minnesota mortgage professional magazine october 2015
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015PRESORTED STANDARD
U.S. POSTAGE PAIDNMP MEDIA CORP.
NMP MEDIA CORP.1220 WANTAGH AVENUEWANTAGH, NEW YORK 11793
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Headlines and breaking news from NationalMortgageProfessional.com.
Headlines and blogs from around the web.
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Simple. It’s all online. You and your clients always know where your rental loans stand.
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Visit lendinghome.com/NMPto get started or call 1-888-674-6084
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N A T I O N A L M O R T
O C T O B E R 2 0 1 5 l V O L
A SPECIAL FOCUS ON “THE FUTURE OF MORTGAGE BANKING”Flexibility and Financial Promise Lead Experienced LOs Back toBrokerage Firms By Mat Ishbia ..............................................................56
Failure to Go Paperless Carries Big Risks By Greg Schroeder............58
Why One Mortgage Business Leader is Making Millennials Her Mission By Casey Cunningham ........................................................60
Vision Versus Progress By Alec Cheung................................................61
Can You Help a Brother Out? By Eric Weinstein ..................................63
The Mortgage Industry’s Future is Here By John Vella ........................64
The Delicate Balance of the Mortgage Industry By Keith Guenther....66
MSAs Going Away? So What! By Sue Woodard....................................68
The Blueprint for Future Success Lies in People, Not Profit By Cal Haupt............................................................................70
Making the Case for the Modern Title AgentBy Michael P. Bell & Elliot Liss..................................................................72
Community Lenders Are Essential to the Future of Mortgage Banking By Wes Miller............................................................74
FEATURESTRID Readiness: Will You Pass or Fail? By Keith Bilodeau ....................8
The Elite Performer: Because I’m Happy By Andy W. Harris, CRMS ....8
Compliance in Marketing........................................................................16
Writing and Formatting Your Mailer By K. Justin Restaino ..................18
NAMB Perspective ..................................................................................20
Broker? Banker? How to Choose …By Laura Burke, MBA, MS, MIS, CFE, EA ................................................26
Transitioning to TRID By Jeremy Potter ................................................28
Agility Resources Group ...................................... www.agilityresourcesgroup.com ......................................66American Advisors Group.................................... www.aag.com/wholesale ................................................57American Financial Resources Inc. ...................... www.afrwholesale.com/wd-benefits ....................Back CoverAngel Oak Mortgage Solutions ............................ www.angeloakms.com ..................................................43Brokers Compliance Group.................................. www.brokerscompliancegroup.com ..................................96Caliber Home Loans.............................................. www.caliberhomeloans.com ............................................29CallFurst.com ...................................................... www.callfurst.com ............................................................62Calyx Software...................................................... www.calyxsoftware.com ....................................................39Carrington Mortgage Services, LLC ...................... www.carringtonwholesale.com ..............................31 & 50Document Systems, Inc./DocMagic ...................... www.docmagic.com ........................................................7Equity Prime LLC................................................ www.equityprime.com ..........................................67 & 85First Guaranty Mortgage Corp. ............................ www.fgmc.com ..............................Inside Front Cover & 56Flagstar Bank .................................................... www.flagstar.com/ae ....................................................17Franklin First Financial, Ltd. .............................. www.franklinfirst financial.com/wholesale ......................41Freedom Mortgage Corporation .......................... www.freedomwholesale.com ............................11, 65 & 79HomeBridge Wholesale ...................................... www.homebridgewholesale.com ....................................13Land Home Financial Services Wholesale Division www.lhfswholesale.com ................................................73LendingHome .................................................... www.lendinghome.com/nmp ............................................1MB Financial Bank ............................................ www.mbmortgage.com ..................................................68MBS Highway .................................................... www.mbshighway.com/MNN ..........................................83Mortgage Information Services, Inc. .................... www.mtginfo.com ........................................................63Mortgage News Network (MNN) .......................... www.mortgagenewsnetwork.com ..............................34-35Mortgage Star Conference .................................. www.mortgage-star.net ..................................................58
V I S I T O U R A
Company Web Site Page
10Is TRID Really Helping theConsumer? By Joseph J. Murin
36NMP’s MortgageProfessional of the Month:Laura Lawson, ChiefPeople Officer, UnitedWholesale MortgageBy Phil Hall
50Lykken on Leadership:Seven TransormationsEvery Leader MustUndergo to Move FromGood to GreatBy David Lykken
88Step Inside Ginnie MaeBy Ted W. Tozer
90Is Your Company YourClassroom?By Ray Maninang
T G A G E P R O F E S S I O N A L
L U M E 7 N U M B E R 1 0
Mentoring Millennials By Ginger Bell......................................................30
Diversify Your Product Line With Non-Agency MortgagesBy Tom Hutchens......................................................................................32
Preparing for the Housing Market’s Next Shift By Danny Jasper........38
The Long & Short: The Business of Short Sales By Pam Marron........42
Performance Solution Through Technology By Joni Pilgrim................46
NAMB National Schedule of Events & List of Exhibitors ....................52
Pending Credit Legislation Shows Congressional Extremes
With Regard to Credit Knowledge By Terry W. Clemans......................54
Industry Updates: October 2015 By Gavin T. Ales ................................76
Operation VA SITREP: Your VA Situation ReportBy Richard M. Bettencourt Jr., CRMS, CMHS ........................................76
FBI Fraud Alert Raises Concerns Over Settlement Agent Wiring Instructions By Andrew Liput ......................................................78
MBA’s Mortgage Action Alliance: A Message From MAA
Chairman Fowler Williams ......................................................................78
NMP’s Economic Commentary By Dave Hershman..............................80
OrigiNation: By Originators, For Originators By Andy W. Harris..........82
Just Ask Eric & Laura By Eric Weinstein & Laura Burke ........................84
Time Management for Mortgage Lenders By Bubba Mills ..................89
COLUMNSNew to Market..............................................................................12News Flash: October 2015 ..........................................................14Heard on the Street ....................................................................40Outstanding Places to Work ......................................................92NMP Calendar of Events ............................................................93NMP Resource Registry..............................................................94
MortgagePlannerMarketing.com.......................... www.mortgageplannermarketing.com ............................89NAMB+ ............................................................ www.nambplus.com ......................................................23NAMB PAC ........................................................ www.namb.org ..............................................................25NAPMW ............................................................ www.napmw.org ....................................................64 & 91NAWRB ............................................................ www.nawrb.com ............................................................82Nationwide Appraisal Network............................ www.nationwide-appraisal.com ......................................74New York Community Bancorp, Inc. .................... www.nycbmortgage.com ................................................87Pacific Union Financial, LLC ................................ www.pacificunionfinancial.com ......................................59Paramount Residential Mortgage Group, Inc. ...... www.prmg.net ..........................15, 51 & Inside Back CoverPB Financial Group Corp..................................... www.calhardmoney.com ................................................27Radian Guaranty ................................................ www.radian.biz ............................................................81RCN Capital ...................................................... www.rcncapital.com ......................................................19REMN Wholesale ................................................ www.remnwholesale.com ......................................MN1 & 5Residential Home Funding Corp. ........................ www.rhfbranch.com ......................................................55Ridgewood Savings Bank .................................... www.ridgewoodbank.com ..............................................71Secure Insight....................................................www.secureinsight.com ..................................................33TagQuest .......................................................... www.tagquest.com ........................................................77The Bond Exchange ............................................ www.thebondexchange.com ..........................................69The National Real Estate Post.............................. www.thenationalrealestatepost.com ........................75 & 86Titan List & Mailing Services, Inc. ........................ www.titanlists.com ..........................................................9UAMP................................................................ www.uampexpo.com ....................................................86United Wholesale Mortgage ................................ www.uwm.com ................................................47, 48 & 49
D V E R T I S E R S
Company Web Site Page
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OCTOBER 2015Volume 7 • Number 10
1220 Wantagh Avenue • Wantagh, NY 11793-2202Phone: (516) 409-5555 • Fax: (516) 409-4600Web site: NationalMortgageProfessional.com
Vision … Implementation ... Connect!This is the story of how a simple idea can change the mortgage industry for the better for thefuture!
I am sitting on a flight on a Sunday evening, Oct. 20, returning to New York from the SecondNAMB Wholesale Summit in Dallas. I attended not as a member of the media, but as a mem-ber of NAMB—The Association of Mortgage Professionals, working with the association on the
concept of this Summit since its inception earlier this year.I’m under a confidentiality agreement not to detail what was specifically discussed, but I cannot resist the
opportunity to report on what I saw. I’ll get to that later … but want to share with our readers the genesisthat lead to what I can only say are “historic” Summits.
A little over a year ago, current NAMB President John Councilman walked into a Wholesalers BreakfastRoundtable at a conference in Atlantic City sponsored by NMP Media Corp. and conducted by my son andNMP co-founder, Andrew T. Berman. Andrew’s idea was to gather about 15 wholesalers in an open round-table discussion annually to see where they thought the mortgage industry was and where it was headed.
This Wholesalers Breakfast, in its early years, was initially met with apprehension and doubt. It’s not easyfor companies competing with one another for market share to open up and share ideas on their own oper-ations and strategies. But, they did and NAMB’s president walked into what was NMP’s third foray into theWholesalers Breakfast in Atlantic City. What Mr. Councilman saw was both an inspiration and a vision. I’llnever forget the e-mail he sent me after the breakfast. John was astounded at the openness between thewholesalers in the roundtable discussion. He said in his e-mail that the discussion was filled with passion asthe wholesalers collectively discussed ways to increase market share and better serve their mortgage brokersand correspondents clients. I called John the next day and thanked him for his compliments. His vision wassimple … he wanted to know if I could develop the idea behind the Wholesalers Breakfast in Atlantic Cityinto a more global concept for NAMB, to not only afford the opportunity for wholesalers to share their suc-cesses and issues, and to discuss ways for them to grow their market share, profitability and compliance,while concurrently give the opportunity for feedback from the mortgage
broker community.If you have followed me to this point—and I hope I haven’t bored you yet, here is the evolution—his e-
mail and our phone conversation, and the NAMB Wholesale Summit was born. A vision John had from abreakfast roundtable in the old Trump Taj Mahal in Atlantic City was about to take off and little do I thinkthat John, the NAMB Board and officers or myself would ever thought it could become the game-changer itis on its way to becoming.
Fast-forward to March of 2015 in Orlando and the First NAMB Wholesale Summit was scheduled. At first,companies thought it was just another conference or convention with a new name for marketing purposes.But the intent and goal of the Wholesale Summit is to unite the wholesaler with their mortgage broker andcorrespondent clients. Working jointly with one another will ensure prosperity for the marketplace for yearsto come.
What started as a simple exchange of ideas in an Atlantic City meeting room has grown to become anational meeting of the industry’s top minds, coming together to help shape and form the future of the mort-gage marketplace for years to come.
So why this content for the edition featuring “The Future of Mortgage Banking?” Simple … as much asthe success of the NAMB Wholesale Summits have been to date, they still cannot accomplish as much aspossibly can be done without greater participation of the remaining wholesalers in the mortgage indus-try. The future of this mortgage industry lies in the collective hands of the players that form the intricatefacets and layers of this profession, and so much can be accomplished by the joint collaborative efforts ofthis group. So I look at the first two NAMB Wholesale Summits as the seed being planted for the future ofmortgage banking.
If you are a wholesaler and missed the past two NAMB Wholesale Summits, I urge you to step up tothe plate and become a participant sponsor in 2016. This is not a conference, convention or trade show.Visit this link (nmpmag.com/summit) to read more about the genesis and thought behind the first NAMBWholesale Summit. As I said at the outset of this column, it is your opportunity to change the mortgage indus-try for the better for the future.
There will be two NAMB Wholesale Summits annually in 2016, with the first being held Tuesday, Feb. 9,2016 in San Antonio, Texas at the Hyatt Regency. Take a seat at the table with up to three members of yourteam and be part of this historic process in growing market share for the wholesale segment, both compli-antly and profitably. I urge you to visit http://conta.cc/1OjkFIK for more information on the NAMBWholesale Summit and to register your team for the 2016 NAMB Wholesale Summits. Also, feel free tocontact me directly by e-mail or by phone at (516) 409-5555, ext. 310 if you would like to discuss theSummits.
Change for the better can be made when you have a vision, accompanied by a plan to implement and avehicle to connect. The NAMB Wholesale Summits deliver just that. Don’t leave the future of this industry inthe hands of others without you being at the table!
Sincerely,
Joel M. Berman, Publisher-CEONMP Media [email protected]
National Mortgage Professional Magazine is published monthly by NMP Media Corp. • Copyright © 2015 NMP Media Corp.
publisher’s deskFROM THE
STAFF
ADVERTISINGTo receive any information regarding advertising rates, deadlines and requirements, please contactVP-Sales & Marketing Beverly Bolnick at (516) 409-5555, ext. 316 or e-mail [email protected].
ARTICLE SUBMISSIONS/PRESS RELEASESTo submit any material, including articles and press releases, please contact Editor-in-Chief Eric C. Peckat (516) 409-5555, ext. 312 or e-mail [email protected]. The deadline for submissions is thefirst of the month prior to the target issue.
SUBSCRIPTIONSTo receive subscription information, please call (516) 409-5555, ext. 301; e-mail [email protected] or visit www.nationalmortgageprofessional.com. Any subscription changes may be made to theattention of “Circulation” via fax to (516) 409-4600.
Statements, articles and opinions in National Mortgage Professional Magazine are the responsibility of theauthors alone and do not imply the opinion or endorsement of NMP Media Corp., or the officers or mem-bers of National Association of Mortgage Brokers and its State Affiliates (NAMB), National Association ofProfessional Mortgage Women (NAPMW), National Consumer Reporting Association (NCRA) and/or otherstate mortgage trade associations.
Participation in NAMB, NAPMW, NCRA, and/or other state mortgage trade associations events, activ-ities and/or publications is available on a non-discriminatory basis and does not reflect the endorsementof the product and/or services by NMP Media Corp., NAMB, NAPMW, NCRA, and other state mortgagetrade associations.
National Mortgage Professional Magazine, NAMB, NAPMW, NCRA, and/or other state mortgagetrade associations do not make any misrepresentations or warranties concerning the regulatory and/orcompliance aspects of advertisers, products or services and/or the editorial content contained in NMPMedia Corp. publications. National Mortgage Professional Magazine and NMP Media Corp. reserve theright to edit, reject and/or postpone the publication of any articles, information or data.
Eric C. PeckEditor-in-Chief
(516) 409-5555, ext. [email protected]
Joey ArendtArt Director
(516) 409-5555, ext. [email protected]
Scott KoondelVP of Operations
(516) 409-5555, ext. [email protected]
Richard ZytaSocial Media Ambassador
(516) [email protected]
Joel M. BermanPublisher - CEO
(516) 409-5555, ext. [email protected]
Beverly BolnickVP-Sales & Marketing
(516) 409-5555, ext. [email protected]
Phil HallManaging Editor
(516) 409-5555, ext. [email protected]
Francine MillerAdvertising Coordinator
(516) 409-5555, ext. [email protected]
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National PresidentKelly Hendricks(314) [email protected]
President-ElectNikki Bell(678) [email protected]
Vice PresidentCathy Kantrowitz(845) [email protected]
Vice PresidentLaurel Knight(425) [email protected]
SecretaryWindee Falla(281) [email protected]
TreasurerJudy Alderson(918) 250-9080, ext. [email protected]
ParliamentarianFrances Reinhardt(678) [email protected]
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NAMBThe Association of
Mortgage Professionals2701 West 15th Street, Suite 536 l Plano, TX 75075
Phone: (972) 758-1151 l Fax: (530) 484-2906Web site: www.namb.org
OFFICERSJohn Councilman, CMC, CRMS—PresidentAMC Mortgage Corporation10136 Avalon Lake Circle l Fort Myers, FL 33913Phone: (239) 267-2400 l E-mail: [email protected]
Rocke Andrews, CMC, CRMS—President-ElectLending Arizona LLC3531 North Pantano Road l Tucson, AZ 85750Phone: (520) 886-7283 l E-mail: [email protected]
Fred Kreger, CMC—Vice PresidentAmerican Family Funding28368 Constellation Road, Suite 398 l Santa Clarita, CA 91350Phone: (661) 505-4311 l E-mail: [email protected]
Rick Bettencourt, CRMS—SecretaryMortgage Network300 Rosewood Drive l Danvers, MA 01923Phone: (978) 777-7500 l E-mail: [email protected]
Andy W. Harris, CRMS—TreasurerVantage Mortgage Group Inc.15962 SW Boones Ferry Rd., Ste 100 l Lake Oswego, Oregon 97035 Phone: (503) 496-0431, ext. 302E-mail: [email protected]
Donald J. Frommeyer, CRMS—Immediate PastPresident/NAMB CEOAmerican Midwest Bank200 Medical Drive, Suite C-2A l Carmel, IN 46032Phone: (317) 575-4355 l E-mail: [email protected]
DIRECTORSKay A. Cleland, CMC, CRMS KC Mortgage LLC2041 North Highway 83, Unit CPO Box 783 l Franktown, CO80116Phone: (720) 670-0124 l E-mail: [email protected]
John H.P. Hudson, CRMSPremier Nationwide Lending1202 W. Bitters Road, Bldg. 1, Ste. 1205San Antonio, TX 78216Phone: (817) 247-4766 l E-mail: [email protected]
Olga Kucerak, CRMS Crown Lending110 Broadway, Suite 360 l San Antonio, TX 78205Phone: (210) 828-3384 l E-mail: [email protected]
David Luna, CRMS Mortgage Educators and Compliance947 South 500 E, Suite 105 l American Fork, UT 84003Phone: (877) 403-1428 l E-mail: [email protected]
Linda McCoy, CRMS Mortgage Team 1 Inc.6336 Piccadilly Square Drive l Mobile, AL 36609Phone: (251) 650-0805 l E-mail: [email protected]
Valerie Saunders RE Financial Services13033 West Lindburgh Avenue l Tampa, FL 33626Phone: (866) 992-0785 l E-mail: [email protected]
John Stevens, CRMS Bank of England d/b/a ENG Lending11650 South State Street, Suite 350 l Draper UT 84062Phone: (801) 427-7111 l E-mail: [email protected]
NAMB 2014-2015 Board of Directors
Mike BrownPresident(908) 813-8555, ext. [email protected]
William BowerVice President(800) [email protected]
Maureen DevineEx-Officio(413) [email protected]
Julie WinkTreasurer(901) [email protected]
Renee EricksonConference Chair(866) [email protected]
Mary CampbellDirector(701) [email protected]
Scott LedbetterDirector(801) [email protected]
Judy RyanDirectorCredit Plus(800) [email protected]
Mike ThomasDirector(615) 386-2285, ext. [email protected]
Dean WangsgardDirector(801) [email protected]
Terry ClemansExecutive Director(630) [email protected]
Jan GerberOffice Manager/Member Services(630) [email protected]
National Association of Professional Mortgage Women1851 South Lakeline Boulevard, Suite 104, Box 303
Phone: (800) 827-3034 • E-mail: [email protected] site: www.napmw.org
2015-2016 NAPMW National Board of Directors
National Consumer Reporting Association701 East Irving Park Road, Suite 306 l Roselle, IL 60172
Phone: (630) 539-1525 l Fax: (630) 539-1526Web site: www.ncrainc.org
2014-2015 Board of Directors
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0151.800.649.1362 I www.DocMagic.com
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elite performerT H E
By Andy W. Harris, CRMS
You’re welcome for leaving that jingle in your head the rest ofthe day. Seriously though … are you happy? It’s a good ques-tion I don’t think many of us ask ourselves on a consistentbasis. Happiness is described as a mental or emotional state
of well-being, defined by positive or pleasant emotions ranging fromcontentment to intense joy. Man, doesn’t that sound great? This makes me reallythink about the word “contentment” and how much that word can truly definehappiness from its roots growing all the way up to intense joy. That “intense joy”is certainly a feeling I want every day, but I wish it were that easy.
Every morning at the gym, I see the same old man walking around, always in thebest of moods. He seems to be quite personable and says hello to everyone at theclub and everyone knows him. Hereminds me of someone that seems trulycontent with their life and always in goodspirits, maybe even riding the intense joywagon. You can tell when someone haslegitimate happiness and pure inten-tions. They don’t need exterior support orinfluence for joy as they have an internalhappy auto-pilot taking care of that. It’s agood trait to have and those that portraythis image certainly attract others.
About once a week, the old man walks up to me and asks a few questions ormakes a few comments that really get me thinking. I have to get on myself to notfeel as though this is a disruption in my workout when taking off my headphones,providing he always has something valuable to say.
This past week, he asked me how I was doing and how work was going. I toldhim the common answer and that things were very busy and work was goinggreat, having a great year, etc. He responds by saying how great it is that I am hav-ing a successful business. He then asked if this success was bringing me happiness.
I thought for a second, are these two things one in the same? Can you have suc-cess without happiness or is happiness the very definition of success? What exact-ly is success if you’re not happy? I answered by telling him that I was happy, butwas I being fully honest? In reality, the more “success” I have as others define it,brings more pressure, responsibility, deadlines and stress at times. Stress and hap-piness don’t get along all that well. He went on to talk about how important it isthat I am truly happy as so few people experience this true happiness.
I think he left me with a challenge to find my true joy. I thought about that forquite some time. I do feel I am content and certainly happy with most things inmy life, and of course, my amazing family. I can also say that I certainly have somedays where I am happier than other days as do most people. For us to perform ourbest, I believe we all need “true” happiness and to find what it is that producesthis within us. It’s not just about another’s definition of success, but our own def-inition which must bring us internal happiness or “intense joy.” I believe you can-not be truly successful without it … so are you happy?
Andy W. Harris, CRMS is president and owner of Lake Oswego, Ore.-based VantageMortgage Group Inc. and past president of the Oregon Association of MortgageProfessionals. He may be reached by phone at (877) 496-0431, e-mail [email protected] or visit www.vantagemortgagegroup.com.
Because I’m Happy
“It is not how much
we have, but how much
we enjoy, that makes
happiness.”
—Charles Spurgeon
TRID Readiness: Will You Pass or Fail?
SPONSORED ED ITORIAL
By Keith Bilodeau
On Saturday, Oct. 3, the industry implemented the mostsweeping and significant changes in the history of mortgagebanking. These changes impact the way we originate, disclose,process and close loans. Unlike previously, these regulations
apply evenly to all residential loan originators regardless of who they workfor. There is a general lack of understanding of the new requirements andtheir impact on originators, real estate agents, builders, title companies, set-tlement service providers and applicant/borrowers. The all-too-commonstatements of “I will figure it out when it gets here” and “Isn’t it just somenew disclosures?” and my favorite, “I just don’t have time to attend TRIDtraining” should concern us all greatly. Below are just a few of the areas likelyto be least understood about TRID and the impact it will have on all partic-ipants in the loan process.
1. Impact of the realtor on buyers and sellers. Do they know they cannotwrite a 21-day or even 30-day contract on or after Oct. 3rd? These new reg-ulations are strict and confusing to implement, and timing requirementsaround the Loan Disclosure, and specifically, the Closing Disclosure makeclosing within these windows extremely unlikely. If realtors are not settingproper expectations and contract terms, there will be many disappointedand misinformed buyers and sellers. It’s also fair to assume the realtors’failure to understand and set expectations will somehow become thelenders fault when the loans cannot meet the contract closing date.
2. The need for policies and procedures. Starting with just the applicationdate. Have all originators spent time defining and documenting policiesand procedures for something as basic as being able to defend their “Ap-plication Date.” The Application Date is now defined differently than ithad been in the past. Incidentally, this is covered in TRID training at greatdepth.
3. Setting dates. The need to establish specific dates, events, policies andprocedures that will subsequently have to be defended to state or federalexaminers, or to other parties such as lender/investors and warehouselenders, only scratches the surface of required TRID knowledge.
4. Adhering to the new rules. On Oct. 3, any requests for credit in pipelinesthat do NOT have a GFE and TIL (and for broker loans a subsequent TIL)will not be protected under the OLD rules. If any of those requests containthe new six elements that make up an application, they will now becomeApplications under TRID and will be expected to have a compliant LE is-sued by no later than EOD Wednesday Oct. 7.
5. A new timetable. Plan for seven to 10 days before expected Consumma-tion (closing date) to be working on the final Closing Disclosure. Anyonewho does not understand this should quickly register for TRID training.
It is likely those of you taking time to review this magazine and read thisbrief editorial have already invested in TRID training. My greater worry is forthose who are too busy to invest in TRID training and in their business.
Keith Bilodeau is senior vice president of Wholesale Production at FreedomMortgage. With more than 30 years of experience in capital markets, operationsand production, Keith offers unique expertise in helping mortgage professionalsgrow their business by leveraging Freedom Mortgage’s technology and pro-grams. He may be reached by e-mail at [email protected] visit www.freedomwholesale.com.
Lender NMLS ID: 2767. Freedom Mortgage Corporation, 907 Pleasant Valley Avenue, Suite 3, Mount Laurel, NJ 08054.
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By Joseph J. Murin
We are now into the earlydays of the long anticipat-ed TILA-RESPA IntegratedDisclosure (TRID) era. Like
any new regulation, TRID would likelyhave had an impact on the mortgageindustry no matter what its scope. Butthis one is different. TRID representsperhaps the largest change to affect ourindustry in decades. It’s about muchmore than when the forms are due orwhich numbers go on what line. It’sabout changing the way that lenders,settlement agents, brokers and evenreal estate agents interact and collabo-rate to push a sales agreement throughto loan closing. It’s a process change …and a sweeping change at that.
We know that the ConsumerFinancial Protection Bureau (CFPB)enacted this rule to simplify and clarifythe ponderous and confusing settle-ment phase of a home sale for the con-sumer. Few would argue that theprocess, as it stood previously, waseither simple or transparent. There willalso likely be some positive develop-ments as TRID takes root in the indus-try. Perhaps the many different firmscharged with servicing a mortgagetransaction will be forced to learn bet-ter and more effective ways to commu-nicate and work together.
There are also several potential out-comes created by TRID that could have avery negative impact on the people it isdesigned to protect. To its credit, theCFPB reviewed thousands of commentsas it considered the final rule. It solicitedmortgage and real estate industry input.It even postponed the original Aug. 3implementation deadline when itbecame apparent that far too many inthe industry were not yet ready (even ifthat wasn’t the official explanation given).
At the heart of my concern, however,is the reaction to TRID. How will thosebusinesses being more tightly regulatedseek to mitigate their own risks andcosts? And what really does the con-sumer want from the real estate trans-action? Is the settlement documenta-tion a primary concern to the typicalbuyer or seller? If anything, I fear TRIDis a solution addressed to a threat thatdoesn’t exist at the level the CFPBbelieves.
One of my first concerns with TRIDhas been debated thoroughly in themonths running up to the deadline. Bynow, we know that TRID mandates thatthe loan estimate (once the Good FaithEstimate) be delivered or placed in themail no later than the third businessday after receiving the consumer’sapplication. TRID now also requires thata closing disclosure (once a big part ofthe HUD-1) must be provided to theconsumer at least three business daysprior to consummation of the transac-tion. The intent of this provision is cer-tainly clear. Consumers have frequentlybeen surprised by HUD-1s delivered theday of the transaction bearing figuresvery different than those they had seenon the GFE. This is a legitimate concern,and the rules under RESPA were longflaunted when it came to ambushing aconsumer at the closing table.
Consider, however, the likely conse-quences as the three-day rule goes intoeffect. Scheduling the closing, already adelicate ballet of coordination andadjustment in many places, will bemuch more difficult. Worse still, manyclosings will have to be postponed as amatter of law where a title company orloan officer makes a mistake or fails todeliver one of the TRID forms in a time-ly fashion. What does this mean for theharried home buyer or home seller whois depending on the date of the closing
because of a contingency with his or herexisting home? Will we see familiessleeping on moving trucks because theyare temporarily homeless for threedays? Probably not. But we will see a lotof frustrated consumers, real estateagents and lenders.
It’s certain that the requirements ofTRID will result in more collaborationbetween lenders and settlement servic-es firms, as well as real estate agentsand brokers. It’s also very likely that theperiod between sales agreement andclosing will be extended. There will bemore to do, more communicationrequired and more opportunities for anerror to occur in the back-and-forthbetween service providers. As a result,longer closing times will be built intothe process to accommodate theextended process.
My biggest concern with TRID, how-ever, is the increased amount ofexpenses put upon the lender and theservice provider. New technology;training; increased staff; possibly evenmore time on the phone (dependingon how a lender communicates withits service providers) and, of course,increased resources put toward com-pliance all add up to higher coststhroughout the industry. At what pointwill lenders decide it’s becoming tooexpensive to originate a mortgage? Willthey build these costs into the mort-gage where allowable by law?Absolutely. The same holds true withsettlement service provides. No longerwill they be able to absorb higheroperating costs for the sake of beingcompetitive but will need to face thereality of charging a fair cost for servic-es rendered. Although I don’t foresee amass exodus of mortgage lenders andservice providers, I do envision thepotential for the consumers to experi-ence a significant cost to the mortgage
process. I can also easily imaginelenders taking even fewer risks as tothe markets they will serve or the cred-it they will extend, all to accommodatedeteriorating margins.
My question, therefore, is this:Which elements of the transaction dothe majority of consumers who partici-pate in the homebuying or home sell-ing process value most? Is it a largerselection of available mortgage prod-ucts from more lenders, or not having72 hours to review their settlementservices fees? Would they accept a bitmore documentation if it meant shav-ing days or even weeks of delaybetween the time of the sales agree-ment and the closing? I’m not remotelysuggesting that this is an either-orproposition. Transparency and claritydo not necessarily have to be mutuallyexclusive with speed, convenience andprice. But I fear that TRID has madethat a possibility.
Only time will tell if my concerns arefounded. TRID is here to stay—at least forthe foreseeable future. I have no doubt wewill adapt and improve our processes toaccommodate it. But it will be interestingto see the balance between how much ithelps the consumer … and how much itharms him or her.
Joseph J. Murin is chairman of JJAMFinancial Services and vice chairman ofChrysalis Holding LLC. He is the formerchairman of The Collingwood Group LLC,and served as president of Ginnie Mae in2007-2008. Murin was previously with theU.S. Department of Housing & UrbanDevelopment (HUD), to which he broughtmore than 40 years of diverse experiencein the financial services, mortgage andbanking industries, including roles as theCEO of a number of financial organiza-tions such as Century Mortgage, Basis 100,Lender’s Service Inc., and MSNi LLC.
Is TRIDReallyHelping theConsumer?The potential forunintendedconsequences that harmhomebuyers andsellers is very real
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AAG Adds Jumbo ReverseMortgage Offering to ItsProduct Line
American Advisors Group (AAG) hasannounced the launch its new jumboreverse mortgage loan program, calledthe AAG Advantage. With AAG Advantage,qualified borrowers may now obtain areverse mortgage on properties valued atup to $6 million, versus the FHA loan limitof $625,500 associated with a traditionalHome Equity Conversion Mortgage (HECM)loan.
The AAG Advantage is available notonly to owners of property types eligiblefor a HECM loan, but also to owners ofGinnie Mae-approved condominiums.This means borrowers whose propertiespreviously may not have qualified for areverse mortgage now have access to thisviable retirement planning tool. The AAGAdvantage will initially be made availableto senior homeowners in select states, andwill roll out to other U.S. states in subse-quent phases.
Like a HECM reverse mortgage, AAGAdvantage is designed for borrowers age62 or older to convert a portion of theirhome equity into cash to help them retirecomfortably. With AAG Advantage, ownersof higher value homes now have theopportunity to borrow up to $3 million inloan proceeds—a significantly higheramount than offered through a tradition-al HECM loan. With the AAG Advantage,borrowers are not required to pay mort-gage insurance premiums that arecharged with a government-insuredreverse mortgage.
“With our new AAG Advantage, we’reproud to help extend reverse mortgages toa greater number of seniors and provideborrowers with higher value homes asolution to access more funds,” stated AAGchief executive officer Reza Jahangiri. “Thelaunch of AAG’s jumbo reverse mortgageloan further reinforces our commitmentto helping American seniors age in placeand gain greater financial freedom.”
Credit Plus Introduces NewFraudPlus ID Feature
Credit Plus has announced a new fea-
ture, FraudPlus ID, that can be addedto its credit reports to help validate aborrower’s name, address, date ofbirth, Social Security Number andphone number. In addition, FraudPlusID goes even further and reviews theborrower’s data against the IndustryStandard Exclusionary Watch lists.
For just a minimal fee on each cred-it report, lenders will get a clear pictureof their borrowers. They’ll also realizegreater cost savings for those pre-quali-fications who don’t qualify for a com-plete FraudPlus report. In addition, thefeature can be turned on for every cred-it report thereby ensuring identity vali-dation is always ordered.
“This new feature enhances FraudPlusby taking identity validation to the nextlevel,” said Greg Holmes, national direc-tor of sales and marketing at Credit Plus.“By ensuring borrowers are who they saythey are, lenders will have greater peaceof mind that their risk of fraud has beenminimized.”
RealtyTrac LaunchesEnhanced Marketing ListLead Generation Platform
RealtyTrac has announced the launchof its enhanced Marketing List LeadGeneration Platform, allowing cus-tomers to leverage RealtyTrac’s nation-wide real estate data on more than 120million U.S. residential and commercialproperties to create targeted marketinglists in a convenient, self-service onlineinterface.
“With RealtyTrac’s proprietary realestate intelligence and extensive mail-ing list development, you get the datasegmentation and modeling informa-tion you need to precisely target youroutreach and fuel customer acquisitionand retention,” said Rob Barber, CEO atRealtyTrac. “Users can find homeown-ers nationwide based on geographicand demographic characteristics. Thisopens up numerous new marketing listapplications for virtually every type ofbusiness looking to market its products
and services to a specific subset of U.S.property owners.”
Registered users can create cus-tomized lists in real time with thecounts of available records updateddaily. Customers pay per propertyrecord downloaded, and can previewthe number of records that matchtheir criteria before downloading.
“More important than the vast sizeof our dataset is the quality of ourdata,” said Kevin Kerley, director ofdata solutions at RealtyTrac. “Whilemany data providers merely resellthird-party lists, we collect data from abroad range of sources. Our lead gen-eration platform allows you to targetnew homeowners, renters, high-income households, and countlessother demographics. The ability to cre-ate and refine a list of targeted leadsmakes our Marketing List platform theperfect tool for retailers, financial serv-ice firms, Realtors, and other businessowners.”
Vantage ProductionEnhances VIP’s MobileFunctionality
V a n t a g eProductionLLC has an-nounced amajor en-
hancement to its enterprise-class CRMplatform, VIP. The new capability,Vantage Mobile, makes a full array ofVIP’s renowned functionality availableon mobile devices, enabling compre-hensive “on the go” features thatgreatly amplify the success of mort-gage loan originators (MLOs) in thefield. Vantage Production’s advanceddesign brings a complete range of truemobile VIP capabilities to mortgageorigination.
“Lenders that are serious aboutstaying competitive need a solidmobile strategy,” said VantageProduction President and CEO SueWoodard, who personally originatedloans for over 20 years. “A simpleInternet presence is no longerenough,” she cautioned. “Lenders
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need true functionality that benefits allparties, including MLOs, referral part-ners and borrowers.”
Vantage Mobile enables MLOs to eas-ily conduct critical marketing, sales andservice tasks—including referral part-ner relationship management—regard-less of where they are or the time ofday. VIP client MLOs can manage leads;view all client loan status data; accessreferral partner information, add newpartners and implement co-marketing;plus perform other key tasks and quick-ly get information needed to acceleratesales and provide exemplary servicethat sets them apart.
“Having the right answer at the righttime to a borrower question or referralpartner concern often makes the dif-ference between continued commit-ment to the MLO’s service and losingout to a competitor,” said Woodard.“Vantage Mobile is a giant step forwardfor MLO sales effectiveness. Now loanoriginators can accomplish many tasksthey would otherwise have to performin their offices, such as adding a refer-ral partner on the fly or launching amarketing campaign. Full informationon every lead is available, along withcritical MBS market information andanalysis to help MLOs provide the bestrate guidance possible.”
LoanLogics UpdatesIts Compliance Audit for TRID
LoanLogics has released enhancementsto its Compliance Audit interface insupport of the new TILA-RESPA (TRID)regulations that took effect Oct. 3,2015. The Compliance Audit interface isfound within LoanLogics’ LoanHD plat-form. LoanLogics now provides thetools needed to identify, track andtrend loan discrepancies and defectsrelated to the use of the new closingdisclosures. The result is that clientshave the internal communication,training and documentation processes
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EWSFLASH l OCTOBER 2015 l NMP NEWSFLASH l OCTOBER 2015 NMP NEWSFL
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House Committee PassesTwo CFPB Reform Bills
The House Fi-nancial ServicesCommittee haspassed a pair ofbills that wouldchange the
power structure of the ConsumerFinancial Protection Bureau (CFPB).
HR 1266, the Financial Product SafetyCommission Act of 2015, removes theCFPB from within the Federal ReserveSystem and makes it a standaloneagency. The bill also replaces the office ofdirector with a new five-member biparti-san commission. Otherwise, all powersgranted to the CFPB in the Dodd-FrankAct remain unchanged. The bill, spon-sored by Rep. Randy Neugebauer (R-TX),passed by a 35-24 vote.
HR 957, the Bureau of ConsumerFinancial Protection-Inspector GeneralReform Act of 2015, would create a newInspector General for the CFPB thatwould require a presidential nominationand a Senate confirmation. Currently,the Federal Reserve’s Inspector Generalperforms double-duty with the CFPB. Thebill, sponsored by Rep. Steve Stivers (R-OH), passed in a 56-3 vote.
“Consumers are understandably con-cerned about our economy,” saidFinancial Services Committee ChairmanJeb Hensarling (R-TX). “We remain stuckin the worst recovery of the last 70 years.At the same time, they’re concerned thatWashington is taking away their choicesand raising many of their costs.”
It is uncertain whether either billwill gain traction in the Senate. TheWhite House has already threatened toveto any bill that rearranges the CFPBpower structure.
Cordray Takes Credit forHousing MarketSuccesses
Richard Cordray, Di-rector of the Con-sumer Financial Pro-tection Bureau (CFPB),offered a display ofself-congratulatory
accolade by crediting his agency asbeing at the core of today’s housingmarket vibrancy.
In a speech delivered before theNational Association of Realtors (NAR),Cordray claimed that the CFPB’s rules to“encourage common-sense, consumer-friendly business practices” were key tothe current level of positive housingmarket achievements. Noting theAbility-to-Repay (ATR) and the QualifiedMortgage (QM) rules as examples ofimprovements created by his agency,Cordray stated that industry data refut-ed the predictions of critics that theCFPB would ruin housing.
“In 2014, the first year of our newrules, mortgage originations for owner-occupied home purchases increasedbetween four and five percent,” Cordraysaid. “The upward trend appears tohave accelerated over the first half ofthis year. And while we saw minor con-solidation in some parts of the mort-gage market, there is no evidence ofany mass exodus, as the doomsayerspredicted. In fact, after adjusting formerger activity, the number of lendersthat reported having originated mort-gages showed an increase in 2014. Andin particular, the number of communi-ty banks and credit unions that origi-nated home-purchase mortgages lastyear was higher than the year before.”
Cordray added that the CFPB hasbeen “taking pains” to create specialrules designed to protect communitybanks and credit unions, and heacknowledged that real estate brokers“suffered greatly during the [2008financial] crisis and its aftermath” whilepledging the Bureau would work withthis profession “to ensure that con-sumers’ experience of the financial mar-ketplace and the promise of theAmerican Dream are one and thesame.” He also insisted that the CFPBwas the friend of the honest lendersand the foe of the dishonest ones.
“Reasonable regulation of financialmarkets, which includes evenhandedoversight and enforcement of the law,should always tend to benefit the mostresponsible providers,” Cordray said.“By taking on and rooting out unfair
competition that gobbled up marketshare by driving down sound under-writing standards, the ConsumerBureau is supporting responsiblelenders. The market leaders of todayare those that have remained focusedon providing sustainable homeowner-ship rather than just making a quickbuck, no matter how.”
