At the age of 36, Serena Williams is one of the world’s top-ranked women’s tennis players. Forty-year-old New England Patriots quarterback Tom Brady is about to play in his eigth Super Bowl. Now in his 80s, Clint Eastwood has been on Hollywood’s A-list for a half a century.
What do these three superstars have in common? Each has achieved long-term success because they made and kept a commitment to quality. Whether it’s in sports, Hollywood or the mortgage business, success starts with making that commitment and then following through.
If you want to make a long-term commitment to quality, here are three things (and possibly four) you need to do:
Create a valid QC plan
All lenders need a valid, up-to-date QC plan that includes target defect rates, pre-funding QC, post-close QC and targeted reviews on each area of risk. It should include internal audits, which must be performed consistently and include all branch activities and staff training, so that everyone in the organization understands exactly what is expected of them.
Take steps to ensure your QC plan is carried out
In other words, develop policies and procedures that everyone in the organization pledges to follow. Make them detailed. The procedures should be a progression of steps that ensure quality at every stage of the mortgage process.
The commitment to carry out a QC plan needs to start from the very top, permeate down throughout the organization, and be reinforced at every level. We actually have a form that our clients have their employees sign, pledging their commitment to quality.
Take quick action when problems are found
It’s one thing to know where the quality issues are in your loan process. It’s another to know what to do when they are found. There’s no advantage to acknowledging the gaps in quality if you don’t take steps to close them. Sadly, many lenders don’t have a plan that clearly states how issues should be addressed and who should address them.
If you need help, hire experts when needed
The stakes for maintaining high-quality loan files are high and growing every year. Besides delinquencies and compliance concerns, adding staff to handle QC functions is one of the costliest steps you can undertake. That is why many companies outsource their QC needs to a qualified third-party vendor, which makes it easy to scale and react to shifts in volume.
Before choosing a vendor, however, it’s important to understand what services they provide in fine detail, and how much those services cost. It goes without saying that a lender should only pay for the services it receives—but unfortunately in our industry, that is not always the case. You also need to make sure your QC partner is not only up to date on all current rules and regulations, but can work within your organization’s business rules and requirements. It is vitally important to do business only with a firm that has the necessary internal and internet security measures in place too.
Making a long term commitment to quality takes dedication. But unlike sports and in Hollywood, where luck and connections are often deciding factors, the payoff in our industry is much more certain. Lenders that are dedicated to quality invariably perform better, experience lower rates of delinquency, and stay out of trouble—all of which are reflected on their bottom line.
If you need advice on any of the above steps or simply want a third-party analysis on your organization’s QC plan and policies, reach out to us at firstname.lastname@example.org. We’d be happy to help.