This past week, I spent a few hours talking to my good friend George Orwell over lunch at his favorite English pub. (George Orwell was an early 20th century journalist and author, best known for his works such as Animal Farm and Nineteen Eighty-Four.)
Our conversations covered many subjects. He was fascinated and extremely impressed by today’s technology, like all the wondrous things my little I-Phone could do. But he was also extremely troubled by the current direction of our banking and lending industry.
Since I know a thing or two about this business, I asked him to elaborate. George paused, took a sip of ale, and told me what he’s observed over the past two years. He explained how excessive government intervention and regulation, under the guise of rescuing the economy and protecting the consumer, has squashed competition and free enterprise, increased the costs to consumers, and limited their options.
George went on to predict an, (ahem) “Orwellian” banking industry where ever increasing government regulations had made business so difficult, that it drove all of the brightest enterprising minds out of the industry. “In a few years,” he declared, “the Big Four Banks will have gobbled up the few remaining lenders. Then they themselves will merge together, becoming Super Mega-Bank, the one place for all banking needs.”
George continued by describing Super Mega-Bank’s business culture:
“Need a mortgage? A credit card? How about a checking account? Call our toll free number. Hold times are about 16 hours. We’ll take your call eventually. Or stop by a branch. One of our drones will be happy to hand you an application. Have a question? Our drones are trained to smile and say, ‘No problem.’ If your question requires knowledge or personal attention, you’ll just have to settle for a blank stare from one of our helpful drones.”
I pointed out to George that his Orwellian prophesy doesn’t have to become reality. Although recent industry changes have been disturbing and destructive, the pendulum is bound to swing back towards the center.
Borrowers will always want that personal touch. They’ll always need sound professional advice uniquely formulated for their personal situation. And they’ll never get this from a bank drone. Not today, not tomorrow.
Yes, the banking and lending industry is going through some dark times. But I assured George that there’s a new dawn over the horizon.
As long as the Big Banks continue to promote order-takers rather than competent and qualified advisors, as long as there are small mortgage brokers like us who contribute to the local economy by helping local Realtors, Financial Planners, and CPAs become more successful, and as long as there are small mortgage brokers like us who deliver to our client better advice, better products, and better rates than the Big Banks, then the future for Mortgage Planners will always be bright.
Warren Goldberg is a Mortgage Planner, and published author. His interviews include Blog-Talk Radio, Newsday, and the Long Island Herald. His newsletter is read by almost two thousand subscribers.
Since 1992, he’s been sharing his financial knowledge and wealth-building strategies, including how to properly use your mortgage as a financial tool. His clients regularly express their trust and appreciation by recommending friends and family call when in need of mortgage, real estate, and financial guidance.