NMP National Mortgage Professional January 2024

JANUARY 2024

Vol. 16, Issue 1 $20.00

GEN Z HAS PICKET FENCE DREAMS THE DREADED BLACKLIST

THE SWOT SMELL OF SUCCESS

HEY,

BE PATIENT

Huge Markets Open Up With Credit Changes

BUD

DEFINE YOURSELF 2024 INDUSTRY TITANS

Lending to cannabis workers can provide budding opportunities

A P UB L I C AT I O N O F A M ERI C A N BU SIN ESS M ED IA

MATT

RCNCAPITAL.COM

860.432.5858

JANUARY 2024

Vol. 16, Issue 1 $20.00

GEN Z HAS PICKET FENCE DREAMS THE DREADED BLACKLIST

THE SWOT SMELL OF SUCCESS

HEY,

BE PATIENT

Huge Markets Open Up With Credit Changes

BUD

DEFINE YOURSELF 2024 INDUSTRY TITANS

Lending to cannabis workers can provide budding opportunities

A P UB L I C AT I O N O F A M ERI C A N BU SIN ESS M ED IA

MATT

RCNCAPITAL.COM

860.432.5858

JANUARY 2024

Volume 16 Issue 1

CONTENTS

nationalmortgageprofessional.com

4 Cannabis Calls

There's money to be made in the marijuana industry for savvy LOs.

COVER STORY

6 Tackling Overcapacity

PAGE 42

Keeping staff is costly but could pay off when refinances return.

CULTIVATING OPPORTUNITIES

8 Be Prepared For Job Hiring

Once you understand the process, cannabis workers can be lucrative clients.

Not all jobs are alike. You need to tailor your hiring processes.

10 The Future Pot Of Gold

Changes are coming that could add $1 trillion in originations.

13 People on the Move

See who the movers and shakers are in the mortgage industry.

14 Build-A-Broker: Check Into Home Equity Tech

There’s $20 trillion in tappable home equity. Are you equipped to break into this lucrative market?

17 Non-QM Resource Guide AMC Resource Guide

2024

18 Your First Million Dollars: Make Yourself Inspiring

28 How To Reach Gen Z

Gen Z may seem young but they’re 20% of the population and ready to buy.

Learn the process of being mentally stimulated to do something creative.

20 Benchmarks and Best Practices: Build On Your Weaknesses

Look at successes, weaknesses, opportunities, and threats in 2024.

22 Data Bank

31 Originator Tech Resource Guide Wholesale Lender Resource Guide 34 How To Beat The Blacklist

Named to the Freddie Mac Exclusionary List? Here’s what to do to escape.

S P E C I A L AWA R D S S E C T I O N PAGE 50

38 Your Elevator Pitch

How to explain exactly what it is MLOs do day by day.

60 Non-QM Lender Directory 61 Wholesale Lender Directory Originator Tech Directory AMC Directory 62 Facebook Thoughts: Dino Nuggets — What Every Classy Gentleman Eats For Dinner

THE NEW ENGLAND MORTGAGE

2024 INDUSTRY TITANS

Honoring the key players who have dedicated their expertise and years of experience to the mortgage business.

SHOW GUIDE

PAGE 24

nationalmortgageprofessional.com

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024 |

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JANUARY 2024

STAFF Vincent M. Valvo CEO, PUBLISHER, EDITOR-IN-CHIEF Beverly Bolnick ASSOCIATE PUBLISHER

Volume 16 Issue 1

LETTER FROM THE PUBLISHER

High, There …

W

hen mortgage pros talk about alternative products, usually that means things like reverse mortgages, private lender loans, or sometimes even VA loans. It doesn’t usually mean loans to people who get high for a living.

But, although significant challenges remain on the federal level, there is a road being built for mortgage originators to confidently offer loans to the nearly half million people who work in the cannabis industry. Marijuana is now legal in 21 states, and that number is increasing.

So, too, is the opportunity for LOs to corner the market on home loans to these buyers.

