Placing People At The Center Of Lending


BLOG VIEW: In today’s marketplace, consumers are becoming more selective about the brands that they choose to work with, and this extends into mortgage lending, as well. Price and convenience will always be key factors, but increasingly, U.S. consumers are demonstrating a preference to work with organizations that are committed to simultaneously establishing and nurturing an ongoing relationship with customers and demonstrably operating in a way that provides value to the greater good.

Too often, lenders (and borrowers) view the mortgage origination process as a singular event – ending at closing and with new house keys in hand. In reality, this is just the beginning of a long-term partnership between lender and borrower – one that bears a tremendous impact on the economic futures of both parties.

Making this transition, however, requires employees who believe in the value of their work and consistency in communication between lenders and borrowers over time. Lenders are constantly looking for ways to strengthen and reinforce the relationships with their valued employees, and one proven strategy is equipping employees with a degree of ownership of the company that they work for. The result is often a stronger bond among employees at every level, fostering increased positivity within the organization, and improvement to the quality of products and services provided to borrowers.

A few years ago, our firm implemented an employee stock ownership plan (ESOP), and the ensuing benefits underscore the importance of prioritizing people and relationships – a deciding factor for a lender’s (or any organization’s) ability to strengthen the following:


Whether employed by a top 10 lender or as part of a private local brokerage, mortgage professionals’ salaries are largely based off of commissions – not bonuses – and they often see their own production as a stand-alone component of their employer’s overall business. If they want to make more money, they have to try to originate more loans. Rewards are then given to the top producers. By itself, this approach places a higher emphasis on individual performance instead of creating an environment where employees work for the good of a company.

An ESOP essentially flips this on its ear by asserting that cumulatively, employees with an ownership stake in their future will benefit more. We have always had a strong corporate culture and saw this strengthen as our employees, as owners, more strongly support and promote the long-term buy-in to the company’s philosophy of placing people before profits.


According to the National Center for Employee Ownership (NCEO), a company is 25% more likely to stay in business after implementing an ESOP, which is a compelling statistic for industries such as mortgage lending. Organizations that provide company ownership options to employees project a dimension of corporate stability that helps differentiate them from the crowd – something that is critical in a hypercompetitive industry like ours. The NCEO also found that employees at ESOP companies are 4% to 5% more productive, have retirement accounts that are 2.5 times greater, and earn as much as 12% more in wages over employees of non-ESOP companies.

An ESOP attracts employees who are highly motivated – team players who collectively value their roles as stakeholders in the company. From the person who answers the phone, to the person who helps fund the loan, employees are equally incentivized to excel because the distribution of wealth across the organization is more evenly dispersed.

Customer Service

As mortgage lenders, we are in the business of helping people achieve their dreams of homeownership by providing the best financial product for their specific needs. The ability to take this approach requires that a mortgage professional possess a true sense of fulfillment in serving each borrower. This is an inherent trait that is shared by some of the most successful mortgage professionals, ESOP or not.

However, research shows a correlation between employee-ownership and higher levels of commitment, loyalty and job satisfaction. Employees look forward to the statement at the end of the fiscal year because they know that the profits are being shared and that those profits were driven by successfully helping people attain their financial goals.

Over time, loan officers demonstrate a motivation to go above and beyond for their borrowers, as well as seek out new opportunities within the local community for partnerships and prospects. Prioritizing relationships and delivering a smarter mortgage plan to borrowers earns a lender the reputation of being a lifelong trusted resource – well beyond the closing date.

The most recent data from the NCEO estimates that there are approximately 7,000 ESOPs covering 13.5 million employees, showing significant room for growth in the strategic adoption of ESOPs. For lenders, this is an important decision, as the timeline for adoption and implementation can span several years, and an ESOP is more effective if the existing corporate culture and business approach to lending puts people first.

Based on our own experience, the decision to execute an ESOP – when done correctly – could very well be the best way for a lender to strengthen its overall business, both today and for years to come.

Matt Price is north Texas branch manager for Brentwood, Tenn.-based Churchill Mortgage Corp. With more than 16 years of mortgage industry experience, he started his mortgage career as a loan officer with a national mortgage lending firm and later worked at KPMG LLP, a public accounting firm, where he focused on financial statement audits before joining Churchill Mortgage in 2010.

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