A few years ago, the average age of a loan officer was around 54 years old. Today, it’s 46 years old, according to a 2017 Insights Report from Stratmor Group. There’s a reason why loan originators are trending younger, and if you’re not actively recruiting younger employees, then you could be missing out on a valuable boost to your business.
At Originators Connect 2018, a panel discussion took place about how young mortgage professionals can refuel the mortgage industry and strategies behind recruiting, educating, and retaining them.
“We’re in the midst of reinventing our industry a little bit, so [millennials] bring a fresh look to that, and they’re not so caught up on the way things used to be,” said Jeff Leinan, senior vice president of National Wholesale Production at Plaza Home Mortgage, Inc. “Obviously their ability to understand and work with technology is fantastic, [and] their ability to work through change . . . this is a new, fresh industry for them, and they’re eager and they’re excited and it’s really kind of fun to work with them.”
The word ‘millennial’ seems to be synonymous with ‘young people,’ but this isn’t just about 20-somethings anymore. Using the cutoff of 1996 as the end of the millennial generation as suggested by Pew Research, the vast majority of millennials are well into the workforce.
Yet, employers are still asking the question: what do millennials want?
On one hand, the next generation of employees wants the same thing as the rest of the workforce: the ability to advance, fair compensation, and to be valued.
“Millennials, like everyone else, they want opportunities for growth. They want to be heard, they want to feel like they’re making an impact. A lot of things now are all about the bigger picture, it’s not just about you; it’s about what kind of impact you make in your career, in your relationships,” said Vanessa Rodriguez, marketing and communications coordinator at Plaza.
Millennials and the subsequent generation also want things from their employers that weren’t as highly valued by their predecessors, including a greater desire to feel at home within the company culture, opportunities for mentoring and networking, flexible work environments, and the ability to make their own schedules. Rather than simply advertising a job description, promote the most exciting and rewarding aspects of the position, because millennials want to feel good about what they’re doing for a living.
The mortgage industry probably has a leg up on competing industries in fulfilling what the next generation wants in a career, because one of the things that millennials value is the chance to be in charge of their own fate and make their own success.
Getting young employees involved in creating those success markers is one way to be competitive when it comes to recruiting and hiring, especially when dealing with compressed margins and competing with salaried offers. Be flexible when it comes to incentives and what they’re willing to work for, whether that’s paying off student loans or receiving a small base salary until they make a certain volume.
The mortgage industry definitely took a (well-deserved) image hit after the financial crisis, but now that the perception is improving, it’s a great time for younger employees to get on board.
“For the younger people coming in now, there’s tremendous opportunity because there’s a whole gap of people that are missing in our business, and they’re going to be able to slide in. So I explain to them, you’re going to have a greater opportunity because you’re not going to have this whole bench of people above you. They don’t exist. When people in their late 50s and 60s decide that they want to retire, the people behind them don’t exist because they’ve left the business,” Leinan said.
Gone are the days being placed at a desk in front of a phone and being told, ‘Go get ‘em.’ Data from the Qualtrics-Accel Partners survey for CNBC, which surveyed almost 1,500 millennials about what they look for in an ideal workplace, revealed that the first 90 days on the job is key to retention; 40% of those surveyed chose sufficient training as the number one desire in a new job.
External mortgage training programs exist, but new originators can often learn best from seeing how top producers handle everything from client meetings and working with referral partners to using industry lingo and problem-solving unique situations. Providing mentoring and shadowing opportunities, and prioritizing communication about their progress are valuable ways to invest in young employees.
“The best advice I ever got was, when you reach success, make sure to send the elevator back down. You want to make sure that you’re helping people. They don’t know what you know. So you want to make sure that you’re culturing them and giving them the motivation to continue to succeed,” said Matt Coles, sales manager at Plaza. Celebrate their successes, however small, and highlight the contributions that younger employees are making to the team. Involve them in discussions with higher ups, share their ideas and attribute them accordingly.
Technology adaptation is a tangible benefit of hiring younger employees, but there are intangible benefits as well.
“These young people that I work with, they reinvigorate me. They give me the passion to want to go my job. As big-eyed and excited as they are, because they’re excited about it, it reinvigorates my older sales team, myself, it’s a great injection of youth and positivity to the team. It also helps build your network,” Coles said. “And then let’s not be silly—hiring super experienced people is expensive, so if you can get a young person in at the beginning of their career, you build their career, you help them out, you might get them cheaper and help mold best practices, so you’re really going to be an influencer in their career.”
Coles said that some of his clients have even opened their offices to summer internships as a way to invite and attract young people into the mortgage world. Leinan suggests reaching out to schools and universities and posting open positions on their alumni channels, and just talking to young people about the industry. At Plaza, their overall retention for millennials is higher than 80%.
“They’re engaged, they’re focused, they see a path, and they want to get there,” he said. “This is not a job for them, it’s a career.”
If you want until the point where half your team is ready to retire before hiring the next generation of employees, not only will you be working from behind, but you’ll have also lost out on that valuable overlap period where they can learn from each other for the joint success of the company.
“Demographics don’t lie. So if the people who focus on [recruiting millennials] a little earlier are going to have an easier transition when the time comes. The people who wake up one day and realize that a good segment of their business is retiring or deciding to go do other things, they’re going to miss out.”