Mortgage industry talent battle has job seekers running the show

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  • Demand for home loans has skyrocketed during the pandemic as interest rates have fallen.
  • This, in turn, has led to an increase in the demand for talent, especially from underwriters and loan officers.
  • One recruiter recalls an “absolutely insane” signing bonus of $ 50,000, claims job seekers “put on a show.”

When it comes to booming hiring markets, the mortgage industry could be on fire.

The

Federal Reserve
cut rates in the spring of 2020 as the pandemic hit the United States, energizing the mortgage market in the process as borrowers sought to refinance existing loans or buy new homes.

Competition for talent in mortgage lending over the past year has therefore seen some fast-growing lenders (and not necessarily banks) raise wages by tens of thousands of dollars and offer equally gigantic signing bonuses. to attract experienced workers. Other lenders have filled job shortages by turning to pandemic-plagued industries, such as the hospitality industry, to poach new talent.

“Right now, I would say these candidates are running the show,” Madeline White, Phoenix-based executive mortgage recruiter at Parker + Lynch, told Insider. Many of its clients are small and medium-sized businesses that may not have dedicated talent training staff and resources.

White added that since last year she has seen a mortgage advisor offer a signing bonus of $ 50,000 and underwriters’ salaries increase in some cases from $ 30,000 to $ 40,000 above what was once considered a “normal” market.

A “signing at 50k is absolutely insane,” White said of the offer, which the candidate accepted.

Although the frenzy has started to set in in recent months as lenders have staffed themselves, White says the growing demand from lenders is far from over. Clients told her, “I have met all of my needs, but call me back in six weeks and I promise I will have 10 more loan processors that I will need,” she said.

The hiring surge in the mortgage industry comes amid a wider labor shortage in the United States created by Covid-19 fears and, according to many employers, has increased unemployment benefits and Generous stimulus checks in the event of a pandemic. This is a look at a single industry’s efforts to rectify the problem as the economy struggles to bounce back from the pandemic.

Jobs in the mortgage industry consist of loan officers, who help borrowers with loan applications, and underwriters, who assess clients’ creditworthiness. Underwriters in particular have been in high demand, according to industry insiders.

In addition to near-zero interest rates, broader structural factors have also played a role in the industry’s tight labor market, as there is typically no dedicated class of loan officers or loan officers. graduate underwriters each year.

“The mortgage industry is still a tribal knowledge industry today,” Anthony Hsieh, founder and CEO of digital mortgage lender LoanDepot, told Insider. “Anyone with specific skills that are difficult to train, there is a demand for that. Underwriters are in high demand,” he added.

LoanDepot has added around 5,000 net new employees since March 2020, the company said.

Hiring of the hotel industry

As for less experienced workers, staffing issues in the mortgage industry may actually be contributing to worker shortages elsewhere, as some lenders say they have been able to bolster their ranks by bringing in newly laid-off workers to fill. entry level vacancies during the dark days. of last year’s pandemic.

United Wholesale Mortgage has recruited laid-off workers for entry-level jobs, Laura Lawson, the company’s personnel manager, told Insider, and about 40% of the 5,000 new hires in 2020 were employees who had lost their job. job. Hospitality hires are particularly suited to customer service roles, she added.

According to Lawson, UWM has not increased salaries or signing bonuses to attract new employees throughout the pandemic. But that hasn’t been a barrier to hiring more workers, she said, as UWM places a strong emphasis on career growth, on-site benefits and training opportunities during the job. recruitment.

UWM has long pursued a recruitment strategy based primarily on onboarding new employees into the industry and training them, with over 200 instructors capable of training workers in areas such as mortgage closing, sales, and training. underwriting, Lawson said.

“In a competitive environment, we should not rely solely on experience in mortgage lending,” she added.

UWM does not disclose entry-level starting salaries. But the median annual salary for loan officers – including underwriters and those working in trade credit and real estate – was around $ 64,000 in 2020, according to data from the Bureau of Labor Statistics.

The average hospitality and recreation worker can expect to earn about $ 494 per week, or about $ 26,000 per year, according to BLS data for August.

And while wages for hospitality and leisure workers are rising at their fastest rate since 2001, a recent Joblist survey found that more than a third of former hospitality workers are unwilling to return to their previous careers. .

Other mortgage companies are looking to attract labor by emphasizing the flexibility of remote work and extended paid time off. HousingWire, for example, reported last year how lenders were incorporating paid sponsorship programs, in addition to higher salaries, to attract talent.

For Madeline White, whose work focuses primarily on recruiting more experienced mortgage candidates, the mortgage boom continues to represent an opportunity. His team at Parker + Lynch began working entirely on mortgage and banking financial services in August of last year, and continues to focus on filling long-standing vacancies in the industry.

“We were already a bit understaffed before that, and then the refi boom happened,” a client recently told White. “And now all of a sudden we still need more people.”

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