As detailed in Erica Drzewiecki’s cover story for this issue, loans for cannabis industry workers get turned down all the time — by banks, by credit unions, by governmentbacked loan programs through VA, HUD, and FHA. But recent legislation has allowed secondary markets to pool and sell cannabis industry mortgages as long as pot is legal in the state where the mortgage is located. Even so, risk-averse institutions like banks and some mortgage companies just don’t want to be part of that business. That opens the door for LOs to step in and save the day — and corner the market on this industry. When the legal and reputational risk no longer burdens an institution, it will try to come in and collect market share here. If LOs are smart, they’ll do everything possible to make that future go up in smoke right now.

Meanwhile, we’re starting the year saying “Hi, there” to a couple thousand mortgage leaders at the annual New England Mortgage Expo. It’s an amazing way to kick off any year, bringing together the industry’s finest to network, strategize, and lock down opportunities. For us, it’s the start of our annual roadshow of conferences — we’re doing about two dozen this year across the nation via our Originator Connect Network events group. The next few months will see us in Atlanta, Austin, Charlotte, Irvine, Chicago, and more. But first, we set the spark at Mohegan Sun Casino and Resort in Connecticut — where weed use and cultivation is now legal.

So, maybe, folks at the show will engage in their own idea sharing about how to take care of the mortgage needs for people who toke.

Christine Stuart NEWS DIRECTOR Keith Griffin SENIOR EDITOR Erica Drzewiecki, Katie Jensen, Ryan Kingsley, Sarah Wolak STAFF WRITERS Dave Hershman, Erica LaCentra, Harvey Mackay, Lew Sichelman, Mary Kay Scully CONTRIBUTING WRITERS Regina Morgan ADVERTISING SALES EXECUTIVE Nicole Coughlin ADVERTISING ASSOCIATE Alison Valvo DIRECTOR OF STRATEGIC GROWTH Julie Carmichael PROJECT MANAGER Meghan Hogan DESIGN MANAGER Stacy Murray, Christopher Wallace GRAPHIC DESIGN MANAGERS Navindra Persaud DIRECTOR OF EVENTS William Valvo UX DESIGN DIRECTOR Andrew Berman HEAD OF CUSTOMER OUTREACH AND ENGAGEMENT Krystina Coffey, Matthew Mullins MULTIMEDIA SPECIALIST Melissa Pianin MARKETING & EVENTS ASSOCIATE Kristie Woods-Lindig ONLINE ENGAGEMENT SPECIALIST Joel Berman FOUNDING PUBLISHER

Submit your news to editors@ambizmedia.com If you would like additional copies of National Mortgage Professional Call (860) 719-1991 or email subscriptions@ambizmedia.com

www.ambizmedia.com

VIN CEN T M. VALVO Publisher, Editor-in-Chief

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| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

© 2024 American Business Media LLC. All rights reserved. National Mortgage Professional magazine is a trademark of American Business Media LLC. No part of this publication may be reproduced in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without written permission from the publisher. Advertising, editorial and production inquiries should be directed to: American Business Media LLC 88 Hopmeadow St. Simsbury, CT 06089 Phone: (860) 719-1991 info@ambizmedia.com

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DAVE HERSHMAN

RECRUITING, TRAINING, AND MENTORING CORNER

Overcapacity: Make The Right Choices To Succeed

When Refis return — and they will — you want to be appropriately staffed

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BY DAVE HERSHMAN, CONTRIBUTOR, NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

t the Mortgage Bankers Association’s annual convention, the word “overcapacity” was discussed a lot. As a matter of fact, we have been dealing with this word for 24 months or so within this industry. All industries have slumps. But the mortgage industry seems to be unique with its feast or famine nature.

Even real estate cannot rival the mortgage industry’s ups and downs.

For example, if real estate sales fall by 20%, this is considered a deep slump. And that slump carries over to the mortgage industry. However, if a refinance boom ends at the same time — our volumes can and did contract by well over 50%.