Homebuying Hits MostAffordable Level in TwoYears in Q1
RealtyTrac andClear Capitalhave released ajoint reportshowing thatbuying a home
was at the most affordable level in twoyears in the first quarter of 2015 despitethe average U.S. home price increasingat more than twice the pace of the aver-age weekly wage nationwide over thepast year.
For the report, RealtyTrac analyzedrecently released Q1 2015 averageweekly wage data from the Bureau ofLabor Statistics and average prices forsingle family homes and condosderived from publicly recorded salesdeed data collected by RealtyTrac in582 U.S. counties with sufficient homeprice data. Average interest rates on a30-year fixed rate mortgage came fromthe Freddie Mac Primary MortgageMarket Survey. Clear Capital analyzeddata from its Home Data Index to deter-mine counties at highest risk and low-est risk based on affordability andpotential for price growth.
Average home price appreciationoutpaced average wage growthbetween the first quarter of 2014 andthe first quarter of 2015 in 397 out of582 (68 percent) U.S. counties analyzedfor the report. But during the sametime period, the average interest rateon a 30-year fixed rate mortgagedropped 57 basis points (13 percent),from 4.34 percent in the first quarter of2014 to 3.77 percent in the first quarter
of 2015. The drop in interest rates—along with wage growth outpacinghome price appreciation in 32 percentof counties—meant buying a home inthe first quarter of 2015 required asmaller share of the average wage com-pared to a year ago in 339 of the 582counties (58 percent).
“Although home prices continue tooutpace wage growth in the majority oflocal markets, this analysis somewhatsurprisingly shows that affordability isactually improving in most marketsthanks to falling interest rates andslowing home price growth, which isallowing wage growth to catch up insome markets,” said Daren Blomquist,vice president at RealtyTrac. “At thenational level, buying an average-priced home in the first quarter of 2015was the most affordable it’s been intwo years and nearly twice as afford-able as it was in the second quarter of2006—when affordability was its worstin the past 10 years. At the local levelwe’re seeing several bellwether mar-kets where wage growth matched oreven outpaced home price growth overthe past year.”
Major markets where wage growthoutpaced home price growth in thefirst quarter—counter to the nationaltrend—included Cook County, Ill. inthe Chicago metro area; OrangeCounty, Calif. in the Los Angeles metroarea; Brooklyn, N.Y.; Fairfax County,Va. in the Washington, D.C., metroarea; and Riverside County in SouthernCalifornia, where the average weeklywage in the first quarter was up 10 per-cent from a year ago, double the fivepercent growth in average home pricesduring the same time period.
The average U.S. home price is still12 percent below where it was in thesecond quarter of 2006, when buying ahome was at the least affordable levelin the last 10 years. Meanwhile, theaverage wage nationwide has risen 34percent and the average interest rateon a 30-year fixed rate mortgage hasdropped 44 percent during that sametime period, resulting in a 48 percentimprovement in affordability.
Among all 582 counties analyzed inthe report, only 20 (three percent)exceeded their 10-year affordability
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averages in the first quarter of 2015,including counties in the Nashville,Lansing, Michigan, Cincinnati,Memphis, Washington, D.C., andAtlanta metro areas.
Trade Groups OpposeProposed FHLB RuleChanges
A coalition ofindustry tradegroups has senta letter to theleadership ofthe House Fi-
nancial Services Committee calling onthem to reject a proposed FederalHousing Finance Agency (FHFA) rulethat alters the membership require-ments in the Federal Home Loan Bank(FHLB) system.
The proposed rule, which was firstissued in September 2014, rewrites theFederal Home Loan Bank Act regardingthe mortgage asset ratio requirementthat applies when an institutionapplies for FHLB system membership.Under the proposed change, the ratiowould be changed from a one-timeconsideration in the applicationprocess into an on-going obligation.
“We respectfully urge Congress toprohibit this proposed rule from takingeffect,” said the letter from the tradegroups. “Congress should also directFHFA to consult with stakeholders toevaluate an appropriate membershipstructure to allow the system to bestserve its mission in the 21st Century.”
The trade groups added that thechanges would risk “underminingmember confidence in the system,forcing current members to considerthe risk that they may one day findthemselves on the wrong side of anarbitrary requirement.”
The trade groups also oppose a sec-ond proposed change would preventcaptive insurance companies frombeing part of the FHLB system. In theirletter, they noted that many captiveinsurance companies are owned by oraffiliated with mortgage real estateinvestment trusts (REITs), which arecurrently the direct holders of nearly$300 billion in mortgages and mort-gage-backed securities (MBS) that werepurchased via permanent capitalraised in the public markets.
“Notably, this influx of capital hashelped partially replace the decliningretained portfolios of Fannie Mae andFreddie Mac,” the letter said. “In turn,the system helps captive insurers, andby extension their parent companies,by providing flexibility in fundingterms. The ability to match fundingterms with expected asset maturitiesallows these companies to invest in agreater array of mortgages and MBS—including those to borrowers whoremain underserved. In return, theSystem receives more collateral thanother sources of funding, such as WallStreet repurchase agreements. It isworthwhile to note that the system hasnever lost money on an advance.”
The letter was signed by representa-
tives from the Mortgage BankersAssociation, the IndependentCommunity Bankers of America, theNational Association of Real EstateInvestment Trusts and Habitat forHumanity International.
Ocwen CEO Ron FarisHonored With HomeFree-USA’s CommunityChampion Award
Ocwen Financial Corpo-ration has announcedthat its President andCEO Ron Faris was pre-sented with theCommunity ChampionAward from HomeFree-
USA, a counseling agency and home-
ownership development organization.The award, presented at HomeFree-USA’s Leadership and TrainingConference, recognized Faris for hisvision and innovation in servicing chal-lenging mortgage portfolios as well ashis personal commitment to keep fami-lies in their homes whenever possible.
“Ron Faris is a man of character whocares about doing the right thing forstruggling borrowers,” said MarciaGriffin, founder and president ofHomeFree-USA. “Ocwen has been theresince the beginning. Under Ron’s lead-ership, Ocwen has employed creativesolutions to help homeowners, particu-larly those in minority communities,better afford their homes and avoidforeclosure.”
Griffin’s experience working withOcwen was echoed by her peers at localand national non-profit organizations,Ocwen customers and Ocwen employ-ees during a brief video that was pre-miered during the event.
“On behalf of everyone at Ocwen, itis an honor to receive the HomeFree-USA Community Champion Award,”said Faris. “Partnering with non-profitcommunity organizations likeHomeFree-USA is integral to our busi-ness model. At Ocwen we respect andvalue the contributions of housingcounselors and are highly motivated tocontinue our partnerships to build onour shared success.”
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HomeFree-USA is a HUD-approvedhomeownership development, foreclo-sure intervention and financial empow-erment organization. Since 1995,HomeFree-USA has helped more than23,000 families experience the accom-plishment and joy of purchasing theirfirst home. HomeFree-USA is also amember of Ocwen’s CommunityAdvisory Council, a diverse 17-membergroup of national, regional, and localnon-profit housing counseling, commu-nity development, and civil rightsorganizations from across the country.
HUD Grants Reliefto Victims of Hurricane Sandy
The U.S. Depart-ment of Hous-ing & UrbanDeve lopment(HUD) has de-cided that it will
not force thousands of New York andNew Jersey homeowners to repay feder-al disaster recovery funds following adecision by the Federal EmergencyManagement Agency (FEMA) to increaseflood insurance claim payments to fam-ilies it initially underpaid followingHurricane Sandy. Federal law providesHUD the discretion to weigh the real-world recovery challenges faced bymany of these families against anotherlegal requirement that prohibits anyfederal ‘duplication of benefits.’
Harriet Tregoning, HUD’s PrincipalDeputy Assistant Secretary forCommunity Planning and Development,has informed state and local leaders inthe Sandy-impacted region that addi-tional flood insurance proceeds up to$20,000 will not be subject to a duplica-tion of benefits review or collection.This will eliminate the need for HUDgrantees to reclaim assistance fromthese households, or to repay thosefunds through non-federal sources. Todate, three-out-of-four National FloodInsurance Program (NFIP) claimantsreceived less than $20,000 in additionalcompensation from FEMA and wouldnot face any possible repayment.
Families who received/will receivemore than $20,000 in additional floodinsurance payments will still have theopportunity to demonstrate the addedclaim payments address legitimateunmet needs and therefore are notduplicative.
“These families have suffered enoughand shouldn’t be further victimizedthrough no fault of their own,” saidTregoning. “We have a larger responsibil-ity to facilitate recovery, not to hinder itjust because these families didn’t receivesufficient flood insurance payments.”
HUD determined that below $20,000,any benefit gained by going through aprotracted process of reexamining anddocumenting costs incurred by home-owners would not outweigh the larger
financial and human costs associatedwith doing so. For those NFIP policy-holders who receive more than $20,000in additional claim payments, HUD willrequire its grantees (primarily New YorkState, New York City, and the State ofNew Jersey) to determine whether anyamount over $20,000 duplicates feder-al assistance already provided.
On Oct. 29th, 2012, Hurricane Sandydevastated the East Coast of the U.S.,damaging or destroying 650,000 homesand generating nearly 145,000 claimsfrom homeowners to FEMA’s NationalFlood Insurance Program (NFIP).Thousands of these policyholdersreceived insufficient flood insurancepayments due to alleged fraud on thepart of FEMA contractors charged withdetermining damage payouts. FEMAinvited homeowners to appeal theirclaim payments which resulted (andwill continue to result) in additionalflood insurance payments.
The Stafford Act requires the FederalGovernment and its state and localgrantees to assure that any Federalassistance deemed duplicative to berepaid. Prior to the decision, many pub-lic leaders and homeowners alikeexpressed concerns that any additionalFEMA flood insurance payments wouldtrigger the law’s prohibition againstduplication of benefits. However, theAct also gives HUD’s Secretary discretionin those cases where recovering anyduplicated benefits would not be in theFederal Government’s interest.
Residential ConstructionUp in August
Residential con-struction was ata seasonallyadjusted annu-al rate of$383.3 billion
in August, 1.3 percent above the revisedJuly estimate of $378.5 billion, accord-ing to new data from the U.S. CensusBureau of the Department ofCommerce. Nonresidential constructionwas at a seasonally adjusted annualrate of $404.7 billion in August, 0.2 per-cent above the revised July estimate of$403.8 billion.
Overall construction spending dur-ing August was estimated at a seasonal-ly adjusted annual rate of $1,08 billion,a very slight 0.7 percent increase abovethe revised July estimate of $1,07 bil-lion but 13.7 percent above the August2014 estimate of $955 billion. Duringthe first eight months of this year, con-struction spending amounted to $683.4billion, 9.8 percent above the $622.4billion for the same period in 2014.
Spending on private constructionwas at a seasonally adjusted annualrate of $788.0 billion, 0.7 percent abovethe revised July estimate of $782.3 bil-
continued on page 38SPONSORED ED ITORIAL
Learn how to use the new TRID regulations and credit data to grow yourbusiness. Nowadays, organizations cannot rely on miracles to keep themout of hot water with governing agencies. In this competitive environ-ment, mortgage companies are being compelled to continuously growingtheir business and attract new clients and also to stay in compliance withfederal regulations.
One of the largest regulations to be handed down to the mortgageindustry in recent times is known as TRID. TRID says you have to give theborrower a three-day loan estimate and the customer can walk awayfrom the table at any point, and for any reason, during that three-dayperiod.
As mortgage professionals, you have access to extremely sensitive in-formation. Use the tools you have at your disposal as a lender to generatemore business. As a lender, whether you are a banker or a broker, youhave access to extremely specific information to target consumers foryour marketing and to generate new business. Only lenders can accesscredit information. Utilize credit data to help you personalize your mar-keting campaigns in many different ways. You can use credit data to de-fend yourself against things like the new three-day TRID rule. It can bematched perfectly with the many compliance enforcement guidelinesand all of the new regulations that seem to be popping up.
Extremely specific campaigns that require an understanding of theguidelines, but also an understanding of the data available to you. TRID'sthree-day loan estimate won't be a problem if you pre-screen yourprospects. Create your own personal market by selecting the customersyou want to work with. You can pre-screen your prospect list in manydifferent ways. The most common selects to pre-qualify the borrowerare; loan amount, revolving debt, loan type, income, LTV, mortgage opendate, credit score, and debt ratio. By following the guidelines around theuse of credit data and pre-screening your target borrower, you alreadyknow they qualify so you are not wasting the borrower’s time or yourown. This creates a sense of trust and loyalty with the borrower by show-ing that you care.
TagQuest was recently awarded the status of being a fully authorizedagent with one of the major credit reporting agencies. That is the highestrank you can get as a marketing company. As a marketer, it is our job tokeep you informed as to what is available to you.
Customer Spotlight: Jason P., Branch Manager in GeorgiaEach month, we talk with our clients to see how their campaigns aregoing. Here’s some feedback we received from Jason P., a branch man-ager in Georgia.
Marketing method: Direct maill Volume: 5,000 piecesl Response rate: More than one percent l Results: More than a 20 percent conversion rate into working loans
that will close
Highlights of the campaign that worked well …“Easy! It’s really turnkey.”
Highlights of the campaign that might appeal to others in the mort-gage industry …“Even with the Internet and all of the technology today, direct mail stillhas its place, and it can offer a better ROI than most other forms of mar-keting/advertising … you just have to do it the right way.”
Based in Medford, Ore., TagQuest Inc. is a full-service marketing firm de-veloped throughout the ever-changing mortgage industry. Utilizing industryknowledge, marketing expertise, and technology we implement any or allaspects of your marketing and/or advertising campaigns. With a proventrack record, more than 10 years in business, and decades of experienceTagQuest knows what it takes to produce unprecedented results in today’sfast-paced mortgage environment. For more information, call (888) 717-8980 or visit www.tagquest.com.
Compliance in Marketing
� nmp news flashcontinued from page 15
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Your lender should beyour strongest link.
Some restrictions may apply. All borrowers are subject to credit approval. Programs subject to change. The information provided herein is for
dissemination to and for real estate and financial business entities only and is not an advertisement for the extension of credit to consumers.
With decades of industry know-how,Flagstar is a partner you can rely on.
Warehouse lines up to $100 million • Agency/government products • Multi-channel delivery
Underwriting flexibility • TRID-ready • Local account executives—direct point of contact
Connect with us. Visit flagstar.com/ae to find an account executive near you.
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SPONSORED ED ITORIAL
By K. Justin Restaino
With so many marketing channels available, it can be diffi-cult to determine the best strategy to reach prospects. How-ever, we’d argue that direct mail is so impactful that everymortgage lender should consider incorporating it into their
marketing efforts.Direct mail offers you the advantage of personalization that other
mediums—like television, radio, flyers and billboards—don’t. Rather thansending out generic, one-size-fits-all pieces, incorporate personalizationinto your mailing. For example, don’t send your mailer to “Dear Home-owner at 15 Main Street.” Instead, try the more personal, “Dear Amanda.”This month, we’ll share helpful advice to maximize your direct mail piecewriting and composition of the piece.
The copy“What constitutes appealing copy?” you might be wondering. In a nutshell,the copy that is going to be the most successful with your target audiencehas the following attributes:l The copy is direct, straightforward and to the point.l It’s written the way people speak, rather than in flowery language.l It avoids lots of industry jargon that might be confusing for recipients.l The copy is benefits-driven, i.e., it speaks to what a loan can do for the
prospect (save hundreds of dollars a month, free up more money totravel, go from being a renter to grilling in the backyard of your firsthome, etc.).
The formatBy and large, people tend to skim lengthy pieces. However, don’t let thatstop you from getting your point across. Fortunately, formatting can helpand to guarantee that people will immediately notice and read the mainbenefits of your services, we recommend the following:l Avoid using lengthy blocks of text. Instead, keep paragraphs to two to
three sentences. l Bold important sentences and use bullet points or subheads if necessary.l Create a headline and a PS. Studies show that these attract lots of at-
tention. Take advantage of that by writing something attention-grab-bing in these sections.
The executionA call-to-action (CTA) is critical in any direct mail piece. Essentially, theCTA is a guide that instructs the recipient to take a specific action after re-ceiving your mailer. Your CTA will also allow you to track the success ofyour campaign, because you can easily evaluate how many of your directmail recipients performed your CTA. The best CTAs are time-sensitive (“Fora limited time …”) and easy to do.l Some CTAs you might want to consider include: Signing up for your e-
mail marketing list, downloading a free e-book, liking your socialmedia page, visiting a landing page that you specifically designed forthe mailer, etc.
Direct mail yields excellent results for mortgage lenders for a numberof reasons: It’s easy to target to a specific demographic, offers measurableresults, conveys legitimacy, enables personalization, and provides manydifferent types of mailers to help marketers differentiate themselves fromtheir competition.
K. Justin Restaino is vice president of Titan List & Mailing Services Inc. Formore than 15 years, he has led Titan’s Mortgage Division, helping lendersof all capacities grow their businesses utilizing targeted direct mail. With aspecialized focus in refinance and purchase markets, Restaino has the insightfor proper data and mail application for success. He may be reached byphone at (800) 544-8060, ext. 204 or e-mail [email protected].
Writing and Formatting Your Mailer
�
to audit their compliance with the newregulations.
“LoanLogics has completed severalTRID enhancements to our ComplianceAudit interface to help clients cost effec-tively evaluate their compliance withTRID and relieve some of their concernsaround defects related to these changes,”said Brian K. Fitzpatrick, president andCEO of LoanLogics. “Our technology canhelp drive a culture of lending whereteamwork, timing and tracking are para-mount to ensure loan quality and compli-ance while reducing the manual tasksand associated labor costs.”
MBA Launches TRIDResource for Consumersand Lenders
The Mortgage Bankers Association(MBA) launched a set of resource guide-lines to educate both consumers andlenders and their business partnersneeding to comply with the new “KnowBefore You Owe” or TILA RESPAIntegrated Disclosure (TRID) regulationsthat went into effect Oct. 3, 2015.
“MBA has worked closely with theCFPB to create these materials so thatboth consumers and the real estatecommunity can comply with the newprocedures in an efficient and smoothprocess,” said MBA President and CEODavid Stevens. “Our industry has beenpreparing for these changes over thelast several months and we are confi-dent that everyone involved in the clos-ing process will benefit as a result ofthese new rules.”
The resources are comprised of sev-eral documents designed to assist con-sumers and the broader real estatecommunity in plain, easy-to-under-stand language.
They include:l Consumer One-Pager: Targeted for
consumers and covering the changesof Know Before You Owe;
l Lender One-Pager: Targeted for realestate agents and broker partners,also covering the changes broughtby Know Before You Owe;
l PowerPoint Slide Deck: Targeted forreal estate agents and brokerpartners to use in presentations withcolleagues.
eOriginal LaunchesDatalytics Auditing andCompliance Solution
eOriginal Inc. has announced thelaunch of a fully-electronic, disruptive
mortgage platform. eOriginal has spear-headed the collaboration of several inte-gration partners to deliver a fully digitalprocess that includes eNotarization,eRecording, eWarehousing, eCustodianservices and integration with MortgageIndustry Standards MaintenanceOrganization (MISMO) compliantSmartDocs and Forms.
Ahead of the mortgage technologyadoption, eOriginal pioneered what isbelieved to be the first all-digital paper-less home purchase and mortgagetransactions in the U.S. in July of 2000through a patented process. The entirehomebuying process—from closing theloan, recording the documents anddelivering the package to the secondarymortgage market—took less than threehours to complete.
“eOriginal is and has been ready forend-to-end digital mortgage for morethan 15 years,” said Stephen Bisbee, CEOand president of eOriginal Inc. “Now thatthe marketplace has caught up to us, weare excited to see how our eMortgageplatform will empower marketplacelenders and lending industries—provid-ing consumers with anticipated innova-tion and supporting the requirements ofregulators like the Consumer FinancialProtection Bureau.”
eOriginal has also announced thedebut of Datalytics, a real-time asset-levelauditing and compliance solution for thefinancial services industry. Originally driv-en by the increasing demand for detailedreal-time monitoring in support ofeOriginal’s electronic mortgage solution,Datalytics provides analysis, monitoringand reporting of origination data for fasteraudit request response and to preventerrors and resubmissions. The solutionprovides a full chain of custody for dataacross the loan process at the asset-level,which will enable an unprecedented levelof insight and due diligence while savingtime, reducing risk and decreasing costs.
The new solution complementseOriginal’s eAsset Management Platform,one of the most secure platforms on themarket for managing electronic businesstransactions and protecting financialassets post-signature throughout theirlifecycle.
Incorporating origination data into aconfigurable dashboard with intuitivedrill down capabilities, Datalytics pro-vides asset-backed security (ABS) buyerswith asset-level data and document asso-ciation with confirmation that there havebeen no modifications and alerts if thereare any.
ISGN Enhances ItsSettlement ServicesPlatform to Conform toTRID Mandate
ISGN Corporation hasannounced enhance-ments to its Gators set-
new to marketcontinued from page 12
continued on page 32
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It has been a whirlwind13 months as your NAMBpresident. As I look back,I see many of my originalgoals were accomplished,but some were not. I’m
certain that is typical of any leadershiprole. It actually surprised me to findhow many of my original 50 goals wereeither accomplished, set in motion, ortried and found not to be as wonderfulas I had thought. Many items I suggest-
ed would not have worked without theinput of the board and staff.
I’m not disappearing into the night,although there may be a few peoplewho wouldn’t mind that. I look forwardto working with NAMB’s new president,Rocke Andrews, and the new board inthe coming year. I even get to vote likea regular board member rather thanjust chair board meetings.
If you would aspire to a leadership
role within NAMB, let me or someoneon the board know. We need peoplewith a passion for the industry to stepup and make a difference.
Sincerely,
John L. Councilman, CMC, CRMSNAMB [email protected]
The President’s Message: October 2015
N A M B P E R S P E C T I V E
The CEO PerspectiveA Message From NAMB CEO Donald J. Frommeyer, CRMS
Well here we are atanother NAMB Nation-al … it’s that time ofthe year. It’s a timewhen we change overto a new board of
directors, a new set of exhibitorsthat will make this NAMB Nationalone of the best yet. I personallywant to welcome you to the bestconference we have put on to date.Your attendance at NAMB Nationalstates that we are all on the wayback and are doing incredible thingsas mortgage professionals.
As I depart the board of directorsas immediate past president, wewill welcome three new board mem-bers: Bob Sweeney from Indiana,Michele Velez from California andNathan Pierce from Utah. These are
excellent choices to be added to theboard, and they will be led by yournew President Rocke Andrews.
For those of you who do not knowa lot about Rocke, he is a statewidepast president from the ArizonaAssociation of Mortgage Professionals.Rocke comes to the presidency work-ing his way up the ladder. He becamea board member in 2011, and hashelped me and John Councilman outin a lot of ways. He has definitelyearned your support and is an excel-lent choice for your next president.
I would be remiss if I didn’t men-tion the job that John Councilmanhas done this past year. To be truth-ful, following my three-year presi-dency had to be hard, and John setsome goals and was successful withmost of them. As president, you set a
number of goals and hope you canaccomplish a few. But the one thingthat remains to me as the one I wishI had thought about was to set up asub-committee on diversity. Johnhad a great idea and this committeewill be a continuing committeethroughout the next five years or so.Great job John and welcome to theelite world of NAMB past presidents.
I am also excited about theupcoming year to serve as your CEO. Isigned a new three-year agreementto do this and I really am excited tocontinue to work with all of you forthat period of time. One of my jobsthis year is to be the ConferenceCommittee Chair to oversee all threeNAMB conferences. Yes … I saidthree. NAMB will be adding a newconference called NAMB EAST 2016,which will be held Tuesday-Friday,March 8-11, 2016 at the WestinHilton Head Island Resort & Spa inHilton Head, S.C. and will be a greatexperience for all who attend. We aregoing to change up the format forthis, so stay tuned.
With that said, you cannot forgetthe NAMB 2016 Legislative &Regulatory Conference, set forSunday-Wednesday, April 10-13,2016 in Washington, D.C.
So while you are attending NAMBNational in Vegas, please take noteof the things you liked and thethings you did not. We will be send-ing out a survey to get your ideas. Ithank you for your support on this.It will only make your event betterin the future.
I also need you to join the party… you need to become an NAMBmember today! We are aiming tobreak the 15,000 member mark. Logon to JoinNAMB.org to become amember today. Let me be frank …we need you! So come and help usand become part of a great organi-zation that believes in you and whatyou do. No questions asked!
Donald J. Frommeyer, CRMS is chief execu-tive officer for NAMB—The Association ofMortgage Professional. He may be reachedby e-mail at [email protected].
NAMB’s WholesalePartnership
By Rocke Andrews,CMC, CRMS
NAMB recently com-pleted its SecondWholesale Summit. This
was a very successful event andhelped to further cement our part-ner relationships in this third-partyorigination (TPO) channel. Thewholesalers are looking to NAMB tohelp in educating loan originators,as well as account executives, andNAMB is looking at what we can doto improve broker relationships.
In an informal setting, we bringoriginator problems to the investorsand they bring their challenges to
us. This open line of communicationhelps each side understand the otherbetter.
The primary topic of discussion thistime was TRID and how each whole-saler is going to handle the LoanEstimate and the Closing Disclosureforms. Obviously this will probablychange by the time we meet again,but it helps us to coordinate solu-tions. They explained their technolo-gy issues. One item that came up wasonly one originator may disclose perborrower. So if your borrower is shop-ping and the other competitor isusing the same source as you the firstto input the data will get the disclo-sures and the other is out of luck. If
your borrower decides to go withyou, but another disclosed throughtheir site the borrower will need torequest you so they can delete theother file—similar to what hasalways happened for dual loans, butsomething that will arise more oftenin the new era of TRID disclosures.
We also asked our partners to par-ticipate in our legislative efforts. Theyagreed to pass on our requests forgrassroots participation and local con-tacts with members of Congress tohelp get our mutual concernsaddressed with laws and regulations.
They, in turn, asked us to helpthem with a certification for theiraccount representatives that theycould use to show our memberstheir knowledge and dedication forour industry. Wholesalers are alsoconcerned with bringing new work-ers to our field and are working toprovide a path to new entrants tolearn and be successful in the loan
origination business.Topics we are looking at working
on in the future include a more uni-form and reasonable broker agree-ment, sales training for originators,and joint efforts to solve regulationissues. We are all really on the sameteam trying to increase the TPOchannel, while best serving the con-sumer. It has, and will continue tobe, a profitable channel for whole-salers and brokers, while providing aknowledgeable and lower-pricedoption for the consumer. Please sup-port our wholesale partners as theyare supporting you through numer-ous efforts to better our industry andorganization.
Rocke Andrews, CMC, CRMS of LendingArizona LLC in Tucson, Ariz. is president-elect of NAMB—The Association ofMortgage Professionals. He may bereached by phone at (520) 886-7283 ore-mail [email protected].
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N A M B P E R S P E C T I V ENAMB is Back!
By John L.Councilman, CMC,CRMS
A few years ago, thingslooked very bleak for
NAMB and for our industry. We weren’tat all certain the country would surviveeconomically, much less our industry.NAMB was $1.5 million in debt andhad no money in the bank. Our whole-sale lenders were going bankrupt, thebig banks had left the wholesale chan-nel, membership was plummeting,and our conferences were only draw-ing a few hundred people and losingmoney. Even voices inside NAMB werecalling for us to declare bankruptcyand start a new association. A few ofNAMB’s top leaders said, “No way! Wewill not declare bankruptcy. We willnot quit! That is not the news that oureconomy needs. We have a responsibil-ity to our industry and to our country.”
As NAMB’s treasurer, perhaps theonly person foolish enough to take the
job, I insisted we would survive, nomatter what we had to cut and whatwork we would have to do ourselves.NAMB’s board took on the monumentaltask of doing all that a paid staffer haddone previously. It took a lot of sacri-fice. Wounds that had divided our mem-bership and our state chapters werehealed, in no small part due to theuncanny ability of Don Frommeyer tobuild consensus. Within two years, ourstate chapters were solidly back in thefold and NAMB was in the black. Therest is something of a fairytale-like story.
As people began to realize thatNAMB was here to stay, membershipbegan to slowly rise. Our social mediachannels began to pick up membersand followers. Government officials stillknew NAMB and probably didn’t realizehow perilously close we can come toextinction. Picking up the ball on leg-islative issues was much easier, espe-cially since we were able to maintainour primary lobbyist, Roy DeLoach.
The last shoe to drop into place was
the restoration of NAMB’s conferences.Vince Valvo has been a godsend. Hetook our great content, sold out theexhibitor booths and made attendancesoar.
Today, NAMB is back! EverythingNAMB did at its peak is now back inplace. Our conferences are great andvery well-attended. NAMB National isvying to become the largest mortgageconference in the United States. Topspeakers are back at our Legislative &Regulatory Conference, and we will beunveiling the details on NAMB Eastshortly. We are able to influence law-makers to introduce legislation favor-able to originators and we help theCFPB understand our issues and con-sider them. Membership had tremen-dous gains this year. Our social mediapresence is gaining 20 percent year-over-year. Wholesale lenders are inlock-step with NAMB. Our leadership isnothing less than amazing.
What does all of that mean to you?It means your industry and your jobare safer and more productive. Whenyou have a strong trade association,your interests are powerfully protected
in many ways. Trade associations helpthe industry to grow. You are not alone,just as long as we band together to pro-mote our industry and solve our prob-lems. We protect one another becausewe don’t stand a chance going at italone. There are still far too many mort-gage originators who haven’t gottenthat message. If you haven’t joinedNAMB, do it today. We have kept NAMBmembership costs among the lowest ofany national trade association.
You may be reading this article atNAMB National. If so, thanks for comingto Las Vegas. Enjoy yourself at the greatparties and social events. Learn how tobe the best possible mortgage profes-sional at our sessions, and don’t forgetto take advantage of all of the opportu-nities to learn how to make moremoney. It is all made possible by yourmembership in NAMB.
John L. Councilman, CMC, CRMS of AMCMortgage Corporation in Ft. Myers, Fla. ispresident of NAMB—The Association ofMortgage Professionals. He may bereached by phone at (239) 267-2400 or e-mail [email protected].
Why Do INeed
NAMB?
www.namb.org … JOIN TODAY!
l NAMB Testifies Before Congress
l NAMB Works With the CFPB
l NAMB Participates in Multiple Regulatory/CFPB Panels
l NAMB Webinars
l Full-Time NAMB Lobbyist on Capitol Hill
l NAMB Protects Your Business
l NAMB Forms Industry Coalitions
l NAMB Education
For detailed information, visit www.namb.org.
Are You an NAMBLending Integrity Sealof Approval Holder?
(No additional costs to NAMB members)
How to Apply for your National LendingIntegrity Seal
www.lendingintegrity.orgClick on EARN the Seal
NAMB members ONLY–Log in to the Lending Integrity site with your NAMBUser ID and Password (If you do not know your User ID and Password, typein your e-mail and click log-in and the system will send you a password. Ifyou have any issues, please call (972) 758-1151 or [email protected]).
Lending Integrity RequirementsThe Lending Integrity Seal of Approval is awarded only to mort-gage originators who meet specific requirements. To earn theprivilege to display the Seal, mortgage brokers and loan officersmust:
l Be an NAMB member
l Meet the requirements of the SAFE Act
l Pass a national criminal background check
l Attend eight hours (or equivalent) of professional development education
each year
l Attend two hours (or equivalent) of ethics training every other year or
each license renewal cycle
l Provide professional references
l Subscribe to NAMB’s Best Business Practices
l Agree to NAMB’s Code of Ethics
l Must be renewed annually
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respect in Washington, correct?
The Consumer Financial Protection
Bureau (CFPB) and the Federal
Reserve respect our position on
issues because our members are
small business owners whose
number one goal is to strengthen
homeownership in the United States.
Is it true that you have already
been something of a ubiquitous
figure in Washington, D.C. already
on behalf of NAMB?
I’ve made approximately 16 or 17
trips to D.C. A typical trip depends
on what’s going on. I’ve met with the
Federal Housing Administration
(FHA), the Department of Veterans
Affairs (VA) and specific legislators.
On separate occasions, I’ve met with
the Fed and the Consumer Financial
Protection Bureau (CFFB).
We hear so much about the power
of Political Action Committees
(PACs) and their impact on
shaping federal policy. Just how
important are PAC contributions in
getting your voice heard in
Washington?
Unfortunately, they are a major
Rocke Andrews is no stranger to
readers of National Mortgage
Professional Magazine or to the
industry as a whole. As broker/owner
at Tucson, Ariz.-based Lending
Arizona LLC, he is one of the most
prominent figures in the Grand
Canyon State. And after a number of
years in high-profile positions within
NAMB—The Association of
Mortgage Professionals, he will
become the organization’s president
in Las Vegas at the association’s
NAMB National conference.
We spoke with Andrews about
NAMB, his work, the industry and its
relationship with the federal
government.
How did you get into the
mortgage profession? Was this
something you always wanted to
pursue?
Rocke Andrews: I graduated as a
civil engineer, and really didn’t enjoy
that. In 1987, I decided to get a real
estate license–I saw greater flexibility
and income potential in that field and
it enabled me to be my own boss.
That was back during the start of
the savings and loan crisis. Did
that impact you?
Not on my business, in particular.
There was just the general effect on
the economy.
So, all of these years later, are you
still satisfied with your career
switch?
I find that being a mortgage broker is
the best way to get mortgages to
people. The professional died out a
little bit with the economic crisis. But
today, service is probably better for
getting mortgages to people.
How did you first get involved with
NAMB?
I was working at Nova Financial in
the early 1990s when a wholesale
rep for Countrywide took members
of our office to the Arizona brokers
association’s luncheon. The people
there were friendlier and more willing
to share ideas than at the mortgage
bankers’ organization. I attended my
first NAMB convention in 1996.
When did you become further
involved in NAMB?
I served on the Education Committee
in 2009, and I was elected to the
board of directors in 2012.
Did you become involved with your
state association as well?
I was president of NAMB’s state
affiliate in Arizona in 2001, but my
initial goal was to be part of the
national organization.
In the past few years, NAMB has
become an increasingly prominent
force in Washington, D.C. As
incoming NAMB president, how do
you plan to keep that momentum
going?
One priority I have is to increase
NAMB’s membership … the more
members we have, the better
position we can have at the table in
Washington, D.C.
Where is NAMB today in terms of
membership numbers?
We currently have about 3,800
members, and I would like to grow
that number to 5,000.
But even as a relatively
moderately-sized organization,
NAMB still commands a lot of
N A M B P E R S P E C T I V EgettingknowtoRocke Andrews, CMC, CRMS
NAMB President-ElectB Y P H I L H A L L
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N A M B P E R S P E C T I V Efactor. It gets you entry into offices.
This is something we want to
pursue—it ensures we can get in
and get appointments.
But NAMB isn’t throwing money
at PACs like handfuls of New
Year’s Eve confetti?
Only if they ask for it. And if we
donate to them, it is strictly to pursue
our legislative goals. We will be
looking strictly at [PACs connected
to] members of the Financial Services
Committees.
Let’s switch gears for a minute to
consider a few issues that impact
the industry. There has been a lot
of talk about getting more young
people interested in mortgage
careers. What is your view on
this?
Actually, here in Arizona, where we
have quite a few young loan
officers, due primarily to family
relationships. They tend to start as
assistants and work their way up. I
see it as issue, not as a major
concern.
What about the state of third-
party origination?
One of my priorities as NAMB
president is to let people know it is a
safe channel. People need to know
that NAMB is here to help them with
compliance concerns–especially when
the CFPB may be coming after them.
The national homeownership is at
its lowest level … one that has
not been seen since 1966. Should
we be worried?
People take pride in homeownership,
but not everyone is made out to be a
homeowner. Before 2008, we got a
little bit ahead of ourselves trying to
get everyone into homeownership.
But many potential homeowners
either cannot or will not consider
buying a home.
There is a large percentage of
people eligible for home loans who
don’t think that they are. We need
to educate them on the possibility
of financing. In many places, it is
cheaper to own than rent. And this
not just a long-term investment, but
it is also better for their budget.
While first-time homebuyers are
facing obstacles, either real or
perceived, there is a great deal
more activity pursuing wealthy
homeowners on the jumbo
mortgage side.
There is less competition because
you are not competing with giant
government agencies.
We know that NAMB helps many
professionals with this business.
Has it helped your new business
operations?
It has not necessarily resulted in new
business, but in some business–
referrals from members in other
states, and learning about new
products and new lines of business.
Will we be seeing more of you
around the country in your new role
as NAMB president?
I can see my travel increasing a little
bit. But all of the NAMB officers put
in lot of time to do this work. I don’t
think the president has greater time
demands than others on the board.
You spend about 40 to 50 percent of
the week working on NAMB. We’re
constantly working on stuff.
Phil Hall is managing editor of
National Mortgage Professional
Magazine. He may be reached by e-
mail at [email protected].
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Mortgage Currentcy is a subscription-basedezine that interprets the mortgage underwritingand compliance rules in plain, easy-to-understandlanguage and how they affect your files inprocess. NAMB Members save $70 on annualsubscription option. Visit the Websiteat www.mortgagecurrentcy.com/tour.php
NAMB Members will receive a Twenty-FivePercent (25%) discount off of the regular pricewith their NAMB Membership.
Simplii VOIP business phone solutions include all thefeatures and functionality of a high end businessphone system without the high costs. We offer allNAMB members a 10% discount off their phoneservices. For more information please e-mail [email protected]
If you want a social and mobile marketingstrategy that gets noticed contact Social5 todayfor a FREE consultation and demo and to receiveyour NAMB member discount pricing .
SYNCRO connects mobile salespeople to theiroffice website leads. NAMB Members receive a10% discount off regular prices for monthlyunlimited SYNCRO Web Chat packages.
NAMB members get special pricing plus 1 monthFREE.
The Bond Exchange is a national surety agencyspecializing in providing mortgage license bondsto thousands of mortgage professionals acrossthe country.
USA Business Lending is the nation’s premiercommercial brokerage firm representing over3500 lenders.
NAMB members receive a 10% discount offregular prices for Warm Welcome LLC services.For more information visit WarmWelcomeLLC.com.
Dear Mortgage Professional, I’m sure many of you will be reading this while you are traveling to or fromLas Vegas for NAMB National or San Diego for the MBA Annual Convention& Expo. Let me briefly introduce (or reintroduce) you to NAMB+.
NAMB+ is the for-profit marketing & communications subsidiary ofNAMB, the Association of Mortgage Professionals. NAMB+ was formed
to help NAMB increase the value and benefits of membership in the organization. Theway this works is NAMB+ seeks out and establishes strategic relationships with a varietyof different product and service providers that want to work specifically with mortgageprofessionals and are willing to offer special discounts, pricing and product offeringsexclusively for NAMB Members. NAMB+ is the bridge that connects NAMB Memberswith these specially selected Endorsed Providers.
If you are a NAMB Member, just login to NAMBplus.com to see details about all ofthe amazing offers and discounts that are available to you right now. If you are not yet
a NAMB Member, you can JOIN NAMB today and start saving. Whether you are a newor existing NAMB Member, the money you can save by using or switching to even oneNAMB+ Endorsed Provider could pay for the cost of your membership multiple timesover! Why wait another month, start saving today!Sincerely,
John G. Stevens, CRMS, PresidentNAMB+, [email protected] • NAMBPlus.com • @JohnGlennStevenshttps://www.facebook.om/JohnGStevensUtahhttps://plus.google.com/114643023635445909618/posts
See below for a complete listing of the current NAMB+ Endorsed Providersand visit NAMBPlus.com for more information.
NAMBPLUS Login InstructionsUsername = Member Number
Password = First initial of your first name capitalized and your last name with the first letter of
the last name capitalized (example = JStevens)
*If you are not a NAMB member please visitNAMB.org and join today to gain access
to NAMBPLUS.com and the many benefits NAMBmembers receive!
