GREENWOOD VILLAGE, CO – November 19, 2020 – A mammoth shift in the mortgage lending landscape and a growing emphasis on company culture are just two of the major changes the mortgage industry has experienced over the past 40 years, says STRATMOR Group Senior Partner and Co-founder Jeff Babcock in the company’s latest Insights Report.
In the report, Babcock, who is set to retire at the end of the year, shared some of the lessons he’s learned since the mortgage advisory firm was founded in 1981. The number of strategic opportunities, challenges, changes and outright threats that the mortgage industry has seen during that time “literally staggers my imagination,” he notes.
According to the InFocus article “STRATMOR Celebrates Our Founding Partner Jeff Babcock,” one of the biggest changes has been the trend towards less concentration of volume among the top mortgage players. Not counting mortgage brokers and vendors, the mortgage industry is currently home to several hundred lenders of scale, with significant fragmentation among them.
“Today, the top 30 lenders account for less than 60 percent of the total market, down from 90 percent just 10 years ago,” Babcock says. “Further, our industry still has relatively low barriers to entry, despite complex regulatory requirements, thus creating great opportunities for upward mobility.” He added that 23 of the top 30 lenders today were not among the top 30 lenders 10 years ago, according to STRATMOR Group’s research.
A few more of the lessons Babcock discusses in the article: Independent mortgage banks are here to stay, company culture is critical to achieving success in the industry, and winning teams are built on collaboration.
Babcock’s Legacy
As his retirement approaches, numerous colleagues and clients have praised Babcock’s contributions to the industry.
“Jeff uses the data that STRATMOR collects very wisely,” says Rob Chrisman, STRATMOR senior advisor and author of the popular Rob Chrisman Daily News and Commentary. “His grasp of trends in the business is matched only by his curiosity about the industry. He is very good at asking the right questions and then analyzing the answers against what he knows or has heard from others.”
“I’m a raving Jeff Babcock fan,” says David Hrobon, chairman and CEO of Wintrust Mortgage, who worked closely with Babcock to identify acquisition targets for his company since his firm joined the MBA and STRATMOR Peer Group Roundtable (PGR) program 20 years ago.
“Jeff works as a salesperson in the beginning, and then he takes that hat off and becomes a data analyst and financial modeling guru,” Hrobon says. “Along the way, he plays psychiatrist to everybody involved to keep people focused on the prize and to help eliminate some anxiety. He’s gifted at all of this, which is a rare attribute.”
Adds STRATMOR CEO Lisa Springer: “Jeff set the tone for our entire company. Our vision, our purpose, and our core values are based onhis work over the past 40 years. Jeff brought high integrity, an incredible work ethic, and the mantra that we live by, ‘The most successful lenders live by their numbers; they embrace change and create a culture of accountability and transparency.’ STRATMOR is committed to carrying on that tradition and guiding our clients to do the same.”
In a second article in the November Insights Report “How to Become the Mortgage Lending Choice of Millennials,” Mike Seminari, director of STRATMOR’s MortgageSAT Borrower Satisfaction Program, notes that so far this year, millennials have comprised 52 percent of purchases and 42 percent of all mortgage loans. That’s a huge market segment, with Gen X and baby boomers both far behind at 26 percent each. Seminari provides a number of strategies lenders can implement to better appeal to millennial borrowers. Fox example, lenders should create visibility on their corporate websites and on individual loan officer websites so millennial borrowers can read reviews, something they are actively looking for.
Click here for the current edition of STRATMOR’s Insights Report.
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