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As production drops, recruiting will rise.  Don’t lose your best producers because they are being sold the Cinderella story by another lender. I am hearing more and more lenders that are doing business per regulation, losing talent to lenders who are clueless about the new regulation.  The problem is that in today’s regulatory world, the LO can be fined, stripped of their license and lose a lot of income by not knowing what is and is not acceptable. Your best defense is to round them up and educate them.

_____ What is your new LO Comp Plan?  Explain the various ways that an originator is now allowed to be paid, and why they are no longer allowed to be paid the way they may be used to.

_____ Why is this your new LO Comp Plan?  Give the originators reference points in the regulation as to why it had to change.  This leaves them armed with facts when someone calls with false idealism.

_____ How will this affect their income?  Take your top producers into a one-on-one meeting and show them the before and after.  Chances are good it will not result in less income, but it will result in a different way of paying them as compared to before.

_____ When is the meeting and what is the strategy to roll it out?  Do not leave this in the hands of anyone other than the experts.  However, Do, make your presenter someone the originators can relate to.  If the compliance person, who has never been in the shoes of the originator, stands up to recite new policy, it will most likely not go over well.  However, if a top producing originator(s) in your company stands up and talks about the changes and why then more will be on board.

_____ Your presentation should include the following:

  1. What are the rules?
  2. How do they apply to your LO?
  3. Where can they find the regulation so that they can read it themselves?
  4. How will the new QM rules potentially affect their production? Be Positive!
  5. What additional conduits will you create to broaden your product offerings, if any?
  6. How will locking in a loan work?  What has changed?
  7. What happens during a change of circumstance that renders a file non-QM?
  8. How will they market this to their referral base?  Give them a presentation already done so that all they need to do is insert their name and set up the meeting.  The presentation should be positive in nature and give new ideas to get people qualified with the new rules.
  9. What marketing push will occur to acquaint your market areas with the new regulations?
  10. Clearly define the assurances as to why your company is well-positioned and able to gracefully handle these changes.

Compliance can certainly handle the citing of the references part, but rallying the team together, removing the fear and giving your sales staff hope falls into the hands of Executive Management and Production heads.  There is always business out there for talented people!  Stay positive and give your sales staff the product support, knowledge base and marketing support they need and you will have much less to worry about.

Tammy Butler, Master CMB

Author Tammy Butler, Master CMB

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