24
N A M B P E R S P E C T I V E
NAMB’s Second Wholesale SummitFurther Strengthens theBroker-Wholesaler Bond
B Y P H I L H A L L
WHOLESALESUMMIT
Inspiration can strike in the leastlikely locations. For example, JohnCouncilman found his inspirationfor NAMB’s Wholesale Summitsduring a breakfast in Atlantic City.
“I attended the Northeast MortgageBrokers Convention in Atlantic City lastyear,” recalled Councilman, president ofNAMB—The Association of MortgageProfessionals. “[National MortgageProfessional’s] Andrew Berman held abreakfast for some major wholesalelenders. After the breakfast, I was veryinterested in talking about this issue fur-ther–but there was no forum for that.”
Councilman sought to share hisenthusiasm on a wholesale-exclusivemeeting with the NAMB board of direc-tors. He outlined the possibility of theassociation hosting a pair of summits–one in the spring, the other in the fall–dealing with the challenges and trendsfacing the wholesale lending sector.Although the board had not budgeted
for new conferences, they wereintrigued by Councilman’s idea.
“They took a giant leap of faith thatpeople would be interested–even thoughthis was without having any funding for itin place,” Councilman added.
As a result, NAMB’s first WholesaleSummit took place in Orlando, Fla. inMarch, while a second summit was heldrecently in Dallas. An initial plan was tohave the second Wholesale Summit pig-gybacked on NAMB National in October,but was scrapped because the proposeddates clashed with a previously sched-uled event. But in seeking participationin the new summits, NAMB CEO DonFrommeyer wanted to avoid a come-one/come-all invitation.
“We limited participation to a maxi-mum of three members of any compa-ny,” Frommeyer said. “But we werelooking for the decision-makers. Wedidn’t want account executives–wewanted the people above them.”
The first summit brought in repre-sentatives from 15 of the industry’sleading companies: Angel OakMortgage Solutions, B2R Finance,Carrington Mortgage Services, FranklinAmerican Mortgage, FreedomMortgage, HomeBridge Wholesale,Impac Mortgage Wholesale, Land HomeFinancial Services’ Wholesale Division,Lenders Compliance Group, New PennFinancial, Quicken Loans, REMNWholesale and United Wholesale.Frommeyer recalled that the first sum-mit got off on a very cautious note, withboth the organizers and attendeesshowing more than a little uncertainty.
“We did not know what to expect,”Frommeyer said. “Everyone was tenta-tive–no one wanted to speak up. Butafter the first break, attendees startedto introduce themselves to othersbecause they did not know each other.”
NAMB provided its attendees at thefirst Wholesale Summit with data from
a proprietary survey conducted withhundreds of loan originators and mort-gage brokers on what they expectedfrom wholesale lenders. The secondWholesale Summit was dominated bydiscussion on the impact of the newTRID regulations on the wholesale sec-tor and the entire industry.
Frommeyer dubbed the wholesaleoutreach “a work in progress” and statedhe was open to inviting non-NAMBmembers to next year’s meetings. As forCouncilman, the idea for more NAMBsummits aimed at specific segments ofthe industry was not out of the question.
“We may, but it’s not on the agenda,”Frommeyer said, adding that NAMB wasalready pre-occupied with the produc-tion of four major conferences for 2016.
Phil Hall is managing editor of NationalMortgage Professional Magazine. Hemay be reached by e-mail [email protected].
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Richard AbaziaTanner AllenTodd AllenChuck AndersonRocke AndrewsMike AonJoseph ArcherJohn ArditoJoe AshtonMark AtanasoffJames BagnellKaren S. BarnesRoshe BarooniJim BarryDave BeachAllycyn BennettJoel M. BermanRick Bettencourt Jr.Jeannine BlandKenneth BlaudowAudrey BoissonouDouglas BradenDavid BradleyTiffany BradleyAndy BrikhoAndrea BuckMichael BurroughsMark Cahoone
Kenneth CampbellJoseph CannarozziTerry CaseyDana ChahidiJim ChapmanEric ChauhanAlan CicchettiBrent ColemanRuben ConcepcionJohn CouncilmanRonald CraryDawn CychnerTom CychnerBrady DayKeith DeLatteMichael DelzerRay DeMarDonald DeRespinisMichael DesantisBruce DittmerJames DorneyJeffrey DrawdyTammy EngelJim EzellGinny FergusonFAMP FEDERAL PACAntonina FriedlandDon Frommeyer
Mary Jane GalbisoJill GallagherRick GilbertGregory GrahamVictoria GreerMartin HackfordSteve HakesKelly HaneyMark HarcrowAndy HarrisMelissa HayesLisa HernandezHoward HowlandJohn H. P. HudsonMarvin HudsonDavid HughsonEd IrwinErik JaneczkoPeaches JensenRyan JonesJon KaempferDavid W. Kane, Jr.Jason KauffmanMichael KanukaMike KelsoKevin KennedyJonathan KimuraEdmund King
Linda KnowltonMichael KopieckiFred KregerMarci LaBordeShane LesterKim LewisBobbie LindnerAnthony LombardoDavid LunaLisa LundKelly LynchAngela MacKinnonPaul MarshSteve MatthewsLinda McCoyJohn McCullyAshby McDonaldHoward MiselmanJoe MoodyJim MorrisVernon MorrisonVicki MurphyRoberty MurrayElena NeisGary OgamiMatt OliverDonald OpekaWilliam Ormond
Dennis OshiroRaymond OshmanSean O'SullivanNorm OttleyJim PairCarrie PanacekCarlos PazosChris PeckDawn PembertonRichard Petano Jill PfeifferClaude PhillipsNathan PierceJohn PorterDean RathbunKathy RavenDonald RizzoJeanine A. RobbinsHeather RoseJoan F. RuthHartley SappolValerie SaundersGary SchillerJulia SchlossGuy SchwartzLisa SeverseikeJeff ShealeyChris Shedd
Mark SheridanAnn ShipleyShawn SidhuTimothy SimkoKane SmeltzChris SmithLynette StaleyMitch StamMarc StarrJohn G. StevensMarvin StockertDiana TardifDonald ThomasDouglas TurnerForrest Van BenthuysenCasey Van WinkleDan Van WinkleMichelle VelezDebbie Villarreal Bryan WardIrving WebbCharles WestKimber WhiteJames WilsonEdward ZadehBenita Zimmerman
For additional information about NAMBPAC, please feel free to contact me or visit namb.org.
John G. Stevens, CRMS • 2014-2015 NAMBPAC [email protected]
* Federal Election Law requires NAMBPAC to use its best efforts to collect and report the name, address, occupation and employer of everyone who contributes $200 or more in a singleyear. If your contribution to NAMBPAC in 2015 is less than $200, your name may not appear on this list, but NAMBPAC is still very grateful for your generous support!
Dear Mortgage Professional, We have had a tremendously successful year at NAMB and it has beena particularly busy and productive one for our Government Affairsteam. I am so proud to report that NAMB continues to be a highlyrespected voice in Washington, D.C. and the voice of the mortgageoriginator nationwide.
NAMBPAC is as strong as it has been in nearly a decade, and thatis thanks to all of our members who have so generously and
continuously supported us through the years. Please accept mysincerest and most heartfelt THANK YOU for all that you have done foryour Association!
Thank you for all of your continued support!
John G. Stevens, CRMS2014-2015 NAMBPAC Committee Chair
A very special thank you goes out to all who have contributed to NAMBPAC already this year!
26
By Laura Burke,MBA, MS, MIS,CFE, EA
I have been both a mort-gage banker, a mortgage
broker, a broker/owner, and back to abanker. It’s a merry-go-round … some-times you’re a lion, sometimes a horse,but most important is that you contin-ue to go around and around continuingto earn an income. There is no right orwrong answer as they both provide asource of employment.
A mortgage banker provides a serv-ice of loan origination, processing,underwriting and closing. Bankers uti-lize lenders like Fannie Mae andFreddie Mac, offering a variety of loanproducts such as conventional, jumbo,FHA, VA and USDA. Most bankers havetheir own underwriters in-house, whichoften means the ability for direct con-tact, questions, structuring and otherkey questions that often only an under-writer can answer adequately.
Another positive aspect as a bankeris the opportunity to learn differentroles within the industry to allow futurecareer expansion and growth. As a bro-ker, your expansion opportunities arelimited to possible ownership of a bro-kerage company.
I will point out that a banker is mostdefinitely the way for a newbie to go,they offer structure and training.Education, training and product knowl-edge are typically abundant in thebanking arena. Most bankers have thefunds to spend on their employees, tohelp increase their sales ability, tech-nique, customer service, leadership,product knowledge and more.
Mortgage brokers have positive andnegative sides as well. All mortgage bro-kers have to be federally-licensed, aswell as state-regulated. All brokers mustpossess an active NMLS (NationwideMortgage Licensing System & Registry)number.
A broker doesn’t work for a specificlender, they are a middle person. Theyoriginate loans, some may even processtheir own loans, while others offer in-house processors and then submit theloan to a lender of choice.
A broker must be knowledgeable inall products they want to offer, thusbrokers tend to be more seasoned loanofficers. Some mortgage brokers willonly take on loan officers with a mini-mum of two years under their belt, andin my opinion, that’s not enough. LOsworking as brokers will be expected toshop their own loans, understandingspecific lender guidelines for that type
of loan, knowing how to structure aloan, and either processing the loan, orhaving a processor assist in the process-ing of the loan and then properly sub-mitting the loan to the lender’s under-writing department.
Often, the LO working as a brokerwill need to work with an account exec-utive from the lender they are placingthe loan with for more product infor-mation, such as lender overlays on topof standard guidelines. This is where itcan get tricky. When you work for abank, you know their guidelines. As abroker, it is more difficult to learn in anever-changing environment 15-25 ormore lenders guidelines. Thus, one wayto combat this is to work with three orfour key lenders, get to know theirguidelines, underwriters and schmoozewith account reps. The more businessyou or your company sends to a partic-ular lender, the more brownie pointsyou score. It’s like taking care of yourown. Who are you going to help inneed, a good friend or co-worker whoyou positively interact with daily orsomeone you see at a Chamber ofCommerce networking event once everyother month.
There is an upside to this as well. Asa broker, you have more autonomy andfreedom to place your loans where you
want them to go. This is the number oneadvantage of being a broker—the abili-ty to submit different types of loans toyour choice of lender. Never submit thesame loan to more than one lender at atime … this is unprofessional. Thisaction could cause a lender to stopaccepting future loans not only from youas an individual loan officer, but couldjeopardize the whole company’s abilityto continue to submit loans to thelender that the loan gets pulled from.
One other major difference is at clos-ing. A banker is lending their ownfunds, whether a loan or not, they areclosing in their name. They can chooseto keep the loan in the name with theuse of their own funds, portfolio lend-ing or they can choose to sell the loanto one of the players, such as FannieMae, Freddie Mac or another largelender who are buying loans. What abanker will do is sell their loans in bun-dles—for example a $5 million bun-dle—the larger the bundle, the moreperks the banker may be able to obtain.For example, sometimes the bankersproviding $50 million or $250 millionin loan bundles may get a rate discountthat they can choose to pass on to theborrower to attract more loan businesswith a tad lower rate, or maybe keep itto help pay for internal costs, such as
Broker? Banker? How to Choose …
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877-686-6565 Office866-318-4471 Direct Fax
www.calhardmoney.com • e-mail scenarios to: [email protected] Financial Group Corp. NMLS #357614/PB Financial Group Corp BRE #01522495
Disclosures: per FDIC Regulations Section 6500 Part 226, Subpart C, 226.24. The amount of each payment that will apply over the term of the loan is based on simple annualinterest applied to the unpaid balance. Loans range from 1 day to 60 months, are interest only and include a balloon payment due at term. Finance charges apply. Payments do notinclude amounts per property taxes or insurance premiums. This is not a commitment to lend. Rates and points are subject to change without notice. NMLS #357614
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the in-house underwriters. They mayalso get a pass on some guideline thatis in a grey area, allowing them to struc-ture a loan differently.
A broker, on the closing side closesthe loan in the lenders name, nothingever closes in the broker’s names,unless the broker has secured a loan,called a warehouse line of creditenabling them to table fund. Tablefunding allows a broker to close in theirname for a short while, typically lessthan two weeks. They then packagetheir loans and send them to the lenderwho is “buying” them from the brokerand servicing them. There are risksinvolved here for the broker owner, asthe loan is closed and funded with theirwarehouse line of credit, thus the pack-age must be exactly how the lenderexpects it to be in order to sell the loan.If it is not, the lender who the brokeranticipated selling the loan to couldreject it, causing the broker to rectifythe issue immediately.
There is a gray side to being a bankerthat allows the brokering of certainloans. It’s kind of like having your cakeand eating it too. However, there arenot many bankers that are currentlyoffering both avenues.
It may seem that, as a banker, youreceive a slightly reduced commissionsplit, but it is an offset for what you getin return—an office, the use of thecompany’s computers and software,printers, all business supplies, businesscards, in-house underwriters, proces-sors, marketing materials, and training.I can honestly say I made the mostmoney in my career as a banker, morethan I did as a broker.
Even though my commission was setto the same amount for every deal,with a little fluctuation for volume, Itruly made more. I think I worried lessas well. I had a specific processorassigned to me. I was allowed to havean assistant and all was good in myworld. I worked for a portfolio banker,which made my position easier. I hadunique programs, the ability to under-write based upon our own guidelinesand common sense, and the bankerwasn’t selling the loans. It was a greattime to be a banker.
Brokers and bankers both haveadvantages and drawbacks based onthe timing of where you are in the cir-cle of life chain. When I first started inthe business, I was unaware of mort-gage brokers. They weren’t popular orabundant at the time. As my careerevolved, I started to learn about whatmortgage brokers could do, and soon,all of us bankers had a network of bro-kers that we passed off business to. As abanker, our guidelines were too strictand we couldn’t do the loans. But tokeep our real estate agents happy, weknew who could get the deal done. Themindset was that brokers did the moreundesirable and more difficult to doloans. But bankers still controlled themarket, as brokers only had a smallpercentage of the business.
That soon began to change. Soonmany banks, lending institutions
opened their doors to brokers’ loans.Brokers were starting to competeagainst the bankers for the more desir-able loans. They could now originatetop-notch, top-quality loans, as well asblemished ones. It was perfect verbiagefor a broker to say, “Work with me. I’llshop your loan for the lowest rate, thebest scenario.” Or if they had a moredifficult loan, “Don’t go to a banker. Ifyour loan is denied, it’s over. If I origi-nate your loan, and one lender says no,we simply repackage the loan and sendit to another lender for a secondoption.” Brokers soon started cuttinginto the bankers’ pockets and were clos-ing more than 50 percent of the marketshare until the financial crisis hit.
Then, the rules and the gamechanged. Banker guidelines tightened,home values dropped, foreclosureswere running rampant, and both bro-ker and banker’s compliance rules hadan overhaul, and many bankers andbrokers closed shop. The big boys likeBear Sterns, Countrywide, LehmanBrothers and Washington Mutual closedtheir doors. Even Fannie Mae andFreddie Mac required a bailout. Just thesame impact hit the brokers as well, asmany closed their doors and went outof business. Today, it seems that thebanking side is on the upswing, as wellas the brokers who were able to sustainthemselves though the crisis. Surviveand thrive!
Both mortgage brokers and mort-gage bankers have their advantagesand drawbacks, so choose the avenuethat is right for you and continue toprosper!
Laura Burke, MBA, MS, MIS, CFE, EA isan author, and trainer with 20-plusyears of experience in the mortgagearena. She has been in the trenches asa loan officer, originating more than$35 million to becoming CEO of herown mortgage brokerage company.Laura specializes in federal tax law,compliance, fraud, data management,security, leadership, training and mar-keting. She may be reached by e-mailat [email protected].
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By Jeremy Potter
Oct. 3, 2015 isn’tjust another datein the mortgageindustry. It’s the
date the Consumer Financial ProtectBureau (CFPB) will be enforcing a newrule that will have an influence on bothhomebuyers and the residential mort-gage industry alike. The rule is calledthe Truth-In-Lending-Act and RealEstate Settlement Procedures ActIntegrated Disclosure Rule, also knownas TILA RESPA Integrated Disclosure or“TRID.” While TRID is designed to sim-plify the mortgage disclosure process,being unprepared for the changes canhave a catastrophic effect on thelender. TRID is more than just a rule …it’s forcing a cultural change on thebusiness and forcing lenders to changehow they operate.
The problem doesn’t lie with therule itself, but with the transition overthe course of the next couple ofmonths. Lenders that are entirelyunprepared for the implementation ofthis rule will likely have a difficult timemanaging both the old rule and TRIDsimultaneously. This transition is amore demanding process than a typicalrule change, which can be helped alongtremendously and handled more effi-ciently by technology. TRID affectseveryone within the loan process, forc-ing the loan originator, processor, lockdesk specialist, and closer to go abouttheir job in a new way. Switching tothis new rule can only be made easierby each department involved beingproperly trained and ready for thechanges that are coming. They musthave a full understanding of the ruleand the penalties that will be handedout, should there be a violation.
As a refresher, there are a few keychanges to be aware of when this rule
takes effect. First, that the Good FaithEstimate (GFE) and the Initial Truth-in-Lending (TIL) Statement are combinedtogether into a “Loan Estimate” docu-ment and second, that the HUD-1Settlement and the Final TIL be com-bined into the “Closing Disclosure.”While the time frame stays the samewith the Loan Estimate document beinghanded out to within three days of aloan application, the Closing Disclosuredocument will now have to be in theconsumer’s hands at least three busi-ness days prior to closing. Adhering tothis new time frame is essential to avoidsome hefty fines ranging between$5,000 per day up to a possible $1 mil-lion per day depending upon the sever-ity of the offense.
My company, Norcom Mortgage, forexample, has invested well in its com-pliance team and sees it as a tacticaladvantage, not just a defensive necessi-ty. The main priority is protecting thecustomer’s best interest, the company,and the individual loan officer whilealso taking on the new changes thatTRID will bring about. Our complianceteam has worked very closely with theMortgage Bankers Association (MBA),vendors and industry partners in orderto make sure that the company is pro-tected from every angle. In addition,Norcom is following all areas of thebusiness and industry closely, to makestaff the most prepared they can possi-ble be.
Transitioning over to these new doc-uments and set of rules can be madesignificantly easier by planning ahead inall areas. Having extensive knowledge ofthe TRID rule by internal compliancestaff can lead to fewer mistakes downthe line. IT staff must have the technol-ogy ready to handle the new rule andthe quality of the software system itselfwill make a huge difference when itcomes to the transition. Having excel-
lent communication with the cus-tomer, real estate agent, attorney orclosing agent, and seller, makes it eas-ier to adapt to any changes that maypresent themselves. Other lendersthat follow suit are the ones that aregoing to thrive most with this transi-tion.
Knowing what to expect is the onlyway to transition to TRID seamlessly,but even then there are some possibleissues that may arise. Loan applica-tions dated prior to the execution ofTRID will be processed at the sametime as the new document require-ments and rule, which can become amajor issue for several departments.IT departments have to ensure thatthe right timelines and documentspackages are applied to the correctfiles, while closing departments mustbe able to be flexible enough to han-dle both loan applications and knowwhich set of rules and documents gowith the correct application.
Compliance teams are truly the lastline of defense and should be trainedas such.
Investing in compliance teams willbe beneficial to help with this transi-tion as their priority is protectingeveryone within the company in addi-tion to their customers. It affects sev-eral parts of the business and theindustry as a whole, so it’s importantto make sure the company remainssupported throughout this process.Training each department to be ableto know and understand the differ-ences in each loan and guaranteeingthat they are sent to the right file iscrucial. The lenders that focus on theculture of compliance and build ruleslike this into the DNA of the companywill come out head and shouldersabove the competition.
A lack of proper training or generalconfusion can lead to misunderstand-
ing of the rule, which can lead to thepenalties mentioned above. With speedbeing a major factor within this indus-try, the new time constraints along withthese new rules will likely have anaffect over this area. Any delays in thetransaction, as simple as a miscommu-nication or as big as a third party delayor software malfunctioning and failingto work properly, can produce prob-lems that lead to a violation of TRID.The new requirements and time con-straints will put more pressure on thelender to have everything together andcommunication is absolutely vitalbetween every party involved.Employees need to be well-trained toavoid any delays and keep within thenew time crunch that has presenteditself with this rule.
Having a transition plan is anabsolute must in order for survivalthroughout this process, but it needs tobe more than something that is laid outfor the company without any kind offollow through. For the most success,an employee’s attitude needs to bechanged as their job has adapted andtaken on new expectations along withthese rules. A plan that covers IT, train-ing and disclosures is on track to thrive,but a business that goes one step fur-ther and includes a focus on changingthe employee’s mindset is the best wayto come off this transition as tri-umphant.
Jeremy Potter, general counsel and chiefcompliance officer, joined NorcomMortgage with experience in the govern-ment contracting community, havingserved as an analyst in the metro D.C.area for regulatory issues at the marketresearch firm INPUT Inc. Jeremy holds abachelor’s degree in political sciencefrom the University of Mary Washingtonin Fredericksburg, Va. where he graduat-ed cum laude.
Transitioningto
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By Ginger Bell
The Millennial generationis defined by technology,has a strong desire to getahead quickly, grew up
with highly involved “helicopter” parentsand surprising to some; actually cravesmentors. A 2011 PwC survey revealedthat when asked which benefitsMillennials would most value from anemployer, respondents named training,mentoring and flexible working opportu-nities over financial benefits.1
In fact, according to a November 2014Virtuali survey,2 Millennials think men-toring is the most effective and desiredtype of career development training.However, Millennials are not satisfiedwith existing corporate training andmentoring programs. To bridge this gapcompanies need to be more creativewhen structuring training and mentoringprograms. Successful mentoring pro-grams may be the defining factor thatdetermines whether Millennials succeedor fail within your organization.
These four expert tips can help com-panies understand the wants and needsof Millennials, and create more effectivementoring programs.
1. Allow for customization:Millennials see themselves as individualsMillennials were largely raised by BabyBoomers. This, of course, has had aneffect on who they are and how they
developed. Many Boomers raised theirchildren to believe they were special andgave them opportunities to have uniqueexperiences and points of view.Millennial individuality started early.Millennials didn’t grow up with teddybears given to them by their grandpar-ents. No, they created their bears atplaces like Build-A-Bear. They seldompurchased an entire CD, instead they cre-ated playlists on iTunes and Amazon.
The adult Millennial looks for individ-ual customization in the workplace aswell. Knowing this, your company needsto make your training and mentoringprogram as customizable as possible toappeal to Millennials. Companies canbegin with personality assessments tobetter understand Millennials’ traits andthen match them with mentors and vari-ous training and e-learning activities andprograms so that they can create theirown learning path. Millennials like to beinvolved with their learning so allowingthem to select from a menu of optionshelps them to be involved in their careerpath.
The best way to reach Millennials iswith a blended approach. Your mentor-ing program should include on-demandcontent, traditional content and teambuilding as well as individual mentoringopportunities with specialists. The goal isto provide experience-based learning andmentoring. When Millennials don’tunderstand the career path or feelemployers don’t appreciate their individ-uality, they will take their talent and
potential elsewhere; this is why it isimportant to set the expectations andinvolve them in the training and mentor-ing process.
2. Provide recognition: Millennials areaccustomed to recognitionBaby Boomers instilled Millennials with astrong sense of self-esteem by tellingthem how special they were. ManyMillennials were carefully coached inorganized sports and other activities.Video and computer games rewardedthem with badges, points, leveling upand immediate recognized achievement.This does not however; mean thatMillennials expect undeserved recogni-tion. Millennials appreciate simple thankyou notes and awards for great work, butthey also grew up in an era where every-one received a trophy for everything …even if they took last place. In otherwords, Millennials have recognition inse-curities and sometimes wonder if therecognition received is as artificial astheir boxes full of trophies they receivedas children.
Because of this generalized recogni-tion, Millennials have been trained tolook for outside reasons to validaterecognition they receive. In sports, thisvalidation is easy: Did you win or did youlose? In business it becomes a little morechallenging: did what you were recog-nized for make a difference or not? Whenrecognizing a Millennial, the giver ofrecognition needs to validate, throughactions, that whatever they did to get
recognition is making a difference in theorganization or team.
Millennials want to be challenged andwhen a mentor challenges them, letsthem figure out a solution, recognizesthem for finding that solution, and thenimplements the solution, they know theyare valued because they see that they’vemade a difference in the company. Ifthey cannot find outside validation, thenthe recognition they receive is just likethose boxes of trophies that they knowthey didn’t deserve … not inspiring. Tothem, rewards are natural outcomes ofgood work, and smart employers estab-lish recognition programs that incorpo-rate appropriate and deserved recogni-tion. Millennials generally like and lookup to their managers and see them asmentors, not adversaries. They want tobe guided, coached and trained and theywant to improve. As a result, training anddevelopment programs are high priori-ties for Millennials in the workplace—according to a PwC study,3 Millennials saythey want training and developmentmore than cash bonuses. A company canbenefit by providing regular feedbackand recognition to Millennials. Yes, thistakes both thought and effort, but thepayoff of employees who are engagedand feel good about their work are worththe investment.
3. Utilize technology: Millenniallearning is tech-drivenMillennials expect the technologies thatempower their personal lives to also
Mentoring MillennialsFour things companies should include when building a Millennial mentorship program
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through the problem, and who will leadthem down a path to figure out a solu-tion on their own.
Millennials want a mentor who theycan come to about roadblocks or ques-tions and know that the mentor will notfix the roadblocks but offer guidance tohelp them fix the problem.
If mentors constantly give a strongvision of the future, outline specific goals,and give support without telling how,Millennials will devote themselves to thementor and attach themselves to thevision and goal.
Many companies require mentorshipprograms to last for a set amount oftime, but not all mentor-to-menteearrangements are productive for a spe-cific period. Developing an effective
mentorship program is important tocompanies who want to developMillennials for the future. There ismuch to be gained with an effectivementorship program. Remember whendesigning your mentorship program besure to allow for an individual to cus-tomize a portion of their mentorshipprogram, provide for relevant recogni-tion, utilize technology and keep les-sons relevant and timely and allow forMillennials to grow on their own withthe support of their mentors.
© Copyright 2007-2015 Carrington Mortgage Services, LLC headquartered at 1600 South Douglass Road, Suites 110 & 200A, Anaheim, CA 92806. 800-561-4567. NMLS ID 2600. Nationwide Mortgage Licensing System (NMLS) Consumer Access website: www.nmlsconsumeraccess.org. AZ: Mortgage Banker BK-0910745; 2159 McCulloch Blvd 4, Lake Havasu City, AZ 86403. CA: Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act, File 413 0904. CO: Check license status of your mortgage loan originator at www.dora.state.co.us/real-estate/index.htm. GA: Georgia Residential Mortgage Licensee 22721. IL: Illinois Residential Mortgage Licensee. KS: Supervised Loan License SL.0000313. KY: Mortgage Loan Company License MC21112. MN: This is not an offer to enter into an interest rate lock agreement under Minnesota Law. MO: Residential Mortgage Broker License 09-1746-S. NH: Licensed by the New Hampshire Banking Department. NJ: Licensed by the N.J. Department of Banking and Insurance. NY: Licensed Mortgage Banker—NYS Department of Financial Services. New York Mortgage Banker License B500980/107664. OH: Ohio Mortgage Broker Act Mortgage Banker Exemption MBMB.850208.000 (FHA, DE & VA automatic loans only) OR: Mortgage Lender License ML4886. PA: Licensed by the Department of Banking. RI: Rhode Island Licensed Lender, Lender License 20112809LL. VA: Licensed by the Virginia State Corporation Commission MC5382. WA: Consumer Loan License CL2600. Also licensed in AL, AR, CT, DE, DC, FL, ID, IN, IA, ME, MD, MS, MT, NM, NC, OK, SC, TN, TX, UT, WV and WI. NOTICE: All loans subject to credit, underwriting and property approval guidelines. Offered loan products may vary by state. There is no guarantee that all borrowers will qualify. Restrictions may apply. This is not a commitment to lend. Terms, conditions and programs are subject to change without notice. This information is for mortgage professionals only and is not intended for distribution to consumers. Carrington Mortgage Services is not acting on behalf of or at the direction of HUD/FHA or any government agency. All rights reserved.
At Carrington Mortgage Services, we are committed to meeting the financing needs of underserved borrowers. We have loan programs specifically tailored to credit-challenged borrowers, so there’s no need to turn away clients due to low FICO scores. We are your government lender of choice with loan programs, service, technology and national support to grow your
business today, tomorrow and beyond.
HELPING YOU NAVIGATE THOSE TOUGH LOANS
FICO minimums to 550 on government programs, FHA, VA and USDA. Expanded FHA/VA guidelines include manufactured housing, manual underwriting
and use of non-traditional credit.
Nationwide operations support from coast-to-coast with operations centers across all time zones provides our brokers with outstanding service and fast turn times.
Growing your business with the right partner has never been easier. Get started
today with Carrington Mortgage Services.
866-453-2400Or learn more about our programs online at:CarringtonWholesale.com/ToughLoans
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drive communication and innovation inthe workplace. Fifty-nine percent of thePwC survey4 said that an employer’s tech-nology was important to them when con-sidering a job, but they habitually useworkplace technology alongside theirown. Over half of those questioned rou-tinely make use of their own technologyat work, and 78 percent said that accessto the technology they like to use makesthem more effective at work.
Millennials grew up with screens allaround them—personal computers, cell-phones, laptops and video games. Theyare completely comfortable sharing per-sonal and professional informationthrough instant and text messages. Theyalso feel intimately connected with peo-ple through social media but may lack inpersonal skills. Millennials are eager tolearn and pick up new skills, and if theirmentors tell them they need to work ontheir soft skills, they will. It may feelstrange to provide training to young pro-fessionals on how to make a phone call,but if that skill is important to your busi-ness, it is something you’ll need to do. Astrong emphasis on technology andsocial media will help make your compa-ny attractive to high-potential and high-performing Millennials. Be sure to offeran easy-to-use e-learning system that isoptimized for mobile devices.
Managers and executives may not beable to dedicate as much time as they’dlike to mentorships, and not allMillennials want regular check-in meet-ings. Giving and receiving mentoring tipsdoesn’t have to take a lot of time. Usingtechnology can help to develop an effec-tive mentoring program. Creating a sim-ple three-minute lessons in an e-learningsystem like Morf Media Inc.5 is a greatway to lend mentoring advice. Podcastsor recorded videos that can be housed inone central system is another easy way togive on-demand mentoring tips. Ratherthan a one-off or a lunch and learn,record it and use it in a learning man-agement system. If you are wanting tomeasure what they have learned you canadd a few questions to your three-minute lesson or video. Checking forunderstanding and offering quick andeasy lessons is key to an effective men-toring program. Also consider setting upa forum with teams and get key man-agers and executives to use the forum toanswer questions from younger employ-ees. Mentoring is a team event andMillennials want to be involved in theprocess.
4. DIY mentoring: Millennials wantmentorship with some supportMillennials are looking to attach them-selves to visionary mentors who focus oncreating a long-term vision and develop-ment for their employees. Millennials’mentors whose philosophy inspires themwith where they are going, but allowsthem to figure out how to get there ontheir own will be effective. This doesn’tmean they want a mentor who providesa good vision or lesson and then throwsthem to the wayside. Rather, they want amentor who they can approach with aproblem, who will help them think
Ginger Bell is the best-selling author ofCracking the Success Code and SuccessToday, books she co-authored with BrianTracy and other business specialists. Herexperience includes creating and manag-ing training standards, expectations andmeasurements that build employee com-petencies. Ginger is currently involved inleading development of a gamification e-learning system with Morf Media Inc., aninternational gamification software devel-opment company. She may be reached bye-mail at [email protected].
Footnotes1—PWC.com/en_M1/m1/services/consulting/documents/millennials-at-work.pdf2—PRWeb.com/releases/millennial/leaders/prweb12260713.htm3—PWC.com/en_M1/m1/services/consulting/documents/millennials-at-work.pdf4—PWC.com/en_M1/m1/services/consulting/documents/millennials-at-work.pdf5—MorfMedia.com
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Diversify Your Product Line With Non-Agency Mortgages
SPONSORED ED ITORIAL
By Tom Hutchens
The Federal Reserve announced last month that it won’t beincreasing the funds rate. Still, we are likely to see rate liftofffrom the Fed in the near future. It’s not a matter of “if,” butrather “when” they’ll raise rates. Many analysts predict that
when this happens, it will signal the beginning of the end of a decades-long secular bond market run; but the move is sure to have a profoundeffect in mortgage markets, as well.
Most notably, the mortgage refinance market stands to take a hit fromrising rates. Volume will start to dry up as mortgage rates reverse their34-year downtrend from the high teens of the early 1980s.
Lenders that rely heavily on refinancing need to come up with a way tobolster their new mortgage pipeline in order to replace lost volume. Thebest way to do this is by diversifying into non-agency mortgage products.
Since the housing crisis, the hands of lenders have been tied as they’vehad limited options to issue loans not eligible for sale to government-sponsored enterprises (GSEs). Within the last two years, however, there hasbeen a reemergence in the non-agency market, as lenders are once againoffering these products to their networks. Now, there exists a diverse mort-gage product mix on the market that can meet the needs of almost anyborrower.
Here are some examples of the types of borrowers that can benefit fromnon-agency products:
l Borrowers who have experienced a recent credit event, such as a fore-closure or short sale.
l Borrowers that don’t have W-2 income and instead rely off of incomefrom investment properties.
l Self-employed borrowers whose tax returns may not necessarily reflecttheir true income due to business write-offs.
l Foreign nationals that don’t have credit in the U.S. system.l Borrowers that have significant savings, but limited income.
Loan originators need to start taking advantage of these new productsif they want to be able to satisfy the growing demand of their referralbases. With a wider array of ways to address customer needs, they standto increase their reach to a subset of buyers that has been otherwise un-derserved for the last eight years. If all they offer is Fannie Mae, FreddieMac, FHA, and VA loans, they’re stuck competing with the majority ofother lender that do the same thing. They also run the risk of their referralpartners looking for a provider with a more diverse product offering.
Tom Hutchens is senior vice president of sales and marketing at Angel OakMortgage Solutions, an Atlanta-based wholesale lender currently licensed in24 states. Tom has been in the real estate lending business for nearly 20years. He may be reached by phone at (855) 539-4910 or e-mail [email protected].
�
tlement services and vendor manage-ment platform as the ConsumerFinancial Protection Bureau (CFPB)delays its TILA-RESPA IntegratedDisclosure (TRID) effective date toOct. 3, 2015.
Designed to meet TRID’s closingdisclosure requirements, ISGN’sGators is a highly configurable, Web-based title and closing solution thatstreamlines the fulfillment and pro-cessing of orders. The latest versionof Gators now supports the importand export of the Mortgage IndustryStandards Maintenance Organization(MISMO) Reference Model version 3.3file formats. As a result, Gators willinterface with RealEC’s Exchange plat-form to support its Closing Insightdisclosure service, which several ofthe top originators in the U.S. arestandardizing on.
In June, ISGN enhanced Gators todefault to the correct closing disclo-sure form based upon the loan pur-pose in anticipation of the initial Aug.1 deadline. Gators’ users still have theoption to produce the HUDSettlement Statement and Good FaithEstimate for those few loan productsthat do not require the new closingdisclosure form. ISGN continues todevelop enhancements natively tomaintain Gators’ current functionalityand minimize the learning curve forexisting users.
“We spent the last month workingclosely with our customers to deter-mine what other enhancements wecould make to the Gators platform tohelp them comply with the TRID clos-ing disclosure requirements as quick-ly and easily as possible,” said DonGaspar, chief technology officer forISGN. “The new integrated disclosuresare living, dynamic documents withseveral moving parts, which is unlikeanything the mortgage industry hasever worked with before, so we willcontinue to leverage our customers’feedback to make further enhance-ments to Gators as we approach thenew Oct. 3 deadline.”
New Quandis MilitarySearch TechnologyAddresses UpcomingChanges
Quandis Inc. has announced that ithas extended its Military SearchService to locate active duty militarypersonnel in other facets of consumerlending for compliance adherence.
The White House announced theimplementation of a new rule to pro-tect servicemembers and their fami-lies from high-cost loans and preda-tory lending, which takes effect onOct. 1, 2015. It closes loopholes in the2006 Military Lending Act (MLA) byexpanding the definition of “con-
sumer credit” to include paydayloans, vehicle title loans, refundanticipation loans, deposit advanceloans, installment loans and creditcards.
The Quandis Military SearchService works by performing auto-mated bulk searches on theDepartment of Defense’s (DoD) Website to identify borrowers that arelisted as active duty in all militarybranches. An official military statusreport is provided by the Departmentof Defense within 24 hours.Currently, most searches are per-formed manually by lending entitieson the DoD’s site, which is arduous,time consuming and risky.
“Expanding our footprint intoother aspects of lending that canleverage our Military Search Service isa natural fit for us,” said ScottStoddard, CEO of Quandis. “The solu-tion that we provide today for mort-gage lenders to address SCRA compli-ance is easily transferable to anyorganization that gives a loan to aU.S. servicemember. They have spe-cific rights that must be adhered to inorder to comply with the new MilitaryLending Act that will be implementedon Oct. 1, or stiff penalties can belevied.”
The Quandis Military SearchService is currently in use by ser-vicers, banks, foreclosure attorneys,trustees and various outsourced net-works operating in the mortgagebanking industry. It is proven to helplending organizations comply withthe Servicemembers Civil Relief Act(SCRA) of 2003, which has variousrules around foreclosing on activemilitary personnel who have becomedelinquent on their mortgage. Thesolution can be utilized to quickly,efficiently and cost-effectively locateall active military personnel.
ABS Releases Upgrade toThe Mortgage Office
Applied Business Software Inc. (ABS)has announced an update, Version2.1.6, to its signature software, TheMortgage Office. Version 2.1.6 of TheMortgage Office will allow customersto enjoy enhanced features, includ-ing: Lockbox processing support;seamless accounting system integra-tion with QuickBooks and PeopleSoft;the ability for users to customize cer-tain labels in the Investor and LenderStatements; user defined loan, lenderand vendor imports from Excelspreadsheet; and a new partnershipDRIP shared based model.
“We are extremely pleased with thisrelease. Innovation, along with our cus-tomers’ needs and wants, are at the
new to marketcontinued from page 18
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ClosingGuard™ closing agent risk rating tool withunlimited vetting, monitoring, risk reporting and 24/7access to our watch list and shared closing agentdatabase.
QuickCheck™ once and done closing agent riskreport generated in one business day or less,completely online and secure.
VendorCheck™ quick and easy to read risk report ofany third party service provider, with data verified,evaluated and reported in an easy to one-page format.
SAFE-Chek USA™ the only employee screeningservice designed to assist mortgage lenders in meetingSAFE Act and GLBA requirements to manage risk ofaccess to borrower personal and financial data.
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forefront of our software develop-ment,” said Jerry Delgado, CEO & co-founder. “The new feature set is consis-tent with prior releases, whereenhancements to compliance, report-ing, efficiency, versatility and scalabili-ty are the ultimate objectives.”
New MBA White PaperFocuses on Security Risks
The MortgageBankers Associa-tion (MBA) hasreleased a newwhite paper,
“The Basic Components of anInformation Security Program,” that dis-cusses the information security risks fac-ing the mortgage industry and the basicsecurity practices necessary to help miti-gate the risks. The report was authoredby members of the MBA ResidentialTechnology Forum (RESTECH) Infor-mation Security Workgroup and isintended to assist small and medium-sized entities that might need help inunderstanding and managing securityrisk.
“We realized that smaller firms mightnot have enough resources or expertise tobe kept abreast of the rapidly changingrisks” said Shawn Malone, vice president ofBusiness Compliance at Radian Group andchair of the RESTECH Information SecurityWorkgroup. “Thus, our workgroup identi-fied a need for a security guide that non-technical individuals could utilize to helpimprove the security of their organiza-tion.”
Although all security risks are impor-tant, the paper highlights the most criticalareas of focus.
