What is pull-through -- and why is it vital to your business?

What is pull through rate, and why is the fact that it's been improving across the country so exciting?

By David Lykken
Special to MPA


Recently on my Lykken on Lending radio show, I was honored to have as a guest Tyler Sherman, CEO of Motivity -- a company that helps organizations with increasing their pull-through rates. Most of us are probably aware of the news I discussed here last week -- that the average pull-through percentage is the highest it's been since 2011. But what exactly is the "pull-through" rate?
 
Tyler defines the term, and I would tend to agree, as application to funding. In other words, the pull-through rate is the number of people who end up getting keys to their homes divided by the total number of applications that are taken. It's not just a question of how many applications are being passed along to the next step in the process. The real question is, start to finish, how many loans are being closed?
 
And why is the pull-through rate so important? Why is the fact that it been improving across the industry so exciting? Because pull-through rate is all about efficiency. It's about doing the best with what you've got. Improving pull-through rate is process improvement. It's the foundation. If you can get your pull-through rate to its optimal level, then filling the pipeline with more applications can only lead to improvement.
 
David Lykken is 40-year industry veteran who consults on virtually all aspects of mortgage banking. David hosts a successful weekly radio program called “Lykken On Lending” (www.LykkenOnLending.com) that is heard each Monday at noon (Central Standard Time) by thousands of mortgage professionals.