“As if things couldn’t get more ridiculous at the online mortgage lender Better Mortgage, where 900 people were laid off over a Zoom call this past December, the company reportedly issued another wave of layoffs by inadvertently notifying employees via its payroll app.”
This is a quote from The Verge in an article posted yesterday.
The news was reverberating across our industry because everyone seems to be both bemused and fascinated by Better Mortgage’s frequent and massive screw-ups.
I don’t normally discuss other companies in our industry by name, but Better is hardly a competitor because they close so few purchases (fewer than 50 in our entire Bay Area market over the last 3 months). Their inability to close purchases is partly what is leading to their implosion too (a frequent problem with all of the overly tech-centric mortgage lenders).
I have blogged about Better a few times including “When Better’s Not Better; It’s All About Training,” and more subtly here: “I Caught My Dog Kevin Issuing Pre-Approvals.”
Why Better’s Issues Are So Fascinating
What makes Better so fascinating is the hubris of its CEO and founder, Vishal Garg – another rising CEO who loves to pretend that he is making the world a better place, while disparaging everyone, abusing employees, taking home 8-figure paychecks and cultivating a $4 billion net worth.
He notoriously insisted that his competitors were racists without any evidence; he denigrated his employees as “dumb dolphins;” and he orchestrated Better’s notorious layoff of 900 people over Zoom, as referenced above.
Comically, some of his competitors are using Better’s foibles in their online ads including this from SELFi: We Didn’t Fire 900 Employees – SF FinTech Start-up – selfi.com.
What Are My Points – Besides Just Enjoying The Drama?
I. Checking Our Hubris When Riding a Wave.
Better rode the refinance wave better than anyone – to their credit. But – they also got arrogant, burned bridges, and over-expanded – something I have seen time and again in both the real estate and mortgage industries. And, now that refis are dead, Better is imploding. If we slide into a recession, I suspect we will see a lot more arrogant firms and CEOs (“making the world a better place”) get their comeuppance as well. In any case, Better is another huge reminder to check our hubris during the good times.
II. THE BIGGIE: Responding to Feedback and Adjusting Systems.
This is the biggest takeaway by far. We take enormous pride in our efficiencies and systems – BUT we are willing to tweak, adjust and even blow them all up on a moment’s notice – precisely because we are not so arrogant as to think we have achieved perfection.
We get constructive feedback from agents and borrowers every week in surveys and emails – and we LOVE it! This is because we use it every time to adjust our systems.
Feedback comments included too many contacts at JVM; horrible loan-servicing issues post-close (got one this week in fact); too slow of appraisals; too few follow-ups after issues arise; too much reliance on email over phone calls – and much else. And, man did we appreciate them!
This is because we adjusted our systems every time in response to those complaints – and we will continue to do so – and we are now stronger than ever as a result.
So – please keep your feedback coming – it only makes us better (see what I did? 😊)
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 1197176, NMLS# 310167