Mortgage staffing: overcome the boom-and-bust talent cycle

By developing an in-house training center of excellence, mortgage lenders can build more flexible talent pools in high-demand areas like underwriting and compliance.

It’s a market swing that’s painfully familiar to every lender: Interest rates drop, and mortgage staffing needs rise; eventually rates rise and resource needs decrease. 

Developing an in-house training center of excellence (CoE) is a strategic way to manage the mortgage industry’s boom-and-bust cycle for talent. CoEs give lenders flexibility to scale up when origination volumes grow and then reskill or redeploy staff as volumes drop off. But not all CoEs are created equal. It takes the right strategy, tools and tactics to build a training center that fills the mortgage industry’s pipeline.

The trouble with mortgage staffing

Mortgage lenders are under constant pressure to do more with less. The cyclical nature of the industry’s talent acquisition, however, presents one of the biggest barriers to efficiency by churning up a perfect storm of workforce challenges. Chief among them is the exodus of underwriters. We saw this when interest rates began ticking upward in 2022. Skilled mortgage professionals—underwriters, processors, closers and servicers—routinely move into new fields when origination volumes sag for long periods of time. But the flood of departures after 2022 was dramatic even by industry standards, with some estimates citing a 47% drop in the number of loan officers.

While interest rates are the primary driver of employment volatility, other external influences play a role as well. They include housing demand and mergers and acquisitions that drive out smaller players or lead to layoffs among overlapping teams. 

In this constrained employment environment, traditional training often falls short. Lenders tend to recruit and hire reactively, ramping up too late during market booms and cutting too deeply during busts. Lack of long-term talent planning and flexible training pipelines make matters worse, with most programs taking a one-size-fits-all approach of rigid, step-by-step paths. Learners start and end at the same point, and there’s little strategic connection to the business. Something needs to change—and that’s where a CoE focused on training comes in.

What does a training CoE look like?

A training CoE acts as a strategic enabler for long-term talent building and upskilling. It differs from traditional training by aligning closely with the business in several key areas. For one thing, it develops training programs to directly support business goals such as increased loan volume or reduced turn times. For another, it’s designed to meet real-time operational needs by adapting quickly based on pipeline volumes, regulatory audits or shifting performance KPIs. During a refinancing boom, for example, a CoE might prioritize and fast-track underwriter upskilling to clear backlog.

CoEs also help lenders keep an eye on future skill requirements. They analyze trends in technology and market direction to build a more flexible workforce through cross-training and career pathways to reduce attrition during downturns. For example, as automation continues to change how loans are processed, CoEs can begin retraining processors in QA or exception-handling roles.

Leadership of the CoE is typically cross-functional. It includes learning and development (L&D) professionals as well as business and delivery leaders. The CoE team tracks industry developments and works closely with business teams to develop and run relevant, measurable training programs. Mature training CoEs leverage technology solutions such as learning management systems (LMS), simulations and AI-driven learning platforms to personalize the learning journey and track real-time progress.

Industries including IT services, healthcare, aviation and financial services (particularly insurance) have been leveraging training CoEs for years. In sectors where regulatory pressure is high and roles require deep specialization, the CoE model helps maintain compliance and enables rapid workforce scaling.

5 guiding principles to build a CoE

Here are five guiding principles for mortgage lenders to consider when stepping up their approach to training: 

1. Not every role needs to be trained at full scale from day one. One of the most effective ways to build a scalable workforce is by breaking down complex roles into modular skill tracks. For example, instead of training a new hire to become a full-fledged underwriter—a process that can take months—start them in a junior underwriting or pre-underwriting role. This position allows them to gain experience in document preparation, data validation and file setup while experienced underwriters focus on decision-making and sign-off. This layered approach creates a skills ladder and helps workers build confidence in a controlled, predictable manner. 
   
   
2. Establish a skill-building framework. Training isn’t just about content delivery; it’s about structured learning paths, measurable progress and application-based assessment. The “tool gate” model gives structure to a training CoE. It’s a milestone-based approach in which learners demonstrate proficiency with specific “tools” (skills, software or processes) before progressing to the next phase. The tool gate model monitors progress at every stage and includes role-specific training frameworks with hands-on practice and certification checkpoints.
   
   
3. Embed continuous learning. Building a resilient workforce requires investment in ongoing, incremental skill development. The CoE should assess skill levels quarterly or even monthly using on-the-job performance data, knowledge checks, quizzes and 360-degree feedback to personalize learning journeys. Whether it’s remedial training for struggling team members or upskilling high performers for leadership roles, learning should be part of everyday operations. This mindset ensures your team is always prepared for both current demands and future disruption. 
   
   
4. Make smart use of technology. From content delivery to performance tracking, take advantage of the edge that technology provides for every layer of the training process.
   
   
   • Incorporate LMS, microlearning apps, gamification platforms and even AI-driven training analytics.
   • Introduce automation concepts early in training programs and host sessions on emerging technologies such as generative AI and intelligent document processing.
   • Empower trainers and delivery teams to integrate technology tools into each aspect of the training lifecycle. This grassroots enablement fuels innovation and ensures change is embraced from the bottom up. 
      
5. Leverage strategic partnerships to jumpstart CoE capabilities. You don’t need to build everything from scratch. Partnering with organizations that have already developed mature training CoEs—especially those with deep industry expertise—can significantly reduce the time required to build, train and scale. These partners often provide access to proven content, platforms, trainers and governance models. 

The mortgage industry’s future will be shaped by its ability to build, scale and continuously evolve its talent pool. By breaking down roles, structuring skill building, forming strategic partnerships, embedding continuous learning and embracing technology, lenders can create a workforce that is as flexible as it is capable. 

Now is the time to build a strategic engine that drives performance, agility and transformation, because the talent you build today will define your competitive edge tomorrow.