Looking Ahead: The Power Of Bank Branches With Loan Officers

By KIMBERLEY HAAS

As consumers turn to mortgage professionals they can trust in their communities, it is predicted that more industry leaders will depend on a retail model to make the most out of the market.

Joe Ludlow, vice president of sales at Advantage Systems, Accounting for Mortgage Bankers, and ApprovalSoft in California, made note of the potential trend during a recent interview with The Mortgage Note.

Ludlow said since it is getting harder for potential homebuyers to get approved for a loan, they are seeking out a local professional to help with the process. As a result, bank branches and loan officers with a desk there are popular again.

“Branches now are becoming more important. Loan officers are becoming more important,” Ludlow said. “I think the trend in the market in the next few years will be the formation of more branches.”

Advantage Systems is a provider of accounting and financial management tools for the mortgage industry. They work with banks, credit unions, independent mortgage companies, and wholesale lenders.

Last month, the company announced a new feature that offers enhanced reporting capabilities to deliver greater levels of transparency and a better analysis of the contribution each branch is making to the overall company.

Regional managers can see the activity for the branches they manage, while C-suite executives running the same report can see the full impact of loans originated by a branch or group of branches, according to a press release.

Ludlow said branch managers are entrepreneurial and want access to this information on a daily basis.

“Branch managers need to understand where they are all the way through the month in terms of their expenses for marketing, in terms of the margins on the loans that closed earlier in the month, in terms of what their fixed costs are so they can break even,” Ludlow said.

“We think that the branch manager should have the ability to manage their branch for profitability and understand where they’re not profitable.”

Ludlow said that, in his opinion, the people who are going to be successful in the industry moving forward are the professionals who have good relationships with members of the community they serve, and this plays into his prediction that retail branches will become increasingly important in the near future.

According to the Global Banking Consumer Study by Accenture, 66% of American consumers like seeing bank branches in their neighborhood, while 71% say they turn to the branch to solve specific and complicated problems.

Michael Abbott, senior managing director and global head of Accenture’s banking industry group, said in a related opinion piece for Forbes that, “Digital has been an incredible tailwind for the industry, but there is such a thing as too much of a good thing. We are entering a post-digital age that demands the best of both digital and non-digital experiences.”