What Borrowers Want Now: Future-Proofing Your Mortgage Business for 2025 and Beyond

Robert Fillyaw [00:00:01]:
Hey, everyone. Welcome to the next exciting episode of Lending Leadership with the mortgage pros. Robert Fillyaw here as always with Dave Holland and Tom Mills. And we have something exciting for you guys today. We've got a wake up call and we're going to be talking a little bit about the, what borrowers are really looking for in 2025 and 2026 and beyond. It shifted, and if you're not shifting with them, you're going to get left in the dust. Welcome, boys. I'm excited to chat with y' all today.

Dave Holland [00:00:29]:
Yeah, likewise. So I think all, you know, I still originate, so I have a perspective on this.

Robert Fillyaw [00:00:38]:
He can never let us forget that he still originates.

Dave Holland [00:00:40]:
Millsy putting it out there. I remember when I started in 2000, I don't know how I did this. I used to meet people physically in their homes probably 50% of the time with handwritten directions or MapQuest directions. Pittsburgh's a confusing place to get around. I don't know how I, how I did the volume that I did. And then when I stopped meeting in people's homes, I probably met like pre2012, 2013. There was a big refinance boom. In 12.

Dave Holland [00:01:12]:
I met probably half the people in person in a tiny little office. And if I didn't, I would FedEx them a package of the disclosures, highlight everything where they needed the sign, and they would FedEx it back. I think I did 200 loans in 2012. I don't know how I did. It didn't happen.

Tom Mills [00:01:30]:
Well, you probably, you probably closed it. 100 of the people that you went to their home, because let's be honest, you came out, you didn't have a copier there, so you came out with their original documents that they couldn't even take the shop.

Dave Holland [00:01:43]:
That's good.

Robert Fillyaw [00:01:44]:
It's a great point.

Dave Holland [00:01:45]:
And some of these meetings would take hours because they were, they weren't ready. Right. They'd be looking for their stuff in their home. I would eat dinner probably a third of the time with them. Some people's homes were just train wrecks. Just. I don't know how I, how I did what I did back then, but that's the way we did business. Obviously now with technology, most people do an app online.

Dave Holland [00:02:08]:
Most people sign everything online. I think this year, me or my team have probably met with like four or five people in person all year. Some of them were friends and we just want to catch up. So they came in. So technology has made it easier and harder for our business. We all know that things are a lot more competitive. We saw that shift with Millennials and now Gen Z. But I really feel that the borrowers do a lot more research before they get to us.

Dave Holland [00:02:39]:
Right. So they're better educated. You can offer. You can often tell they're better educated because the questions they're asking, sometimes they're good questions, sometimes they're kind of more harebrained questions. But I feel that a lot of borrowers still want a trusted. Both a realtor, a trusted real estate agent, and they also want a trusted mortgage advisor. However, you got to position yourself in the right way, so they're not just sucking all the information out of you and, and you're doing all the work and then you're not getting paid. So there's some tactics we're going to get into in this call to kind of avoid that.

Dave Holland [00:03:20]:
And, you know, a lot of our lows and ellos that we talk to in the business say, hey, I lost four deals this month. Here's a news flash for you. You never had that deal.

Robert Fillyaw [00:03:30]:
They weren't your deals. You didn't, you didn't lose anything. You, you didn't have them. It's funny to hear you flashback, Dave. I never did the house thing because that's how you end up in a pit, rubbing the lotion on yourself. Again, like, that wasn't my jam, but probably like 90% of my clients I met in person, in, in the office and went through every page of the disclosure and explained it to them in, in detail. And it, you're right, it, it completely shifted. And the ones I didn't was the FedEx, just like you said.

Robert Fillyaw [00:04:01]:
So, you know, today, if we have to realize that clients are savvier, they want things faster. We, we live in an instantaneous society. They want things right now. And they're skeptical. They are, you know, doubting Thomas. So if you're going to win their business and earn their trust, you better bring it. You. I've talked for a long time with originators, and it's some of what we're going to get into today.