“A risk-based approach is the mosteffective way to understand and imple-ment an effective information securityprogram,” said Robb Reck, chief infor-mation Security Officer for PulteMortgage and vice chair of the Infor-mation Security Workgroup. “Thispaper identifies those critical risks andoffers suggestions for how to mitigatethem. Our hope is that by providingthis information, companies will beable to more rapidly mature their secu-rity practices.”
The white paper notes that the finan-cial services industry has been designatedas one of the six critical infrastructure sec-tors in the United States because of thevalue of its data as a target for criminalsand other bad actors. The report outlinespractical steps that MBA members cantake to mitigate information security risk.
“MBA continues to increase thebreadth and depth of information secu-rity resources available to our mem-bers,” said Rick Hill, vice president forIndustry Technology at the MBA. “Chiefexecutives, board members, risk man-agers and everyone across the organiza-tion are part of managing risk.Individuals in these roles should notethat regulators are expecting theirinvolvement in the development andoversight of corporate risk manage-ment programs. MBA will continue todevelop resources to help companiesnavigate through the security risks fac-ing our industry.”
Collateral AnalyticsDevelops New MarketRanking System
Collateral Analytics has developed a newautomated ranking system to objectivelydefine the market condition of individualreal estate markets ranging from specificneighborhoods to cities, states or theoverall U.S. This new system is com-pletely data driven and is based onthe same market indicators whichare used by appraisers in the MarketCondition Addendum of the standard1004 Appraisal Report.
The CA Market Condition Rankingsystem is based on the magnitude
and trends of the individual marketindicators with which are then com-bined to create the qualitative marketranking which include ratings such as“Normal,” “Distressed” or “Hot.” Thisinnovative ranking system can be com-pletely automated and used to define,not only current, but also historicalmarket conditions for any geographicalarea, property type, property character-istics or price range.
“It seems that everyone has an opin-ion regarding the state of the real estatemarket,” said Michael Sklarz, presidentand CEO of Collateral Analytics. “Most ofthese opinions are anecdotal and sub-jective which is unfortunate given theimportance of the real estate market tothe larger economy. The Collateral
Analytics Market Ranking System pro-vides a straightforward and systematicway to do this.”
Your turnNational Mortgage Professional Magazineinvites you to submit any information pro-moting new “niche” loan programs, newproducts or any other announcement relat-ed to the introduction of a new program,to the attention of:
New to Market columnPhone #: (516) 409-5555
E-mail: [email protected]
Note: Submissions sent via e-mail are pre-ferred. The deadline for submissions is the1st of the month prior to the target issue.
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Master the Markets with Barry HabibRecap of key economic events that took place over the past week and a look aheadto events that will potentially impact interest rates in the housing market.
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Laura LawsonChief People Officer
United Wholesale MortgageB Y P H I L H A L L
N M P M O R T G A G E P R O F E S
“My hope is that UWM continues to gainmarket share as the number one wholesalelender in the country and are known beyond
the mortgage industry for always putting our people first.”
Laura Lawson holds the
title of chief people
officer at United
Wholesale Mortgage
(UWM). Admittedly, it is
not the type of title that
one would find in most mortgage
companies. But Laura Lawson is
not the type of person you find in
most mortgage companies—nor,
for that matter, is UWM your run-
of-the-mill mortgage company.
National Mortgage Professional
Magazine traveled to UWM’s
headquarters in Troy, Mich. to
learn more about this fascinating
individual and her distinctive
company.
Where did your career begin?
I am a graduate of Michigan State
University, with a major in
advertising. After graduation, I
thought that I would do what a lot
of professionals do in the metro-
Detroit area—work with one of the
big three auto companies. I tried it,
working for Chrysler in marketing
and advertising, but I had a bigger
dream and vision for myself. I loved
entertainment, television and the
music industry, and I had a sister
living out in Los Angeles. So, I
thought “Well, why not? Now’s the
time!”
I moved out to Los Angeles to
pursue my dream, and I got
connected with an executive
producer that had an overall
producing deal with Fox Television
Studios. After working there for
nearly three years, I moved with
this producer over to Warner
Brothers, which was looking to
start some talk shows.
Warner Brothers was launching
a talk show with Sharon Osbourne
and another show with Ellen
DeGeneres. Neither one had ever
done a talk show—Sharon was
really in the spotlight with The
Osbournes reality show, while Ellen
was just kind of starting to reclaim
her fame. We made the wise
choice of structuring a deal where
we had the option to choose which
of those shows to work on—and
went towards Ellen DeGeneres. I
was the first staff member that
joined The Ellen DeGeneres Show,
along with an executive producer,
and we hand-picked and grew the
staff for Ellen’s show.
What year was that
approximately?
It was 2003. At first, there were the
test shows, and then from the test
shows, of course, it was green-
light. The nature of The Ellen
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DeGeneres Show was to make
people feel good and to
appreciate people. I could always
be proud to tell my mom to watch
the show.
But after five years into the
show, my mom was battling
cancer back in Michigan. We
could never take a break from the
show, so I was just waiting for
that summer hiatus, so I could
come home and be with her. And
once I finally got home, 12 days
later, she passed away, and that
changed my life forever. I realized
at that point: I’m single, I don’t
have a family. I am “Ms. Midwest
Values,” it’s time to be with my
family. So, I left all of it. I left this
job where I was able to work with
all of these idols on the big
screen, attend all of the cool
parties, and enjoy all of the cool
incentives. I came back home to
Michigan. But I came back and
didn’t worry about what I was
going to do next.
After I moved home, I talked to
all the TV stations about news
reporting. But I could not do the
news … it just wasn’t me.
By chance, I met up with
someone who was telling me
about this great company called
United Wholesale Mortgage and
its CEO, who was looking to build
a dream team. When I met with
Mat Ishbia, I thought, “Okay, it
sounds a little crazy to come from
Hollywood to go into wholesale
lending.” And it wasn’t the
Google-esque office that it is
today, but you could just tell there
was this energy and excitement
about it, and I took a gamble on it
and I believed in Mat’s vision.
What year was this?
It was around 2011.
What was the title that you were
originally hired for? Do you
remember the position?
I came onboard as a marketing
supervisor to build the marketing
team. In reality, it was marketing
and anything else related to sales,
growth and company culture. We
were small and mighty … and
made things happen. To be
S S I O N A L O F T H E M O N T H
honest, for me I’ve never been
about a title in an organizational
chart. It’s about the impact that
you make; not the titles that you
carry.
After experiencing all of that, the
excitement of Hollywood, what
specific things that Mat said
about this position intrigued you
enough to step into a field that
you had no knowledge of, yet
you felt you had the ability to
step in and take over?
He was uncertain of the impact
that marketing could have on
UWM. Mat started here working
through every level of the
company, but had never really
experienced the magic of
marketing. So it was the
opportunity of him saying, “Well,
show me what you’ve got. You’re
going to take a gamble on me, I’m
going to take a gamble on you.”
He gave me that dose of “prove
yourself” that was like “Game on
… let’s do this thing and win
together.” Mat and I share a
competitive nature. My sports
background is in soccer; his is in
basketball.
I loved the challenge.. And it’s
been exciting here ever since.
That’s why I love being here at
UWM every day. I park my car
every morning and practically run
in here because I cannot wait to
get started. I cannot wait to see
what I can achieve each day, but I
know that I’m never going to end
the day finishing my to-do list. We
are constantly innovating and
coming up with new ideas that
aren’t just amazing for UWM …
they’re amazing for the whole
industry! This is what keeps me
driven, this is what keeps me
excited; it’s that same spirit of my
first ever interaction with Mat until
today: The constant challenge of
how can we do more and get
better every day.
Mat infuses a tremendous
amount of passion into the
corporate culture of UWM. As
chief people officer, which is a
unique title, you’re the one
responsible for delivering a lot of
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that passion and fun within the
workspace. What do you feel
makes United Wholesale stand
out from the competition?
One of UWM’s key corporate
pillars states “our people are our
greatest asset.” We know that our
secret sauce is our people and
that cannot be replicated. It’s
something magical we have, and it
is part of our model of bringing in
and retaining the best of the best
in the industry. I feel like it’s rare to
go into a company in the
mortgage or financial service
industry and experience the
energy and family feel that we
have here.
How important a role do you feel
the mortgage broker plays in the
current residential finance
sector? What do you feel lies
ahead for the future of mortgage
brokers, and how do you think
UWM is going to be able to
support the growth of that
sector?
Mortgage brokers play a huge role
in creating a bright future in this
space. We are very focused at
UWM on how we can champion
their success—letting consumers
know that brokers are the best
choice when it comes to
purchasing or refinancing a home.
We especially love bringing
brokers to visit our headquarters—
so they can see firsthand all the
resources we have put in place to
ensure their success—from
technology to marketing tools to
training and all the speed of
service measures we have
created. Our hope is that our
broker clients see how we do it
and can take the tools, coaching
and learning from our techniques
back to their own respective
offices. The same things that work
for us here at UWM can work for
our brokers, as well. If our clients
are successful, then we’ll be
successful.
What would you regard as your
major accomplishments at UWM
since you joined the company
five years ago?
My biggest impact here is
proposing new ideas and executing
on them. I think a company dies
without great minds, brilliant minds
and innovators. It’s just pushing the
limit on what we can do, it’s taking
care of people, and it’s believing
that anything is possible.
I want to make sure that when
our team members come in every
day that they are energized to
come to work and excited about
what’s ahead. Everyone has had
that job where you dread leaving
home, you dread the drive, you
dread coming to work. Here at
UWM, everyone makes an impact
and I want everyone to be excited
to come into work each day. It gets
to be 6:00 p.m. and it almost stinks
that you have to leave. We have so
much fun, and we always have
more great work to do.
Where do you hope UWM is five
years from now?
My hope is that UWM continues to
gain market share as the number
one wholesale lender in the country
and are known beyond the
mortgage industry for always
putting our people first. I’d love for
UWM to be nationally recognized
as the premier champion of
mortgage brokers—the company
that put all its effort into helping
brokers grow their business, and
ultimately, the company that
helped brokers make a successful
comeback.
When you leave here at the end
of the day and you leave your
co-workers behind, how do you
spend your leisure time?
It’s all about my kids. I have two
little boys, a one-year-old and a
three-year-old. What I do here in
giving it my all and the passion to
work, I do that for them as well.
That is what my life is all about
now. It used to be about
celebrities and living the crazy
Hollywood life and all of that
excitement … my children are my
excitement now!
Phil Hall is managing editor of
National Mortgage Professional
Magazine. He may be reached by e-
mail at [email protected].
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Preparing for the Housing Market’sNext Shift
SPONSORED ED ITORIAL
By Danny Jasper
As interest rates sank to ultra-low levels after the housingbust, the mortgage industry has become more dependentto an extent on refinance business from clients seeking tosave money and cut interest payments. And, while industry
experts predicted a lower volume or refinancing business in 2015, banksand mortgage lenders are still profiting from small waves of refinancingopportunities. However, don’t over rely on refinancing to continue to sup-port volume. To be successful in the future, mortgage lenders will needto refocus their business efforts on driving purchase volumes higher.
While a decline in refinance volume may be challenging, the good newsfor your business is that as the housing market and general economic con-ditions continue to improve, first-time homebuyers, move-up householdsand vacation buyers are finding themselves in a position where they arewilling and able to buy homes.
For the last two years, prognosticators have forecasted this shift froma refinance-dominated market to a purchase-driven one, and the normal-izing of home price growth, increased rates, record-high rents and the im-proving economy are helping to bring this prediction to a reality.
Higher rates may entice lenders to think outside the boxBut, it’s the anticipated rate increase that will serve as one of the major cat-alysts for a purchase-dominated market. After almost a decade long ultra-lowinterest rate environment, if rates increase only slightly, the number of peoplewho can benefit from a refinance will dwindle considerably.
As rates began to rally, expect to see more lenders start to think outsideof the box with their lending products. Once-conservative lenders willbegin to lower their margins and increase their risk tolerance in an effortto keep volumes up and cast a wider borrower net. The Federal HousingAdministration (FHA), along with Fannie Mae and Freddie Mac, have al-ready started to do this with recent guideline changes targeted aroundmore affordable lending products.
Have the proper checks and balancesNo matter what products you currently have available on your lendingplatform, it is imperative to have the right operational processes in placeto fully evaluate and understand the risks involved. Make sure you’re pre-pared by ensuring you have the proper underwriting tools, overlays andother checks and balances in place.
For example, at Castle & Cooke Mortgage, we originate FHA loans forborrowers with a FICO score as low as 580 under some circumstances.However, we do have stipulations clients must meet, such as requiring theborrower to have six months reserves, no more than 150 percent paymentshock and one year in the same line of employment, all of which signifya borrower with lower default risks than their credit score would indicate.
Expanding credit can be a double-edged sword. After years of being ina reactive environment, expanding access to mortgages is something theindustry needs to prepare for with the upcoming increase in new purchasevolume. Although lending standards were not strict enough prior to thehousing crisis, we are now in one of the tightest credit markets in over adecade. Understanding there is a medium ground between having liberallending standards and being too conservative is key to responsible andsensible lending in the upcoming market shift.
Danny Jasper is senior vice president of Capital Markets for Castle & CookeMortgage LLC, one of the nation’s leading independent mortgage lenderswith 38 locations. He leverages more than a decade of experience in invest-ment, research and analysis to expand Castle & Cooke Mortgage’s marketshare and oversee its pricing analysis.
� nmp news flashcontinued from page 16
lion. Public construction spending inAugust was an estimated seasonallyadjusted annual rate $298.2 billion, 0.5percent above the revised July estimateof $296.8 billion.
New Statistics Offer aDifferent View ofMillennial Homebuyers
The popular be-lief that Millen-nials are inten-tionally avoid-ing homeowner-ship appears to
be a myth, according to new researchreleased by Realtor.com.
According to a Realtor.com analysis ofdata from comScore, almost 65 percent ofMillennials aged 21 to 34 looked at realestate Web sites and apps in August.Another survey, conducted for Realtor.comthrough the BDX Home Shopper InsightsPanel, found the top trigger concerns forMillennial homebuying were an increasein income (35 percent), unhappiness withthe current living arrangements (32 per-cent), favorable home prices (32 percent),favorable interest rates) and rent increases(22 percent).
However, the main impediments pre-venting a Millennial homebuying boomhave been limited inventory (40 percent), alack of affordable options (37 percent), thetime needed to locate the right house (36percent), problems coming up with a down-payment (28 percent) and the inability tofind the right neighborhood (23 percent).
Furthermore, data produced byRealtor.com in partnership with OptimalBlue found that Millennial buyers whowant to close on a home tend to be ingood financial shape, with high FICOscores (an average of 714) and low debt-to-income ratios (an average of 36 percent).
“People who believe that Millennials aredisinterested in homeownership are grosslymistaken,” said Jonathan Smoke, chiefeconomist at Realtor.com. “This generationhit the job market during one of the largestrecessions of all time and they’ve had towork hard to establish credit and save for adownpayment. With the older segment justbeginning to enjoy the life events that drivehomeownership—marriage and chil-dren—now is the most appropriate time forthem to consider homeownership, andthat’s what we’re seeing.”
Affordability Woes ImpactOne-Quarter of Markets
H o m e o w n e r -ship affordabili-ty is a growingproblem innearly one-quarter of the
major metro markets, according to thelatest Health of Housing Markets Reportreleased by Nationwide.
“On a national level, housing afford-ability is fairly valued, with little sign ofa housing price bubble,” said David Berson,Nationwide’s senior vice president and
chief economist. “However, certain areasare seeing price appreciation that is toorapid compared with income growth,potentially driving homebuyers out of themarket.”
The new quarterly report has deter-mined that relative affordability is eitherapproaching or has gone beyond unhealthylevels in the Pacific Coast, Colorado, Texasand parts of the East Coast. The impact oflower oil prices on employment has con-tributed to four states—Texas, Louisiana,Wyoming and West Virginia—occupyingthe entire bottom 10 metro areas. But theLone Star State is something of an anomaly,as the housing markets in Dallas, Austin,Houston and San Antonio continue to showsignificant vibrancy.
According to the report, the healthiesthousing markets are, in order, Kankakee,Ill.; Harrisburg-Carlisle, Pa.; Dayton, Ohio;Yakima, Wash.; Lansing-East Lansing, Mich.;Buffalo-Niagara Falls, N.Y.; Lancaster, Pa.;Niles-Benton Harbor, Mich.; Battle Creek,Mich.; Muskegon, Mich.
Chase RMBS SettlementMonitor Credits ChaseWith $3.5 Billion in Relief
Joseph A. SmithJr. has releasedhis sixth report onJPMorgan Chase’sprogress under its
settlement with the federal governmentand five states concerning claims thatChase, Bear Stearns and WashingtonMutual packaged and sold bad residentialmortgage-backed securities (RMBS) toinvestors before the financial crisis.
“I have credited Chase with$3,555,280,673 in consumer relief to158,107 borrowers through March 31,2015,” Smith said. “I will continue to moni-tor and report on Chase’s progress untilChase provides the required $4 billion incredited consumer relief by Dec. 31, 2017.”
The Monitor’s report also containsChase’s self-reported consumer relief creditfor the second quarter of 2015. As of June30, 2015, Chase claimed an additional$126,253,926 in consumer relief.
“I am in the process of confirmingChase’s additional claimed relief,” Smithsaid “I plan to report my findings near theend of this year.”
Your turnNational Mortgage ProfessionalMagazine invites you to submit any infor-mation on regulatory changes, legislativeupdates, human interest stories or anyother newsworthy items pertaining to themortgage industry to the attention of:
NMP News Flash columnPhone #: (516) 409-5555
E-mail:[email protected]
Note: Submissions sent via e-mail arepreferred. The deadline for submissionsis the 1st of the month prior to the tar-get issue.
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O N T H E
heardstreet
Our Heard on the Street column is a chronicle of events, changes and passages in the lives of the people and companies shaping the mortgage industry.
DocMagic Continues toGrow Via NewPartnerships
DocMagic hasannounced thatPHH Mortgage
has signed a multi-year license agree-ment to use its expansive set of prod-ucts to help ensure compliance withthe TILA-RESPA Integrated Disclosure(TRID) rule that went into effect on Oct.3, as well as other federal, state andinvestor requirements.
“We have worked closely withDocMagic for the last year to thorough-ly evaluate, test and integrate theirtechnology and compliance solutions,and we will use various components toensure we are TRID compliant,” saidEric Sadow, chief compliance and fairlending officer for PHH Mortgage. “Weare confident that our use of theDocMagic technology and compliancesolutions will meet our needs and theneeds of our clients, regulators,investors, partners and borrowers.”
PHH, its clients and their borrowerscan access DocMagic’s eSign/eDeliverytechnology that enables the electronicdelivery of TRID documents and theelectronic viewing of closing disclosuresand related documentation.DocMagic’s Audit Engine electronicallytracks and logs transactions touched byall parties working with its ComplianceEngine as well as its SmartCLOSE portal,while continuously comparing the ini-tial Loan Estimate against the finalClosing Disclosure to ensure RESPAcompliance throughout the process.
“For a lender with the size and repu-tation of PHH to select DocMagic tocomply with TRID, speaks volumesabout how sophisticated and scalableour solution really is,” said DominicIannitti, president and CEO ofDocMagic.
DocMagic has also announced thatMid America Mortgage Inc. will utilizeDocMagic’s SaaS-based compliance andmortgage loan document enginetogether with the on-premise solutionsof DocMagic’s recently acquiredeSignSystems patented eSigning,
eNotary, eVaulting, eRegistration andeRetention solutions. This is the firsttime since the acquisition ofeSignSystems in October 2014 that thecombination of technologies will bejointly utilized to facilitate a completeeClosing and validate DocMagic’seMortgage model.
“We made the decision to sign withDocMagic and its subsidiary divisioneSignSystems because of the uniquecapabilities of the combined technologycomponents, together with the mostpowerful eMortgage reputation andexpertise in the industry,” said Jeff Bode,president of Mid America Mortgage. “Theblend of these technologies integratedwith our loan origination system (LOS),Mortgage Machine, establishes the pathfor us to close our loans electronically.DocMagic’s solutions are ready today foreClosing, and now that the GSE’s areaccepting eNotes, their advance readi-ness for electronic closings is critical toMid America’s short and long-termeStrategy.”
“The marriage of our SaaS and on-premise solutions delivers a uniquevalue proposition for Mid America,” saidIannitti. “DocMagic’s SaaS model compli-antly delivers dynamic, intelligent, data-driven loan documents and disclosureswith a full eClosing for borrowers.eSignSystems’ on-premise platform pro-vides Mid America with internal controlsand tools to configure the solution totheir specific business processes and theability to efficiently work with third par-ties to achieve an eMortgage.”
FBC Mortgage Partners WithSecureInsight to ManageClosing Agent Risk
FBC Mortgage LLC has announced that
it has enhanced its risk managementpolicies and procedures governing itsmortgage lending business by requiringindependent screening and risk moni-toring for all settlement agents havingaccess to a borrower’s loan documentsand mortgage proceeds. This is especial-ly important given the ConsumerFinancial Protection Bureau’s “KnowBefore You Owe” Integrated Disclosurerule, effective Oct. 3, 2015. The processwill be managed for FBC bySecureInsight, powered by SecureSettlements Inc., a vendor managementfirm specializing in closing table risk.The company will use bothSecureInsight’s ClosingGuard andQuickCheck tools to evaluate the back-grounds, licensing, insurance and trustaccounts of agents as a method to iden-tify potential threats before a closingtakes place.
SecureInsight’s vendor risk toolsfeed a shared, nationwide database ofrated settlement professionals in themortgage industry. This database iscurrently accessed by nearly 100lenders throughout the U.S. to verifythe status of tens of thousands ofagents.
“We are pleased and honored to havebeen chosen by FBC for these critical riskmanagement services,” said SecureInsightPresident Andrew Liput. “In our extensivedealings with the FBC leadership team wesaw first-hand their serious commitmentto quality control, consumer protectionand overall loan quality assurance. We areproud to be their partner in this impor-tant endeavor.”
SecureInsight’s proprietary evalua-tion process combines automateddata analysis with live reviews bytrained analysts for the most accurateand informative risk analytics in theindustry.
“We recognize our responsibility toprotect consumers from identity andmortgage fraud, and our company con-
tinually seeks to not just meet, but toexceed, regulatory expectations forquality control and loan quality assur-ance,” said Michael Dunn, generalcounsel at FBC. “We take the manage-ment of third-party service providersseriously, both for operational risk andalso for investor confidence and con-sumer protection. We spent severalmonths evaluating various providers tohelp us address settlement agent risk,and were impressed with whatSecureInsight has to offer in its ClosingGuard and Quick Check products.”
Castle & Cooke MortgageExpansion ContinuesWith Two Branches inNew Mexico
Castle & Cooke Mortgage LLC hasannounced its expansion into the NewMexico market with new branch inAlbuquerque, N.M. and Las Cruces, N.M.
“We are thrilled to have two newbranches in New Mexico and to expandour home loan services to new cus-tomers,” said Adam Thorpe, presidentand chief operating officer for Castle &Cooke Mortgage. “We will continue toraise the industry standard in everynew branch we open by offering excep-tional customer service and recruitingtalented mortgage professionals forthose markets.”
Iris Guzman will manage theAlbuquerque location and Kyler Breenwill lead the Las Cruces branch. Bothlocations will offer a full range of resi-dential mortgages, along with the fastloan closings and exceptional servicethat have become hallmarks of Castle& Cooke Mortgage.
“With its diverse population,Albuquerque is a perfect location forCastle & Cooke Mortgage’s NewMexico branch,” Guzman said. “Ourbroad array of loan programs com-bined with our renowned expressloan funding will serve a multitudeof buyers, including first-time home-
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buyers, investors, veterans and repeatbuyers.”
Castle & Cooke Mortgage is in themidst of an aggressive expansion strat-egy with plans to be in 48 states by theend of 2016. This year alone, the com-pany has opened six new branchesand is now lending in 19 states.
Levy & Watkinson Joins Offit KurmanAttorneys at Law
L e v y &Watkinson, aNew Jersey-based lawfirm, has
announced that it is joining OffitKurman Attorneys at Law, a full-ser-vice law firm located in the mid-Atlantic Region. E. Robert Levy andWayne Watkinson, partners in Levy &Watkinson, will join Offit Kurman asprincipals and as members of thefirm’s Financial Institutions RegulatoryPractice Group.
Levy is the executive director of andcounsel to the Mortgage BankersAssociation of New Jersey (MBA-NJ),the New Jersey Association ofMortgage Brokers (NJAMB) and thePennsylvania Association of MortgageBrokers (PAMB), and he will continuein this role after the merger. He is alsothe legislative/regulatory counsel tothe Mortgage Bankers Association ofPennsylvania (MBA-PA). Levy is thelongtime chair of the IndustryAdvisory Council to the AmericanAssociation of Residential MortgageRegulators (AARMR) and serves on theNew Jersey Licensed Lenders AdvisoryBoard. He previously acted as DeputyCommissioner for the New JerseyDepartment of Banking and served asDeputy Attorney General representingthe Department.
“It is a natural fit,” said Levy. “Weare grateful to have the support of aleading firm in our region, and antici-pate a lasting, successful partnershipin New Jersey.”
Watkinson’s practice has concen-trated on representing mortgagelenders and brokers in compliance,licensing corporate and litigation mat-ters. He previously served as DeputyAttorney General representing theNew Jersey Banking Department. Inthis position, he represented theDepartment in appellate and adminis-trative courts, and in regulatory andadvice matters. He also served as aRegulatory Officer for the Department,drafting Department regulations forbanks, thrifts, mortgage bankers andother licensees. He is a former chair ofthe Banking Law Section of the NewJersey Bar Association. In addition topracticing law, he is a long timeinstructor for pre-licensing and contin-uing education classes.
“This affiliation is a mutually bene-ficial one: For our clients, OffitKurman, and us,” said Watkinson. “Weadmire the firm’s entrepreneurial phi-losophy and appreciate how it priori-tizes our practice growth.”
Altisource Announces Re-Branding
Altisource Portfolio Solutions SA hasintroduced new brand positioning:“Your One Source.” The brand under-scores Altisource’s ability to provide acomprehensive product set thataddresses the fragmented, complexand often outdated mortgage andreal estate marketplaces. Altisource isdelivering critical innovations,automation and compliance-focusedsolutions built on a multi-year trackrecord of results for banks, mortgageservicers, mortgage originators, real
estate buyers and sellers and othermarketplace participants.
“Over the past several years,Altisource has assembled and culti-vated a portfolio of businesses thatare propelling improvements in themortgage and real estate market-places,” said Barbara L. Goose, chiefmarketing officer for Altisource.“Altisource has created a 9,000 per-son strong, global company rootedin compliance, innovation, serviceand, most importantly, deliveringsolutions that address the challengesour customers and partners face.”
Altisource has consistently foundways to ease pain points in theinefficient mortgage and real estatemarketplaces with solutions that
address many of the elements ofthe homebuying, selling, lending,investment and maintenance life-cycle.
“We’re heading into 2016 withstrong momentum and a clearvision,” said Goose. “Our new brand-ing weaves a common threadthroughout our diverse but relatedbusinesses, communicating a uni-fied and forward-looking messageto our customers. Our goal is tokeep pushing for progress in themortgage and real estate market-places and to be the go-to sourcewhere customers can get the helpthey need to compete and win.”
continued on page 42
ranklin First Financial Wholesle is committed to providing the best programs, pricing and service to the broker community. We offer a full line of products including FHA, USDA and conforming programs. Our team will work hard to help you get your loans to closing fast!
Call 800.528.3007or visit www.franklinfirstfinancial.com/wholesale
FRANKLIN FIRST FINANCIAL, LTD. 538 BROADHOLLOW RD, STE. 401 MELVILLE, NY 11747 IS A LICENSED MORTGAGE BANKER-NYS DEPT OF FINANCIAL SERVICES. LICENSE #B500728 NMLS #1630, HUD APPROVED TITLE II NON-SUPERVISED LENDER #17895-0000-0. FRANKLIN FIRST FINANCIAL IS NOT ACTING ON BEHALF OF OR AT THE DIRECTION OF HUD/FHA OR THE FEDERAL GOVERNMENT. ALL LOANS ARE SUBJECT TO CREDIT & APPRAISAL APPROVAL. PROGRAMS, RATES, TERMS, AND CONDITIONS ARE SUBJECT TO CHANGE WITHOUT NOTICE.OTHER RESTRICTIONS MAY APPLY. THIS IS NOT A COMMITMENT TO LEND. COPYRIGHT FRANKLIN FIRST FINANCIAL, LTD. ALL RIGHTS RESERVED.
We believe in building strong, trusting relationships with our clients, which lead to higher volume of closed loans. Our reputation relies on exceeding your expectations.
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The Long & Short:The Business of Short Sales
No Refi Option for 7.1-Plus Million Underwater HomeownersThe challenge to fix this is made to mortgage and real estate industries
By Pam Marron
Credit is the first thing that mortgage professionals look at when evaluating anew customer. Everything else can be in order, but if late mortgage paymentsare present in the credit history, that alone can be the determining factor ofbeing turned down for the best loan, or having no option other than a higher
interest rate portfolio loan with a minimum of 20 percent downpayment.Five years ago, it was found that short seller credit was being erroneously credit coded as a
foreclosure. Lenders require mortgage delinquency before assisting a homeowner on a shortsale so that the loan can be handled separately in a loss mitigation department. This was called“dual-tracking” and was done to help streamline the process so that if a homeowner was notapproved for a short sale, the process did not have to start over again for a foreclosure. But,when mortgage credit is 120 days delinquent, mortgage credit is coded as a foreclosure.Whether this was known by lenders or not can be debated, but it resulted in the ability of manystunned past short sellers who were eligible for a new mortgage two years after a short sale1 tobe turned down for a new mortgage. Why? Their short sale credit was reflected as a foreclosurewhich required a seven-year wait before a new mortgage could be applied for again, ratherthan the two-year wait required after a short sale.
Last credit problemWe scrambled for more than two years trying to fix this for hundreds who were receiving a loandenial when the foreclosure code was discovered in both Fannie Mae and Freddie Mac auto-mated underwriting systems. After the National Consumer Reporting Association (NCRA) gotinvolved, two trips to the Consumer Financial Protection Bureau (CFPB) and the U.S. Treasury,a meeting with U.S. Congressman Gus Bilirakis’s (R-FL) office who set up a meeting with staff ofthe Banking and Finance Committee, it was finally the demand of Sen. Bill Nelson (D-FL) in aSenate sub-committee hearing to the CFPB and the Federal Trade Commission (FTC) to “get thisproblem fixed now!” that prompted an escalation. The initial call for a specific short sale cred-it code was not accepted but the CFPB worked with Fannie Mae to make changes in their auto-mated system. Within months, Fannie Mae came out with a “workaround” that was releasedon Nov. 16, 2013. But, the workaround did not work for many and out of frustration, we start-ed submitting complaints on the CFPB Web site, ConsumerFinance.gov. This DID work! Lendersresponded within 15 days and miraculously, credit codes were changed … solidifying thatanother credit code COULD be applied to short sales.
Today, there are still 7.1 million homeowners, or 12.7 percent of total U.S. mortgage hold-ers, who are trying to stay put in underwater homes, where the loan amount is greater thanthe home value. For these homeowners who have a conventional mortgage not backed byFannie Mae or Freddie Mac, there is no refinance option. There is also no refi option for sec-ond mortgages and home equity lines of credit (HELOCs) for all 7.1 million underwater home-owners! And, guess what they have to do to get help, or a “modification?” Go delinquent ontheir mortgage and they must show a hardship as well!
This time around, we know that lenders are aware of the damage to credit that the currentloss mitigation policy, a policy that requires delinquent mortgage payments first before assis-tance will be provided, does to consumer credit.
A challenge to the mortgage and real estate industriesWe cannot wait another two years to fix this again! Your help is needed to join forces and pushfor a refinance opportunity where delinquent mortgage payments and hardship are notrequired. This opportunity needs to be made available now for up to 7.1 million homeownerswho are still living in underwater properties. We need this now for the stability of the housingmarket.
Pam Marron (NMLS#: 246438) is senior loan originator with Innovative Mortgage Services Inc.(NMLS#: 250769) in Tampa Bay, Fla. She may be reached by phone at (727) 375-8986, [email protected] or visit HousingCrisisStories.com, CloseWithPam.com or8Problems.com.
Footnote1—The two-year wait still applies but only with proof of Extenuating Circumstances on a manual underwrite.Otherwise, a four-year wait now applies for Fannie Mae and Freddie Mac conventional loans.
continued on page 46
heard on the streetcontinued from page 41
Kent Wiechert of WeststarMortgage AcquiresGoldwater Bank
Kent Wiechert,owner andpresident ofW e s t s t a rM o r t g a g e
Corporation, has acquired GoldwaterBank NA in a stock purchase. WeststarMortgage is a privately-owned companyestablished in 1983 in Albuquerque,N.M. where it maintains corporateheadquarters to this day. The firm’s pri-mary initial focus was to develop spe-cialized software that enabled the com-pany to deliver best of breed loan serv-icing solutions to clients who offeredseller financing as an alternative to tra-ditional real estate financing.
Weststar provides both private andagency loan servicing to more than $2billion in loans in more than 30 states.Beginning in the early 1990s, the busi-ness model grew to include a successfulretail mortgage origination channel.Today, Weststar originates retail mort-gage loans in more than 30 states cov-ering nearly every market outside of theEastern Seaboard.
In 2015, Weststar Mortgage expectsto report new loan originations exceed-ing $1 billion.
“We are very excited about this newacquisition, and look forward to offer-ing our clients even more products andservices through our new relationshipwith Goldwater Bank,” said Wiechert.
Goldwater Bank, located inScottsdale, Ariz., focuses on providingfinancial services in a variety of differ-ent avenues, within all aspects of aclient’s life, also known as LifestyleBanking.
“We’re excited to pair our commer-cial bank platform with Weststar’s mort-gage business and bring our uniqueapproach in banking to even more cus-tomers,” said Julie Merhege, presidentof Goldwater Bank.
On Aug. 28th, 2015, the Office of theComptroller of the Currency (OCC)issued a letter to Goldwater Bank con-curring to a plan submitted by the Bankand Weststar Mortgage almost a yearprior which allowed Wiechert to acquirea controlling interest in the Bank. Thedetails of the plan include a host of pro-visions that will align the two firmsaround their common and complemen-tary business lines; including the inte-gration of the Weststar’s highly success-ful retail mortgage origination channelinto the bank’s already establishedmortgage division.
“By the time we have fully executedthe plan submitted to the OCC the twocompanies will employ more than 600professionals spanning 40 states and allaspects of the banking, lending andloan servicing disciplines,” saidWiechert. “This marks a new adventurefor both companies, allowing us to offer
even more value to clients and cus-tomers nationwide.”
LRES Forms StrategicPartnership With OSC
LRES has announced that it has formedstrategic partnership with OSC, alender-placed insurance, tracking andcompliance services provider.
“Our partnership with LRES greatlyenhances our client experience by pro-viding high-quality appraisal manage-ment services and critical insights onhomeowners’ associations to informrisk exposures,” said Keith Gilroy, presi-dent of OSC.
Through this partnership, LRES nowoffers its lender clients OSC’s lender-placed insurance and REO insuranceservices to manage the collateral insur-ance requirements of its customers’portfolios. In turn, OSC now offers LRES’full valuation lifecycle management forclients by delivering collateral valua-tion reports and supporting data in theMISMO industry-standard format. Thisunion drives compliance efficiencies tomeet the complex multi-collateraltracking demands of lenders while opti-mizing and accelerating the valuationordering process.
“Through our strategic alliance withOSC, we can now offer our customerssophisticated options for collateraltracking and compliance leadership,”said Roger Beane, CEO of LRES.
PrivatePlus MortgageReceives Approval From the FHA
PrivatePlus Mortgage has receivedapproval from the U.S. Department ofHousing & Urban Development’s (HUD)Direct Endorsement Program to under-write and close FHA loans without priorHUD review. This streamlines theprocess for anyone seeking an FHAhome loan.
“There are of course parameters forthe loans,” said Dan Smith, president ofPrivatePlus, “From qualifying criteria toFHA loan limits, and every individual’scircumstances vary. A PrivatePlus mort-gage pro can help consumers deter-mine if an FHA or another type of loanbest suits their needs.”
Smith says that the approval is justanother way the organization seeks tostreamline business processes andexpand consumer choice.
“For instance, last fall, we transi-tioned to a delegated underwritingmodel, meaning another significantportion of our processes are tackled in-
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© Angel Oak Mortgage Solutions LLC NMLS #1160240, Corporate office, 3060 Peachtree Road NW, Suite 500B, Atlanta, GA 30305. Loans in Texas offered through Angel Oak Home Loans LLC, NMLS #685842.This communication is sent only by Angel Oak Mortgage Solutions LLC and is not intended to imply that any of our loan products will be offered by or in conjunction with HUD, FHA, VA, the U.S. government or any federal, state or local governmental body. This is a business-to-business communication and is intended for licensed mortgage professionals only and is not intended to be distributed to the consumer or the general public. Angel Oak Mortgage Solutions LLC is an Equal Opportunity Employer and does not discriminate against individuals on the basis of race, gender, color, religion, national origin, age, disability, veteran status or other classification protected by law. 9-18-15 ANR
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SPONSORED ED ITORIAL
By Joni Pilgrim
Ever since the economic collapse of 2007, the mortgage in-dustry has been the subject of severe scrutiny and regula-tion. The Dodd-Frank Wall Street Reform and ConsumerProtection Act called for greater controls over many business
environments, but the appraisal of property and the qualification of mort-gage candidates came in for a special mention. And with good reason:Over-valuation, fraud and other nefarious practices were rife at the time,and we all bore the consequences when the house of cards came tumblingdown.
This post-collapse regulatory environment is far more robust and se-cure, but it has added enormous pressure to the workload of loan origi-nators, lenders and investors to ensure that the process of loan approvalis managed thoroughly and compliantly, from ordering an appraisal toclosing and even post-funding.
Common complaints from the industry include the duplication of tasksby different players such as appraisal reviews that have commonly beendone by appraisal management companies (AMCs), loan originators,lenders and investors, lack of transparency and fragmented processes.
To complicate matters further, there are hundreds of AMCs and thou-sands of appraisers all of whom must be managed for performance, suit-ability and compliance. Typically, originators and lenders often want touse their own selected appraiser panels, but they have a duty to ensurethat the appraisers are compliant and suitable for the task with good trackrecords. With time pressures and staff shortages managing this compli-cated scenario becomes an onerous task.
The demands of high-speed business environments where resourcesare key and accuracy paramount, have made it critical to employ lessmanual processing and more technology, but there is a lack of sophisti-cated software that uses joined up thinking and offers a way to manageall the processes, people, regulations and organizations that are part ofthe loan approval process in a transparent, efficient and cost-effectivemanner. At present, the process is cumbersome and creaking along; du-plications, manual interventions, and confused processes create qualitycontrol risks and unnecessary expense.
There is a definite need for a solution that connects all the dots, putsthe user in charge, and gives him or her a 360-degree view of the loanapproval process from start to finish, rather than the fragmented, murkyand risky environment in which the industry currently finds itself tryingto operate ethically and compliantly.
Joni Pilgrim is the founder and director of sales and business developmentat National Appraisal Network. For more information, visit Nationwide-Ap-praisal.com or call (888) 760-8899.
Performance Solution Through Technology
�
house,” Smith said. “The takeaway for any-one seeking a loan is that we’re alwaysactively working to ensure we can providemortgage options for most scenarios andthat we can control the process frombeginning to end, meaning a great con-sumer lending experience.”
Churchill MortgageExpands Into the Colorado Region
Churchill Mort-gage announcedthe opening ofthe company’sfirst physical
branch in Colorado in Colorado Springsto support the homebuyer demand of itsbooming population. The branch willprovide mortgage products for the FrontRange area, which includes the cities ofBoulder, Fort Collins, Greeley, Lovelandand Longmont and is where more than85 percent of the state’s populationresides.
