BLOG VIEW: I always think of the New Year as a symbol of hope. It is a clean start, a chance to begin anew. Ralph Waldo Emerson said, ‘Finish each day and be done with it. You have done what you could; some blunders and absurdities crept in; forget them as soon as you can. Tomorrow is a new day; you shall begin it serenely and with too high a spirit to be encumbered with your old nonsense.’
There is no doubt 2012 had its ups and downs, for individual companies and for the industry as a whole. But if we follow Emerson's advice, it is time to forget the missteps. Let's start 2013 with a high spirit and a belief that a New Year gives us new hope.
What do I foresee happening in 2013 that gives me hope? Here are of some of my prognostications, along with some resolutions that I believe will make them a reality.
The industry will get over the anger that has prevented some from moving on and accepting the changes that are necessary in the new world of mortgage lending.
Lenders and servicers will inculcate the concepts and principles of "consumer service." They will back up their words with actions, and will recognize that harm to consumers decreases the willingness of investor participation and is bad for business.
Lenders and servicers will redirect their efforts to develop operational measures that convey their control over how they do business, and they will establish a common approach so that comparisons can be made. This will help consumers, regulators and investors find out who is naughty and who is nice.
The industry will recognize that compliance is separate from operational risk and will develop compliance as a new practice within the risk management function.
The industry will see the emergence of new business models that demonstrate that the best use of technology and risk management can enhance profitability.
Data integrity will become the most critical aspect of any technology.
The end of various loan modification programs and the rising concern over student loan debt and defaults will move the focus of the financial regulators away from mortgage lenders. However, the scrutiny of examiners will continue.
Housing prices will stabilize, and in some of the hardest hit areas, home prices will rise as the economy continues to improve.
Finally, what would New Year's be without resolutions? So, in 2013, I urge lenders and servicers to resolve the following:
- Implement a thorough and solid risk management program throughout their organization. Don't be afraid to turn to experts for help.
- Focus more on meeting consumers' needs and expectations, and a little less on what will simply keep investors satisfied.
- Embrace new and innovative technology that will help streamline processes, ensure compliance, and provide a better experience for the consumer.
- Focus on improving data integrity. Cooperate in developing a solid and comprehensive mortgage origination and servicing database for research.
- Strive to create a more positive image for the entire mortgage industry. We've suffered from a largely unpopular image for too long now.
If the industry can keep these resolutions, 2013 promises to be a very good year indeed for the mortgage business!
Guest blogger Becky Walzak is president of Looking Glass Group, LLC, an Indianapolis-based consulting firm focused on business transformation initiatives in the financial services industry. Walzak is also the president of rjbWalzak Consulting, based in Boca Raton, Fla. She can be reached at (561) 459-7070. Phil Hall's column will resume next Monday.