Agree. Operating Costs and expenses always tend to rise, especially during tougher market cycles. However your point on being an independent lead sourcing purchase provider is valid in terms of commission % kept versus a LO who gets in house leads or leads provided by their sponsor, which the sponsor pays for. Your "But then" comment is also a good discussion point. Good stuff. 🔥
One caveat to this clip is this: What if via automation, off-shoring, virtual office, leveraging tech a lender / broker could greatly reduce the cost to manufacture? Then, the industry could avoid an industrywide reduction in sales compensation. BUT THEN...one could argue that the industry has ALREADY seen / experienced the reduction. It was done by more and more MLO's taking "in-house" comp to win a loan or a broker going "borrower-paid" in order to compete with the broker down the road who was willing to work for less. When those MLO's / Brokers look at their net earnings for 2024 and divide it by their annual volume, was the commission earned (in terms of bps) less than 2022? What about 2019? Or 2016?
As it's my first year in, I'm taking whatever gets the deal done. In house, referral, ... whatever gets it done. I look forward to being able to complain about this in the future 😂
@@dcat9662 When I got started most lenders paid 55bps on average. I would do loans for free if it meant I won. I was playing a long game. Most mortgage brokers were averaging 90-150 bps in gross commission as 1099 independent contractors. You keep doing you. Win, learn, earn and add more satisfied customers and referral sources to your "data bank". The $$ will always be there. It always has...
This is already in the works. Envoy was already off-shoring production duties in 2020 to a company in India and paying them $10K a year, but kept all consumer-facing roles in the US. Despite a good command of English, my former coworkers in India were very difficult to understand…by phone or by email. No doubt they would do the same with foreign MLOs if they figure out how to get around the language and regulatory issues.
If you are netting less than 150 basis points now, you need to evaluate the company you are originating for. Also, consider how many layers there are between you and the CEO; there should be a maximum of two. In reality, I wouldn’t originate a loan for less than 200 basis points LO comp
Agree. Operating Costs and expenses always tend to rise, especially during tougher market cycles. However your point on being an independent lead sourcing purchase provider is valid in terms of commission % kept versus a LO who gets in house leads or leads provided by their sponsor, which the sponsor pays for. Your "But then" comment is also a good discussion point. Good stuff. 🔥
If that happens a lot of LOs will leave
One caveat to this clip is this: What if via automation, off-shoring, virtual office, leveraging tech a lender / broker could greatly reduce the cost to manufacture? Then, the industry could avoid an industrywide reduction in sales compensation.
BUT THEN...one could argue that the industry has ALREADY seen / experienced the reduction. It was done by more and more MLO's taking "in-house" comp to win a loan or a broker going "borrower-paid" in order to compete with the broker down the road who was willing to work for less. When those MLO's / Brokers look at their net earnings for 2024 and divide it by their annual volume, was the commission earned (in terms of bps) less than 2022? What about 2019? Or 2016?
As it's my first year in, I'm taking whatever gets the deal done. In house, referral, ... whatever gets it done.
I look forward to being able to complain about this in the future 😂
@@dcat9662 When I got started most lenders paid 55bps on average. I would do loans for free if it meant I won. I was playing a long game. Most mortgage brokers were averaging 90-150 bps in gross commission as 1099 independent contractors. You keep doing you. Win, learn, earn and add more satisfied customers and referral sources to your "data bank". The $$ will always be there. It always has...
This is already in the works. Envoy was already off-shoring production duties in 2020 to a company in India and paying them $10K a year, but kept all consumer-facing roles in the US. Despite a good command of English, my former coworkers in India were very difficult to understand…by phone or by email. No doubt they would do the same with foreign MLOs if they figure out how to get around the language and regulatory issues.
@@jennodine 😳
If you are netting less than 150 basis points now, you need to evaluate the company you are originating for. Also, consider how many layers there are between you and the CEO; there should be a maximum of two. In reality, I wouldn’t originate a loan for less than 200 basis points LO comp