Robert Fillyaw [00:04:23]:
All of this is great, and it makes the process easier, but it also almost commoditizes us.

Dave Holland [00:04:28]:
Not almost, not all.

Robert Fillyaw [00:04:30]:
It does. Yeah, absolutely. It commoditizes us. So you have to be able to be that trusted advisor to, to win them over and take the next steps to decommod, decommoditize yourself and bring value.

Tom Mills [00:04:43]:
Well, look at, you know, when you say, why do you have to, you know, provide extra. Why do you have to explain More you mentioned they're educated. I mean, you know, as the average home, first time homebuyer age has moved up to what is that, 37 now the high.

Robert Fillyaw [00:04:59]:
Yeah.

Dave Holland [00:05:00]:
Which is a whole nother conversation. That's crazy.

Tom Mills [00:05:02]:
And also now think about millennials and Gen X. I mean they're, they're mostly dual income, college educated families that, you know, couples that are now buying homes at the age of 37, 38. So they've, they're, they're, they're smart and they know how to find information, you know, and there's a lot of information out there at their, at their fingertips. And I think then when you look at, you know, you mentioned Gen Z. And so when you think about that generation of buyers, they're much younger than the, you know, average first time home buyer. So they're really savvy. Like they're thinking they're not just trying to buy a home, they're like trying to make their first big investment and they, they have a plan of, of, of starting early and, and acquiring real estate. So you, you kind of want to speak really different about that.

Tom Mills [00:05:46]:
I remember, you know, it used to just be a customer call and you know, over the phone you'd pull their credit and you'd tell them what you can qualify for. All in one. Like one call. Close people would do all the time. I think that's a bad move today. You know, you got to put some thought into it. You got to, you know, they want to see a presentation, they want to see something they can look at. They like visuals, something they can reference back to, not just notes that they were to take during that call.

Tom Mills [00:06:11]:
There should be good follow up because that, that's where I think you, you have an opportunity to win it. You know, I don't think that because they're more educated and they want more information, that means they're, they're cheaper and they're going to nickel and dime you. That hasn't proven to be the case.

Robert Fillyaw [00:06:28]:
Yeah, I don't think I agree.

Dave Holland [00:06:29]:
Well, and then there was a shift and I don't know when the shift was probably pre, it probably happened post Covid when we weren't, things were different. If a realtor referred you the transaction and you were the first person to talk to the customer and I should have better stats on this. My close ratio was significantly higher. If a trusted realtor referred me a customer 90% of the time, I would get it. Now sometimes I was the second person they talked to because I talked to their bank or their Uncle's buddy or whatever the case may be. But now I feel that, and maybe this is how we sell, like it's a dog fight on probably 50% of the transactions. And the technique that I, I use when I chat with people, you know, when someone leads with what's your rates and fees, I try to reposition that and I tell them I am not going to have the lowest rates and fees. That is not my value proposition.

Dave Holland [00:07:37]:
My value proposition is local connections, deep industry knowledge, a whole host of things. You know, if you want the cheapest rate and fees, you're going to be talking to someone working out of their parents basement. Right. Or someone who has a very, you know, has a very small shop or it's a credit union who's running a 30 day special until they fill up their pipeline. Nothing against our credit union friends. And then the rates go up. So most of the people listening to this call, you're not going to have the lowest rates and fees. If you did, you, you should be able to sell 1,000 mortgages a month.

Dave Holland [00:08:14]:
So you need to set the tone up front. You need to use language like a lot of people don't know this. I am not paid until the loan closes. We are 100% commission. I really try to get a verbal commitment from people that they're going to stick with me. You know, there's nothing worse than, you know, working with someone and everyone's experienced it six months a year, 18 months, do a lot of legwork, work evenings and weekends. They get an under contract and they start shopping you. So I'd rather not even go down that route.

