In the middle of a refi boom, lenders are getting creative in hiring operations staff

Last month, Patty Arvielo, president and co-founder of New American Funding, tweeted that her company was offering up to a $25,000 sign-on bonus for senior processors, senior underwriters and senior funders.

That tweet got us thinking. Are other lenders offering similar signing bonuses and what does this say about the shortage in the industry when it comes to operations staff?

First off, the shortage is real. Operations people with special designations, such as FHA and VA, are seen as particularly valuable these days. 

Secondly, lenders are using different approaches to address the supply-demand imbalance, with signing bonuses only being one way to potentially attract talent.

Differing perspectives

Fobby Naghmi, EVP and national sales manager at First Option Mortgage, is in charge of recruiting for the Atlanta-based lender.

He agrees that underwriters, processors and closers are in extreme demand right now.

“I’m hearing of underwriters being paid as much as a $150,000 base plus bonuses, which is the highest I’ve ever heard in my 26-year career,” Naghmi told Housing Wire. “Everyone is going after the same pool, so that’s driving salaries up.”

In fact, First Option has doubled its underwriting staff over the past 90 days and is still looking to hire more, he said, as production has doubled year over year.

Demand is especially high for the non-conventional underwriter.

“FHA and VA-certified are golden, and can command a higher compensation plan,” Naghmi added.

But when it comes to signing bonuses, he believes they are less common and is quick to differentiate them from other incentives.

“There are bonuses attached to every underwriter’s compensation plan, whether it’s over a period of time or at signing,” Naghmi said. “Most get it over a period of time, much like with an NFL contract, where a player doesn’t get all the money upfront, but over a number of years.” 

Daniel Jacobs, founder and managing director of Charlotte, N.C.-based TruLoan Mortgage, says he is aware of a lender that is offering an up to $5,000 internal referral fee for referring underwriters.

But when it comes to his own company, Jacobs said the company relies more on creative ways of recruiting new talent such as nontraditional new hires.

“Business is up pretty dramatically,” he told HousingWire. “The tight market for hiring has forced us to think in innovative ways.”

Specifically, volume, Jacobs said, is up 230% year over year. This is partly due to increased demand as of late as well as the fact TruLoan has added some new locations.

When recruiting new talent, TruLoan has recruited people that generally have trusted relationships with real estate agents. For example, it recently hired some people who worked at a local vendor that serves Realtors.

“We wanted to expand the number of Realtors working with us,” Jacobs told HousingWire. “So we’ve found hiring someone new to the business and training them is also effective.”

And early indicators are that going this nontraditional route may be even more effective than the traditional routes, he said.

“If an officer is willing to move for a few more basis points, then we may be their next old company by next year,” he said.

The issue of loyalty is also an important one for Suzy Lindblom, COO of Round Rock, Texas-based Planet Home Lending.

Lindblom is not interested in offering anyone a signing bonus.

“I’m looking across the board for longevity and often the people that come on for signing bonuses are not the most loyal,” she told HousingWire. “Some want to stay and then some will just someplace else for another signing bonus.”

Lindblom is also concerned about making sure her existing staff feels respected and that they are treated equally.

“I watch the industry and change my bonus compensation from time to time,” she said. “This year alone, I’ve changed it three times for my fulfillment staff to meet market demand. This helps me not only retain who I already have but also attract new people. I’m trying to be fair across the board by showing my current employees who have stayed with me that I care about them as much as new people. I have had very good success with that.”

When it comes to attracting new employees, Lindblom relies largely on word of mouth.

She too is also bringing people who are new to the industry, starting them out in entry-level positions and training them for more responsibilities.

“I’ve been doing this for about two years with a tremendous amount of success,” she said. “In fact, my two top processors had very little experience in the industry before coming to work for me.”

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