President, Consumer and Commercial Banking Products, Ally Bank
Some executives try to bury their mistakes, but Diane Morais is forthright about what went wrong after Ally started offering mortgages in 2017.
Detroit-based Ally saw home loans as a product that it could sell to both its auto-loan borrowers and its online depositors, two customers segments that previously had little overlap.
In an effort to start offering home loans more quickly, the $162 billion-asset Ally decided to partner with a vendor. Within about 18 months of the product’s launch, however, Morais decided that the company’s initial strategy needed to be revisited.
“Candidly, we weren’t really seeing the type of results that we were expecting or needing to see,” she recounted.
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So Morais, a former Bank of America and Citigroup executive who joined Ally in 2008, went back to the drawing board. The ensuing strategic assessment considered whether Ally should build a home loan platform internally, make an acquisition, or find a new partner. It entailed a deep analysis of risks and opportunities for the company over both the short term and the long run.
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Ultimately, Ally decided to partner with Better.com, a New York-based digital mortgage firm. The alliance was announced in April, and Ally has since been moving its mortgage business to the new platform on a state-by-state basis. The conversion is expected to be finished during the fourth quarter.
Morais said that Better’s digital processes remove a lot of the burden from mortgage applicants and that Ally has been receiving terrific feedback from its customers. Applicants can obtain pre-approval in as little as three minutes and lock in an interest rate in as little as 10 minutes.
“Sometimes you have to go back and reevaluate decisions that you made through a very objective filter,” Morais said. “And we needed to drop back and change course.”