Dave Holland [00:08:47]:
I'd rather, you know, qualify that person and that's what they're going to do. I don't want to work with them because I don't want to spin my wheels, spend time, money and effort, especially evenings and weekends, only to lose it for an eighth of 1% or a couple hundred dollars. It's not worth it.

Tom Mills [00:09:03]:
Yeah, I think, you know, you think about where do you, how you attract that buyer too. I mean of course, you know, mostly, you know, in a purchase environment, a lot of times it's realtor or builder driven referrals. But I think, you know, it's, it's a big reason why you're seeing a lot of people make a big shift towards social media right now too because you know, that can influence, you know, a buyer's decision on who, who they want to transact with. Because all that information's out there and you know, and where do they go for information, they go to a lot of social media, right? Just like we do. I mean, we read our news on social media, then in threads, you know, and when you search for something, sometimes people search in those engines and, you know, when you have a relevant presence there and a space there, they can find more of an affiliation to you. And I think you, you look at, you know, the trends of like, buying today. Like, look at what Instagram, like influencers have done for businesses, you know, So I think, and you think about why, like, if, if somebody, they, they follow that person, you know, a large group of people really is attracted the information that person puts out. So then they get behind something, they end something, and they go buy it, you know, because such and such endorsed that and they've got to have it.

Tom Mills [00:10:19]:
I think, you know, when you can get out there and you can show, you know, that, that individuality, number one, that's what I think attracts people. You know, individuality. People like to find commonality, you know, common ground with the people that they're working with. They don't necessarily deal with who their parents use to buy a home, you know, that's barely in the business anymore. They, they want to deal with somebody that communicates. Like they, you know, communicate now. So you've seen a lot of shift, and I think a lot of originators are kind of confused as to what, what is their, like, what's their plan on social media, like, what is it that they're trying to accomplish. And it's not just about attracting leads.

Tom Mills [00:11:03]:
It's about, you know, that's our biggest opportunity to, you know, build the brand and, or build your own individual brand and, and attract the type of customers that, you know, you want to do business with.

Robert Fillyaw [00:11:14]:
Yeah, it's definitely shifted, you know, and the people that are getting left behind are the people that don't realize that really we're, it's a duality right now and what the clients want, right? Like, they want that instant, fast, easy access to information, instant gratification. They want it right now at the tips of their fingertips. But they, they also want full service. So when they have a question or when they have a need, they want that high touch service that, you know, we think of more as old school. So if you don't have a way to deliver both, you're gonna, you're gonna miss out. Like, that's really what they're looking for. And you have to communicate the way that they communicate. Right? Like, that's why Dave.

Robert Fillyaw [00:11:57]:
Well, not in 2000, I don't think text messaging even existed. I don't know when it came out. But like how, how many of your. Of our borrowers now we communicate almost solely via text. Right. This five years ago that wasn't the case. But you.

Dave Holland [00:12:11]:
I thought it was unprofessional. I thought it was unprofessional. In fact, communicating via text, that's completely finished.

Robert Fillyaw [00:12:18]:
And now if you don't do it, you're. You're done for. Right. And the, the biggest key with this guys, that I think, and I preach this all the time is, you know, I call it speed to lead, but it's, it's. They want that instant response. So even if it's got your text on a call, you know, be back with you. Like whatever it is, they need acknowledgment that they have been heard that you know, that they're trying to get in touch with you and then you follow up with them when you can. Like that's when you start losing people, I think, to the online lenders and then they start poking around if you're not given that level of service.

Tom Mills [00:12:58]:
Yeah. What do you think the importance of like online reviews today? I mean, what do you think the percentage of borrowers that go and you know, it, once they, this is. Once they're talking to Dave Holland, you know, about doing a mortgage, they go and. Do they go and Google Dave Holland and what are they looking for? And what do you. Let's talk about that.

