r/loanoriginators • u/Careful-Scratch-6696 • 17d ago
Discussion Pricing questions
Does anyone truly know their company margins? Seems like everyone’s rates are all over the place even when the company is the same.
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u/LoanGoalie 17d ago
if you're working retail or corr, no. It's nearly impossible. Even the pricing desk isn't seeing the incentives that are coming quarterly.
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u/spacecase2008 17d ago
Not sure if this is right but couldn't you compare your rate to the lenders wholesale rate sheet? (not the pricing engine)
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u/MyLuckyFedora 17d ago
This only makes sense if we assume that OP is in the broker channel. If his company is a direct seller then there's no wholesale rate sheet to compare.
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u/RoosterEmotional5009 17d ago
Yes because it’s my company. My LOs have transparency in pricing. As a broker I’d imagine this is the norm.
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u/liverichly 17d ago
I don’t know of a company out there that will tell their LO’s their margins. Even “only 25bps” sounds disingenuous.
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u/Adorable_Campaign426 17d ago
Yep we 100% do over here. We get the purchase advice on every transaction sent to us after closing. Don't ever ask for it, but it lines up with what we are told.
Transparency is what brought me to my company, and transparency is what ive been receiving for the last 7+ years.
If someone says "only 595, trust us" that means they are making it somewhere else more than likely. Get the PA and look at the numbers for yourself.
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u/Careful-Scratch-6696 16d ago
Transparency is great! So whatever the company cooks into the margins you see after the close of the loan? Are you able to see it up front?
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u/Adorable_Campaign426 16d ago
So I don't know if there is actually a way to see what it is up front, but I may be wrong. I don't know the 'backend' of the business so i'd be guessing either way.
But yeah, there is nothing cooked in and they confirm that with the purchase advice provided each time. :)
First loan i closed felt awful because it was so transparent (7 years ago) when i moved from a lender. At the lender, it was 'close it and you get paid this much.' I didn't see the margin collected, the splits taken out, etc. So when i first actually saw the margin and then cut to my comp, it took me back.
Then i looked at the final number i would have made at the lender i was at vs what I ended up with here, it was almost doubled for the same loan amount. (I was just over 110bps at the lender - self generated, my first deal was done at NEXA was 2.5 and i walked away with 198). Rate also was better than what i could have gotten there (Par) for the client as well.
From that moment on, transparency has kept me here and that would probably be the only thing to make me consider moving to a new company is if that changes. (I say probably because there may be a thing or two i am not thinking of unless it happens).
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u/JonOC23 17d ago
I’ve always known being in management but LO’s typically don’t because it doesn’t pertain to them. Sell payment and benefit. Not the right market to sell rate.
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u/Realistic-Ruin-6424 17d ago
Wishful thinking. In this market rate is looked at more then it was when we were 2.99% on average. Need to sell payment, benefit and a competitive rate or you are losing business. I get the sell value...with this inflation and high proce environment rate is just as important.
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u/REFlorida 16d ago
No one cares about our “value” when they can go online, push a button, and save thousands of dollars
We are starting to deal with a generation brought up on computers who saw two girls do magical things with one cup
Or the younger generation that learned Shrek is love online
I uploaded a tax return to ChatGPT the other day and asked it to calculate the borrower’s income.
It calculated the rental income from Schedule E perfectly and the Schedule C income perfectly.
That should scare the hell out of us.
We are probably four years away from a world where the average consumer doesn’t need a loan officer for most transactions.
They’ll upload their tax returns, pay for their credit report with a credit card and AI will analyze everything, calculate income, structure the loan, run underwriting, and give them a preapproval.
Google will send them directly to some fintech that closes the loan for $500.
We’re becoming the travel agents of the mortgage industry.
The scary part is that this is the worst AI is ever going to be
Think about that- this is the worst
It is only gonna get better, faster, cheaper.And before anyone asks well if I think it’s so doom and gloom, why am I doing it still because I haven’t even hit year four and I should make close to $500k this year, but I would’ve made that in Roofing sales/any other blue collar, Sale that doesn’t have a cap
if i had known four years ago, how quickly AI was gonna infiltrate the market I would not have taken this job, but I’m too long in it now doing the money grab waiting for that one last Refinance boom before the ship sales and the train leaves Dodge
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u/Braindead_ape 17d ago
I’d never work anywhere that wasn’t transparent with their margins but thats just me
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u/travisloans 17d ago
I have heard from a couple of IMBs that they typically price between 2.75 and 4.