It’s been a few weeks since Abode Mortgage announced it was shutting the doors.
Ideally we could render a definitive cause of death, but unfortunately not all the details have emerged. What we can say for certain, is what we saw when dealing with Abode.
As mortgage planners, we sometimes wondered how a company like Abode could thrive. It was somewhat of a “dime a dozen” lender. Abode’s products were run-of-the-mill insured mortgages, like those offered by dozens of other lenders.
Yes, Abode had amazing service (truly), but it’s easy to have great service when you’re not overflowing with deals.
Perhaps Abode would have had more business if it weren’t for such mediocre rates. Abode called its rates “competitive” but they were anything but. When you’re 20+ basis points out of the market, your rates are usually only competitive in the eyes of customers that don’t know better.
Abode also told brokers that its:
Service was “first rate”
Compensation was “attractive”
Underwriters were “responsive”
Model was not to solicit a broker’s clients
But the truth is, the above are nice for brokers, but not very compelling to customers. And, since customers drive this business, a successful lender really does need noteworthy products or noteworthy rates—preferably both.