Robert Fillyaw [00:13:15]:
They've, they've goo. They've googled Dave Holland before they ever got on the phone with him. Right. So if you're not billing your. And they trust the online reviews more than they trust the word of their realtor more than they trust anything you're going to tell them. Them, they trust the online reviews implicitly. So if you're not building that, if you, if you're not, you know, stacking reviews, soliciting reviews from your clients, you're missing the boat there. And the other cool.

Robert Fillyaw [00:13:39]:
Hold on a second, Dave. The other cool thing is once, once you have them built and it's, you know, this glowing aura of awesomeness, you can lead with it, you can get preemptive and attacked with it. Hey, check out my reviews, by the way, I'm looking forward to working with you. Check out what people in the past have said about working with us.

Tom Mills [00:13:56]:
There's no better way to say I'm great than there's somebody else to say how great you are for you, you know?

Robert Fillyaw [00:14:00]:
Yeah.

Dave Holland [00:14:01]:
Well, if you think about restaurants, right. Me and Robert were in Florida for spring break. Before we went to any restaurant, I pop on Travel Advisor or Google or Yelp and look at the reviews and I leave a lot of reviews for restaurants if they're really good or really bad. I mean, if I'm looking at my email signature, it says check out my reviews. So if I am in a competitive situation, I'll read the competitors reviews and oftentimes they have like four. Okay. And then I have literally hundreds. And I'm very diplomatic about it.

Dave Holland [00:14:38]:
I'll say, hey Robert, do me a favor, look at my reviews versus the other company's reviews. Now I don't leave with that they have a bunch of good reviews. But that, that is something, you know, it's a little, it's a guerrilla tactic. But that, that's what I'll use a lot of times to win deals sometimes and we have to understand this as loan officers and professionals. People just don't give a shit. Right? You could be the best loan officer in Florida. You could be number one with everything. And if your rate is an eighth or a quarter percent higher, they're just gonna, they're gonna sell you out.

Dave Holland [00:15:15]:
So again back to a previous point. You never had the transaction that was.

Robert Fillyaw [00:15:19]:
Never client to begin with. That wasn't your client to begin with.

Tom Mills [00:15:22]:
Next.

Robert Fillyaw [00:15:23]:
Right. I, I love you said you're a little tactful about it. Dude. I, I used to not be. I would snip their, like the header of their review and snip mine and put them side by side and be like, look at this. I would go into their NMLS Consumer access, right? And see that, you know, a year ago they were a waiter somewhere or selling cars or something.

Dave Holland [00:15:42]:
I still do that.

Robert Fillyaw [00:15:43]:
And be like, is this really who you want handling the largest financial transaction you've ever done?

Dave Holland [00:15:48]:
I don't want to give our listeners all my pro tips, but yeah, I'm.

Robert Fillyaw [00:15:51]:
Going to give them one more. I'm going to give them one more. I don't know if you guys know this or not. Pissed consumer.com.

Dave Holland [00:15:57]:
I didn't even know that was a website.

Robert Fillyaw [00:15:59]:
Pissed consumer.com so you can go. And it'll, it'll, it has ratings for mortgage companies, but it will calculate the amount of money that their negligent has cost customers. So you know, oh my God, this, that we missed our closing date and had to reschedule the moving van above. They'll put a value on that and say, oh, they cost this customer $3,700. Right.

Tom Mills [00:16:22]:
Let's never Be on that site, fellas.

Dave Holland [00:16:24]:
Yeah, we, we better check ourselves, Robert. Check today and get back to us.

Tom Mills [00:16:31]:
I think, you know, we forget oftentimes that our greatest, you know, sales tools that are, is our ears and our ability to listen. Because, you know, generational, generational, generation, if you, if you listen to them, they're going to tell you how to sell them. That that's one thing common, I think, you know, but sometimes you, you, you don't. You have to ask the right questions, right? And I think gaining an assessment so, you know, all this information's out there, you know, that they, they, they, they've have. So they may, there's a good chance that they've done a lot of research. You know, I think it's two really simple questions to ask a customer. You know, how long have you been considering buying a home? And you know, what type of research have you done? You know, and, and maybe even now. Third question is, you know, based on that research, you know, what are you expecting or, you know, what are you coming into this expecting as far as a rate and payment at that range you said you're looking to purchase at.

