole client success team that actually delivers the mechanism on behalf, the commitment on behalf of our. Of our team.
And then, you know, we do financial literacy trainings every single month, not just for our originators, but for our whole organization. Right? We want our underwriters to feel this.
We want our closers and post closers to feel this, because we'd be kind of out of integrity if our clients were the only ones winning and we had a bunch of teammates that were struggling.
But that's just a decision.
It's not anything other than us saying, this is how we want to feel. This is the fulfillment we want in our job. And sure, like, I bet you there's a ton of companies that they did a thousand purchase loans last year, and 900 of them only wanted the.
The cheapest rate and cost and payment information. But that's because they're getting to them at point of decision, right? So, yeah, you were in the audience when I asked that question, like, who here thinks it's good to get a phone call from someone that says they know what to do? And everyone raised their hand like,
[00:56:30] Speaker A: yeah, should have already known, Ryan.
[00:56:34] Speaker B: We have a newer section in our podcast. It's called Three Answers, Three Quick Answers. I'm going to ask you three questions, and if you can give me three quick answers, Then just go ahead. Okay, first question. One piece of advice for the version of you who was still just originating. What is your one piece of advice?
[00:56:57] Speaker C: If I'm just originating today, Focus on the maximum areas of opportunity, which I believe is helping our builders and our agents manufacture affordability in their product.
[00:57:14] Speaker B: Good answer.
One book or one habit that changed
[00:57:19] Speaker C: how you lead the infinite game by Simon Sinek. And it is focusing on the just cause, not being concerned with who's winning today. Like it? I, I try and stay out of the high school cafeteria that we are in on LinkedIn as a mortgage industry, but everyone is so focused on right here, right now of who's number one, who's winning and who got the most loan officers and who's recruiting. And nobody at all is focused on the big picture of being the most valuable mortgage, even industry to the consumer. And so that book has helped me zoom out to not look at like a finite who's number one, but look at who's going in a direction that we can be proud of.
[00:58:05] Speaker B: And this isn't in, in the email we sent to you, but I'm going to ask you thank 2015 u for what you did to take you to where you are today.
[00:58:17] Speaker C: Mentorship Easy 2015 was the first time I knew that you could have like a coach or be in a mastermind with other mortgage professionals. And that was the year that I went from being a good mortgage hobbyist to a good mortgage business owner. And it set off everything in motion to continue to create my curiosity, to be around other people that I thought highly of or that I thought I could learn from to kind of shortcut my, my future.
[00:58:48] Speaker A: Do you have any final messages? You're going to be at the housing wire. You just came from New England.
As you travel on these stages in different geographical regions with different types of leaders giving a message, we always say this. One of our favorite parts of this show is like for the people that can't make it to the conference or they don't want to be sent to the conference by somebody fearing recruitment, I guess. What is your message to those people that haven't been able to go to a couple of conferences you've been at? What's been the theme and why do you keep showing up?
[00:59:23] Speaker C: I'm trying to help people either create curiosity or stay curious because in a, in an industry or environment where we all feel like we have to have all the answers or we have to be at the right company or we have to have the right platform or we have to have like those are all finite ways of thinking and those are all very short term.
Just stay curious as to what's possible. Just because we've done something for 75 years the same way, it doesn't mean we should double down on it for the next 75.
We have the opportunity to completely change the course of our industry, but with a closed minded mindset. That'll never work. We can't do like, you can tell me a thousand reasons why you think I'm full of it, but what if you just ask your question. What if he's right?
What if we could do that?
Would it be more fulfilling for the mortgage advisor?
Could we have more successful, more more energetically rewarded mortgage advisors? Can we have more profitable organizations that aren't racing to the bottom? Would the consumer ultimately be the beneficiary of a different narrative?
The answer is likely yes to all those things.
[01:00:35] Speaker A: And that yes can be found on Ryan's great YouTube page. So if you want to follow from you can either reach out for Neo home loans or you can follow along till the time is right on these as one of the better YouTube pages of the anybody we've interviewed here. So give him a subscribe and a like. Please give us a subscribe and a like. And if you're listening to our audio podcast, we love any subscribes likes to increase our audio listenership as well as our YouTube viewership. Thank you Ryan again for coming on. We really appreciate it and we appreciate all of our audience and our sponsors.
[01:01:13] Speaker C: Thank you guys. Appreciate you.
[01:01:14] Speaker A: Thank you for joining us on this journey into the heart of mortgage innovation. Every mortgage has a story and we're here to help you write yours. If you enjoyed today's insights, please subscribe, leave a comment, share it with your network and connect with us on social media.
Until next time, keep pushing the boundaries and uncovering the stories that drive our industry forward.