Jay Garvens will manage the branch,leveraging 16 years of mortgage industryexpertise to provide financially tailoredloan programs to borrowers in ColoradoSprings, as well as the surrounding com-munities. Garvens, who is a retired ArmyAviation officer, previously served as abroker, owner and principal of TheGarvens Group in Colorado Springs,which provided lending services forhomebuyers, as well VA loan support formembers of the military and their fami-lies. Currently, Garvens is the treasurerfor the Colorado Association of MortgageProfessionals (CoAMP), a member ofNAMB—The Association of MortgageProfessionals and is also the host of TheJay Garvens Show on KRDO News Radioin Colorado Springs and 760 Real TalkRadio in Denver, where he discussesmortgage and real estate issues.
Also supporting the branch are KayFruci and Tanya Cross, who join as vicepresident of operations and director ofmarketing, respectively. With 13 years ofexperience in the mortgage industry,Fruci oversees the branch’s day-to-dayoperations and works directly with bor-rowers throughout the originationprocess. She is also a member of NAMPand CoAMP. As director of Marketingwith seven years of experience, Crossleads outreach initiatives to sustain thelender’s local presence in ColoradoSprings, while also establishing relation-ships with borrowers and referral part-ners in the surrounding communities.
“Jay Garvens and his team have a richhistory with the military and we consid-er ourselves fortunate to have such anhonorable team serving the borrowersin Colorado Springs and its surroundingareas,” said Mike Hardwick, president ofChurchill Mortgage. “His leadershipcombined with the staff’s collectiveindustry knowledge will ensure thathomebuyers are provided with our trust-ed, consultative lending services and
ultimately ensure their future financialsecurity.”
The branch’s team also includesVictor Malone, Jeff Oster, Ken Smith,Belinda Warren and Heidi Yaegel, whoserve as loan officers, and Shaun Marsh,who is a processer.
Indecomm FormsPartnership WithLendingQB
IndecommGlobal Ser-vices hasannouncedthe forma-tion of a
new partnership with LendingQB, aprovider of browser-based, end-to-endloan origination software, offering cus-tomers new synergies. The partnershipcreates processing efficiency with theability to perform multiple auditsthrough Indecomm’s proprietary solu-tion Kaizen to meet risk managementexcellence and final document man-agement through ViewPoint, whichenables financial institutions of all sizesto reduce business risk on their loansthrough real-time tracking of final doc-ument submissions from title agentsand correspondent lenders. Customerscan access Indecomm’s robust and real-time risk management and reportingthrough LendingQB’s LOS.
“This partnership is in directresponse to our customer’s needs. Timeand precision are of the essence,” saidRajan Nair, CEO of the FinancialServices Division for Indecomm GlobalServices. “Our customers will now beable to benefit from the efficiency ofLendingQB’s LOS combined with thecontrollability to track multiple auditworkflows through Kaizen. And theycan use ViewPoint’s platform to reducebusiness risk on their loans throughreal-time tracking of final documents.”
Kaizen audits and tracks loans in:Correspondent pre-purchase and dili-gence; pre-closing/funding QA; post-closing pre-delivery and quality control(QC); collateral review; regulatory com-pliance; and servicing.
Kaizen identifies loan level errorsand patterns of defects, identifying theresponsible parties and loan types. Thesystem categorizes the root causes ofthe defects it finds, enabling correctionbefore the problem becomes systemicwhile allowing the ability to outsourcenone, some or all of the process.ViewPoint offers lenders data on finaldocuments related to portfolios,agents, and correspondent lenders. Itprovides performance measures rela-tive to their expected date of return. Italso offers scorecards on performanceof agents measured against their coun-terparts. Importantly, ViewPoint candirectly access a county’s recording data
heard on the streetcontinued from page 42
continued on page 83
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leadershipLYKKEN ON
leadership
Seven Transformations Every Leader Must Undergo to Move From Good to Great
By David Lykken
After 40-plus yearsin the mortgageindustry, I’ve dis-covered that the
development of great leadership in the
business really boils down to onething: Growth. Those who achievetheir highest potential are those whoare focused on personal development.They aren’t stagnant; they aren’t justwaiting around for the weekend—orfor retirement. They’re always mov-
ing—always looking for the nextopportunity to excel. In short, theseleaders are focused on transformingthemselves.
In this article, I would like to sharewith you a few observations on whattransformation in leadership reallymeans on a concrete level. In otherwords, what kind of transformationsmust a leader undergo? In what waysdoes a leader need to be transformed?While this certainly isn’t an exhaustivelist, I believe that if you can transformthese seven areas in your life andwork, you’ll have what it takes tomove from the realm of mediocrity tothe realm of greatness.
First, if you want to be the bestleader you can be you’ve got to trans-form how you see yourself. Perceptionis a powerful thing. Henry Ford isfamous for saying, “Whether you thinkyou can or think you can’t, you’reright.” He was certainly on to some-thing. When leaders stop believing inthemselves, they stop taking the nec-essary actions to develop themselvesinto better leaders. When you don’treally think you can be successful, youwon’t even try. On the other hand, ifyou see yourself as having potentialfor success, you’ll do the necessarywork to realize that potential.Moreover, how you see yourself influ-ences how other people see you. Ifyou don’t have confidence in yourability to lead, how can you expectthose you are leading to have confi-dence in you? How you see yourself isthe foundation on which all othertransformation is based.
Second, you’ve got to transformhow spend your time. You’ve heard itbefore. We all have the same 24hours, 1,444 minutes, and 86,400 sec-onds in a day. What sets us apart ishow we use that time. It’s like getting
a huge deposit of money every daythat must be spent by the day’s end.Two different people getting thesame amount of money can comeaway with very different outcomesby the way they’ve spent it. So, howdo you transform the way you spendyour time? First, you’ve got to stopseeing yourself as a prisoner to time.Manage your time … don’t let itmanage you. Don’t tell yourself thatyou have to do X, Y or Z. Tell yourselfthat you’ve chosen to do thosethings. Once you take responsibilityfor your time, you can then work oninvesting it more valuably.
Third, if you want to excel as agreat leader, you’ve got to transformhow you interact with others. Thething about leadership is that itdoesn’t matter how much you knowor how much you can do—if youcannot deal well with people, it’s allfor naught. Why is that the case?Because, by its very definition, lead-ership requires followers. If peoplearen’t following you, it doesn’t mat-ter what it says on your businesscard—you aren’t a leader. Makingthe transition from a mediocreleader to a great one is very muchabout developing the way you inter-act with people. This could meanyour employees, but it could alsomean many others on whom youhave an influence—investors, sup-pliers, customers, the general publicand even competitors. If you want tobe a great leader, focus on develop-ing relationships with those whomyou are leading.
Fourth, you’ve got to transformhow you handle pressure. The hous-ing crisis and recession of the lastdecade has been hard on all of us inthe mortgage industry. However, Ithink the challenging environment
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© Copyright 2007-2015 Carrington Mortgage Services, LLC headquartered at 1600 South Douglass Road, Suite s110 & 200A, Anaheim, CA 92806. 800-561-4567. NMLS ID 2600. Nationwide Mortgage Licensing System (NMLS) Consumer Access Web Site: www.nmlsconsumeraccess.org. AZ: Mortgage Banker BK-0910745; 2159 McCulloch Blvd 4, Lake Havasu City, AZ 86403. CA: Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act, File 413 0904. CO: Mortgage Company Registration 2600 and Supervised Lender’s Licenses 989668 and 989668-001. To check license status of your mortgage loan originator, visit www.dora.state.co.us/real-estate/index.htm. GA: Georgia Residential Mortgage Licensee 22721. IL: Illinois Residential Mortgage Licensee. KS: Kansas Supervised Loan License SL.0000313. MN: This is not an offer to enter into an interest rate lock agreement under Minnesota Law. MS: Licensed by the Mississippi Department of Banking and Consumer Finance. MO: Residential Mortgage Broker License 09-1746-S. NH: Licensed by the New Hampshire Banking Department. NJ: Licensed by the N.J. Department of Banking and Insurance. NY: Licensed Mortgage Banker—NYS Department of Financial Services. New York Mortgage Banker License B500980/107664. NC: Carrington Mortgage Services, LLC is licensed under the North Carolina Agency Permits 102107 & 103455 and North Carolina Secure and Fair Enforcement Mortgage Licensing Act. OH: Ohio Mortgage Broker Act Mortgage Banker Exemption MBMB.850208.000 (FHA, DE & VA Automatic loans only). OR: Mortgage Lender License ML4886. PA: Licensed by the Department of Banking. RI: Rhode Island Licensed Lender and Broker. VA: Licensed by the Virginia State Corporation Commission MC-5382. WA: Consumer Loan License CL-2600 & Mortgage Broker License MB-2600. Also licensed in AL, AR, CT, DE, DC, FL, ID, IN, IA, KY, MD, MT, NE, OK, SC, SD, TN, TX, UT, WV, WI, WY. All rights reserved.
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has done one good thing for theindustry—it has separated the wheatfrom the chaff. Pressure is the cru-cible in which truly great leadersemerge triumphantly. Those whodon’t have what it takes will not beable to adapt and will falter underpressure. If you want to develop intoa great leader, you’ve got to changehow you deal with challenging situa-tions. It’s easy to look good wheneverything is going according to plan,but how do you look when things goawry? Exposure yourself to a little riskand take some chances—that’s reallythe only way to see if you’ve got whatit takes.
Fifth, if you want to reach yourhighest potential, you’ve got to trans-form how you deal with unethicalbehavior. If there is one area in whichleaders in our industry need to placean emphasis, this is it. Since thefinancial crisis, the CFPB and otherregulatory organizations have placedquite a substantial burden on theindustry. And, arguably, the limita-tions on lending have unnecessarilyslowed recovery. However, I think weas industry leaders can sometimescomplain when we should be takingresponsibility. I think we sometimesneed to place greater importance onour reputations and the public per-ception of the mortgage industry. In amore concrete sense, that couldmean blowing the whistle in ourorganizations or having the willing-ness to take some sort of standagainst unethical behavior. Wrong iswrong, and truly great leaders willcall it when they see it.
Sixth, you’ve got to transform howyou embrace technology. In today’sday and age, we are operating in amore competitive market than weever have before. Lucky for us, therevolution in technology has spreadto the industry and there are count-less vendors offering solutions fromwhich we can benefit. If you want tosurvive as a leader in the mortgageindustry, you’ve got to stay on thecutting edge of technological devel-opments. Those who reach their high-est potential are those who aren’tafraid to experiment with new toolsand systems. Moreover, they are oftenthe first ones do it. Technology can bethe leader’s secret weapon. The soon-er you warm up to it, the sooneryou’ll become the great leader youare striving to be.
Finally, for a seventh way you canmake that leap from good to great inyour leadership, you’ve got to trans-form how you see your work. If yousimply want to earn a good living andretire as soon as possible, punching inand out, and flying under the radar,you can simply see your work as a job.However, if you want to become atruly great leader, you’ve got to seeyour profession as a calling. Yourwork has to matter to you not just asa means to paycheck but also as anend in itself. Great leaders care aboutimpact they have on their industry
with Neil Cavuto, and has had addi-tional guest appearances on CNBC,The CBS Evening News, BloombergRadio and NPR. He hosts a weekly aweekly podcast called “Lykken onLending,” as well as a consumer fac-ing video called “Today’s MortgageMinute.” He can be reached by phoneat (512) 759-0999 or [email protected].
and the legacy they leave behindthrough their actions. They see work-ing in the mortgage business as theirown small way of making the world abetter place. If you want to become agreat leader, you’ve got to transformhow you see your work. It cannot justbe for the money. Your work has gotto become a mission for which youlive and breathe. Only then can it
develop into the kind of work thatmoves you from good to great.
David Lykken, a 43-year veteran ofthe mortgage industry, is presidentand chief transformational officer ofTransformational Mortgage Solutions(TMS). David has garnered a nationalreputation, and has become a fre-quent guest on FOX Business News
“Pressure is the crucible in which truly great leaders emerge triumphantly.”
Friday, October 169:00 a.m. ......................Political Action Committee Meeting—Nile C
10:30 a.m. ....................Legislative Action Fund Committee Meeting—Nile C
11:00 a.m. ....................Membership Committee Meeting—Nile C
1:30 p.m. ......................Government Affairs Committee Meeting—Nile C
2:30 p.m. ......................Bylaws Committee Meeting—Nile C
4:00 p.m. ......................NAMB Plus Committee Meeting—Nile C
6:00 p.m.-8:00 p.m. ......NAMB Board of Directors Meeting—Directors’ Room
Saturday, October 179:00 a.m.-Noon ..........NAMB Delegate Council & NAMB Annual Business Meeting—Galleria A
9:00 a.m.-11:30 a.m. Exhibitor Setup—Exhibit Hall
Noon ..........................NAMB National Opens/Exhibit Hall Open
1:00 p.m.-1:45 p.m. ..Concurrent Sessionsn Compliance Track (Sponsored by Brokers Compliance Group): Current Trends in Marketing
Services Agreements and LO Compensation—Egyptian Roomn Marketing Track (Sponsored by Carrington Mortgage Services): Serving the Underserved
Borrower in America—Nile Room Bn Innovation Track (Sponsored by Plaza Home Mortgage): The Evolving Non-QM Market—
The Challenges, Opportunities and Growing Role of Non-Bank Lenders—Nile Room C
2:00 p.m.-2:45 p.m. ..Concurrent Sessionsn Maximize Your Profitability and Prepare for 2016—Egyptian Roomn Marketing Track (Sponsored by Carrington Mortgage Services): Rethinking Mortgage
Marketing With Technology—Nile Room Cn Compliance Track (Sponsored by Brokers Compliance Group): Deconstructing Renovation
Mortgages—Nile Room Bn Innovation Track (Sponsored by Plaza Home Mortgage)—Nile Room A
3:00 p.m.-3:45 p.m. ..Concurrent Sessionsn Marketing Track (Sponsored by Carrington Mortgage Services): Turn Trash Into Treasure—
Producing Profits With Private Lenders—Nile Room An Innovation Track (Sponsored by Plaza Home Mortgage): Millennials—Refueling the
Mortgage Industry—Egyptian Roomn Compliance Track (Sponsored by Brokers Compliance Group): Reinvisioning Mortgage
Origination Through Digitization—Nile Room Bn How to Take Your Sales to a Billion Dollars—Nile Room C
4:00 p.m.-5:00 p.m. ..General Session: Keynote PresentationHow to Make Mortgages Like You’re Seal Team Six—Egyptian Room
5:00 p.m.-6:30 p.m. ..Opening Reception In Exhibit Halln Exhibit Hall Reception Food Sponsored by EquityKeyn Exhibit Hall Reception Drinks Sponsored by Caliber Home Loans
6:30 p.m.-7:30 p.m. ..Legislative Action Fund Raffle Reception—Galleria ALegislative Action Fund Raffle Reception Sponsored by loanDepot and featuring a specialprivate appearance by Don Mann, author of Inside Seal Team Six
Sunday, October 189:00 a.m.-10:30 a.m. ..NAMB Industry Partners Breakfast (By Invitation Only)—Galleria A
11:30 a.m. ..................Exhibit Hall Opens
11:30 a.m.-1:00 p.m. Luncheon Available in the Exhibit Hall (Luncheon TicketNecessary)
1:00 p.m.-1:15 p.m. ..Swearing in of NAMB 2015-2016 Board of Directors
1:15 p.m.-2:00 p.m. ..Keynote Presenter: Sean Becketti of Freddie Mac—Egyptian RoomSean Becketti, Keynote presenter, is vice president and chief economist of Freddie Mac
2:00 p.m.-2:45 p.m. ..Keynote Presenter: Brian Stevens of National Real Estate Post—Egyptian RoomKeynote Presenter Brian Stevens of National Real Estate Post will deliver his presentation,“We’ll Keep You Posted—Market Yourself With the Personal Touch”
2:00 p.m.-2:45 p.m. ..Concurrent Sessionsn Marketing Track (Sponsored by Carrington Mortgage Services): Diversify Your Business—
Shift Into Reverse—Nile Room Bn Compliance Track (Sponsored by Brokers Compliance Group): What’s in Store for
Appraisals and What Lies Beyond TRID?—Nile Room An Innovation Track (Sponsored by Plaza Home Mortgage): TILA-RESPA Integrated
Disclosures—From the Tech Side—Nile Room C
3:00 p.m.-3:45 p.m. ..Concurrent Sessionsn Innovation Track (Sponsored by Plaza Home Mortgage): Fix and Flip Lending—Nile Room An Marketing Track (Sponsored by Carrington Mortgage Services): Three Simple Strategies to
Grow First-Time Homebuyer Business—Nile Room C
4:00 p.m.-4:45 p.m. ..Concurrent Sessionsn Innovation Track (Sponsored by Plaza Home Mortgage): Grow Your Business With Non-QM
& Portfolio Loan Products—Nile Room Bn Marketing Track (Sponsored by Carrington Mortgage Services): Mobile Millennials—How
to Catch a Unicorn—Nile Room A
4:45 p.m.-5:15 p.m. ..Exhibit HallRaffles and prizes announced, including the grand prize trip to Hawaii sponsored by RushmoreHome Loans
6:00 p.m.-8:30 p.m. ..Mortgage Professionals of the Year Gala Dinner—Egyptian RoomA separately ticketed event, the Mortgage Professionals of the Year Gala Dinner is sponsoredby Endeavor America and the reception is sponsored by Best Rate Referrals
Monday, October 199:00 a.m.-6:00 p.m. ..Complete 8-Hour NMLS Course—Egyptian RoomThis separately-ticketed course requires separate, advance registration and payment (walk-inregistration, if available, will incur additional fees)
9:00 a.m.-Noon ..........Designation Class—Professional Certification: ObtainingCRMS/CMC Status Certification—Nile CThis separately-ticketed course requires separate, advance registration and payment (walk-inregistration, if available, will incur additional fees)
10:00 a.m.-10:45 a.m...Boosting, Hot List, Hashtags and Beyond—Nile A & B
11:00 a.m.-Noon ........Legislative Update—Nile A & B
6:00 p.m. ....................NAMB National Adjourns
Schedule of Events(Subject to change)
OFFICIAL MEDIA SPONSORS
List of Exhibitors(As of 10/02/15)
ALPHABETICAL LISTINGCOMPANY NAME ........................................BOOTH #AFR Wholesale ..........................................................580American Advisors Group (AAG) ................................520Appraisal Institute......................................................103Appraisal Nation ........................................................285AppraiserVendor.com..................................................—Avantus Credit ..........................................................205Axis Appraisal Management Solutions ......................503B2R Finance..............................................................530Banc of California......................................................570Best Rate Referrals ..................................................460Black, Mann & Graham, LLP & Goldome Financial LLC —Brokers Compliance Group ......................................111Caliber Home Loans ..................................................201Calyx Software ..........................................................420Carrington Mortgage Services ..................................240Cisco Systems ..........................................................225CMG Financial ..........................................................350CreditPlus..................................................................230Endeavor America/The Money Source ......................109Equity Key Services ..................................................560Equity National Title ..................................................450Excelerate Capital ......................................................—FirstFunding Inc.........................................................355Franklin American Mortgage Company ....................325Freedom Mortgage....................................................475HomeBridge Wholesale ............................................208Homes.com ..............................................................260Lakeview Wholesale..................................................480Land Home Financial Services Wholesale Division ..485LendingHome............................................................203Liberty Home Equity Solutions Inc...............................—Loan Simple ..............................................................280
LoanBeam ................................................................250loanDepot Wholesale ..................................................—LoanTek Inc. ..............................................................—MB Financial Bank NA ..............................................465MGIC ........................................................................375Mortgage Educators and Compliance ......................345Mortgage Information Services Inc. ..........................335MortgageMapp..........................................................210Mountain West Financial Inc. ......................................—NAMB..........................................................................—National Mortgage Professional Magazine ................101Nations Direct Mortgage ..........................................373New Leaf Wholesale..................................................117NYCB Mortgage Company ........................................365Paramount Residential Mortgage Group Inc. ............440Parkside Lending LLC ..............................................340Plaza Home Mortgage Inc. ........................................220Pre Approve Me App ................................................510Premier Nationwide Lending ....................................385Quicken Loans Mortgage Services............................540Radian ......................................................................360RCN Capital ..............................................................320Realty Mogul ............................................................105REMN Wholesale ......................................................107Rushmore Home Loans ............................................505Scotsman Guide Media ............................................550Security 1|RMS..........................................................265SimpleNexus LLC ......................................................370Sourcemedia ..............................................................—Stearns Lending ........................................................501U.S. Bank ..................................................................455United Wholesale Mortgage ......................................207Urban Financial of America LLC................................430Velocity Commercial Capital......................................115
NUMERICAL LISTINGBOOTH # ........................................COMPANY NAME—..................................................AppraiserVendor.com.— Black, Mann & Graham, LLP & Goldome Financial LLC— ......................................................Excelerate Capital—..............................Liberty Home Equity Solutions Inc.— ..................................................loanDepot Wholesale.— ..............................................................LoanTek Inc.—......................................Mountain West Financial Inc.—..........................................................................NAMB— ..............................................................Sourcemedia101 ................National Mortgage Professional Magazine103......................................................Appraisal Institute105 ............................................................Realty Mogul107 ......................................................REMN Wholesale109 ......................Endeavor America/The Money Source111 ......................................Brokers Compliance Group115......................................Velocity Commercial Capital117..................................................New Leaf Wholesale201..................................................Caliber Home Loans203............................................................LendingHome205 ..........................................................Avantus Credit207 ......................................United Wholesale Mortgage208 ............................................HomeBridge Wholesale210..........................................................MortgageMapp220 ........................................Plaza Home Mortgage Inc.225 ..........................................................Cisco Systems230..................................................................CreditPlus240 ..................................Carrington Mortgage Services250 ................................................................LoanBeam260 ..............................................................Homes.com265..........................................................Security 1|RMS280 ..............................................................Loan Simple285 ........................................................Appraisal Nation
320 ..............................................................RCN Capital325 ....................Franklin American Mortgage Company335 ..........................Mortgage Information Services Inc.340 ..............................................Parkside Lending LLC345 ......................Mortgage Educators and Compliance350 ..........................................................CMG Financial355........................................................FirstFunding Inc.360 ......................................................................Radian365 ........................................NYCB Mortgage Company370 ......................................................SimpleNexus LLC373 ..........................................Nations Direct Mortgage375 ........................................................................MGIC385 ....................................Premier Nationwide Lending420 ..........................................................Calyx Software430................................Urban Financial of America LLC440 ............Paramount Residential Mortgage Group Inc.450 ..................................................Equity National Title455 ..................................................................U.S. Bank460 ..................................................Best Rate Referrals.465 ..............................................MB Financial Bank NA475....................................................Freedom Mortgage480..................................................Lakeview Wholesale485 ..Land Home Financial Services Wholesale Division501 ........................................................Stearns Lending503 ......................Axis Appraisal Management Solutions505 ............................................Rushmore Home Loans510 ................................................Pre Approve Me App520 ................................American Advisors Group (AAG)530..............................................................B2R Finance540............................Quicken Loans Mortgage Services550 ............................................Scotsman Guide Media560 ..................................................Equity Key Services570......................................................Banc of California580 ..........................................................AFR Wholesale
Floor Plan
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By Terry W. Clemans
On Capitol Hill there arecurrently two bills intend-ed to address creditreporting issues. Both of
these bills illustrate how sometimeslegislators have little understanding ofthe issues they propose to legislate.These two House bills, HR 3035 and HR3524, showcase the extremes of creditknowledge—from a true understand-ing and reasonable proposal for a solu-tion, to a misunderstanding of theindustry and a bill that, if enacted,would provide little to no change in thecurrent process.
HR 3035, The Credit Access andInclusion Act of 2015, is a bi-partisanbill sponsored by Rep. MichaelFitzpatrick (R-PA) and Rep. Keith Ellison(D-MN). It shows an understanding ofthe credit reporting system and spot-lights a week spot in the credit report-ing system that this bill attempts to cor-rect. HR 3035 seeks to decrease thenumber of consumers with no creditscore, which, as mortgage originators,you understand the importance of agood credit score more than most.There are 15 bi-partisan co-sponsors tosupport the bill that proclaim, “Toamend the Fair Credit Reporting Act toclarify federal law with respect toreporting certain positive consumercredit information to consumer report-ing agencies, and for other purposes.”The bill does this by focusing ontelecommunications and utility compa-nies to provide “full file” credit data tothe national credit bureaus. “Full file”reporting is the reporting of the entirecredit transaction, both positive andnegative information, the typical credittrade line you see on a credit report.That would be an improvement to thecommon practice for telecommunica-
tions and utility companies that todaytypically only report negative data inthe form of collection accounts.
This type of reporting is especiallyimportant for younger generations enter-ing adulthood, as many are not inclinedto develop traditional credit accounts likethe generations before them. Thesegroups are connected to cellphoneaccounts and are renting apartmentsinstead of buying homes. They also tendto use more non-bank financial serviceswhich do not help build credit historyand delay them from having a creditscore. The lack of a credit score will costan American consumer more for everytransaction of their financial life. Nothaving a credit score or having a lowcredit score will cost a consumer morewhen accessing a mobile phone, insur-ance, rent, etc., and ultimately make itmuch harder for them to get aheadfinancially. Congratulations to Rep.Ellison and Rep. Fitzpatrick for under-standing this and trying to get Congress tosolve that problem with HR 3035.
HR 3524 is a totally different situa-tion. The Equal Employment for all Actof 2015, sponsored by Rep. Steve Cohen(D-TN) along with 17 Democrat co-spon-sors, officially seeks: “To amend the FairCredit Reporting Act to prohibit the useof consumer credit checks againstprospective and current employees forthe purposes of making adverseemployment decisions.” Over the lastcouple of years, there has been a lot ofmedia attention about the use of creditinformation in employment screening.Often, the stories talk about creditscores used in hiring decisions. This hasled to this bill, and numerous similarbills in various State Legislaturesaround the county, trying to make sureconsumers are not prevented from get-ting a job due to problems on theircredit report. While on the surface, this
seems reasonable, the problem itaddresses is more of a media creationthan reality.
The use of credit in employment isone of the most over sold media storiesof the past several years. First, creditscores are not used in employment deci-sions. To allege that a credit score is usedor even accessed for this purpose is com-pletely inaccurate and every time it iswritten, it shows the lack of researchdone by the author. Unfortunately,Congress also does not research some-times and then joins right in with themedia hype. While some employers douse credit information in employmentscreening, it is not a credit score, and it isonly for very specific jobs where there isa direct business necessity for the indi-vidual’s credit history to be considered.
This bill, like all of the others, has anexemption for the government and cer-tain other positions that allows for cred-it to be considered in cases where thereis a legitimate business need of theemployer. So basically, if the bill isenacted it would really change nothingfrom what is the current practice.
The Equal Employment OpportunityCommission (EEOC) has stated repeated-ly over the past couple of decades thatthe use of credit information in employ-ment decisions when there is no busi-ness requirement for it is a discrimina-tory practice. Background checks areused to reduce an employer’s legalexposure. Background check fees arestructured in part on how much data isbeing searched and adding credit to thesearch increases the cost. In the litigioussociety in which we live, why wouldhuman resource professionals whosejob is to help reduce the company’slegal exposure, want to spend moremoney on background checks andincrease their legal exposure to boththe consumer and the EEOC? National
Consumer Reporting Association (NCRA)members report that credit informationis only in about nine percent of theemployment screening reports theyprovide. These are instances in whichcredit information as part of a back-ground check is required for the specif-ic position applied for and again, it isbasic credit report information only,not a credit score.
The financial industry, in particular, isone with a requirement for the use ofbackground checks and a review of cred-it information as part of employmentprocess and this bill would have no effecton changing that requirement.
With no bi-partisan support, HR 3524is not headed anywhere fast; even HR3035 with a strong bi-partisan co-spon-sor list is not likely to pass through thisCongress. There is some opposition tothe bill as some consumer advocates donot buy into the consumer benefit.Additionally, some telecommunicationsand utility companies are not support-ing the bill as they are happy with thesystem as is and do not want theresponsibilities under the Fair CreditReporting Act (FCRA) that comes alongwith full file reporting. A similar billwith the two same primary co-sponsorsdid not pass in the last Congress due tosimilar concerns. Regardless of theirfuture, these two bills are a good exam-ple of the depth of understanding (orlack thereof) Congress sometimes hason the issues. HR 3035, a valiantattempt at problem-solving and HR3524, a bill that furthers fiction andwould have little to no impact on thehiring practices currently in place.
Terry W. Clemans is executive director ofthe National Consumer ReportingAssociation (NCRA). He may be reachedby phone at (630) 539-1525 or [email protected].
Pending Credit Legislation Shows CongressionalExtremes With Regard to Credit Knowledge
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By Mat Ishbia
The playing field within the mortgageindustry continues to become increas-ingly level across the board, retail andwholesale lenders alike, as innovativetechnology and a steady revival of pub-lic image continue to serve as greatequalizers for companies of all sizes.The growing appeal of mortgage bro-kers is becoming more clearly recog-
nized by more than homebuyers—butby loan originators as well.
A rising number of loan originatorsare flocking to broker shops, eitherfrom large banks or mega retaillenders, as the career opportunities inthe wholesale segment paint a clearerpicture of financial promise, profes-sional freedom and sustained career
success. The higher training and licens-ing standards that originators are heldto in the broker channel, as well as theability to easily adapt to changes, pro-vide them with greater control overtheir business. It’s a demanding, yetlucrative profession for smart andsavvy self-starters with strong peopleskills.
And the proof is in the numbers.According to numbers produced by theNAMB—The Association of MortgageProfessionals, membership was as highas 23,000 in 2006 before plummeting to8,500 in 2010 following the housingmarket crash. As the broker channel hascontinued to pick up steam and positivepress over the last few years, member-ship has already climbed back to over16,000 brokers, based on NationwideMortgage Licensing System numbers.
This trend cannot be understated.As is the case with any industry lookingto expand its market share, talentattraction plays a key role in makingthat happen. By recruiting top-per-forming loan originators to either joinor return to the mortgage brokerworld, the channel will benefit froman increase in numbers-based produc-tivity, as well as prestige.
The mortgage industry is a magnetfor knowledgeable, driven individuals.It satisfies savvy, business-minded pro-fessionals who excel at building rela-tionships and producing positive bot-tom-line results. It also builds uponthat innate nature that many peoplehave to compete and be the best. It lit-erally pits you against other profes-sionals; your company against therivals down the road. Like in sports, interms of gaining a prospective client’sbusiness, there is always a clear winnerand loser.
Along these lines, for professionalswho are fueled to compete and be thebest, it is only logical that loan origi-nators would want to put themselvesin the best possible position to suc-ceed. That position for maximumachievement lies in the mortgage bro-ker channel, as it offers the resourcesneeded to land the most clients.
It is the responsibility of loan origi-nators to find new clients, counsel bor-
rowers on how to choose the bestmortgage, and fill out loan applica-tions. The job is tied to providinghigh-level client service and helpingborrowers successfully purchase ahome as efficiently and hassle-free aspossible. The freedom and range ofproducts available in the wholesale-broker channel enhance the likeli-hood of successful transactions—andthe reasons are incredibly simple.While large banks and mega retailentities handcuff their loan origina-tors to one specific product, rate orturn-times, brokers have access tohundreds of different optionsthroughout the country.
The loan process is a very person-alized experience for home buyers,as no two borrowers are exactlyalike—in terms of credit score, sav-ings or personal preferences. Oneborrower might need to get an accel-erated closing because of a job relo-cation, while another may be moreinclined to move at a slower pace inorder to get the lowest possibleinterest rate. Considering the varietyof needs from one client to another,it only makes sense for a loan origi-nator to seek an opportunity wherethey are best able to accommodatethose needs. Large banks and megaretail lending institutions are onlyable to offer the loan products thatthey have in-house, and pricing isoften higher because of the over-head costs associated with their mar-keting and advertising initiatives.
Loan originators in the brokerchannel have the flexibility and diver-sity to strategically match borrowerswith specific lenders from all 50states—that align with their specificsituation. They can better specialize inmortgages for clients with complexfinancial situations, such as self-employed individuals, second-homebuyers and anyone dealing with trickylife matters.
A favorable perception is anotherelement that is rapidly shifting backin support of mortgage brokers overbankers. While the public opinionabout brokers may have been a bitjaded following the housing crash,
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This information is solely for mortgage professionals and should not be provided to consumers or third parties. Information is subject to change without notice. This is not a commitment to lend and there is no guarantee that all borrowers will qualify. All loans are subject to credit, underwriting, and property approval. Other restrictions may apply. FGMC is not acting on behalf of HUD, VA, FHA or any other agency of the federal government. First Guaranty Mortgage Corporation (Company NMLS ID 2917) is licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act; Regulated by the Division of Real Estate in the State of Colorado; Licensed by the Delaware State Bank
Commissioner to engage in business in this State under License No. 2403 (renewed through 2015); Georgia Residential Mortgage Licensee; Illinois Residential Mortgage Licensee; KansasLicensed Mortgage Company; Licensed by the Mississippi Department of Banking and Consumer Finance; Licensed by the Nevada Division of Mortgage Lending to make loans secured by liens on real property; Licensed by the New Jersey Department of Banking and Insurance; Licensed Mortgage Banker – NYS Department of Financial Services, Licensee No. B500800 (d/b/a FGMC In Lieu of True Corporate Name First Guaranty Mortgage Corporation); Rhode Island Licensed Lender. For complete corporate and branch licensing information, visit www.fgmc.com or www.nmlsconsumeraccess.org. Follow us on:
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recent years of top-notch client service,access to innovative tools, and high-level licensing and standards have con-tinued to shine a more positive light onthe profession. Brokers are now recog-nized as mortgage gurus and trustedadvisors, licensed and trained mort-gage experts who are in the weeds ofthe business every single day. They areregular fixtures of their local commu-nities, local to their clients and openfor business nearly seven days a weekat various non-bank hours. Brokers aremuch more nimble in their ability toadjust to regulatory changes and arebetter positioned to handle complicat-ed loans than originators at largebanks and mega retail entities.
When the crash hit, talented loanofficers and broker shop ownersbecame unsure of the future and optedto take more secure career paths,whether that was the shelter of a mega
bank or a large retail company. It wasunclear what regulations would beenforced or what would happen tomortgage brokers, as many media out-lets and industry leaders were pinningthe crash on brokers. Now, looking atprojections of the future growth of thewholesale-broker channel, it’s clear tosee the tremendous potential thatexists for originators in the brokerworld.
The ongoing regulatory changesthat are implemented continue tolevel the playing field for brokers, incomparison to mega retail lendersand large banks. Now that the TILA-RESPA Integrated Disclosure (TRID)rule has gone into effect, brokers areable to combine Good FaithEstimates (GFE) and Truth-in-Lending(TIL) into one document, and are nolonger required to disclose lender-paid compensation just as the banks
have never had to disclose this totheir clients—making it look like bro-kers were charging additional fees. Inreality, retail lenders and brokers hadthe same compensation on a loan, butretail lenders and banks were able tohide them because they weren’t beingheld to the same standards. That hasall changed since TRID, and now thatbrokers are on a level playing fieldwith banks and retail lenders in termsof disclosures, brokers will be able tofully showcase their clear advantagesand quickly take over market share.The launch of TRID removes the finalmajor regulatory hurdle for brokers,at least for the foreseeable future,and originators are realizing that bro-kers are thriving again.
In a field that it is incredibly com-petitive and demanding of accuracyand speed, like the mortgage industryis, it’s vital that loan originators put
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themselves in the best position to suc-ceed. Knowledgeable professionals inthe business can make a great livingregardless of the specific path theychoose, but the increased earningpotential and decision-making free-dom that the broker channel offers isan extremely attractive lure for peo-ple who are innately driven and wantto feel in control. There has neverbeen a better time than now for loanoriginators to get back into the brokerworld.
Mat Ishbia is president and chief execu-tive officer of United WholesaleMortgage (UWM), one of the largestindependent mortgage lenders. With avision to create a more perfect mortgageworld, Mat has changed the game, turn-ing UWM into a $10 billion companyand a top national workplace. FollowMat on Twitter @Mishbia15.
By Greg Schroeder
Oct. 1 marked the 15th anniversaryof the enactment of the ElectronicSignatures Act, which provided elec-tronic contracts the same legalweight as those signed on paper. Thelaw was created to make remotefinancial transactions—like getting amortgage—easier, faster and cheap-er, not just for consumers but
lenders and vendors, too. Yet while most Americans feel at
ease using digital signatures—notto mention banking and spendingmoney online—the vast majorityare still signing mortgage loan doc-uments on paper, and the processat many companies in our businesshasn’t changed much since before
the e-signatures act was signed byPresident Clinton.
Sadly, we are no closer today to atruly electronic, paperless mortgageprocess than we were 15 years ago.We’re probably a lot more likely tobuy a driverless car before we can geta completely paperless mortgage.
I think my own recent experienceas a mortgage customer isn’t out ofthe ordinary and is a good exampleof where we are today in our indus-try, which often hails itself as beingahead of the curve when it comes totechnology and automation.
I’m currently going through therefinance process. I was prepared toexpect a lot of paperwork, so it real-ly hasn’t come as a shock to me, but,man, there sure are a lot of things tosign! There is a ton of stuff thatrequires my signature, mostly forthe receipt of one disclosure oranother.
So far, virtually none of theprocess has been done electronical-ly. We haven’t even gotten to theclosing yet, where I know about anhour’s worth of signing a stack ofpapers a foot high awaits.
I thought I was being progressiveby trying to send documents elec-tronically to my lender throughDropbox, but they refused to acceptthem. Although all of my documentswere in order, my lender simply was-n’t able to open any attachments orlinks I sent. I was then required tosend them hard copies via a courierservice, but two weeks later thelender couldn’t locate my docu-ments and therefore never updatedmy file. It turns out they were at thelender’s scanning department, even-tually destined for a paper folderand one of their thousands of filingcabinets.
By way of comparison, I’ve alsobeen going through the process ofgetting several new business trade-marks, and my experience there hasbeen totally different. The govern-ment’s Web site wasn’t much to lookat, but I can say that I was able to doeverything electronically, includingsigning the “papers.”
Clearly, the electronic age reallyhasn’t kicked in yet in the mortgageindustry. We lag behind many otherindustries. So what’s holding usback, and what can we do about it?
Embrace technology or get left behindPeople get used to the way they’vealways done things and continue tooperate the way they always have,even when it no longer makessense, either financially or logically,or even when tools to improve theprocess are widely available.
When we founded our company,we saw the need for automating thedue diligence and monitoringprocess for third-party originatorsand appraisers. We’ve standardizedwhat used to be a fragmented,time-consuming and labor-inten-sive chore and created a consistentway for third-party originators(TPOs) and appraisers to be vettedand monitored by the lenders theydo business with. The system iscompletely electronically-enabledand eliminates the need for paperdocuments.
Nevertheless, despite the factthat everything we do is electronicand paperless and the documentsare stored in the cloud for easyretrieval, many of our clients stillinsist on printing everything outand then filing them away. Think ofthe amount of money they wouldsave by not printing all of thosepages, savings that can be passedalong to grateful borrowers, theones who eventually pay for all thiswaste.
Lenders who rely on third par-ties, like mortgage brokers andappraisers, for example, alreadytake on inherent risk. Each relation-ship must be managed for quality,performance, profitability andproper credentials. But then theytake on additional risk and expense,needlessly.
At many companies, signing upand then managing their TPOs andappraiser networks is still donemanually—on paper, taking hours
“We’re probably a lot more likely to buy a driverlesscar before we can get a completely paperlessmortgage.”
Failure to Go Paperless Carries Big Risks
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to manage just one relationship,often by their most highly paidemployees—their account execu-tives. Plus, these tasks must bedone annually for all of the thirdparties they work with. For big com-panies, that could mean reviewingthousands of client relationships.Then there’s the lost opportunitycost to consider: your account exec-utives could be doing something alot more productive—like findingand creating new revenue opportu-nities—rather than gathering bro-ker applications.