Tom Mills [00:17:25]:
Because they're going to now tell you every bit of research that they've done, how reliant they are on the data out there or how reliant are they going to be on what you provide them. And I think that also, you know, oftentimes I think if you quote a customer rate and then they kind of don't seem like really happy about it. The reason is because they, they were expecting something better. You know, when there's a reason they were expecting something better, they went somewhere and saw 24, 48 hours a week, whatever. Before you told them that their rate is 699, they saw six and a quarter. And now you just hit them with 699. And you don't understand where their research has been, what they've looked at, why that's there, you know, and I think, you know, it's important to understand that, number one, where are they sitting at when you're going to start going over your loan options and how much detail and how much explanation you need to be if they tell you they've been researching this every day and they know everything. You have to feed into that a little bit, feed into their education.

Tom Mills [00:18:21]:
Don't treat them like they're, they're not. You know, you say things like, I know from your research, you probably understand that most of those rates have a small, you know, fine line underneath and they have Typically a point, you know, charged on them. I know you're probably also looking at the APR and things like that. Right, right. You know, don't, you know. And then I think you're, you're speaking to them like they are educated and they, you know, then they kind of appreciate that you're having a different level of conversation. I think that's huge, guys. The ability to really assess your borrower and their knowledge really early on in conversation.

Robert Fillyaw [00:18:55]:
Good point. Yeah. I love the open ended questions and you know, just that that builds rapport. It shows you as an expert. Right. It, it just validates them and it's going to uncover things, it's going to, it's going to give you. I love how you said it, Tom. They're going to tell you how to sell them if you ask the questions and listen, you know, and don't think about it.

Tom Mills [00:19:15]:
Another thing too we used, I used to always ask this back in the day and this is so overlooked. You know, what's the one thing you're scared of? You know, what's the one thing we're worried about? What's your fear going into this? Because they all, they do have a fear. Like we forget that most of them, they don't do this every day. They don't know if they're getting approved for that, if they can buy that. But their wife sitting there or the spouse sitting there and they see this home and they want it and you know, they're nervous, they're scared. They have enough money, they don't want to tell you everything. They had this issue three years ago, you know, like ask them what it is, it's got them fear and start to overcome that. Because when you, you know that sales 101 find the fear and solve it and you get the sale.

Tom Mills [00:19:52]:
Like I still think that applies today too.

Robert Fillyaw [00:19:54]:
Absolutely.

Dave Holland [00:19:56]:
Let's get into. You know, I get a lot of questions on this from loan officers when we bring people on from companies that didn't have a POS or point of sale. So technology has made it much easier for us as a loan officer, but it's also made us a little disconnected from the bars. We talked about meeting people in their homes, meeting in person, taking applications by phone. And I don't want to use the word push but I kind of push my customers to our point of sale which is built out. It's great. You know, they fill out the application on their time. It's accurate information.

Dave Holland [00:20:34]:
And then oftentimes I'll wake up in the morning in W2s pay stubs, everything will be loaded, the file's done.

Tom Mills [00:20:42]:
So that's really new for you, Dave, because, you know, eight, 19 months ago, you didn't have a point of sale, right?

Robert Fillyaw [00:20:47]:
So that's. Yeah, we did. Yeah.

Dave Holland [00:20:49]:
No, yeah, we did.

Tom Mills [00:20:50]:
Okay.

Robert Fillyaw [00:20:50]:
Yeah.

Dave Holland [00:20:52]:
But so when people are using a point of sale, they're afraid they're going to lose the connection to the bar. So there's an easy fix to that. Right. And what my team does is, hey, Robert, we ask our customers to start with, you know, HMA Connect. It's our point of sale system. I talk about our secure ecosystem. I don't want people emailing me W's and pay subs with npi. I want it in our system.

