matchbox State of the Market-January 2024

Hello everyone and welcome to 2024. I hope you had a happy and healthy start to the new year. It seems that I say that the holiday season flies by each year, although I think all of us in the mortgage industry, were all happy to see 2023 come to close. Although a challenging year, it provided a lot of insight and valuable experience to learn and hopefully grow from in 2024.

 We are ramping up for Conference seasons. We will be attending the MBA IIMB conference this month, Lender’s One conference, ICE Experience, hosting an ACUMA webinar, and the TMC Conference. Let’s meet up and catch up on all the new offerings for his year. 

On a personal note, the year ended with me becoming a grandfather on December 30th. It is as amazing as everyone said it would be and my wife and I feel truly blessed to have a new Grandson in our lives.

Why does it have to be either or and why can't it be both?

We start 2024 with our anniversary on January 10th. Fourteen years ago, matchbox was started as an acronym, with a high-level concept of utilizing our experiences as Mortgage Bankers to help Mortgage Bankers in a variety of areas. The idea was to have all of these areas provided “in a box” for our clients. The industry was very different then, as the Mortgage Industry had limited technology offerings. For example, Encompass was just starting to gain traction in the industry as the market leader in the Loan Origination space. Over the past 14 years, I have been so fortunate in so many ways. I have had the opportunity to meet and support hundreds of great clients, have been able to build an incredible team of passionate Mortgage Bankers, and have been embraced by the industry and by so many. Since we started, our core has not changed- to support our clients with the best possible service and expertise to help them succeed in any market environment.

As we start off this year, it feels like it will be a telling year in a variety of ways. From my perspective, we are struggling to meet the market changes similar to where we were in 2019 and then COVID hit in 2020. After a brief period of uncertainty, interest rates dropped to historic lows and the industry went through a stage of record volume. All thoughts of efficiencies and tech adoption were pushed to the wayside in favor of supporting new staff and the record volume.

Once COVID ended, the various economic efforts that were put in place to support us through COVID started to show their effects in the form of inflation. The unwind of these support measures came in record-breaking increases in interest rates in 2023, that triggered one of the most challenging years in the Mortgage Industry. Although we are no stranger to cycles, 2023 hit harder than most have ever seen, and companies and departments struggled in many ways. In looking back, we swung from one extreme to the other, and decision were made at the extremes of each stage of the cycles.

Going back to when we started, one of our focuses was technology but it was not imagined that it would be the main source of focus and growth. The tech options within the Mortgage Industry have exploded since we started, and in the process, it has opened many opportunities for our growth and expertise. The impact of technology has continued to grow and has excited, forced, or challenged many companies on how to best utilize and implement their business model.  These applications would dramatically change the Customer or Member experience, improve internal efficiency, and provide a path for reducing staff.

Coming into 2020, companies were eager to bring on new technologies to help them support their growing pipelines. All the shiny new toys were embraced to be the final answer to so many problems. When 2023 came, the volume shrank, companies were forced to reduce staff, and revisit all the technology that was contracted over the past few years. All of sudden, those contracts that were signed when volumes were high did not look so good, the intended benefits of the technology were not seen, and with staff levels reduced to pre-2020 levels, most decided that various tech options were no longer viable or needed.

So, we enter 2024, with this quandary- what is more important in this market - the technology or the people? And my answer is in the words of my favorite Uncle, “why does it have to be either/or, why can’t it just be both?” Rather than trying to make the argument for either side (which I have made for each over the years), I am fully convinced that we need both to succeed in 2024. People and technology must work in unison for both to thrive. We have fought and blamed each other over the past few years and have spent so much time and effort putting things into place to only unwind with a high cost and effort. Tech cannot succeed without strong people utilizing it and putting it to the best use. And Staffs cannot support their client or Member base without a continuously evolving experience that is supported with a strong tech stack. It is not a battle for who is to blame, but rather a year to realize that we need both to succeed in this and the coming years.

Embrace your staff and embrace your technology and get them to work together. There is no magic formula on how to accomplish this as there are variables within each company that can affect this mission. As we head into a new year, I implore you to spend time on getting both to work in unison to make you the best you can be this year. This year will be a reset in many ways. The good companies will learn from the good and bad from the last cycles and not repeat prior mistakes.

There are some great technology options in the market today and there are also amazing people. Let ‘s join them together to build a stronger model for the pending increase in volume.