Last week, we welcomed Travis Lemmon, owner of Creekside Mortgage in Pleasant Grove, Utah to discuss the rise in rates, shift to purchase, and what it was like going from a national lender to starting his own brokerage.
A Balanced Pipeline
When thinking about whether to specialize in purchase or refinance depends on who you ask. There’s an argument for both sides. On one side, becoming an expert allows you to focus in one area, but then you may miss out on riding the market waves, like with refis in 2020 and 2021. Many lenders quickly transitioned their focus to refinance. For Travis, it’s always been about having a balanced pipeline.
In 2020, Travis’ pipeline was 60% refi / 40% purchase, this followed suite in 2021. Enter 2022, the tides shifted and it is 30% refi / 70% purchase. Their ability to adapt was a result of the diligent effort they put into nurturing their real estate agent relationships throughout the refi boom. “Don’t forget about your agents!” Travis would say at the top of each meeting. Admittedly, Travis didn’t expect rates to move as fast and high as they did, but those relationships paid dividends.
Finding the Refis
Refis are hard to find these days, but there is always a need for them. It’s not always the case that someone wants to lower their payment. Travis is currently seeing two main use cases for refinances. The first is divorce, where one spouse keeps the home, and the second is cash out refis. As inventory remains low, and home appreciation high, homeowners grapple with uprooting their lives and moving, instead they utilize a cash out refi to make home improvements or put towards other investments. Those are the immediate opportunities in this environment, but having a long-term view is critical, “Every purchase loan we work on has the potential to be a refi in the future,” said Travis.
The Relationship Flywheel
Relationships and service are top of mind, as Travis puts it, “One thing is for certain, someone is going to market them.” Each successful loan closed is another layer of referrals. Building and nurturing relationships long before and after they have worked with you is important. It starts with honesty and knowing that sometimes you may not have the lowest rate.
Building A Business
Travis spent years working at a national lender, the kind whose name is plastered on a national sports stadium, yet he felt that it provided little benefit, “Marketing dollars were spent on things that I didn’t benefit from. I knew that it meant customers could find a better deal somewhere else.” Ultimately, the push to go out on his own was the desire for more control and transparency over the customer experience.
When COVID-19 hit, Travis lost his entire pipeline of more than 20 deals in just 5 days. “There was a month of sheer panic.” Fortunately, they had run a lean business and were able to keep all their staff on payroll. This enabled them to capitalize on the refi boom. Volatility is part of the job, but ultimately it comes down to the team they’ve built and genuine client relationships that have led to their continued success.
To learn more, check out the webinar replay here.
About: Creekside Mortgage is Utah’s Highest Rated Independent Mortgage Broker. Winners of the Best of Utah Valley award in 2019 and 2021 and Top 1% in the nation awards in 2019 and 2020. Their partners have a combined experience of over 40 years in Mortgage Lending. They shop up to 73 wholesale lenders so their clients know they are getting the best rates and fees every time. Learn more at https://creeksideutah.com/.