Dave Holland [00:21:22]:
We use it through the entire process. We'll close. You'll close and sign about 90% of your documents on it. And then what my team does is, quote, schedule a mortgage consultation and review, then the 1003 application with them. And that's how you build rapport.

Tom Mills [00:21:42]:
Yeah.

Robert Fillyaw [00:21:42]:
So, yeah, I used to do something exactly similar, Dave. I would say, hey, listen, there's a lot of information we need to get from you to put together an estimate and make sure that we're the best option to win your business. Instead of interrogating you, I want to send you this link so we can get, we can get the foundation and then we're going to call you and go over everything and talk through it from there.

Dave Holland [00:22:01]:
That way, I like foundation interrogation. I like that.

Robert Fillyaw [00:22:06]:
That way. That way I'll be prepared to speak to you about what your options are. That, and I'm making the best use of your time and mine.

Dave Holland [00:22:14]:
I'm gonna, I'm gonna. If a listener see me typing, I'm gonna, I'm gonna type those words down. I really like that.

Robert Fillyaw [00:22:20]:
Well, it's being recorded, Dave. You can come back and watch it.

Tom Mills [00:22:23]:
Recently I've seen that the customer is, is more. Ask more questions about there's their information being safe and secure. So, Dave, you bring up a point of sale, there's a lot of reasons we should direct customers to a point of sale for ease and efficiency for us. But with the level of cyber, you know, you know, cyber incidents that are out there, it. I think there's a lot of reasons that we should push on there. And, and, and customers are asking questions about that and they want to make sure that when they send information, it's safe and secure.

Dave Holland [00:22:50]:
Absolutely.

Robert Fillyaw [00:22:52]:
Great topic, guys. We could, we could talk about this for another hour, right? And probably still just be Scratching the surface. But we're going to wrap here based on making sure we don't take too much of everybody's time out there. So final thoughts. If you guys could tell every yellow one thing to be ready for the buyers that are in the market now in the future, what would that be?

Dave Holland [00:23:14]:
My one thing would be have the hard conversations up front. Know what you have. You don't want to spin your wheels. It's going to happen even if you have the hard conversations up front. But if someone's not going to use you and is going to shop you unmercifully, then get, get rid of that person now instead of, you know, having a trail of tears over the next 12 months.

Robert Fillyaw [00:23:39]:
Yeah, the faster you can find out and move away. That's not your client. Right? The faster you can find out, move away from them, the better. I like that. Mine would be the, the speed to lead the, the speed to communication. I think that it is so important now, even if it's just a, you know, on a call. I'll call you back. Something to.

Robert Fillyaw [00:23:58]:
So the, the borrower knows that, you know that there you need to get in touch with them. The people who don't do that, I think you, you cause frustrations. It's a service issue and that's when they start looking, you know, to talk to other people.

Tom Mills [00:24:14]:
I'm gonna go, you know, back to what I said a little bit ago. Ask questions, listen and then, you know, give, give detail to people. Give, give people something to look at, something they can reference back to. You know, you see a lot of people using, you know, Trust Engine, Mortgage Coach today, presentation tools like that, especially as we move into refinance markets, you know, they become really, really important to a lot of customers that are shopping out there. But first off, really, you know, understanding like where, where does your buyer fit, you know, what is their knowledge? How do they want, you know, how do they want to be serviced to that transaction?

Robert Fillyaw [00:24:53]:
Really great takeaways, guys. Hey, I enjoyed mixing this up with you guys. Great topic. Let us know out there what you're seeing as you're engaging with the, the new borrowers in the market. What you're seeing that's worked for you or maybe even what hasn't worked for you. We would love to hear some comments from you guys. For Tom Mills and Dave Holland, this is Robert Philyaw, Lending leadership with the Mortgage Bros. Thanks for tuning in guys.

Dave Holland [00:25:18]:
Thanks.