Technology and automation havetransformed this antiquatedprocess into an effective businessoptimization opportunity. Itenables organizations to achievehigher value business outcomes,such as assessing performance,eliminating nonproductive relation-
ships and identifying opportunitiesto grow productive ones.
A paperless process is also moresecure and private. The opportunityfor identity theft is huge when yourely on so much paper. Dumpstersare still a goldmine for thieves trail-ing companies who fail to adequate-ly destroy paper documents. Butthat risk is eliminated by workingwith companies that have electroni-cally enabled their services.
Fortunately, the technology tomake this process more efficient,cost-effective and safer alreadyexists and has for some time, andmany lenders are in fact using it.Not only can this entire process beautomated, enabling the processingof thousands of third-party applica-tions a month quickly and cheaply,but the documents can be storedelectronically too. Doing so puts an
end to redundant applications whileenabling easy retrieval of docu-ments, when required.
Yet many companies aren’t takingadvantage of these systems, andeven when they do, they don’t makethe most of them. There is still plen-ty of road that needs paving.
Let me say, though, that thingsaren’t entirely bleak. Many in themortgage business are in fact mak-ing the necessary changes in tech-nology and efficiencies that will con-tinue to transform our industry.While some progress has beenmade, the pace of change has beenslower than it needs to be. Manycompanies have been reluctant tomake the reforms they need tomake. They prefer the old way ofdoing things, often only becausethat’s what they’re used to and com-fortable with.
Indeed, if you’re not embracingtechnology—still doing things man-ually and keeping paper documentsin filing cabinets—you are going tobe left behind or put out of business.
To stay competitive, companiesmust transition to a paperless envi-ronment. When a mortgage can bemade, start to finish, without produc-ing any paper, not only will the cus-tomer’s experience be greatlyimproved, but all of the players in theprocess will be able to realize greaterefficiencies and cost-savings, whiledoing so in a compliant manner.
Greg Schroeder is the founder andpresident of Comergence Compliance,a provider of third-party risk-manage-ment platforms for the mortgageindustry, specializing in mortgageoriginator and appraiser due diligenceand profile surveillance.
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By Casey Cunningham
In 2008, I began noticing a trend thathas continued to negatively impactthe mortgage industry today, andprobably will for decades to come.Despite home sales reaching an eight-and-a-half year high and a continuousflow of revenue through residentialreal estate, something (or someone) isstill missing that is integral to the sta-bility of today’s industry: Millennials.
What keeps me awake at night? Inthe last several years, there has been adrastic downturn in the number ofyoung professionals entering the
mortgage industry. Not to mention,the average age of a loan originator iscurrently 54-years-old. There’s a gen-erational gap already present—howcan we expect to gain the trust of theMillennial generation when theyaren’t even being represented? It’sespecially concerning when you con-sider that their buying power is over$200 billion every year.
The financial crisis of 2008 hit themortgage industry hard and manymortgage officers left for other pur-suits. Despite the ideal timing and
lucrative rewards that have appearedsince then, Millennials just aren’tchoosing to become loan officers,despite the 43 percent of their genera-tion who will actively look for a newjob this year. With a population sur-passing 80 million, Millennials official-ly outnumber Baby Boomers and willshortly become the largest share of theAmerican workforce.
Therefore, I’ve decided to make itmy personal mission and a key busi-ness initiative of my company, XINNIX,to make it easier and more enticing forMillennials to choose loan originationas a career path.
I’ve extensively studied Millennialsin the workplace and firmly believethat their personality traits as a gener-ation are ideal for the mortgage bank-ing business. Now, I’m out to prove it.I’m offering complimentary training
classes to those in the industry on howto get the attention of the Millennialgeneration and to assimilate them intothe workplace.
When you think about it, Millennialsare really ideal for this business. Theyare entrepreneurial, collaborative,embrace technology, and are passion-ate about giving back and making adifference. Millennials like to see theimpact their hard work has made—what better payoff than to facilitate afamily buying a home?
Casey Cunningham is CEO of XINNIX, hav-ing co-founded the company in 2002. Shehas more than 26 years of diverse retailmortgage sales and leadership experi-ence, beginning her career as a loan offi-cer and quickly became a top producerwith an annualized production of $60million and 500 closed loans.
“In the last several years, there has been a drasticdownturn in the number of young professionalsentering the mortgage industry.”
Why One Mortgage Business Leader is Making Millennials Her Mission
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W W W . N A T I O N A L M O R T G A G E P R O F E S S I O N A L . C O M
NMP Daily is the mortgage industry'ssource for news, insights, trends and tips.It keeps subscribers informed of the regulatory and legislativeupdates, latest industry happenings and breaking news about themortgage technologies and services.
“…the cost of compliance is going up for creditors:Not only do the new forms and new processes result inmore regulatory considerations, the cost of newsolutions to address these new rules has also beensignificant.”
continued on page 62
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By Alec Cheung
The eMortgage has been an industryvision for years, yet progress toward thatvision has been slow, hampered by iner-tia, acceptance and long-entrenchedprocesses. All that is about to change dueto three factors that are converging tofinally tip the scale and make eMortgagesa reality for the mainstream. The first islarge-scale, consumer-focused regulatorychange brought about by the ConsumerFinancial Protection Bureau (CFPB); thesecond is growing adoption of data stan-dardization; and the third is the con-sumer expectations of Millennials, thefirst generation to come of age in a large-ly mobile and always connected world.
The influenceand impact of the CFPBWhen the CFPB wrote the TILA-RESPAIntegrated Disclosure (TRID) rule, theywere carrying out legislation hard-codedinto the Dodd-Frank Wall Street Reformand Consumer Protection Act to improveborrowers’ ability to understand andmake well-informed decisions whenshopping for a mortgage. But the resultof actions taken by the CFPB ended uphaving a much larger effect, some ofwhich will only be fully understood whenthe mortgage industry has had sufficienttime operating under these new rules.
Nevertheless, it is not difficult to rec-ognize some of the early effects of thenew regulatory requirements. For exam-ple, lenders and settlement agents mustcollaborate much more closely togetherand earlier than before. Also, informa-tion exchange has to be quicker, moreaccurate and occur in a timelier mannerin order to meet the delivery schedulerequired by TRID, as well as to meet theresponsibility of proper disclosure to theconsumer. As a result, the cost of compli-ance is going up for creditors: Not only do
the new forms and new processes resultin more regulatory considerations, thecost of new solutions to address thesenew rules has also been significant.
Given this new environment, it’s onlynatural that eMortgages and eClosingsare coming back into favor. They bothhelp offset the cost impact of TRID, whilealso providing better transparency anddata-driven evidence of compliance. Thecost-savings and other value-added bene-fits for both originators and consumersinclude:
l Reduced cost to originate: Electronicprocesses are less costly to support.Savings come not only from lessprinting and mailing, but electronicworkflows are simply more cost-efficient than manual processes.
l Fewer errors: eMortgages andeClosings cut down on some of themost common errors found inmortgage documents, such as missedsignatures and inconsistencies inname or address. When governed byelectronic processes, consumerscannot proceed until all signaturesare complete. Furthermore,automated data checks can ensurethat fields such as name, address,loan amount, and others areconsistent throughout all of the loandocuments. This cuts down on re-work for the lender and makes theexperience better for consumers, whoavoid having to re-sign corrected orpreviously un-signed documents.
l Easier sale to secondary investors:Because eMortgages are less likely tocontain errors (easier to check),secondary investors have bettervisibility into the portfolio of
mortgages they are buying. Thisincrease in transparency leads to amore confident buyer and thus aquicker sale.
l Faster process turn times: Becauseelectronic documents and processescan transact quicker, the totalprocessing time can be much lower.When this is applied to processeswhere documents must be sent backand forth, electronically delivereddocuments result in faster transactiontime. This creates a more efficientexperience for consumers, real estateagents and lenders alike, since themortgage transaction is completedmore quickly.
In addition to its regulations, the CFPBis also propelling the industry forwardthrough their support for eClosings.Earlier this year, we took part in theCFPB’s eClosing pilot which was conduct-ed to provide a hands-on test of howeClosings can benefit consumers. Uponpublishing their results this past August,they held a private roundtable to solicitinput and feedback on next steps. Many atthis roundtable, including eLynx, felt thatthe CFPB could drive progress towardeClosings (and more broadly towardeMortgages) by helping to accelerateacceptance of electronic documents bymore and more mortgage participants.We encourage the CFPB to continue voic-ing their strong support for electronicprocesses and promoting the use of tech-nology to address consumer’s expecta-tions. The pilot’s results survey clearlyindicated a consumer preference for theelectronic process over the paper alterna-tive, with 17 percent finding it more effi-cient and 15 percent deriving a feeling ofgreater empowerment in the mortgagetransaction. This level of success with thefirst live test of the eClosing process is pos-itive affirmation for the CFPB to continuechampioning industry change.
Data standardization has growing momentumA second important trend that is acceler-ating the move towards eMortgages isdata standardization. Through ourinvolvement with the Mortgage Industry
Standards Maintenance Organization(MISMO), we see the growing successMISMO is having at advancing the stan-dardization of data for the mortgageindustry. With programs like MISMO cer-tification at the company and practi-tioner level, it is becoming easier to rec-ognize and seek out those that are up tospeed with the latest mortgage datastandards.
Other influential groups are addingtheir own momentum. A good exampleof this is how Fannie and Freddie arenow actively working towards a UniformClosing Dataset (UCD) built using MISMOstandards. As explained by Freddie Mac,“The UCD is a common industry datasetthat allows information on theConsumer Financial Protection Bureau’sClosing Disclosure to be communicatedelectronically.”
As part of the long-standing UniformMortgage Data Program (UMDP), UCDaddresses the need for better collabora-tion between creditor and settlementagent on the Closing Disclosure. UCDshows how the GSEs continue to pushahead with data standardization, recog-nizing the many benefits it brings,including stronger fraud prevention, bet-ter credit risk management andimproved transparency, all of which areneeded to bring private capital back tomortgages in a big way.
Millennials are a new factorEven with the CFPB instigating changeand data standardization makingeMortgages more viable, one new factoris contributing to making eMortgages areality—shifting consumer expectationsand preferences. Just this year, theMillennial generation, those under theage of 34 in 2015, became the largestcomponent of the workforce and thelargest homebuying segment. This is thefirst generation that has come of age in apredominantly mobile and online world.Their preferences and expectations willultimately compel the mortgage industryto make the changes required to makeeMortgages and eClosings a reality.
Earlier this year, the Pew Research
Vision Versus Progress: The Three Drivers That Are Making the eMortgage a Mainstream Reality
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vision versus progresscontinued from page 61
Center reported that in the first quarter of2015, the Millennial generation hadbecome the largest sector of the work-force at 53.5 million. According to Pew’sanalysis of U.S. Census Bureau data,Millennial workers now outnumberGeneration X, ages 35-50 in 2015, whocome in at 52.7 million. Furthermore, the2015 National Association of Realtors(NAR) Home Buyer and SellerGenerational Trends finds thatMillennials are now the largest segmentof recent homebuyeres, coming in at 32percent of all buyers, ahead ofGeneration X, who comprised 27 percentof all buyers. Given the size of thesegroups, their preferences will re-shapehow business is done, including the
process of buying a home.The Economist Intelligence Unit, the
research arm of The Economist maga-zine’s Economist Group, reports that morethan 80 percent of banks will use mobiletools as their primary communicationchannel for Millennials by 2020. But forMillennials it’s more than just communi-cation. Technology is ingrained in theirdaily lives and the homebuying processwill need to change to meet the very spe-cific ways this generation uses technology.
Now, does this mean Millennials careabout eMortgages? I doubt it. ButMillenials do care about many of thethings that will make eMortgages feasible.For instance, the ability to receive, reviewand sign mortgage documents via mobile
or tablet devices will accelerate the massadoption of paperless lending. And notjust for portions of the mortgage work-flow, but for the entire process. Once thishappens, end-to-end data from mortgagetransactions will become available, andwith MISMO data standardization, itbecomes easier to capture, exchange andanalyze even across multi-party work-flows. Electronic processes will then final-ly make it to the various downstreamactivities that have been holdouts andthat have inhibited eMortgage andeClosing processes such as electronicnotarization, county recorders, and sec-ondary market investors.
The preferences and expectations ofthe Millennial generation are largeenough to provide a demand pull thathasn’t existed before. When paired withthe dual push of the CFPB’s influence andthe industry’s own adoption of data stan-
dards, eMortgages may soon becomemainstream.
When it happens, and paper-basedmortgages go the way of rotary tele-phones and black & white TV, we willwonder why it took so long. Originatorswill create and close more loans, borrow-er experiences will be far more pleasant,and investment capital will flow in at lev-els not seen in a decade—all to the ben-efit of consumers, the industry, the econ-omy and the nation.
Alec Cheung is vice president of productdevelopment and marketing for eLynx, aprovider of on-demand Web-based servicesfor secure, paperless document and datacollaboration and distribution. He hasmore than 20 years of experience infinance, technology and mortgage services.He can be reached by e-mail [email protected].
www.callfurst.com
By Eric Weinstein
Dear Eric:I read your article in National MortgageProfessional Magazine, and I’m a 23-year-old loan originator who has been inthe business for about a year now. I hadbeen working to get my license and work-ing in operations to observe what isgoing on in the operations side of thebusiness. Now, I’m doing full-time salesand was wondering if you had anyadvice for a young person like myself get-ting into the business? Sean T. BogueRonkonkoma, N.Y.
Dear Sean:You are on the right track. My numberone piece of advice is to learn, learnand learn some more. Be like a spongeand absorb all of the knowledge youcan, from wherever you can. There aretwo major aspects to being a successfulloan officer and a third when you areready to open your own company. Thefirst is sales and the other is technicalknowledge of your product. Later, youwill need to learn how to manage andoperate and a business.
I credit my own sales ability to ZigZiglar’s Secrets of Closing the Sale. Thiswas my sales Bible. Read it, learn it,memorize it and sleep with a copy of itunder your pillow. In fact, I highly rec-ommend all of his books. More thananything, this book transformed mefrom a meek accounting nerd to a topproducing salesman. Spoiler alert: Thesecret is to just be a good person.
The second thing you will need is anencyclopedic knowledge of your prod-uct, which is mortgages. Befriend otherLOs in the office and share war storieson tough loans. Talk to account repsabout weird scenarios you get and theones they have gotten. Read their prod-uct Web site and learn every ratio, LTVand guideline on ever type of loan.Read every word of every disclosure.This is called “paying tuition.” Believeme, it is better than the other type of
“paying tuition” which is where youscrew up a deal and lose a commission.It is much cheaper to hear about howanother LO screwed up and lost hiscommission than losing your own.Learn to process, lock and do every jobin the office. Try to not delegate things,but do them yourself. That is how youlearn. You can delegate only after youknow everything there is to know aboutthat job.
Soon you will have arrived at the topof your field, and ask yourself, “What isnext?” That is the time when you willstart thinking about opening your ownshop. It doesn’t have to be big or glam-orous, but you will proudly be able tosay it is your own. Many people arehappy to achieve this and remain a oneman shop, but if you have the drive andability, the next step is to start hiringnew LOs.
If you were smart and did what I toldyou, you should have also “absorbed”the way your previous mortgage shopwas run. You will have identified thethings that were right and the things youthought just didn’t make sense. Nowthat you own the place, you can do ityour way. Hopefully, that is a better way.
My background was in accountingand business, so that was the easypart for me. Not everyone has thattype of experience. My advice is theplay to strengths and staff your weak-nesses. You might need to hire in thebeginning a bookkeeper/office manag-er/assistant/everything-else-you-don’t-know how-to-do. You will make lessmoney this way, but that is your ownfault for not having learned it.
Here is the deal. I will send you TheMortgage Press article I wrote in July2011, “This Is My Story and I am StickingWith It.” In it, you will find the exact for-mula on how to become rich and suc-cessful in the mortgage industry.Basically, exactly what I did. In addition,I will mentor you, respond to your callsand e-mails and help you on your way.
For this, I will require two things fromyou. Firstly, you will let me publish yourquestions and my answers so that EVERY-ONE can benefit from your education astime goes on. Secondly, and most impor-tant, you promise, that when you are richand successful, you will be willing to takethe time and make the effort to help thenext 23-year-old new LO just starting outin the business. In this way, we continuethe chain of helpfulness and compassionto make the world a better place.
If you want the abbreviated version,here it is … Just be a good person andthe wealth and happiness will flow toyou. If you don’t agree, I am going to useyour question and my answer anyway
“… you will need is an encyclopedic knowledge ofyour product, which is mortgages. Befriend other LOsin the office and share war stories on tough loans.”
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next month for my article, but I will justchange your name. It is hard coming upwith new ideas to write about everymonth. You will see.
Eric Weinstein worked in banking, on thecommercial real estate side until 1991,when he fell in love with residentiallending. In 1995, he started a smallmortgage company in his basementcalled Carteret Mortgage Corporation,which in 2003, grew to one of the largestmortgage broker companies in theUnited States. Eric is semi-retired, doingmortgages by referral only. He may bereached by phone at (703) 505-8692 or e-mail [email protected].
By John Vella
Mortgage transactions will eventuallybe an entirely paperless, digitalprocess and more than likely startedand finished on a mobile device.Consumers are demanding it. Thetechnology exists. Obviously this is amore sophisticated transaction thanordering takeout, but we’re on thecusp of being able to offer it. Howwell a mortgage company adapts tothis rapidly approaching reality
means the difference between mov-ing forward as a standout or beingforgotten in the past.
The mortgage industry needs aplan to support this full-service,online borrowing experience. Someearly adopters already do, which is agood sign for an industry that hasalways been paper-heavy and slow toadopt new technology. The corners ofthe real estate industry that have
been most progressive in many casesinnovated out of necessity during thecredit crisis, creating a “silver lining”out of the housing meltdown now thatwe’re a few years removed from themost challenging days. Technologyshowed that more transactions couldbe closed, and closed faster with bet-ter regulatory compliance. There has-n’t been a lull of services and solutionsintroduced since. We’re not as desper-ate to overcome the issues thatbrought us here, like servicing massiveamounts of defaults or needing reli-able platforms that keep the processtransparent and in line with regula-tions. Instead, this new tectonic shifthas rippled out from borrowers’demand for convenience. And it isnow being felt across the industry.
Moving in sync with the push forinnovative technology is critical tooffering an easier, more efficienthome buying and selling experiencefor the consumer. Importantly, it hasthe added benefit of helping mortgagebrokers want nothing more than moreopportunities. A self-service platformwhere each transaction can be con-ducted from beginning to end today isa major differentiator, and in the verynear future will be mandatory toremain competitive. Too many firmsget fixated on the cost of investing inthe technology, but taking a step backand evaluating the implications of notdoing so will quickly reveal that thequestion is really, “How long can I getaway without offering it?”… one yearor two years? Maybe three years?Timing the market is a risky proposi-tion for buying or selling a home, andthe same applies to investing in criti-cal technology to be competitive andsoon relevant.
The right tools for the jobSelf-servicing options start with onlineloan applications and can carry theborrower all the way through the clos-ing process. In fact, the mortgageaspect of the process is but one pieceof online real estate experience, andgenerally is behind other elementslike shopping for a place. The entire
homebuying process is being digi-tized: browsing for properties, takingvirtual walk-throughs, applying forfinancing, closing financing, and alimitless menu of additional servicesthat can be chosen along the way.Some are “nice” options that can beoffered, such as letting agents andcustomers send immediate feedbackon a property as they visit it. Othersare absolutely necessary today,including allowing access to docu-ments and accepting electronic signa-tures.
The mobile device is at the centerof most technology initiatives. Astimely connections and communica-tion grow out of the need for bettercustomer service and regulatory com-pliance, the mobile device is emerg-ing as the tool allowing every partici-pant in the process to communicatein real time. The ability to review andtransmit documents at every stage iswhat keeps the process moving andmoving in a direction that is moretransparent and regulatory compli-ant.
Power to the peopleBy now we know the Millennial gen-eration homebuyer is the poster childshaping the industry. This is the newborrower we are clamoring to workwith. The Millennial generationexpects us to deliver shorter time-frames and immediate, around theclock responses to questions. Serviceused to mean face-to-face interac-tion, but today requiring that is oftenseen as an inconvenience when muchof the process can be completedonline. Across the industry we areworking on ways to make informationreadily available and delivered towhatever device they want to use. Acompetitive advantage doesn’t onlybegin there. This digitally-empow-ered generation of homebuyers mayhave demanded we meet them ontheir own terms and had us rethinkthe way we interact, but that recogni-tion for simplicity has spread acrossgenerations. Gen Xers and BabyBoomers are increasingly interestedin the convenience of digital solu-
“Mortgage companies today need to court theMillennials, but also listen to all borrowers and takesteps toward creating self-servicing platforms foreveryone.”
The Mortgage Industry’s Future is Here
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tions, and comfortable making largepurchases online.
Baby steps for every generation Mortgage companies today need tocourt the Millennials, but also listento all borrowers and take stepstoward creating self-servicing plat-forms for everyone. Attracting a newwave of borrowers and easing theconcerns of those who will fill out sec-ond or third loan applications isgoing to take more work than havinga flashy Web site. Our industry stillrequires a concerted effort to makethe process as transparent as possi-ble. Transparency transcends genera-tions and other demographics and ofcourse is a requirement in manyaspects of the mortgage process.While other generations may nothave the same expectations asMillennials, the integration of offer-ings such as advanced Web sitedesigns and well-trained call centerstaff that comes with a push towardmobile and paperless options aregoing to be welcomed by all.
TRID won’t be an excuse for longThere is reluctance among brokeragesthat may seem overwhelmed by whatis the easiest, lowest-risk place tostart. These are brokerages that wereconstrained with extensive resourcestied up in preparation of the OctoberTILA-RESPA Integrated Disclosure(TRID) rule implementations.Introducing self-service options mayhave been pushed off everyone’s proj-ect list, but when the dust settlesaround TRID implementation, head-ing into the first quarter of 2016,finding the resources needs to hap-pen sooner rather than later. It justmay be TRID that sparks a firm’smove to technology.
For example, the rules call foraccelerated timelines for takingaction on documents, so we’re look-ing to reduce what had taken monthsinto weeks or even days. We needways to keep the acquisition and orig-ination process moving around theclock. Online and mobile access todocumentation and information iscritical and really the only way towe’re all going to meet these newdeadlines. A good self-servicing sys-tem keeps the operation running and
with a clean, clear audit trail. We nowhave opportunity to store, retrieveand sort data in a way that we nevercould with paper.
The rise of thereal estate tigerSome firms have been able to buildtechnology teams outside of those orig-inating loans or working on compli-ance measures. Each organizationshould have a technology expert onstaff. Reinventing the industry will taketechnology savvy, which is not a skillsetfound in every loan officer’s back-ground. What leading firms are doing isbuilding technology Tiger Teams with asingle tech-driven mission. They arenot relying on their rank and file tomake technology and vendor partnerdecisions. They are removed from thetech team that makes sure compliancesoftware works, and instead are dedi-cated to using technology to drive busi-ness, approaching technology with theobjectives of a loan officer.
If building a dedicated tech teamfeels like too large of a leap, the nextbest thing is organizing a focus groupof employees, vendors and even cus-tomers. This is a highly effective wayto discern what technology is avail-able relative to what each groupneeds. Teams can explore topics likehow they want to receive and sendinformation from each other. Whatinitiatives are priorities for today, andwhat can wait until tomorrow?
Vendors should be able to providea look at what has been done success-fully already. There is an expandingfoundation on which anyone canbuild a unique full-service solution.Of course the single most importantstarting point will be looking for solu-tions that are scalable, becauseinevitably technology will change asfast as the demands of customer. Adigital strategy has to be focused onwhat people want now as well as whatthey’ll need in the future.
No time like the presentNot too long ago it seemed technolo-gy and the mortgage industry werevery removed from one another. Weaccepted that each mortgage wouldbe hundreds of sheets of paper andthat we had to rely on postage stampsand office visits to complete a trans-action. Coming out of the meltdownwe made strides to improve borrower
satisfaction and offer better processdocumentation. We became empow-ered to let technology handle more ofthe workload, and that in some casesit was better than we were. Along theway we discovered that technologygave us speed and accuracy. And inthe near-term market, where origina-tions may very well stay flat, theindustry needs to be faster. Even if amortgage servicer is reluctant to openup to a new, online direction, I don’t
believe anyone would want to do lessbusiness. The sooner a firm closes aloan, they have lowered cost, andthey are ready to originate the nextloan. The customer is online andready to help; they just need to begiven the tools they need.
John Vella is chief revenue officer ofAltisource Portfolio Solutions. He hasworked in the real estate and mort-gage industry for the past 30 years.
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By Keith Guenther
As we look ahead to 2016, the focus onthe mortgage industry’s recovery willendure. In discussing areas of growth,it is only appropriate to also discuss theareas of continued struggle. We havemade positive strides, but the industrycertainly has a long way to go. Rightnow, the housing market is extremelyfragile. To overcome the current
volatility, experience a true recoveryand make homeownership viable formore consumers, we must pay closeattention to the factors that willimpact the market this year andbeyond. While it is never possible toknow with certainty what lies ahead,by understanding the lingering issuesat hand and preparing for forthcom-
ing ebbs and flows, we can act accord-ingly to benefit our industry and theconsumers we serve.
Moving forwardTo assess where we must go from here,it is important to look back severalyears. The government’s decision tolower interest rates to soften the hous-ing crisis resulted in consumers havingeasy access to capital. The industrylargely agrees upon the fact that theaccess was in fact, too easy. Countlessefforts have been made to now softenthe impact of the crisis and to limitforeclosures—mostly by imposing reg-ulatory change. While modified guid-ance has been important to transform-ing and repairing the industry, withoutmanaging the fundamental chal-lenges, we’ll only continue to hinderthe economy from growth.
The Fed’s decision in September toleave interest rates unchanged willalso influence the market in the com-ing year. In a Mortgage BankersAssociation (MBA) survey indicatingresults from the week before the Fed’sannouncement, the Refinance Indexhad increased by 18 percent from theprevious week, bringing the refinanceshare of mortgage activity to 58.4 per-cent. In the same week, the unadjust-ed Purchase Index increased by 20 per-cent from one week earlier, 27 percenthigher than the same week one yearago. With rates remaining low, we canexpect this uptick in both mortgageapplications and refinance activity topersevere—which begs a few ques-tions: Are we giving ourselves a falsesense of security with low rates? Whenrates do rise, will we be at risk of a col-lapse? For those refinancing, is adefault just around the corner?
A forecast for growth in both vol-ume and price remains contingent onseveral elements beyond interest rates.It is important for us to explore addi-tional factors in order to best moveforward:
l The global economy: Two yearsago, the head of the nation’slargest hedge fund nearly predictedthe fallout with the notion that the
U.S. economy becomes “notcreditworthy.” Today, we are in themidst of the redistribution ofwealth and deleveraging. It is notjust our own economy that themortgage industry should bewatching closely; it is important topay attention to internationalactivities as well. For example,continued fallout from China’scurrency devaluation andsubsequent massive selloff couldhave a potential negative impacton our market.
l Rental rates: Rental rates continueto skyrocket, which, in addition tolow interest rates, is drivinghousing. For many consumers, itnow makes more financial sense topurchase a home instead ofcontinuing to rent at exponentiallygrowing prices. Yet, this notion iscomplicated by the struggle manyface—high rental rates and debtpose a barrier to meeting thequalified minimum downpayment.
l Job growth and consumer debt:Elements such as job growth notonly impact housing, but indicatethe health of the economy as awhole. Beyond housing marketnumbers, when evaluating theindustry’s well-being, we must payattention to consumer debt, whichis at an all-time high. Manyconsumers are in the midst of theshort-term debt cycle. Inclined tolive off of money they do not haveby increased debt, but moreimportantly by those who cannotpay their obligations; and otherscontinue to be burdened byprevious defaults.
Whether it’s a Millennial buried instudent loans, or a family workingto improve its financial situationfollowing a foreclosure, obstructingthe pursuit of homeownership isthis combination of damaged credithistory, debt issues and inability tosave money due to high rentalrates. As a result, more lenders areconsidering and offering sub-primeloans; Equifax’s National ConsumerCredit Trends Report found that inthe first five months of 2015, the
“Beyond housing market numbers, when evaluatingthe industry’s well-being, we must pay attention toconsumer debt, which is at an all-time high.”
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volume of first mortgageoriginations to borrowers withsubprime credit scores increased30.5 percent.
“It appears that American lendersstill believe in second chances, andwithout sub-prime loans, therewould be no second changes in thehousing market,” said Amy CrewCutts, Equifax’s chief economist.“The underwriting on mortgagestoday is tough on everyone, and webelieve that the sub-prime lendingthat is happening is beingunderwritten even more carefully.”
The mortgage industry is clearlyexperiencing and working througha very delicate balance. We mustcontinue to find the best ways toprovide these second chances andopen the door to homeownership,while still limiting risk and evadinga potential subsequent downturn.
l Defaults and shadow inventory:The industry’s focus has turnedaway from talking abouthomeowners in danger of default.However, there should be anemphasis on those at risk ofdefault again as well as thepersisting shadow inventory. HOPENOW reported approximately122,000 non-foreclosure situationsand 29,000 completed foreclosuresin July 2015. While both numbersare down from this time period lastyear, they depict the continuingstruggle of American homeowners.The data also emphasizes theongoing reliance on both formaland non-formal forbearanceoptions and other workout plans,such as deed-in-lieu programs.When we take a closer look at thenumber of Americans who remainin these difficult financial
situations we can easily realize, thedownturn is not over as manyperceive it to be.
Of course, we could talk aboutheighted regulation for days. For thepast few years, compliance has beenthe primary area of interest. However,in 2016, regulatory oversight willintrigue the industry less. For themost part, mortgage companies havegrown more accustomed to the guide-lines and to making necessary adjust-ments. Instead, the conversation willmost likely be around potentiallyloosening lending and other possiblesolutions to improve the viability ofhomeownership. Right now, manyAmericans simply cannot afford tobuy homes. Will that be the new real-ity, or will credit requirements loosenand we return to low downpaymentsand interest rates? In the meantime,
banks should be assessing their loanprograms and developing new ones.It is critical that, looking ahead into2016, banks and the industry as awhole work toward reducing debtwithout igniting deflation and dis-cord. There are numerous considera-tions that must be accounted for aswe explore the future of lending, andat the same time, so much relying onit. Only when we have a clear, holisticunderstanding of the foundationalissues that created the downturn andcaused these lasting market chal-lenges can we truly rise above andbeyond it.
Keith Guenther is CEO of Lake Forest,Calif.-based USRES Inc. and its wholly-owned subsidiary, RES.NET Inc.Guenther oversees all day-to-day activi-ties and drives the strategic and techno-logical initiatives for the companies.
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By Sue Woodard
Marketing services agreements(MSAs) have been a way of life in ourindustry for generations. Varied intheir size, shape and effects, MSAshave had great impact on mortgageloan originators. Today, their daysappear numbered, thanks to theCFPB. But the situation is far fromdire, assuming mortgage loan origi-
nators (MLOs) and their leadersmake the right moves—quickly—tosolidify relationships with referralpartners.
MSAs have been frustrating forthose who do not benefit from them,and most MLOs are accustomed tobeing turned away by referralprospects due to preexisting agree-
ments with favored lenders. Havingbeen an MLO myself for a large partof my career, I am never far fromwhat’s happening on the street—and the MLOs I speak to who havenot been reaping the benefits ofMSAs are logically jubilant at thisturn of events.
On the other hand, I’ve talked tomany who work for large lendersthat leveraged MSAs for years andmany are indeed sorry to see theagreements start to go away. It’sunderstandable, since it is humannature to resist change. Yet manyMLOs who worked under MSAs willtell you it was not exactly like catch-ing fish in a barrel. You still had toperform or risk losing a deal toanother lender, as some MSAs weremore like rights of first refusal.Others will tell you that they sawservice levels under stricter MSAssuffer, as the relationship couldsometimes be taken for granted.With the playing field more level,everyone can ultimately benefitfrom greater attention paid to serv-ice levels, better competition andmore professional experiences forborrowers and referral partnersalike.
But why do I feel this is such atime sensitive issue, which must beacted upon now? Because you, dearreader, are not the only lender orMLO reevaluating their referral part-nerships and pondering how youwill interact most effectively withthem in this new non-MSA eraahead. Thinking about co-brandedmarketing with referral partners asone key way to solidify a relation-ship? The first one to the referralpartner with this concept wins—they will not typically co-brand withmore than one lending partner. Soyou’ve got to be smarter than thosewho are faster—and faster thanthose who are smarter.
Making it happensmart: Technology and automationTechnology is a great leveler.Without it, transactions suffer, and
along with them, relationships.With the right technology, justabout everything becomes easierand more efficient. It is easy tothink back a decade or two whenwe were just starting to see theimpact of computers and couldscarcely dream of the digital revo-lution that has permeated everyaspect of American life. In lending,technology has seen quantumchange that has redoubled everyyear, and is now so ingrained in theway we do things it is impossible tocontemplate doing without.
Technology combined withautomation lets us find the bestprogram and rates for each individ-ual borrower’s situation inmoments, not the hours and evendays once required. Advanced cus-tomer relationship managementblends with next-level salesautomation to create amazing mile-stone and marketing campaignsthat cement the bonds with bor-rowers and real estate profession-als. Mobile device functionalitybrings immediacy to MLO effortsnot possible just months before.And instead of being intimidating,it is all enabling—especially as wemove away from restrictive MSAs.We’re replacing exclusivity withperformance excellence that sub-stantially upgrades the state of themortgage loan origination art.
And automation makes co-branded marketing simple, as itdoes with so many things—not tomention that it’s critical to the suc-cess of this endeavor with a referralpartner. Automation keeps yourconsistent, focused marketing planon track—and keeps your relation-ship on track—even when you orthe referral partner are on vacationor busy closing deals.
Making it happen fast:Promote benefits of co-brandingNow is the time to get to your refer-ral partners with co-branded mar-keting—but when a MLO presentsthis opportunity to a referral part-
“MSAs have been frustrating for those who do notbenefit from them, and most MLOs are accustomed tobeing turned away by referral prospects due topreexisting agreements with favored lenders.”
MSAs Going Away? So What!Smart lenders are moving quickly to embrace the change
With the MB Edge,you’llstand outfrom thecrowd.
New from MB Financial Bank’s Mortgage Division: The MB Edge Program provides advantages to our valued clients. We understand the importance of the broker / borrower relationship, and do everything we can to retain lasting connections with our customers. At MB, we value your business.
MB Financial Bank, N.A. . www.mbmortgage.com
Member FDIC MB Financial Bank NMLS: 401467
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ner prospect, it needs to be some-thing special. The competitive dif-ference comes when the MLO pro-vides highly sophisticated co-branded automated marketingcampaigns that parlay outstandingcontent, sharp professional designand easy implementation. Thispotent combination makes referralpartners truly look into the futurefor their businesses and see won-ders—with their brand namesprominently part of the entirepackage. Working with the MLOempowers referral partners to flexmarketing muscles they didn’tknow they had, and all withoutimpact to their current bandwidth,thanks to automation.
With David Letterman retired,top 10 lists may no longer be partof late night television. But hereare 10 great examples of automatedco-branding features, all readilyaccessible to MLOs, which candirectly improve the lives of realestate professionals:
1. Advanced, automated capabili-ties that include a Web presenceto centralize each referral part-ner’s co-branded marketingefforts with the MLO;
2. Co-branded marketing tools thatallow the MLO to choose fromready to go campaigns or createcustomized materials, all co-branded with the referral part-ner for readily implemented co-marketing campaigns;
3. Profile customization thatallows the referral partner toeasily upload and edit logos,photos, contact information andother essential information usedin marketing collateral;
4. A secure list management envi-ronment in which the referralpartner can comfortably providecampaign recipient informationto which only they personally,not the lender, have access;
5. Great designs and sophisticatedcontent for all materials that arebeyond virtually every referralpartner’s capability to create;
6. A loan status center that empow-ers the referral partner to checktransaction status of all loansthey have referred to the MLO,available 24/7 via desktop, lap-top and mobile device;
7. Co-branded open house flyersthat MLOs can provide for eachopen house event, with propertyinformation and compliant,lender-approved loan informa-tion;
8. Full reporting capabilities thatallow referral partners andlenders to evaluate the effective-ness of their co-branded market-ing efforts;
9. Vastly increased marketing reachfor both referral partners andMLOs;
10.Immensely stronger professionalbonds for all parties—not onlythrough leads coming back frommarketing campaigns, butthrough greatly improved bor-rower experiences that increasethe real estate professional’ssuccess with their own efforts forborrower referrals.
Change comes with the territoryEven with the knowledge thatlenders need to move quickly toembrace this change, the reality isthat most people are predisposedagainst change. So it’s no surprisethat some in the lending industryare greeting the emerging trend inMSAs with dismay. British novelistArnold Bennett once said, “Anychange, even a change for the bet-ter, is always accompanied by draw-backs and discomforts.” He wasquite right, of course, and com-pletely relevant even though hesaid it about a century ago. But inthe case of disappearing MSAs, thedrawbacks and discomforts can belimited.
In the long run and in the shortrun, all MLOs can benefit if MSAs infact end up fading into history.Those working under them now canput advanced co-branding tech-niques to work that will more thanmake up for the lost exclusivity theagreements provided. Along theway, their service levels will riseand client satisfaction will gothrough the roof. That said, themost influential MSAs were pre-dominantly with the largest institu-tions, and those are often the slow-est to change course, particularlywhen technology is involved. Big ITdepartments frequently prefer tobuild things rather than buy them,
and frankly that is very difficult inthis case. This level of advanced CRMis extremely difficult to replicate,and the content libraries owned andcontinually refreshed by companieslike ours that have been in the spacea long time are virtually impossibleto duplicate.
MLOs working for most othernational, super-regional and smallerfirms may have a bit of an advantagehere. These companies are generallymore inclined toward nimblenessand prompt evaluation of availabletechnologies. Further, the technolo-gy providers offering the mostadvanced co-branded marketingtools are well-versed in dealing withthe non-mega lender tiers, makingthe selection and implementationprocess a much simpler mattertoday than in the “big iron = bigcheck” era. Thanks to cloud-based
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and SaaS delivery, unit pricing andother considerations, getting up tospeed is faster and more cost effec-tive than it has ever been with tech-nology of this game-changing mag-nitude.
Despite the normal impulse towant things to remain the same,change is your friend—especially ifyou make your move quickly toembrace the opportunity presentedby the collision of old ways of doingbusiness going away and the newera of automation and technology.
Sue Woodard is president and CEO ofVantage Production, a CRM technol-ogy provider based in Red Bank, N.J.Prior, she was an award-winningmortgage originator, trainer andspeaker. She can be reached by e-mail at [email protected].
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By Cal Haupt
In today’s transactional mentalitywhere quotas and the race to closedeals has become the cure-all for build-ing profitability and beating out thecompetition, we often lose sight of theimportance of cultivating successful,long-term relationships and deliveringexceptional service—the true secret tosuccess.
Before you think to yourself, “Thisdoesn’t apply to me, I communicatewith my clients regularly on socialmedia,” it’s important to differentiatebetween social media communicationand interpersonal communication. Inthe mortgage industry, we understandthe importance of developing a socialmedia presence, communicating fre-quently with our clients on Facebookand Twitter, and monitoring onlineconversations to resolve potential cus-tomer service issues before they erupt.However, does communicating viasocial media have the same influenceas interpersonal communication? Howsuccessful are we in nurturing andbuilding long-term relationships whenwe’re sitting in front of our computers
as opposed to engaging in face-to-faceinteraction?
In the last decade, there has been amonumental shift in the way we com-municate. As a society, we’ve altered ourinteraction preferring mediated commu-nication over personal communication.We prefer to e-mail rather than meet,text rather than talk and post ratherthan converse—a shift that has openedthe door to more social and professionalconnectivity within social networking,yet it leaves more clients feeling less per-sonally engaged with those whom theychoose to conduct business with.
