matchbox State of the Market-January 2024
Hello everyone and welcome to 2024. I hope you had a happy and healthy start to the
new year. It seems that I say that the holiday season flies by each year, although I
think all of us in the mortgage industry, were all happy to see 2023 come to close.
Although a challenging year, it provided a lot of insight and valuable experience to
learn and hopefully grow from in 2024.
We are ramping up for Conference seasons. We will be attending the MBA IIMB
conference this month, Lender’s One conference, ICE Experience, hosting an ACUMA
webinar, and the TMC Conference. Let’s meet up and catch up on all the new offerings
for his year.
On a personal note, the year ended with me becoming a grandfather on December
30th. It is as amazing as everyone said it would be and my wife and I feel truly blessed
to have a new Grandson in our lives.
Why does it have to be either or and why can’t it be both?
We start 2024 with our anniversary on January 10th. Fourteen years ago,
matchbox was started as an acronym, with a high-level concept of
utilizing our experiences as Mortgage Bankers to help Mortgage Bankers in
a variety of areas. The idea was to have all of these areas provided “in a
box” for our clients. The industry was very different then, as the Mortgage
Industry had limited technology offerings. For example, Encompass was
just starting to gain traction in the industry as the market leader in the
Loan Origination space. Over the past 14 years, I have been so fortunate in
so many ways. I have had the opportunity to meet and support hundreds
of great clients, have been able to build an incredible team of passionate
Mortgage Bankers, and have been embraced by the industry and by so
many. Since we started, our core has not changed- to support our clients
with the best possible service and expertise to help them succeed in any
market environment.
As we start off this year, it feels like it will be a telling year in a variety of
ways. From my perspective, we are struggling to meet the market changes
similar to where we were in 2019 and then COVID hit in 2020. After a brief
period of uncertainty, interest rates dropped to historic lows and the
industry went through a stage of record volume. All thoughts of
efficiencies and tech adoption were pushed to the wayside in favor of
supporting new staff and the record volume.
Once COVID ended, the various economic efforts that were put in place to
support us through COVID started to show their effects in the form of
inflation. The unwind of these support measures came in record-breaking
increases in interest rates in 2023, that triggered one of the most
challenging years in the Mortgage Industry. Although we are no stranger
to cycles, 2023 hit harder than most have ever seen, and companies and
departments struggled in many ways. In looking back, we swung from one
extreme to the other, and decision were made at the extremes of each
stage of the cycles.
Going back to when we started, one of our focuses was technology but it
was not imagined that it would be the main source of focus and growth.
The tech options within the Mortgage Industry have exploded since we
started, and in the process, it has opened many opportunities for our
growth and expertise. The impact of technology has continued to grow
and has excited, forced, or challenged many companies on how to best
utilize and implement their business model. These applications would
dramatically change the Customer or Member experience, improve internal
efficiency, and provide a path for reducing staff.
Coming into 2020, companies were eager to bring on new technologies to
help them support their growing pipelines. All the shiny new toys were
embraced to be the final answer to so many problems. When 2023 came,
the volume shrank, companies were forced to reduce staff, and revisit all
the technology that was contracted over the past few years. All of sudden,
those contracts that were signed when volumes were high did not look so
good, the intended benefits of the technology were not seen, and with
staff levels reduced to pre-2020 levels, most decided that various tech
options were no longer viable or needed.
So, we enter 2024, with this quandary- what is more important in this
market – the technology or the people? And my answer is in the words of
my favorite Uncle, “why does it have to be either/or, why canʼt it just be
both?” Rather than trying to make the argument for either side (which I
have made for each over the years), I am fully convinced that we need both
to succeed in 2024. People and technology must work in unison for both
to thrive. We have fought and blamed each other over the past few years
and have spent so much time and effort putting things into place to only
unwind with a high cost and effort. Tech cannot succeed without strong
people utilizing it and putting it to the best use. And Staffs cannot support
their client or Member base without a continuously evolving experience
that is supported with a strong tech stack. It is not a battle for who is to
blame, but rather a year to realize that we need both to succeed in this
and the coming years.
Embrace your staff and embrace your technology and get them to work
together. There is no magic formula on how to accomplish this as there
are variables within each company that can affect this mission. As we head
into a new year, I implore you to spend time on getting both to work in
unison to make you the best you can be this year. This year will be a reset
in many ways. The good companies will learn from the good and bad from
the last cycles and not repeat prior mistakes.
There are some great technology options in the market today and there
are also amazing people. Let ʻs join them together to build a stronger
model for the pending increase in volume.
matchbox hot takes
• Fannie Mae forced the hands of inactive lenders, and many are coming
back for submission assistance. If you find yourself in this situation and
want some assistance with possible options, please contact us.
• Credit costs are increasing again. Ignite’s merchant portal provides a
fully integrated, secure payment portal to capture Credit and Appraisal
fees directly from Encompass at the time of application. Contact me to
discuss this cost saving solution.
• HMDA is right around the corner. Our compliance story is the first step
in making your compliance and HMDA reporting process much easier.
