Originator rises from the ashes to bring brokerage back from the brink

Mortgage originator Michael Mann brought his business back from the brink. What did he do to turn a failing brokerage around and settle $5m in one month?

Originator rises from the ashes to bring brokerage back from the brink

Two and a half years ago, Michael Mann was fed up. Following a series of personal and professional challenges, he was on the brink of closing his underperforming mortgage brokerage and launching a new career. Fortunately, he changed his mind and decided instead to radically change the way he did business. The gamble paid off, with Mann’s team closing 25 loans worth around $5m in one month.

How did you begin your career as a mortgage professional?

I don’t believe anyone grows up as a kid, saying “I want to be a loan officer” or “I want to work in the mortgage business”. I sure didn’t! I got into the ‘so-called’ mortgage industry as a part-time loan officer in September 2002, and I say ‘so-called’ because at the time you needed more licensing to cut someone’s hair than you did to finance someone’s mortgages worth millions of dollars. I began working full-time a few months later, in January 2003, and worked for a few different companies before starting my own office in 2009.

Why did you decide to open your business?

I didn’t like working 9 to 5 for someone else, so I joined a national mortgage lender, Fairway Independent Mortgage Corporation, and opened my own branch in January 2009. I got into business because of the freedom and flexibility. Unfortunately, I initially thought that it meant showing up when I wanted to and doing whatever I liked, but I soon found that freedom and flexibility only come after you have the discipline to do what needs to be done first.

What are you most proud of achieving in your career?

Early on, the majority of my business came from refinances – it was about 25% purchase lending and 75% refinancing. Today, our main focus is to have a purchase-first mentality, and in 2012 our final numbers were 92% purchase and 8% refinance. We didn’t get there overnight; I finally decided, after reliving my first year in business over and over and over again – seven times in a row! – that I was being strung along by the refinancers, and it wasn’t a stable or steady business plan. So we used a very specific strategy to bring that purchase figure up to 92%.

Could you share a few details of the strategy you used to grow your purchase lending?

I made a purposeful, laser-focused business decision to go after the real estate agents in our area, in a different and unique way compared to what every other mortgage broker was doing. Basically, I treat the real estate agent as my client, in addition to the person who is actually buying the house, and by doing that I am able to create a new business channel with that realtor. I work with them and help them to grow their business, by teaching them how to market themselves, because the more that I help other people achieve their goals, the more my business seems to take care of itself. It’s really cool how that happens!

Did it take long to see real changes in your loan book, moving from refinances to purchase money?

No, it didn’t, and it’s very important to point out that it didn’t take me 10 years to achieve this – it really was a two-year turnaround. I don’t believe in letting the market dictate your business success. The last two and a half years have not been the greatest market we’ve had – in fact, it’s been pretty ordinary. But I’ve still been able to grow my business to the point where we’re closing $5m in sales this month. And the cool part is – I don’t do most of the work! At least 80% of the work is handled by my team.

Has that been part of your success strategy – building an effective team around you?

Absolutely. When my daughter was born, on September 19, 2010, she was three and a half months early; at 1lb 10oz and 12 inches long, we actually didn’t know if she was going to survive. She spent 97 days in the hospital, and during that very stressful time my business tanked. There was one month where we closed one loan, and the next month we closed no loans whatsoever. Although I had two people working with me, I realised, ‘If I’m not here, this thing takes a nosedive’. I considered quitting the mortgage business altogether. That night, when I went to the hospital to visit my daughter, the doctor told me that they had to sedate her because she was ‘trying too hard’. Here is a 1lb 10oz premature baby trying too hard, and I was thinking about quitting. Well, that settled it – I wasn’t quite ready to give up, so I walked into the office the next morning and said, ‘Alright, folks. What happened over the last two months is never going to happen again. Things are going to change, and if you want to stick around, I need fighters. Are you in?’ They both said yes, and since then we’ve grown to 11 employees. This month we closed 25 loans, of which 23 are purchase loans. And my daughter is a 100% healthy two-year-old!

How were you able to actually step away from doing so much work day-to-day?

Over the last 12 months, one of my mentors, Carl White, has been hugely instrumental behind me setting up my business to operate efficiently without me being there. Everyone who works in my business knows what their job is, and we’ve implemented systems and structures to make sure the same thing happens every time on each of our files. It means we’re able to deliver the best service we can, and it means I don’t work more than 40 hours a week, ever. In this business, it’s so few and far between that people do that. My team actually urges me to go play more golf, simply because that’s one of the ways that I get more loans – on the golf course.

What are you passionate about, outside of the mortgage industry?

I’m passionate about my family, absolutely. And I’m also driven by my purpose, which is to give back. In April this year, through a donation project run in conjunction with Fairway, the Boot Campaign, and Military Warriors Support Foundation, we were able to present a home, free and clear, to a Purple Heart recipient who was injured in Afghanistan in 2009. This April was the five-year anniversary of my father’s passing; he used to advocate for our disabled veterans, and when he was dying I promised I would continue his legacy to support the veterans. It’s a huge cause and a driving force behind everything that I do.