Thus, while we are undoubtedly com-municating more with our thousands ofcompany Facebook fans and our impres-sive list of professional connections,these connections are often weak tiesthat won’t stand the test of time. Thinkabout your vast number of LinkedIn con-nections or your Twitter followers for amoment. How many of them have youhad direct contact with in the last year?While there is an element of residualconnectivity through status updates, it’snot the type of communiqué that can
take the place of face-to-face interaction.In reality, for the vast majority of
organizations, future success doesn’t liewithin the thousands of relationships weharvest on social media, but rather, witha relatively small number of people whoare critically important to the success ofour business. It’s these significant rela-tionships that must be nurtured, fosteredand safeguarded.
Professional relationships redefinedIf we take a step back and view our pro-fessional relationships through the lensour own personal relationships, we drawupon key emotional factors that help usestablish the bond within those relation-ships. Loyalty, commitment, trust,dependability, respect and integrity areall words used to describe a level of emo-tional attachment found in a strong per-sonal relationship. As you can imagine,no matter how much time someonespends tweeting and posting onFacebook, these attributes can be diffi-cult to convey through the channels ofsocial media.
To build strategic relationships, weneed to dedicate a significant portion ofour time and energy to those relation-ships that matter most—our current,past and future clients, and those whohave been instrumental in our careerand success including our partners, theteam we work with and our valued pro-fessional connections. If we take time toinvest in and safeguard these relation-ships they will be there for us when weneed them the most—through challeng-ing times, tight deadlines, when we needa favor, or to share strategies, resourcesor insight. Most importantly, we need tobuild relationships before we need them.
Business relationships should be nur-tured much like we nurture our personalrelationships. After all, they are the fuelthat feeds our success and they requireeffort to fortify, build and maintainthem. They must be mutually beneficialand we must be willing to take the timeto care, share, listen, laugh and supportin order to build long-term loyalty andconnectivity. Our efforts should never beforced or fabricated as this will eventual-ly become transparent. Instead, they
should become a normal part of ourdaily routine. On average, you shouldspend five percent to 10 percent of yourweek dedicated to building relationships.If you’re accustomed to eating lunch atyour desk or you’ve never taken a clientto a baseball game or out to dinner, itmight be time to rethink your strategy.
Fortifying strategic client relationshipsYour clients are your business, so a criti-cal factor in improving your business is toimprove your client relationships. Tomaximize your relationship with clients,or any professional relationship, tryincorporating a few of these straightfor-ward strategies into your daily routine.
Ask more questionsAsking questions opens up a two-waydialogue that allows us to better under-stand client perspectives, situations andfeelings. When you have a conversationwith a client, especially a new client, takenotes. Jot down important informationabout them. Ask them whether they’remarried, how many children they have,what they do for a living, etc. Ask yourclient specifically what they are seekingor need from you and be sure to ask forfeedback on how well they feel you’reserving their needs and ways you canimprove.
Learn the Interests andpreferences of your clientsMost people love to talk about them-selves. Take advantage of this opportuni-ty and get to know your clients on a morepersonal level by mastering the art of lis-tening. Take the time to learn about theirinterests and ask about their preferences.Are they a football fan? What is theirfavorite type of food or what is theirfavorite restaurant? Inquire about theirhobbies, travels, where they’ve lived,how many languages they speak andwhen their birthday is. Building lastingrelationships doesn’t happen overnight;however, in the long run the return oninvestment is well worth the effort putforth.
Strive to connectWhether you schedule a time for lunch or
“How successful are we in nurturing and buildinglong-term relationships when we’re sitting in front ofour computers as opposed to engaging in face-to-faceinteraction?”
The Blueprint for Future Success Lies in People, Not Profit
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www.nationalmortgageprofessionalmagazine.com
plan an occasional outing at a footballgame, connecting with your most val-ued clients is essential. Even if theydecline, which they sometimes will, itsends a clear message to your client thatthey matter, that you’re willing to taketime out of our personal life to spendtime with them and that you value therelationship. While it isn’t always feasi-ble to carve out time to meet witheveryone on your client list, picking upthe phone and calling on occasion cando a world of good as well. Calling justto check in, asking how they enjoyedtheir recent vacation or inquiring feed-back on how well you’re servicing themcan be a tremendous relationshipbuilder.
Give often, receive occasionallyPeople who have become powerful rela-tionship builders don’t think about
what they can get out of a relationship,but rather, what they can give. Toaccomplish this we need to be sharplyattuned to our clients’ needs and wants.Answer questions before they ask, deliv-er beyond the expected, give often andbe willing to receive on occasion. It’s thismentality that will help build powerfulprofessional relationships and lasting,loyal clients.
Never underestimate thepower of appreciationWhen was the last time you sent a hand-written thank you note? Saying thankyou to your clients should be an activepart of your ongoing success strategy.However, all too often we fall short indelivering this important message to ourclients. An expression of gratitudethrough a hand-written note, a personalphone call or a small gift delivered totheir door will convey to them how
much you appreciate them, how impor-tant they are to you and that you valuetheir business.
Above all, be genuineOftentimes, when companies want ourbusiness, they’re willing to tell us any-thing and everything to get our atten-tion and solidify our business.However, today’s savvy customers arefar too sharp to fall for phony salespitches. They’re also far too savvy to fallfor insincere attempts of interest. Nomatter how you connect and engagewith your clients, above all, be gen-uine. If you’re not comfortable taking aclient to dinner, then don’t. If yourcomfort level lies more with personalphone calls and hand-written notes,then that’s what you should do. Yourdesire to reach out and connect withclients should never extend beyondyour genuine comfort level.
Balance is keyAs important as it is to connect withclients, it’s equally as important to ensurea healthy balance by not straying too farfrom the professional proverbial line inthe sand. Know when to dial it back anotch and give your clients room tobreathe. Every client will be different andevery client relationship will yield a slight-ly different approach, however, it’s impor-tant to remember that these relationshipsare, in fact, professional. When interactingwith clients always remember that youractions and the way you communicatewith them greatly influences their opinion,attitude and respect for you and your firm.
Cal Haupt is chairman and chief executiveofficer of Southeast Mortgage, with 13office locations throughout Georgia and islicensed in Alabama, Florida and SouthCarolina. He may be reached by e-mail [email protected].
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By Michael P. Bell & Elliot Liss
There was a time when a settlementservices firm accepted that this was athin-margin, volume driven business.However, the typical title firm’s risknow goes far beyond the possibilitythat its pre-close labor and costs willbe for naught should the deal fail.Compliance costs, increased require-ments from lenders and theirinvestors, and a changing market allmean that a settlement services firmmust pay attention to its margins—which means ensuring the most effi-cient operation possible.
The world of title insurance andsettlement services has never beenone built upon wide profit margins.At the root of the title agency busi-ness model, an agent bears almost allof the settlement service costs:Search, curative, escrow, closing andmore. Ours is one of the few types ofinsurance for which the agent sellingthe insurance policy actually does theheavy-lifting on the policy up front,rather than reserving much of it forthe claims process, as do most prop-erty and casualty insurers.
In the early 2000s, when mort-gage origination volume was at his-toric heights, margins weren’t thebiggest concern for most in ourindustry. Instead, the name of thegame was volume or gross revenue.The high order counts seeminglypushed production costs furtherand further away in the proverbialrear-view mirror.
Today, however, we face a very dif-ferent world. Ours is now a worldwhere clients, especially mortgagelenders, are facing increasing pressurefrom investors and regulators alike. Asa result, their vendors, the title agentamong them, are incurring increasedcosts. Whether it is updated technologynecessary to manage the new settle-ment process under the TILA-RESPAIntegrated Disclosures rule (TRID) orincreased staff to assure a more robustquality assurance process; a title agenttoday likely spends much more to pro-duce a title insurance policy than everbefore. As a result, tighter margins andgreater expenditures reduce overallprofitability.
The new costs of doing businessWhy did a settlement services firm’scost of doing business increase so dra-matically? Many of the causes areobvious. A stream of new regulatoryrequirements, in combination with anincreasingly active culture of lenderand regulatory audits, have any titleagent seeking to stay in business onhis or her toes. Even though some ofthose requirements may not applydirectly to a settlement services firm,the costs do flow down the vendorchain. The requirements of TRID, forexample, apply equally to lender andsettlement agent. But, in many cases,it is the settlement services firmresponsible (de facto) for educatingand counseling his lending client onthe new requirements … at its owncost. This, of course, is in addition tothe expenses incurred in updating oreven replacing technology and sys-tems to come into compliance withthe requirements of TRID. It is com-pounded by the training, oversightand general “tweaking” that comeswith rebuilding an entire operationalprocess. It all adds up quickly.
It’s not only TRID, however, drivingcosts upward these days. The renewedemphasis on lender liability stirred bythe Consumer Financial ProtectionBureau’s April 2012 bulletin (a lenderwill be held accountable for the mis-deeds, actions or inaction of its serviceproviders) has compelled lenders toramp up their vendor vetting andoversight procedures. We see morerequirements, more constraints andmore audits than ever before. For thelender, risk mitigation is essentially atthe core of almost any business deci-sion made today.
One final impetus to increased titleand settlement costs is the secondarymarket and investor as well. The mort-gage industry experienced a tidal waveof buyback demands in the aftermathof the financial crisis. Investors andthe GSEs have since instituted stricterrequirements for each mortgage afirm hopes to securitize. The signifi-cant increase in the complexity of clos-ing instructions bears witness to the
impact of these changes on the settle-ment services firm.
The multiple forces driving “backend” costs up is diverse enough tosupport a fairly simple conclusion: It’snot going to be getting any less expen-sive to run a settlement services firmany time soon.
Can a title company still make a profit? Nonetheless, talk of the death of thetraditional “mom and pop” titleagency is premature. Will it be hard-er to generate substantial profit for atitle company? Absolutely. But itmost certainly can be done.Settlement services firms will survivethe landscape change we are experi-encing, but the successful businesseswill be the ones that take an entire-ly fresh perspective on the businessmodel. It’s never been fun or popu-lar to spend time scrutinizing one’scosts. But it will be absolutely neces-sary for the title or settlement firmthat wishes to maintain a profit.
The title industry is unique inthat the agent typically bears thecosts to produce a title insurancepolicy before the transaction evencloses. There isn’t a title agent inAmerica who hasn’t incurred sub-stantial expenses on a transactionthat falls through, only to grit his orher teeth at the latest sunken cost.Maybe it’s time for title companiesto reconsider how much financialrisk they’re willing to take on beforea mortgage closes. This does notmean that title agents should riseup and demand that their clientsbear those costs—it simply won’thappen. What it does mean is thatour industry needs to revisit previ-ous barriers, requirements and con-straints with a fresh perspective.Perhaps more elements of settle-ment should be outsourced, provid-ing more flexible options to theagent incurring the cost. Many firmsare coming together in strategicpartnerships or alliances, poolingresources to offer greater capacity totheir clients, while eliminating inef-ficiencies and redundancies in what
“Compliance costs, increased requirements from lendersand their investors, and a changing market all mean that asettlement services firm must pay attention to its margins—which means ensuring the most efficient operationpossible.” – Michael P. Bell
Making the Case for the Modern Title Agent
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“… talk of the death of the traditional “mom and pop”title agency is premature.” – Elliot Liss
is an otherwise extremely segmentedprocess.
It is time for more settlement serv-ices firms to consider how they usetheir assets and resources as well. It’spretty standard for such companiesto reduce staff when order countsdrop. But how productive and effec-tive is your staffing plan? Does yourbusiness run more efficiently withversatile employees? More special-ists? More contractors or consultants?There is a tremendous number ofhidden costs within the way wedeploy our human resources.
It’s not just human resources weneed to scrutinize. Just because one
has the latest technology doesn’tmean that firm has automaticallymaximized its efficiency. Owners andexecutives really need to determine ifthey are getting the most out of theirtechnologies and systems; if they arethe right fit for the market and busi-ness model; and if they are deployingthem in the most effective way possi-ble. Are you creating chokepoints inyour workflow to accommodate afancy new production technology? Isthe best-in-class system in whichyou’ve just invested so foreign to yourstaff that it will take extensive trainingand management (all at a cost) to getthem up to speed and comfortable
using the tools they’ll need to get thejob done? There are hundreds, if notthousands, of qualified consultants inour industry who can bring about a verysubstantial return-on-investment fromyour systems if you make use of them.
It is important that the mortgageand title industry remember thatchange brings an opportunity toimprove. Simply doing things “the waythey’ve always been done” could easilybe a recipe for failure in light of thedramatic transformation we’re seeingin the mortgage transaction. It will bethose businesses willing and able tothink creatively; evaluate their busi-nesses honestly and move aggressively
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to adapt that will be the ones to enjoysuccess.
Michael P. Bell is an avid Web designer andis primarily responsible for the design andimplementation of Closeline’s proprietaryWeb-based software platform. All of Bell’sdesigns are structured to foster Closeline’sNational Closing and Escrow Platform. Healso directed the design and implementationof Closeline’s proprietary Web-based soft-ware platform. Elliot M. Liss is a principalwith Closeline Settlements As a foundingprincipal of the firm in 1993, Liss began histitle career servicing bank and non-banklenders in connection with their nationwideand regional lending platforms.
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By Wes Miller
“The essential thing is not knowledge,but character.”—Joseph Le ConteIt goes without saying that data is impor-tant in determining a borrower’s abilityto repay. W-2’s, paycheck stubs, applica-tion information, etc., are all essentialpieces of information when puttingtogether a mortgage loan.
Yet these pieces of paper are justindividual, incomplete snapshots of theapplicant’s overall character. While theyare hard facts, they can be misleadingwhen gathered without sufficient back-ground information on the person.
A community lender has access tomore than just data on the loan appli-cant—they have a strong foundation of
information built on years of knowingthat person. Done appropriately, a judg-ment-based loan takes into considera-tion the borrower’s complete profile. Inmany cases the lender knows the appli-cant’s family, history, spending habits,special circumstances, etc., which maynot tick all the boxes and look perfect onpaper, but can nonetheless be a goodrisk. Such judgment-based loans are acrucial service to local communities.
On the other hand, just because aloan looks good on paper doesn’t meanan applicant should automaticallyqualify. As one of my mentors used tosay, “100 percent of foreclosures werequalified on paper.” A good lendershouldn’t approve a loan just becausean automated underwriting engine saysits eligible.
The industry, however, has transi-tioned away from judgment-based lend-ing into rule-based lending. Regulations,as a result of the last financial crisis, arepushing lending toward a heavilydependent data driven model. The qual-ified mortgage (QM) rule was difficult forcommunity lenders, as it narrowed theirability to lend to those outside theprime “sphere.”
Compliance, in general, is difficultand expensive. However, lack of compli-ance is even more costly. Many commu-nity lenders have either gotten out ofthe mortgage business or have stoppedoriginating non-GSE mortgage loans.This has introduced a vacuum that port-folio lending used to address.
The TILA-RESPA Integrated DisclosureRule (TRID), effective Oct. 3, adds addi-tional complexities with changes intechnology, forms and processes. Suchhigh standards come with an equallyhigh price tag that many small lenders
are legitimately worried they will not beable to pay.
TRID is designed to protect the con-sumer, and is admittedly necessary, asmany financial institutions continue tolag behind the technology landscape ofthe 21st Century. Accommodating TRIDcan be done with technology that cre-ates efficiencies, collaboration andtransparency.
Upgrading technology can be anopportunity for community lenders.Compliance and judgment based lend-ing do not need to be opposing forces.Using proper technology can provide theright balance of qualified data and inthe hands of a local knowledgeableexpert, allow local lenders to continue toserve their communities.
If community lenders are largelypushed out of the mortgage scene, theindustry will lose a crucial skill that theseprofessionals bring to the closing table:That of carefully cultivated, judgment-based lending practices.
We’ve relied, as a nation, on locallenders making loans that help peopleachieve the American dream of home-ownership. That type of loan is now injeopardy. There should be judgment inlending, and community lenders haveserviced that role very well since thebeginning of banking.
It would be a shame if communitylenders were pushed out of the mort-gage sphere.
Wes Miller is the CEO and co-founder ofATS Secured, a new technology categoryfor the real estate closing industry. He hasextensive experience in developing andmarketing both core and ancillary finan-cial products. He may be reached by e-mail at [email protected].
“A good lender shouldn’t approve a loan just because anautomated underwriting engine says its eligible.”
Community Lenders Are Essential to the Future of Mortgage Banking
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calendar of eventsN A T I O N A L M O R T G A G E P R O F E S S I O N A L
see page 93
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They'll never be caught. They're on a mission
from God. from God. They're on a mission
They'll never be caught.
from God. They're on a mission
They'll never be caught.
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Industry Updates: October 2015
SPONSORED ED ITORIAL
By Gavin T. Ales
FHA Single-Family Handbook Changes, Effective Sept. 14,2015On Sept. 30, 2014, the U.S. Department of Housing & UrbanDevelopment (HUD) published the FHA’s new Single-Family
Handbook 4000.1. The Handbook consolidates (and supersedes) many ofthe existing HUD Handbooks, Housing Notices, Single-Family HousingMortgagee Letters and other documents to provide a single, comprehen-sive reference guide to all lenders that offer FHA/HUD -related single fam-ily mortgage products.
An updated Section 6(b) of the Handbook requires that the mortgagee“develop or obtain a separate Mortgage and Note that conforms generallyto the Freddie Mac and Fannie Mae forms in both form and content, butthat includes the specific modification required by FHA set forth in theapplicable Model Note and Mortgage,” and complies “with all applicablestate and local requirements for creating a recordable and enforceableMortgage, and an enforceable Note.”
An updated Mortgage and Note are effective for all FHA Case Numbersassigned on or after Sept. 14, 2015.
FHA lenders should make sure to Accordingly, DocMagic Inc.’s Compli-ance Department has created updated their FHA Security Instruments andNotes to comply with the Model forms as well as the any instructions thatFHA has issued for preparing same. These updated documents should beincluded will return in all closing loan packages that have an FHA CaseNumber Assigned Date of Sept. 14, 2015 or after.
Updated Form: Georgia Security InstrumentsEffective July 1, 2015, Georgia House Bill 322 (HB 322) amended, amongother matters, a number of statutes under Title 44 of the Official Code ofGeorgia Annotated related to witnessing requirements for deeds, mort-gages and bills of sale.
Pursuant to the amendments under HB 322, a security instrument(mortgage) that is secured by real property in the State of Georgia is nolonger permitted to be acknowledged. Instead, Georgia Code Ann. § 44-14-33, 44-14-34 and 44-14-61 each requires an officer described in GeorgiaCode Ann. § 44-2-15, which includes a notary public, to attest or witnessthe mortgagor (borrower) signing the security instrument. Note that a sec-ond (unofficial) witness must also attest to the borrower’s execution of themortgage.
Accordingly, lenders originating mortgage loans in Georgia should en-sure that their Georgia security instruments meet the new document recor-dation requirements under HB 322.
CFPB Releases New Tools for the Know Before You Owe MortgageInitiativeOn Sept. 17, 2015, the CFPB released new online tools as part of its “KnowBefore You Owe” initiative. These new online tools are additions to theCFPB’s “Owning a Home” interactive toolkit aimed at helping consumersnavigate the mortgage process. The CFPB added new tools, including aguide to the mortgage milestone, a monthly payment worksheet, and aninteractive sample of the new Know Before You Owe mortgage forms.These forms are available to everyone for free and are encouraged by theCFPB to be used by consumers, real estate professionals and mortgageprofessionals. Click on this link to access these resources at ConsumerFi-nance.gov/Know-Before-You-Owe.
If you have any questions regarding the contents of this article, pleasecontact DocMagic’s Compliance Department.
Gavin T. Ales is chief compliance officer with Torrance, Calif.-based DocMagicInc. He may be reached by phone at (800) 649-1362, ext. 6446 or [email protected].
�
By Richard M. Bettencourt Jr., CRMS, CMHS
Please, Don’t be a Pest! Happy October everyone! I hope you all have a ghoulish good time!Before we get into this month’s VA SITREP article, I have to ask: Howmany of my readers are hanging with us at the Luxor in Vegas for NAMB
National 2015? If you said YES, I’ll be there … that’s awesome! I cannot thank youenough for taking the time out of your busy schedule to support your industry and yourpeers! I hope you have a great time … I know I will! Let’s chat VA!
Alright, be honest, how many of us on a VA purchase transaction have heard someof the statements below:l From the buyer’s agent: “The seller is not going to be happy with having to pay the
pest inspection!”l From a sellers agent: “The seller is not going to pay for the pest inspection.” l From an underwriter: “Evidence … veteran didn’t pay for the pest inspection.”
Okay … I’m going to let you all in on a little secret! The VA issued a Circular back inMay of 2014 that moved the Pest Inspection into the Non-Allowable Category. Want acopy of the Circular? I’ll put a link up in the Members Section of the NAMB Web site!What does non-allowable mean? How can that benefit the veteran? Well, for my VArookies, there are three categories of expenses in a VA transaction: Allowable, Non-Allowable, and Never to be Paid by the Veteran. Without taking 1,000 words to explaineach category in detail, let’s just focus on the pest inspection fee!
Simply put, veterans can pay for those fees listed in the Non-Allowable category toan amount equal to one percent of the base loan amount. Now, if you have a one per-cent origination fee listed on your New Loan Estimate Form (TRID) and are trying tocharge some of those Non-Allowable fees, you’ll most likely get a notice from your com-pliance department that those fees cannot be charged and you exceeded the one per-cent tolerance! Guess who’ll eat that cost? You! So, it’s important to consider this whenoriginating VA home loans in your particular market. Here in Massachusetts, I nevercharge a one percent origination fee to veterans. Actually, on most of my VA transac-tions, the veterans’ only out-of-pocket costs are the home inspection and the pestinspection! A majority of my VA loans possess a combination of lender and seller cred-its, making the VA loan one of the least expensive options for financing.
I’m sure you are asking, “How does this benefit the veteran?” Well, it’s quite simple!The VA has done a significant amount of work in ascertaining what could be done tomake the VA process easier and help remove seller barriers to increase veteran partici-pation. One of those solutions was to allow the veteran to pay for certain minor expens-es, like pest inspections. Contact your VA Regional Loan Center and ask them about theState Deviation List. This List will identify a variety of fees that have been re-categorizedand could be help you and your veteran on their VA home loan.
Most of the veterans the VA surveyed and every single veteran client I have workedwith in 13 years would never had a problem paying for a $125 or $150 pest inspectionfee. They just wanted to move into their new home! Now, if treatment was required, Iwould suggest you check with your VA Regional Loan Center to see if they’ll allow vet-eran-paid treatments on a case-by-case basis.
So, what do I take away from this and how can this little piece of information changethe way you assist those who did more for us than we could ever imagine? If you arenot using or working for a lender with fully-delegated VA underwriting authority, it’stime to switch! A wholesale lender or non-depository with VA underwriting authorityhas the best chance of following the VA Pamphlet as written, and believe me, that willmake your life a lot easier! We’re still seeing many lenders with overlays that limit someof the amazing benefits the VA has created for our veterans.
As an industry, we need to remove as many barriers as possible to assist in increas-ing our veterans’ opportunity at making the dream of homeownership a reality! We oweit to them!
Until next time, and if you haven’t already, please take a minute today to thank aveteran!
Richard M. Bettencourt Jr., CRMS, CMHS of Danvers, Mass.-based Mortgage Network is sec-retary of NAMB—The Association of Mortgage Professionals. He may be reached by phoneat (978) 304-0818 or e-mail [email protected].
OperationVA SITREP
“Your VA S i tuat ion Report”
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My name is Fowler Williams, and I am president ofCrescent Mortgage in Atlanta, Ga. … I’m honored toserve as chairman of the Mortgage Action Alliance(MAA). We are a voluntary, non-partisan and free
nationwide grassroots lobbying network of real estate financeindustry professionals, affiliated with the Mortgage Bankers
Association (MBA). MAA is dedicated to strengthening the industry’s voice andlobbying power in Washington, D.C. and state capitals across America.
The policies and legislation the industry faces impact our day-to-day jobsin tangible ways. We have a right to join that conversation. We have a dutyto speak up on behalf of our industry and the homebuyers whom we serve.
As a representative of an industry that employs hundreds of thousands ofAmericans, you cannot sit idly by while decisions are made that affect us all.You have a choice—watch it happen and accept what may come, or be anactive participant.
This has been a productive year for MAA and its members. We haveweighed in on several pieces of legislation, including efforts by some inCongress to effectively tax homebuying in order to pay for governmentexpenditures unrelated to housing.
Many of you are likely reading this from the MBA’s Annual Convention andExpo in San Diego, Calif. If you are, please join us for a reception on Monday,Oct. 19 from 5:30 p.m.-7:00 p.m. at South Pool Terrace on Level 1 of theMarriott, co-hosted by MORPAC. This event is for current active MAA andMORPAC members only—but you will be able to sign up or renew your MAAmembership at the door!
Getting involved with MAA allows industry professionals to play an activerole in how laws and regulations that affect the industry and consumers arecreated and carried out by lobbying and building relationships with policy-makers. It only takes a moment to get started, and you do not have to be amember of the MBA to enroll. The larger the group, the louder the voice!
If you would like to run an MAA campaign, please contact Peter Shapiro at(202) 557-2933 or e-mail [email protected] to receive an enrollment cam-paign kit and learn more about how you can engage your colleagues andemployees in MBA’s advocacy programs.
Real estate finance industry professionals who wish to join or learn moreabout MAA can do so at MortgageActionAlliance.org. If you have any ques-tions regarding MBA’s advocacy programs, please contact MBA Director ofPolitical Affairs Annie Gawkowski by phone at (202) 557-2816 or [email protected].
Fowler Williams is chairman of the Mortgage Bankers Association’s MortgageAction Alliance. He is also president of Atlanta, Ga.-based Crescent Mortgage.He may be reached by phone at (800) 851-0263 or e-mail [email protected].
MBA’sMortgageActionAlliance
A Message From MAA Chairman Fowler Williams
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SPONSORED ED ITORIAL
By Andrew Liput
Wells Fargo Bank and the Federal Bureau of Investigation(FBI) recently issued separate alerts throughout the industryregarding settlement agent wire fraud. The reports, circu-lated in September, provided details of a widespread scam
whereby criminals are hacking attorney and title agent e-mail addressesand changing wire instructions prior to closing. When the new instructionsare not validated the criminals make off with the mortgage proceeds.
While most lenders request written wiring instructions, whether to sat-isfy warehouse bank requirements or their own internal risk managementpolicies, very few verify them. The assumption is made that if the instruc-tions are being sent from the e-mail address of an attorney or title com-pany then they must be valid. Some lenders are taking an extra step andchecking the ABA routing number and bank account number with theFederal Reserve Web site to verify that the account is actually at the bankindicated. However, these processes are not a foolproof method to avoidthe type of fraud warned of by federal law enforcement.
The most efficient way to protect your bank from wire fraud throughthis latest criminal scheme is to only wire funds to a verified account. Ver-ifying an account means more than simply checking the Federal Reserverecords. It requires true verification, at the source, that:
A) The account is truly a trust account and not a business or personalaccount;
B) The account holder and authorized signers match the company own-ers; and
C) The account is in good standing and not fraught with bounced checksor fraud alerts.
Once the account is directly verified, then a bank should never wirefunds to any other trust account associated with that settlement profes-sional. In the event an account is changed (which does occur occasionally)then the new account must be verified prior to be used in conjunctionwith a closing.
At Secure Insight we have always prided ourselves in building some-thing more than a “check the box” risk management platform. Built withthe input of risk experts at Lloyds, the Secure Insight platform has alwaysincluded a direct at the source trust account verification and ongoingmonitoring component. We are proud to say that none of our bank clientswould ever wire funds for any reason to an account that has not been in-dependently verified by our analysts. Perhaps this is one reason why afterfour years, the vetting of more than 25,000 settlement agents nationwide,and more than 750,000 closed transactions, not one of our clients hasever experienced a loss from escrow and settlement fraud.
Whether you choose to hire a firm such as ours to manage the risk, oryou are committed to building, developing and managing your ownprocess, one thing is certain. You should never wire mortgage proceedsto an account that has not been truly vetted and verified. In addition, anylast minute requests to change wiring instructions should cause an im-mediate red flag alert, and a closing delayed until the change can be de-termined to be legitimate.
Andrew Liput is CEO of Secure Insight, a risk analytics firm offering vendormanagement services addressing settlement agent risk. He can be reachedby e-mail at [email protected].
FBI Fraud Alert Raises Concerns Over Settlement Agent
Wiring Instructions
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economic commentaryN A T I O N A L M O R T G A G E P R O F E S S I O N A L M A G A Z I N E ’ S
L I S T E N I N G T O T H EF E D ’ S W O R D SBy Dave Hershman
Forget about what the Federal Reserve Board did not do fora minute. Let’s talk about what they said. With the Fed, it isusually more likely that their words will be more importantthan their actions, or lack of action. This has been a very
turbulent end of the summer for the markets. Above all, the Fed is interested inrestoring calm and especially making sure that their actions do not add to theinstability of the markets. And we certainly have had some unstable marketsduring the past several weeks.
This is exactly why we were expecting “calming words” from the Fed whenthey made their announcement. Did we get these words? Absolutely. The Fedsaid that “recent global economic and financial developments may restrain eco-nomic activity somewhat.” Two things are important about this statement. First,it is softened by using the word “somewhat,” meaning the Fed does not see a riskof a worldwide economic meltdown. Secondly, the Fed used the words “inter-national or global” more than once. The international issues broaden the scopeof the Fed’s focus from just looking at our jobs or inflation numbers.
Bottom line is that the Fed did not raise rates, though they did leave thatoption open for their last two meetings of the year in October and December.That is good news for the markets and the consumer. The stock market hasalready been under pressure lately and it did not need the extra pressure of arate hike. And rates on home loans are likely to stay low in light of the Fed’s deci-sion. We can’t think of better news for the consumer right now.
What was the immediate reaction? With stocks, there were two possibleimmediate reactions to the Fed’s decision not to raise rates. First, relief thathigher rates are not coming and a positive stock market reaction. It looks asthough stocks went to door number two—worrying about what the Fed is wor-ried about, namely slower economies overseas. This is one factor which helpedtrigger the correction which started this summer and the Fed has solidified themarkets’ concerns in that regard.
With regard to rates, if the stock market was reacting negatively to the move,there was no reason for mortgage rates to rise. Indeed, in the first week rates didease. However, one must remember that one week of reaction does not give thefull picture. By the time you read this article, there will be another jobs reportreleased and another meeting of the Federal Reserve Board on the way. It couldbe a turbulent October …
Dave Hershman is a top author in the mortgage industry with seven books pub-lished. He is also the founder of the OriginationPro Marketing System, and cur-rently the director of branch support for McLean Mortgage. He may be reached bye-mail at [email protected] or visit OriginationPro.com.
are
NMP Media Corp.1220 Wantagh Avenue
Wantagh, New York 11793-2202p 516.409.5555f 516.409.4600
e [email protected] www.NationalMortgageProfessional.com
We are seeking nominations from our readers for National MortgageProfessional Magazine's "40 Under 40" feature, slated to appear inour December 2015 edition. Anyone who is under the age of 40 and hashad a major impact on the industry can qualify for this feature. This couldbe through innovation, association participation, sales force automation,community activism, management techniques, technology or any othersignificant method that has influenced our industry. We would need a short,three-line bio on the nominee, along with a color photo and companycontact info to complete the profile. To nominate yourself or someoneelse, visit https://nmpmag.wufoo.com/forms/nmps-40-under-40-2015/.
youcoming in december 2015
?nominated
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Help get potential buyers off the fence.
© 2015 Radian Guaranty Inc. MortgageAssure is a registered service mark of Radian Group Inc. All information contained herein is subject to change without notice.
Want more materials to help encourage more potential homebuyers? Download our infographic series today at www.radian.biz/homebuyer
The uncertain job environment and struggle to save a 20% downpayment have kept potential buyers on the sidelines, but you can get them in the market...
with Radian’s MortgageAssureSM program – job loss protection included on all Radian-insured 97% LTV loans, at no cost.
With 3% down and more confidence in their financial stability, potential buyers have more reason to make the dream of homeownership a reality now!
www.radian.biz | 877.723.4261
The uncertain job environment and struggle to save a 20% downpayment have kept
The uncertain job environment and struggle to save a 20% downpayment have kept
The uncertain job environment and struggle to save a 20% downpayment have kept
The uncertain job environment and struggle to save a 20% downpayment have kept
The uncertain job environment and struggle to save a 20% downpayment have kept
The uncertain job environment and struggle to save a 20% downpayment have kept
The uncertain job environment and struggle to save a 20% downpayment have keptpotential buyers on the sidelines, but you can get them in the market...
with Radian’s MortgageAssurejob loss protection included on all Radian-insured 97% LTV loans, at no cost.
The uncertain job environment and struggle to save a 20% downpayment have keptpotential buyers on the sidelines, but you can get them in the market...
with Radian’s MortgageAssurejob loss protection included on all Radian-insured 97% LTV loans, at no cost.
The uncertain job environment and struggle to save a 20% downpayment have keptpotential buyers on the sidelines, but you can get them in the market...
with Radian’s MortgageAssurejob loss protection included on all Radian-insured 97% LTV loans, at no cost.
The uncertain job environment and struggle to save a 20% downpayment have keptpotential buyers on the sidelines, but you can get them in the market...
with Radian’s MortgageAssure M prSM
job loss protection included on all Radian-insured 97% LTV loans, at no cost.
The uncertain job environment and struggle to save a 20% downpayment have keptpotential buyers on the sidelines, but you can get them in the market...
program –job loss protection included on all Radian-insured 97% LTV loans, at no cost.
The uncertain job environment and struggle to save a 20% downpayment have kept
job loss protection included on all Radian-insured 97% LTV loans, at no cost.
Want more materials to help encourage more potential homebuyers?
With 3% down and more confidence in their financial stability, potential buyers havemore reason to make the dream of homeownership a reality now!
Want more materials to help encourage more potential homebuyers?
With 3% down and more confidence in their financial stability, potential buyers havemore reason to make the dream of homeownership a reality now!
Want more materials to help encourage more potential homebuyers?
With 3% down and more confidence in their financial stability, potential buyers havemore reason to make the dream of homeownership a reality now!
Want more materials to help encourage more potential homebuyers?
With 3% down and more confidence in their financial stability, potential buyers havemore reason to make the dream of homeownership a reality now!
Want more materials to help encourage more potential homebuyers?
With 3% down and more confidence in their financial stability, potential buyers havemore reason to make the dream of homeownership a reality now!
With 3% down and more confidence in their financial stability, potential buyers have
© 2015 Radian Gu
Download our infographic series today at www.radian.biz/homebuyer
www.radian.biz
re is a registered service mark of Radian Group Inc.aranty Inc. MortgageAssu© 2015 Radian Gu
Download our infographic series today at www.radian.biz/homebuyer
www.radian.biz 877.723.4261|
re is a registered service mark of Radian Group Inc.
Want more materials to help encourage more potential homebuyers?Download our infographic series today at www.radian.biz/homebuyer
877.723.4261
Want more materials to help encourage more potential homebuyers?Download our infographic series today at www.radian.biz/homebuyer
Want more materials to help encourage more potential homebuyers?Download our infographic series today at www.radian.biz/homebuyer
© 2015 Radian GuAll information contained herein is su
re is a registered service mark of Radian Group Inc.aranty Inc. MortgageAssu© 2015 Radian Gu
bject to change without notice.All information contained herein is su
re is a registered service mark of Radian Group Inc.
bject to change without notice.
re is a registered service mark of Radian Group Inc.
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By Andy W. Harris, CRMS
Last month, I got a mixed response on the independencequestion. I said that I believe the mortgage loan originator(MLO) should be the most independently informed profes-sional involved in the mortgage process. I heard from some
originators that they rely more on their employer’s operations team orunderwriters to stay informed on regulations and guidelines due to beingtied up in sales. I also heard from others that said they seek their own edu-cation and influences in order to counter any potential inaccuracies, or toshare an educated difference of opinion should their employer, lender orunderwriter potentially make an error on interpretation.
Partnering with the most experienced team in any lending channel isvital, but without self-education and non-bias interpretation, it can geta little messy. Special interests are dominant in our industry and weneed to be aware of it. That is where independence is key to best serveyour clients and you must take time for self-education. I think it’s goodthat we all challenge ourselves to learn something new about this busi-ness every day. If we do that for a month, think just how much we cangain and how much we can better serve our clients with this knowledge.In addition, I am certain you would attract more business also over timestanding out amongst your peers.
With that said, thank you for sharing and continue to do so. I want toshare your stories in this column, so let me make it easy on you. Sendme the best and worst stories you have about an interaction with a realestate agent in recent months for the November edition … somethingthat might be unbelievable, funny or makes a great story. I know you’realready thinking of one, so please share your thoughts for additionalcomments and discussion!
Are you an originator? Send your stories! To have topics considered infuture editions, please e-mail me with “OrigiNation” in the Subject Line [email protected]. These can be confidential or yourname and company can be referenced if you wish.
Andy W. Harris, CRMS is president and owner of Lake Oswego, Ore.-basedVantage Mortgage Group Inc. and 2010-2011 president of the OregonAssociation of Mortgage Professionals. He may be reached by phone at (877)496-0431, e-mail [email protected] or visit www.van-tagemortgagegroup.com.
By Originators, For Originators
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heard on the streetcontinued from page 46
to retrieve the recording status of amortgage including the underlyingdata. All of this flows into documenta-tion by state, investor, loan pool, aswell as correspondent lender and/ortitle agent.
Texas Capital BankAnnounces Launch of CorrespondentLending Program
Texas Capital Bank has launched a cor-respondent lending program (MortgageCorrespondent Aggregation) to comple-ment its successful, multi-billion-dollarwarehouse lending program, furtherexpanding its legacy in the industry.The new division expects to hire 100mortgage professionals in Richardson,Texas during the next year.
“We have experienced exceptionalgrowth in our warehouse lending pro-gram as a result of our unmatchedexpertise, superior customer service,customized technology and a commit-ment to exemplary quality,” said GaryOrt, president of Texas Capital Bank’sMortgage Finance Division. “We saw anopportunity to leverage these assets—and our track record in the industry—to address a significant gap in the cor-respondent aggregation market. Wedesigned a program from the groundup with the specialized needs of today’smortgage bankers and financial institu-tions in mind.”
The new correspondent lending pro-gram will introduce a new way formortgage originators to work with theirtake-out investor. Texas Capital Bank isleveraging new technology to bringenhanced due diligence to the loanreview process with the goal of reduc-ing the risk of repurchase demands,while improving visibility into theprocess and reducing purchase times.
“The origination sector needs inno-vative solutions that address the ongo-ing challenges of the mortgage indus-try,” said Jack Nunnery, executive vicepresident of correspondent lending.“We have invested heavily in a new par-adigm that will better facilitate loanpurchasing, while enhancing the prof-itability of our sellers.”
One of the most unique aspects ofthe bank’s new service line is the use ofnew technology developed specificallyfor the aggregation space. Texas CapitalBank joined forces with a technologypartner to develop a new correspon-dent platform which will be known toTexas Capital Bank correspondent sell-ers as Correspondent Hub. TexasCapital Bank is the first financial insti-tution to integrate this technology,which launched in July and optimizesthe interaction between correspondentsellers and investors.
“Correspondent Hub will provideunparalleled functionality and access
to all of the services they require—fromcorrespondent application workflowand approval processes, to pricing andmanagement of transactions, throughloan funding and servicing—all in one,integrated, high-performing platform,”said Nunnery.
Mortgage Professional to Watchl With the imminent retirement of
current CFO, Thomas Marvaso,McLean Mortgage Corporation hasannounced that it has hired industryveteran Greg Crocker as chief finan-
cial officer of the company. ScottCohen has also joined MortgageNetwork as a loan officer in the com-pany’s Waltham, Mass. branch office.
l With more than two decades of salesleadership experience in the mort-gage industry, Kelly Taylor, formersenior vice president of sales forStreetLinks, will lead the newly inte-grated sales and account manage-ment functions for AssurantMortgage Solutions.
l Dallas-based residential mortgageoriginator PrimeLending, aPlainsCapital company, hasannounced the addition of StacyWilliams as a senior loan officer atthe PrimeLending office located inChandler, Ariz.
l ReverseVision has announced it hasbrought experienced mortgage pro-fessional and technology salesstrategist Matthew Shaffer on boardas business development manager.
l LRES has named Jeanee Chapman asits new client relations manager,reporting to the director of clientrelations.
l GSF Mortgage has added JerichoCherry as mortgage loan originatorin Sandy Hook, Va., joining GSF with17 years of mortgage industry expe-rience. GSF has also announced theaddition of David Rae as westernregional sales manager in SanDiego, Calif.
continued on page 86
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Knowledge is power. Power trans-lates to success, whether it is dol-lars in your pocket, stronger lead-ership, increased bottom lines or
peace of mind, we are here for you.This month, we are introducing a new
column for questions relating to starting abusiness, managing a business, training, net-working, tax-related issues, corporate securi-ty policy, fraud alerts and compliance. Allanswers are for informational purpose only,and are not intended to practice law, or aremeant to provide tax advice or tax opinions.After reviewing our information, we bothrecommend seeking legal counsel or theadvice of a tax professional. Please e-mail usat [email protected] to voice
any questions or problems. We are here foryou!
Stop! Before you read this, look in thismonth’s magazine for Eric’s other column,“Can You Help a Brother Out?” on page 63.Read that first. This column will makemore sense if you do it in order.
Sean in Ronkonkoma, N.Y.asks …Thank you for the quick response! Iordered the Zig Zigler book. I have been asponge and absorbing all that I can thelast year in all the areas of operations. I’vebeen learning and memorizing all of thedifferent types of loans and their ratios,especially while I was studying for tests.
Also, I have been talking to the otherloan officers about their loans and someof the problems they are having. You canpublish any of the questions I have astime goes on that will be great for helpinganyone else learning the business. Youcan even use my name it’s not really a bigdeal to me.
I do promise one day that I will helpthe next 23-year-old because everyoneneeds someone to mentor them and helpthem along the way and guide them inthe right direction. I really appreciate youreaching out to me so quickly.
The main problem I have been havingis actually getting a chance at doing some-one’s loan and gaining their trust. I have
been networking the last few months,going to Realtors’ open houses and mak-ing them flyers, and keeping in touchwith them.
It seems like some of the real estateagents have been giving out my cards,but some of them have marketing agree-ments and such. I do have a shot, but Ihaven’t really gotten a referral yet.
I have also been trying to go to differ-ent networking events. I just recently jointhe local board of realtors as an affiliatemember last week and went to a meetinga few weeks before that. I plan on joiningthe women’s council of realtors and theYoung Professionals Network as well. Ihave just joined a charity networking
ByEric Weinstein & Laura Burke
Just Ask
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also seems like you also have answeredmany of your own questions, or Eric hasdone that in a previous conversation withyou.
When I started in the business, no onewould hire me because all they wantedwas an experienced loan officer. I was areal estate agent who decided I liked thefinance side better. It took me months,but I finally got into a small bank thatnever had a loan officer before, so basi-cally I told them what a loan officerwould do for them. They loved the idea,and they used to say I was out hawkingloans for them!
I had a very small base salary, pluscommission, but hey, it was a bank with agreat office and my foot was in the door.They didn’t ever have the best rates, oreven that many products to offer, butwhat they did have was a weekly meetingof four or five top level executives, andmy boss who met to underwrite theloans. So my niche was simple, I haddirect access to the underwriters and Icould often participate in their weeklyapproval meetings. We obviously did not
k Eric & Lauragroup of about 25 professionals who meetevery other Friday for breakfast.
Another thing I’m joining is theChamber of Commerce in the village I livein (they don’t have a mortgage person inthe Chamber). In the meantime, one ofmy father’s friends is a developer in townand he has a new development that he isjust completing and is giving me a shot atthe mortgage loans along with this creditunion I’m competing with.
The first loan he gave me, I lost out tothe credit union that offered a five percentdown conventional 7/1 ARM which wecannot do with guidelines. I offered her agreat fixed rate FHA loan and a 5/1 ARMthat had a better rate because she makesa lot of money, but didn’t have any saved(she’s younger and it’s also a high-cost FHAloan). I kept trying to convince her to gowith the fixed-rate that was about a halfpoint more than the ARM since rates arestill at historic lows, but she decided to gowith the credit union. I was speaking withher and answering all of her questions fora little over a month and lost the loan.
The developer is giving me three moreloans this week, and hopefully, I can makeall of them work and outbid the opposingcredit union. My manager sits down withme just about once a week and we go overwhat I’m doing and he gives me stuff todo.
Right now, I’m trying to get my sphere ofinfluence of my top 20 referral sources thatI will be going after and be in contact withevery week. I read the article you sent meabout how you got started and how youstarted up your company and I thought itwas a great idea. I also like how you didn’ttake all the money for yourself and tookcare of your co-workers and treated themlike friends and family. Greed seems to be alot of people’s downfall.
The bullet points at the end about notgetting mad and angry at your underwrit-ers and processors: I will keep in mindespecially because I have been on theirend already as well. I do really appreciateyou reaching out and contacting me Eric Iknow, I’m really young in the industry andI can tell that just from networking andbeing around everyone in my industry butI’m hungry and want to really get my busi-ness started. If you have any other adviceyou can give me or anything else you thinkI should be doing please let me know.
I have been taking everything one stepat a time, and I have a fantastic operationsteam and management supporting me. Ireally do believe what you said if you’re agood person happiness and wealth willfollow and I have been following that mywhole entire life. Hope to continue speak-ing with you and learning from you.
Eric’s reply to Sean …One of the hardest things when you arefirst starting out is getting business (it’s not
all that easy when you get going, in fact).It sounds like you are doing all the rightthings … seeing real estate agents, farm-ing your sphere of influence and net-working. Unfortunately, sometimes it canfeel like you are taking a shower under aslow drip faucet. You need business andyou need it now to pay the bills. I canassociate with that. I think most peopledon’t make it as a loan officer because inthe first year you starve. All I can tell youis what I did. It worked for me, maybe itwill work for you.
Make about 1,000 flyers, drive aroundand put them in people’s mailboxesaround your neighborhood. Okay, by fed-eral law, they cannot touch the mailbox,but many mailboxes have a small cubbyfor newspapers and the like. Say some-thing like, “I am a loan officer who lives inyour neighborhood. If you are interestedin buying or refinancing, give me a call.”This builds an instant trust with your tar-get market. They know you are a neigh-bor and they can throw rocks at your win-dow if you do a bad job. The biggestdilemma in advertising is building trust atfirst glance. These are people that are giv-ing you very personal information thatthey wouldn’t trust to a computer hacker.You want them to know you are local andyou are a friend.
One of the best ways to get in goodwith a real estate agent is to put money intheir pocket. No, I don’t mean a flagrantviolation of RESPA bribery law, I mean,things like:l Go jointly on advertising. This cuts
their advertising outlay in half. As longas you are mentioned equally in thead, no violation.
l Refer new customers to the real estateagent. A new deal is money in theirpocket. By nature, they will feel theneed to reciprocate.
l Do an especially hard deal that otherloan officers in their office havealready turned down. I would adver-tise, “Give me all of your turned downbuyers.” If I could do it, they wouldlove me forever and eventually startgiving me their good customers.
The second tip is the one of which youcompliment me. Respond to peoplequickly. If they have to wait for your call,they will start dialing the next loan officer.Jump on things right away. I do it becauseI have a horrible memory, and if I don’tdo it right away, I will forget. You areprobably much smarter and have a bettermemory than me, but it is a good habitinto which to get.
Whenever I get slow, one advantage Ihave is that I can price real low. Get thedeal no matter what it takes. This does afew things. l To make a little money is better than
making no money when you have
nothing else to do.l It gives you another satisfied cus-
tomer who which you can market, getreferrals and sing your praises onYelp!
l It boosts your confidence which helpsyou sell the next deal. Sometimes youhave to prime the pump to get thewater flowing.
This last idea is not for everyone, but Iwill throw it out to you. I once had thissame situation and asked another loanofficer his advice. This is what he said.“Pray.” I believe the Lord is infinite andopen to our prayers. Even if you asked fora million, billion things, that is nothingcompared to infinity. Personally, I havebeen known to give a small donation andask for continued business to help sup-port my family and keep doing goodthings for his creation. I can only tell you,it has worked for me. Like I said, it is notfor everybody. Business can be like war.You won’t find too many “naysayers” inthe trenches.
Laura’s reply to Sean …Sean, you have a lot of questions, but it continued on page 88
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Be Part Of Utah’s BiggestGathering Of Mortgage Pros
Each year, the Utah Association of Mortgage Professionals stages an extraordinary event, celebrating,advancing and supporting the men and women who finance residential and commercial real property.
With top speakers, great hands-on sessions and a wealth of opportunities from exhibitors andsponsors, it’s a can’t-miss day for hundreds of mortgage professionals.
The 2015 UAMP MORTGAGE EXPO provides an exceptionalopportunity to showcase your solutions, while networking withhundreds of mortgage industry leaders, brokers and lenders.And all of them are there because they want to improve theirbusiness practices – the best environment for you to show
them how you can help them succeed!
TO SPONSOR AN EXHIBIT OR EVENT PLEASE CONTACT:VINCENT VALVO at 860-922-3441 or [email protected]
FOR ATTENDEE REGISTRATION PLEASE VISIT OUR HOME PAGE: www.uampexpo.com
Join us this year on November 20, 2015, at our exciting NEW location, the Grand Summit Lodge at the Canyons Resort in Park City, Utah!
Content copyright 2015. UAMPEXPO.Com All rights reserved Event Production by Agility Resources Group LLC
heard on the streetcontinued from page 83
l RPM Mortgage Inc. has promotedSue Weaver to the role of Seattleregional sales manager.
l Fay Servicing has announced theaddition of Wanda Montgomery asthe firm’s new senior vice presidentof foreclosure operations.
l Carrington Mortgage Services LLChas announced the promotion ofTom Shaw to senior vice presidentof marketing where he will leadCarrington’s mortgage lendingoperation in all aspects of brandingprograms and deployment of mar-keting objectives to increase returnon investment in the mortgage sec-tor. The Wholesale LendingDivision of Carrington MortgageServices LLC has also announcedthe appointment of CarmenAlailima to the position of insideregional sales manager of itsWholesale West Division inHenderson, Nev.
l Castle & Cooke Mortgage LLC hasannounced the opening of a newbranch in Western Nebraska, to bemanaged by Jennifer Urdiales andserve the Western Nebraska region.Castle & Cooke has also announcedthe promotion of Jenifer Edwardsfrom licensing and compliancespecialist to national compliancemanager.
l EquityKey has announced theappointment of John Robbins, for-mer Mortgage Bankers Association(MBA) chairman and founder ofthe American ResidentialMortgage Corporation, to its advi-sory board.
l Global DMS has announced that ithas hired Mac Chiles as executive vicepresident of sales.
l Washington, D.C.-based business adviso-ry firm, The Collingwood Group hasannounced that former Freddie MacSenior Vice President of Single-FamilyBusiness Paul Mullings has joined thefirm as a managing director to supportthe firm in its Business Advisory and RiskManagement and Compliance practices.
l MCT Trading Inc. has announced that ithas hired Paul Yarbrough to managenew client on-boarding, its secondarymarketing technology, and solutiontraining.
l Catalyst Lending, headquartered inGreenwood Village, Colo. is expandingto Utah under the leadership of DebbieIsaacs, Utah regional manager.
l imortgage, a division of loanDepot LLC,has announced the promotion of DanPeña to senior vice president of nation-al joint ventures.
l Veteran mortgage professional Travis O.Smith has joined Mortgage Network Inc.as a senior loan officer in the company’sBrentwood, Tenn. branch office,responsible for serving buyers andhomeowners throughout the greaterNashville, Tenn. area. Kathy Eckhart hasalso joined Mortgage Network as a sen-ior loan officer in the company’sBrentwood, Tenn. branch office. JamieTritz has joined Mortgage Network Inc.as a loan officer in the company’s WestChester, Penn. branch office, responsi-ble for serving homebuyers and home-owners throughout the southeastPennsylvania area.
Your turnNational Mortgage Professional Magazineinvites its readers to submit any informa-tion, events, passages, promotions, personalor professional occurrences that seem appro-priate and/or other pertinent data to theattention of:
Heard on the Street/MortgageProfessionals to Watch column
Phone #: (516) 409-5555E-mail: [email protected]
Note: Submissions sent via e-mail are pre-ferred. The deadline for submissions is the1st of the month prior to the target issue.
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Together, we canreach new heights.
A National Leader in Wholesale and Correspondent Solutions
Email [email protected] or contact one of our Sales Executives:
Going up? Let’s reach new heights together.
Serve the borrower – Your customers want economic value, convenience, expediency and reliable counsel throughout the loan process. Your expertise and the NYCB platform enable you to originate and close loans faster, easier and at one of the lowest per loan costs of any loan origination channel in the industry. You are very well equipped to compete on the combined effect of dramatically lower operational costs, service responsiveness, and technological innovation.
NYCB Mortgage Banking’s core focus is developing lending solutions that enable you to win today while preparing you for even greater heights tomorrow. As the mortgage division of New York Community Bank, we’re proud to be building on the Bank’s over 150 years of strength and stability.
The NYCB model serves the needs of Correspondent Lenders, Brokers, Community Banks and Credit Unions throughout the nation. Our proprietary web platform elevates your business by offering a
Combined with a comprehensive product menu including Conventional, Jumbo, Portfolio and FHA solutions, you’ll quickly realize why NYCB has everything you need to take your business to the next level.
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Build trusted partnerships – By utilizing our Gemstone technology platform, you gain control over aspects of the mortgage transaction that
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nycbmortgage.com
This information is for use by current and prospective Clients of New York Community Bank, doing business as NYCB Mortgage Banking, and should not be distributed to or used by consumers or other third parties. © 2015 New York Community Bank. All Rights Reserved.
Western Region Sean Gerrity
Vice [email protected]
(415) 876-8017
National Sales DirectorSheryl Heffernan
Senior Vice [email protected]
(310) 678-1613
Eastern RegionJim Ford
Vice [email protected]
(770) 590-7348
Central RegionDebbie SchultzVice President
[email protected](832) 317-3931
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Step Inside Ginnie Mae
By Ted W. Tozer
Last month, we welcomed more than 700 housing industryleaders to our third annual Ginnie Mae Summit. Our goal forthe event is to provide hands-on training to Ginnie Mae issuersand to foster a dialogue about topics of critical importance in
the housing finance industry. We succeeded at both. The two-day Summit made it increasingly clear that our industry is at a
crossroads, welcoming the critical liquidity that independent mortgagebankers (IMB) bring to the secondary market, while acknowledging that theregulatory environment is still uncertain. Add to this landscape, the chal-lenges that Ginnie Mae continues to face in terms of monitoring counterpar-ty risk, while at the same time keeping the door open to liquidity, you canunderstand our dilemma.
Ginnie Mae’s operating model was created based on the assumption thatthe mortgage-backed securities (MBS) program would not change, and thatissuers would primarily be depositories. Clearly, that dynamic has changedwith IMBs now comprising 64 percent of Ginnie Mae’s issuer base, comparedto only 18 percent in 2010. Today’s issuers often have a greater dependenceon credit lines, securitization involving multiple players, and more frequenttrading of servicing rights. Quite simply, the risk is a lot higher and businessmodels of our issuers are a lot more complex. And, today’s Ginnie Mae is notadequately staffed for the kind of complex counterparty monitoring requiredwith the current issuer base.
So, the question is: How can Ginnie Mae effectively monitor counterpartyrisk and protect the government guarantee? The answer is simple: Moreresources.
Our budget, which stands at $23 million for salaries and expenses, simplydoes not allow us to make the changes needed to keep pace with the trans-formation that has occurred in the industry. And, we must keep pace to keepthe liquidity flowing. In the last four years, more than 5.4 million borrowershave benefitted because Ginnie Mae welcomed independent mortgagebankers. In fiscal year 2015 alone, there are over 4.9 million families, mostof modest financial means, that have directly benefitted from a Ginnie Maeguaranteed securitization.
Aside from seeking additional funding from Congress, we are consideringincreased reporting requirements to ensure issuers’ lines of credit and accessto cash will be sufficient to carry them through rough spots when liquidity istight. Any new requirements would apply equally to both depositories andnon-banks.
While these recommended changes will not happen overnight, they arecritical to Ginnie Mae’s long term success in continuing to efficiently protectthe government guarantee. We are committed to working with all of ourissuers to provide housing opportunities for Americans, especially first-timehomebuyers and our veterans.
The reason for that commitment can be summed up by a comment at theSummit from noted economist Mark Zandi of Moody’s Analytics. Zandi stat-ed that without Ginnie Mae, the country would have gone into the abyss dur-ing the economic crisis. The U.S. housing system is just too important to thecountry to let that happen.
Ted W. Tozer is was sworn in as president of Ginnie Mae on Feb. 24, 2010, bring-ing with him more than 30 years of experience in the mortgage, banking andsecurities industries. As president of Ginnie Mae, Tozer actively manages GinnieMae’s $1.5 trillion portfolio of mortgage-backed securities (MBS) and more than$460 billion in annual issuance.By Ted W. Tozer
Where Do We Go Now?
just ask eric & lauracontinued from page 85
sell our loans, we kept them in-house. Sowith that being said, did we have strictcredit guidelines? No, not really, but crite-ria were always open for discussion.Ratios, time on the job, everything was adiscussion. If it made sense, we did theloan.
The bank also had to meet CRArequirements and lend in all areas inwhich the bank had a presence. So since Iwas to hawk their loans, I also had tohawk their home equity loans across avery expansive area. Fortunately for me, Iwas lucky to have gotten into a positionthat allowed freedom. Also within oneweek of my starting, one of the office girlsquit and they needed help covering herduties. Thus I had to be in-house two tothree days a week. I learned home equityloans, auto loans, student loans, insur-ance side and commercial lending as wewere your small local family run bank.
I did all of the same things you aredoing, joined organizations, committees,etc. I wrote an article “Knowtworking:Beyond Networking,” which I will alsosend you a copy. But here are key ele-ments when networking you can use:
l Be yourself, no one likes a phony, dif-ferent than “faking it til’ you make it!”
l Find a niche, and use it! Not to say youdon’t do anything else, but as a newloan officer, you cannot possibly focuson all products. Find what your com-pany has to offer that is unique andcapitalize on it. An idea for you couldbe target first-time homebuyers, asthey will relate to you. Find out whatproducts and programs your companyoffers to first-time homebuyers andknow what credits your state and theVA also are offering.
l Have a signature statement: Which is aone-minute statement of what you do,make it your best byline and mentionyour niche.
l Always ask for the referral and givetwo business cards, one they can keep,and one they can give away.
l Lastly, it takes time, so just keepingdoing all the right things (planting theseeds) and the fruit will come, first theplants, then the blossoms and thenthe delicious fruit!
Cyndi from the Frisco BayArea asks …I am trying to make a decision as towhether I should make the switch frombroker to banker. Any suggestions for me?I live in California, and I am contemplat-ing going with one of the big lenders,before I make my final decision, I waslooking for some insight from both ofyou.
Eric’s reply to Cyndi …Having owned a large mortgage brokeroperation, I am a bit biased. Like Laura, I
have worked for both. We had a saying atmy old broker shop, “You don’t start here.You finish here.” That means, indeed, youlearn a lot being a banker, but you pay forthat “tuition” via a lower commissionsplit. Mortgage brokers tend to be moreexperienced because you end up doing alot yourself. It is more work, but it alwaysends up to be more money.
Cyndi, I don’t know where you are inyour career to give you informed advice.That notion that you are even thinkingabout it tells me you may be going therefor a lack of business. Being a broker ishard and if you don’t have a good follow-ing, or are missing experience or justneed a hand, then being a banker is yourticket. If you know what you are doing,have good referrals coming in and lovethe ability to shop hard deals, then whyare you even questioning the idea?
Laura’s reply to Cyndi …Great question Cyndi, it also happens tobe one of the focus topics this month, soI will briefly address your question here,and will go into more detail in my article.
First, I want you to know I have beenboth, a banker, a broker, a broker/owner,and back to banker. It’s a merry-go-round, sometimes you’re a lion, some-times a horse, but most importantly, isthat you go around and around continu-ing to make money, which is your living.
Both have advantages and drawbacks,but it also depends on timing as well. Iwill point out upfront that a banker ismost definitely the way for a newbie togo. They offer structure and training. Itcan seem like they offer reduced commis-sion splits, but it is an offset for what youget in return.
As a broker, you have more autonomyand freedom, but you may have to be dis-ciplined. The number one advantage ofbeing a broker is having the ability to sub-mit different types of loans to differentlenders, allowing you to offer a widervariety of products to your clients andreal estate agents. There is a gray side tobeing a banker that allows the brokeringof certain loans.
Disclaimer: All answers are for informa-tional purpose only, and are not intendedto practice law, or provide tax advice or taxopinions. After reviewing our informationwe recommend seeking legal counsel or theadvice of a tax professional.
Eric Weinstein worked in banking, onthe commercial real estate side until1991, when he fell in love with residen-tial lending. He may be reached byphone at (703) 505-8692 or e-mail [email protected]. Laura Burke is anauthor and trainer with 20-plus years ofexperience in the mortgage marketplace.She may be reached by e-mail at [email protected].
Eric & Laura welcome your questions, please send your inquiries [email protected].
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By Bubba Mills
Believe it or not, it’s fall.We have fewer than threemonths left in 2015.
When I look in my2015 rearview mirror, the first thing Isee is summer. More specifically, sum-mer vacation. That got me thinking:What do I want to write about thismonth?
When I think about vacations, Ithink about time management. If Iwasn’t good at time management, Iwouldn’t have much time to relax andrecharge. And those are two key itemsthat make us all more effective on thejob.
A few weeks ago, I took the wife andthe camper to a lake a couple of hoursfrom my office in St. Louis for a quick,four-day mini-vacation. And as I thinkback on that time, I remember howcompletely unplugged I was fromwork. Work was locked off in a safe-deposit box in my mind … completelyinaccessible.
That’s the way it should be for every-one in the mortgage business. Let’sface it, it can be stressful. There’s a lot
of money at stake in every deal. Andthere’s always plenty of industrychanges coming down the pipe. Formost of us, there’s a constant pressureto follow up with a client, make moresales calls or complete other tasks. Itisn’t always easy to draw a line betweenwork and the rest of your life.
In mortgage lending, long hoursoften come with the territory. But whenyou fail to set reasonable limits on yourtime, you risk losing everything you’reworking for. When your health or fami-ly life begins to suffer, it’s not only goingto diminish your quality of life, it willalso reduce your productivity.
That’s why I think time managementand learning to work smarter, not hard-er, is key to a successful life in the mort-gage industry. No matter how much youenjoy your career, a balanced life is cru-cial for your health, your happiness andyour long-term success. So here are fivetips to help you start your time man-agement plan:
1. Look at how you spend your timenow. Be honest. Get a small note-book and jot down how long youspend making phone calls, going
through e-mails, making appoint-ments, etc. Do this time log for a fewdays.
2. Prioritize. After you take a look atyour time log, you will probablynotice that a lot of your time is beingspent in areas that have very little todo with making money—yet theyare all part of your “job.” Sort outwhat you should be doing from whatyou are doing.
3. Delegate the busywork. It isn’t realis-tic for you to personally handle everyadministrative detail of your busi-ness. And if you have the right sys-tems and processes in place, itshouldn’t be necessary. Learn to letgo.
4. Plan your day, and work your plan!Give yourself a realistic work sched-ule you can live with, prioritize yourincome-producing activities, andschedule your appointments withinyour specified business hours.
Tell me what you’re thinking. Howgood are you at time management?
How good are you at unplugging fromwork? Do you believe you’d be moreeffective if you were able to unplugwhen you’re away from the office? Whatcan you start doing today to be better attime management? Please send anycomments or questions you have [email protected] orwww.facebook.com/CorcoranCoaching.
Bubba Mills is executive vice president ofCorcoran Consulting & Coaching Inc. He maybe reached by phone at (800) 957-8353, e-mail [email protected] or visitwww.corcorancoaching.com.
“In mortgage lending,long hours often comewith the territory. Butwhen you fail to set
reasonable limits on yourtime, you risk losing
everything you’reworking for.”
Time Management for Mortgage Lenders
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By Rey Maninang
Learning is a life-long endeavor inany business, butit’s particularly
necessary in the mortgage industry,where new products, new underwritingstandards and new regulations crop upregularly. In addition, today’s mortgageprofessionals have education require-ments built into the licensing system,and all state-licensed mortgage loanoriginators have to take at least eighthours of continuing education everyyear1. Although these requirements canfeel like a burden, they really representan opportunity.
Mortgage professionals who gobeyond the required eight hours of con-tinuing education and seek out learn-ing experiences elsewhere positionthemselves to succeed in an increasing-ly competitive market. Education helpsyou not only safeguard your businessfrom regulatory scrutiny, but also safe-guard your client base from competi-tors. If mortgage professionals arearmed with the latest knowledge onproducts, underwriting and regula-
tions, they can offer the best service totheir clients and move their loans morequickly through to close.
But in order to fulfill not only educa-tion requirements but also your desireto learn, you’ll need help. There is awealth of information available—if youknow how to find it—and many onlinetools to help bring you up to speed oneverything from TILA-RESPA IntegratedDisclosure (TRID) changes to the latestloan-to-value ratios (LTVs) for FederalHousing Administration (FHA) loans. Buthunting down information, classes andwebinars can take up time better spenton actually learning and serving yourclients. Your lending partners or mort-gage company should be there to sup-port you and your educational needs.Are you taking advantage of all thatthey offer?
Product and company resourcesTraining and educational resources arethe first things any mortgage profes-sional should look at when consideringworking with a new lender or company.Whether you’re new to the industry,considering changing companies, or
working with a new wholesale loanprovider, you want to make sure youare getting the resources you need toimprove your knowledge, as well asyour business.
When looking at a new company,check out what kind of training theyoffer to get you up to speed and notonly on their specific processes, but alsoon the products they offer. Some com-panies work extensively with FHA orU.S. Department of Veterans Affairs (VA)loans, and some companies have creat-ed their own unique loan products.Look to see what products the companyyou’re considering offers. If they workwith FHA loans, do they do Streamlineloans? Do they work with FHA 203(k) fulland Streamline renovation loans? Dothey work with a variety of credit pro-files, or do they deal exclusively withconventional, high FICO-score clients?
Once you’ve learned what productsthey offer, dig deeper for resources tosupport these loans. What kind of docu-mentation is provided for these prod-ucts? Are there FAQ pages on their Website? Do they compile the latest news onspecific products, like FHA MortgageeLetters? Does the company offer
Webinars or classroom training sessionson working with these loans? These arejust a few of the simple things a com-pany can do to make learning easier formortgage professionals, and thesekinds of resources are critical for origi-nators to hit the ground running withunfamiliar loan products.
By educating yourself on the prod-ucts your company services, you’ll notonly widen your knowledge base, butalso your client base. Armed with infor-mation on a full range of mortgageproducts, you will have everything youneed to sell you—and your compa-ny’s—value to clients.
Regulatory resourcesProduct offerings are just one piece ofthe puzzle, however. Regulations andcompliance are top of mind for many inthe industry today, particularly with therecent TRID implementations. Theserules can be complex and difficult tounderstand—kind of like a mortgagemay be to your clients. Understandingnew regulations and how they apply toyou and your work is critical informa-tion that all mortgage professionalsmust have.
Is Your Company Your Classroom?Get help to master the learning curve for new products, standards and regulations
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Getting up to speed on regulationscan require more than a few pages oflight reading, however, particularly forindependent brokers who may beliable for any lapses in compliance ormisreading of a rule. Taking onlinecourses, attending in-person sessionsor participating in local panels aregood starting points for anyone work-ing in the mortgage industry today.Some lenders will offer Webinars fortheir brokers that break down the reg-ulations and what they mean for yourday-to-day work. In-house Webinarsare excellent, but some lenders mayeven bring in outside help. Outsidelaw firms can be particularly useful,for example, when considering thelegal implications of recent rulechanges and implementations.
Of course, one regulation that allmortgage professionals are familiarwith by now is the Secure and FairEnforcement for Mortgage Licensing Actof 2008 (SAFE Act)2. This calls for bothpre-licensing and continuing educationrequirements for all state-licensedmortgage loan originators. Pre-licens-ing education must be at least 20hours, and continuing educationrequires eight hours of courseworkannually. In order to qualify for therequirement, courses have to beapproved by the National MortgageLicensing System (NMLS). Although thiseducation must be pursued by eachoriginator individually, many lendersand mortgage companies will sponsorNMLS-approved courses.
Borrower resourcesIn addition to offering excellent educa-tional resources to brokers and origina-tors, lenders should also offer educa-tional tools for borrowers. A mortgageis a complex financial undertaking, andthe mortgage process can be complicat-ed and trying. Mortgage professionalscan assist borrowers in explaining thedetails of a loan and the loan process,and some borrowers may be hesitant toask questions if they don’t understandsomething.
This is where lenders can step in andprovide further education for borrow-ers. What does your lender provide toenhance your clients’ experience withthe mortgage process? Clients whounderstand what they are undertakingand who can get the information theyneed will be happier with their mort-gage, and by extension, their mortgageoriginator.
One of the simplest ways to help bor-rowers is pre-qualification or pre-approval tools. Determining how muchmortgage they can afford is often thefirst step customers will take towardbecoming a homeowner, and the fasterand simpler it is, the better. Manylenders offer online pre-qualifications,and this starts the education process formany borrowers. This is also often thefirst time they start to consider things
like debt-to-income ratio, credit scoresand more. By offering tools to determinehow much they qualify for, as well asproviding explanations of commonmortgage terms, lenders can help createan educated and informed borrower.
Once a client is approved for a loanand is moving ahead with buying ahome, there’s still more education nec-essary, and lenders can help their bro-kers by offering different tools for bor-rowers. The mortgage process is a com-plicated one, and many borrowers donot fully understand the financialagreement they are making. Somelenders, however, have created onlinetools to help borrowers get a better pic-ture of exactly what their mortgagemeans to their financial future. Theseloan-review tools will take borrowersthrough the details of their loan little bylittle, going beyond the basics of trans-action costs, principal amount, term,interest rate and monthly payment.These tools often even help with areview of the borrower’s current annualand monthly income, and an outline ofmortgage payment options, along withbudgeting items like non-housing relat-ed expenses and other recurring pay-ments. Online tools such as these offer agreat service to brokers and theirclients, as they allow borrowers to gothrough the information at their ownspeed and when it is convenient forthem.
Mortgage professionals should con-sider carefully what resources are avail-able for their clients, as things like loan-review tools and pre-qualification appscan make the loan process more effi-cient and streamlined. Borrowers willbe happy to get the information andeducation they need, and even happierwith the services their lender and bro-ker have provided.
Education is more critical than everfor mortgage professionals. They mustbe up to date not only on the latestmortgage products and market condi-tions, but also on industry regulationsand standards. There is a plethora ofinformation available, but siftingthrough it all can take more time thanbusy originators have. Partnering withlenders and mortgage companies thatoffer educational resources for theirbrokers—and their borrowers—willhelp mortgage professionals succeed intoday’s market. With a strong educationin hand, originators can spend more oftheir time helping clients and closingloans.
Rey Maninang is senior vice presidentand national sales director forCarrington Mortgage Services LLC’sWholesale Mortgage Lending Division.Under Rey’s leadership, Carrington’sWholesale Division has increased volumeproduction by over 100 percent within atwo-year period, and successfullylaunched several strategic initiativesresulting in consistent profit increases.
Footnotes1—Mortgage.NationwideLicensingSystem.org/profreq/education/Pages/default.aspx.2—Mortgage.NationwideLicensingSystem.org/profreq/education/Pages/default.aspx.
places to workoutstanding
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Equity Prime Mortgage877-255-3554, xt. 600www.equityprime.com
Equity Prime Mortgage is focused on creating an outstanding workenvironment. We consider each and every employee as a true partner
to our success. This approach, combined with Equity’s industry-leading technology and turn times ensures we deliver exceptional
service levels to our branches, referral partners and customers alike.
REMN Wholesale732-738-7100
www.remnwholesale.com
Although REMN Wholesale is part of a large corporation, it feels likea “Mom and Pop”-style company. We encourage our team members
to grow and we train and promote each individual to their fullpotential. As a national company, REMN provides many opportunities
for employment from coast to coast.
PRMG1-866-PRMG-YES (806-776-4937)
www.PRMG.net
Built by originators for originators, PRMG was born from a vision of creating a company with a unique culture
focused on the successes of the producer. We understand what ittakes to be a successful originator and cultivate
new business every day.
United Wholesale Mortgage800-981-8898
www.uwm.com/careers
Voted the #1 place to work in Metro Detroit, UWM is looking for A players to join our talented team. Our business is driven by our
culture, and our people are our greatest asset. If you’re looking forthe opportunity of a lifetime, apply to UWM today!
places to workoutstanding
n a t i o n a l m o r t g a g e p r o f e s s i o n a l ’ s
Attention Recruiters, Business DevelopmentManagers and HR Professionals
We are pleased to announce a new package that will give your firm the recruiting tools toinstantly shift your recruiting efforts into high gear using a multimedia, market-saturatingapproach. We will utilize the most successful methods that our clients have been using to find,identify and place top talents for your company. We have designed these packages with theconcept of making it less expensive to give you the ability to reach more people.
NATIONAL MORTGAGE PROFESSIONAL MAGAZINE1220 Wantagh Avenue • Wantagh, New York 11793-2202
516-409-5555 • Fax: 516-409-4600 • E-mail: [email protected]
NationalMortgageProfessional.com
Freedom Mortgage(844)-380-8450
www.freedomwholesale.com
Freedom Mortgage is dedicated to fostering homeownership inAmerica. A number one ranked lender1, we offer exceptional
opportunities for career growth and development. Our employees arededicated to providing the kind of service excellence, expertise andcutting-edge technology support that have helped us successfully
meet the needs of our customers and business partners for 25 years.1. Number one, overall volume. Scotsman Guide’s Top Mortgage Lenders, 2014.
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calendar of eventsN A T I O N A L M O R T G A G E P R O F E S S I O N A L
To submit your entry for inclusion in the National Mortgage ProfessionalCalendar of Events, please e-mail the details of your event, along with con-
tact information, to [email protected].
* Looking for additional exposure at key industry events?Call 516.409.5555, ext. 4 to discover how to maximize your event coverage.
OCTOBER 2015Saturday-Monday, October 17-19
2015 NAMB National ConferenceThe Luxor Resort & Hotel
3900 South Las Vegas BoulevardLas Vegas
For more information, call (860) 719-1991 or visit
NAMBNational.com.
Sunday-Wednesday, October 18-21
Mortgage Bankers Association AnnualConvention and Expo 2015
San Diego Convention Center111 West Harbor Drive
San Diego, Calif.For more information,
call (800) 793-6222 or visit MBA.org.
Thursday-Friday, October 29-30Virginia Association of Mortgage Brokers
27th Annual ConventionHilton Garden Inn Richmond
Innsbrook4050 Cox Road • Glen Allen, Va.
For more information, call (804) 285-7557 or visit VAMB.org.
NOVEMBER 2015Wednesday-Thursday,
November 4-5Mortgage Bankers Association
Commercial/Multifamily TechnologyOfficer Roundtable
Mortgage Bankers Association1919 M Street NW, 5th Floor
Washington, D.C.For more information,
call (800) 793-6222 or visit MBA.org.
Monday-Tuesday, November 16-17
New York Association of MortgageBrokers 27th Annual Convention
The Melville Marriott1350 Walt Whitman Road
Melville, N.Y.For more information,
call (914) 315-6644 or visit NYAMB.org.
Monday-Wednesday, November 16-18
National Reverse Mortgage LendersAssociation 2015 Annual Meeting & Expo
The Palace Hotel2 New Montgomery Street
San Francisco, Calif.For more information, call (202) 939-
1784 or visit NRMLAOnline.org.
Wednesday-Thursday, November 18-19
2015 Mortgage Star ConferenceCanyons Resort
4000 Canyon Resort DrivePark City, Utah
For more information, call (860) 719-1991
or visit Mortgage-Star.net.
Wednesday-Friday, November 18-20
2015 Mortgage Bankers AssociationAccounting and Financial Management
ConferenceThe Roosevelt New Orleans
130 Roosevelt WayNew Orleans, La.
For more information, call (800) 793-6222 or visit MBA.org.
Friday, November 20Utah Association of Mortgage
Professionals Expo 2015Canyons Resort
4000 Canyons Resort DrivePark City, Utah
For more information, call (860) 719-1991 or visit
UAMPExpo.com.
DECEMBER 2015Wednesday-Friday, December 2-4
MBA 2015 Independent MortgageBankers Conference
Omni Nashville250 5th Avenue SNashville, Tenn.
For more information, call (800) 793-6222 or visit MBA.org.
Tuesday, December 82015 California Holiday
Networking PartyAtrium Hotel
18700 MacArthur BoulevardIrvine, Calif.
For more information, contact BeverlyKoondel at (516) 408-5555, ext. 316 ore-mail [email protected].
Thursday, December 102015 Texas Holiday Networking PartyDoubleTree by Hilton Hotel Dallas–
Campbell Centre8250 North Central Expressway
Dallas, TexasFor more information, contact BeverlyKoondel at (516) 408-5555, ext. 316 ore-mail [email protected].
Tuesday, December 152015 Florida Holiday Networking Party
The Holiday Inn Hotel & Suites5905 South Kirkman Road
Orlando, Fla.For more information, contact BeverlyKoondel at (516) 408-5555, ext. 316 ore-mail [email protected].
JANUARY 2015Thursday, January 21
Mortgage Bankers Association Mergersand Acquisitions Workshop 2016
Hilton Phoenix International Airport2435 South 47th Street
Phoenix, Ariz.For more information,
call (800) 793-6222 or visit MBA.org.
Sunday-Wednesday, January 31-February 3
MBA’s 2016 CREF/Multifamily HousingConvention & Expo
Hyatt Regency Orlando9801 International Drive
Orlando, Fla.For more information,
call (800) 793-6222 or visit MBA.org.
FEBRUARY 2016Tuesday-Friday, February 16-19
MBA’s 2016 National Mortgage Servicing Conference & Expo
Hyatt Regency Orlando9801 International Drive
Orlando, Fla.For more information,
call (800) 793-6222 or visit MBA.org.
MARCH 2016Tuesday-Friday, March 8-11
NAMB East 2016Westin Hilton Head Island Resort & Spa
2 Grasslawn AvenueHilton Head, S.C.
For more information, call (860) 719-1991 or visit
NAMBNational.com.
APRIL 2016Sunday-Wednesday, April 10-13NAMB 2016 Legislative & Regulatory
ConferenceWashington, D.C.
For more information, call (860) 719-1991 or visit
NAMBNational.com.
SEPTEMBER 2016Saturday-Monday, September 24-26
NAMB National 2016The Luxor Resort & Hotel
3900 South Las Vegas BoulevardLas Vegas
For more information, call (860) 719-1991 or visit
NAMBNational.com.
OCTOBER 2016Sunday-Wednesday,
October 23-26Mortgage Bankers Association 2016
Annual ConventionHynes Convention Center
900 Boylston StreetBoston, Mass.
For more information, call (800) 793-6222 or visit MBA.org.
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Online Marketing
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REMN has FHA, USDA, 203k, VA and Conventional solutions to fitthe needs of your customers. But, at REMN, our most valuableproduct is our people. The REMN Sales and Operations Teamsgive you - and your loans - the time and attention that youdeserve. Even better, at REMN, same-day approvals are guaran-teed.* You can rely on us to get the little, yet vital, things takencare of on time.
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