For example, in the 4th quarter of the year 2020, origination volumes hit approximately one and one-third trillion

6 | NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

longer” rates, the greater potential for more refinances in the future. And, of course, lower rates are likely to boost real estate sales as affordability could return to more sane levels. Lower rates can also encourage present homeowners to remove equity at a faster clip.

We should even have more owners listing when rates do fall. Though many these owners may purchase their next home with cash, the availability of inventory will help the real estate crunch tremendously.

So, managers and executives of the mortgage industry, you have some thinking to do. If you guess wrong, Ricky is likely to approach you and say —Lucy, you have some ‘splaining to do!

If you guess right, you will be in a position to take advantage of the next curve the industry throws your way.

We must survive because people will still need to finance homes.

We are not Blockbuster. dollars. In the first quarter of 2023, it was approximately one-third of a trillion dollars, with the most precipitous drop happening in the first quarter of 2022. You can do the math on the percentages. I challenge any other industry to survive such a volatile environment. Yet, we must survive because people will still need to finance homes. We are not Blockbuster.

Not all slumps are accompanied by a drop in sales and a drop in refinances at the same time. As a matter of fact, the recovery from the Great Recession generated very significant refinance activity and I expect refinance activity will return to the market perhaps even before real estate sales begin to recover.

The problem is, we don’t know if this will happen three months from now, or a year or so from now.

Thus, we continue to hear the word overcapacity, despite the fact that just about every mortgage company has cut to the bone quite recently. Do we cut into the bone, or do we gear up for the coming refinances? If you believe refinances will not take place for 18 months or so, you may be more inclined as a manager to cut now. If you believe that elevated refinance activity is right around the corner, then you might be strengthening your sales staff and keeping some overcapacity in place.

Interestingly enough, the longer it takes for rates to ease somewhat, the stronger the refinance period will be. With so many present homeowners at 4% or less, a short-lived increase in rates would not have produced many refinances.

But each month we go with “higher for

There is one thing for sure — there is no way to predict the future. How many forecasters predicted a recession this year? Without any ability to foresee the future, I am expecting most managers and executives to take a middle road here, keeping this closer to the vest but leaving their options open. n Dave Hershman is the top author in this industry with six books published as well as the founder of the OriginationPro Marketing System and the OriginationPro’s on-line comprehensive mortgage school. Dave is also Senior VP of Sales for Weichert Financial Services. His site is www.OriginationPro. com and he can be reached at dave@ hershmangroup.com.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024 |

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ERICA LACENTRA

THE XX FACTOR

Hiring Right: Take The Right Steps For The Right Person How to add more clarity to a daunting process

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BY ERICA LACENTRA, CONTRIBUTOR, NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

f you are anticipating growth in the coming year, it’s likely that will also involve hiring in key areas of your business. If you have experience hiring employees in the past, you know that it can often be a challenging task to find the right person for the role you’re looking to fill.

From scouring resumes, to calling references, to conducting interview after interview, it typically takes a lot of due diligence to ensure you’re selecting the perfect candidate. And, in some instances, even after doing all that legwork, sometimes a candidate’s skills just don’t translate to their role once they come on board, meaning you’re right back to square one.

So, what steps can you take to ensure you get exactly what you’re looking for when hiring?

THE RIGHT PREP IS IMPORTANT

Well before you even start looking through resumes and scheduling

interviews, there are certain things you should be doing to ensure your hiring process is designed to attract the right candidate. First, you want to make sure you are creating a detailed job description for the position. If a future employee doesn’t have a clear idea of what they will be doing, it’s going to be hard to get the right applicants in the first place.

A good job description should first include an overview of the company and what makes it a good place to work for. This could include details on the company’s core values, company culture, and the skills that current employees possess that thrive in the company’s environment. This type of information can help weed out candidates who may not be a good cultural fit in the organization or not align with the values of the company.

This is often a piece that is overlooked during the hiring process but hiring someone who meshes well with the company culture is just as important as hiring someone with the right skill set for the role.

From there, the job description should also include the role’s responsibilities and even goals for this particular position as well as the level of

8 | NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

time. Now a personalized interview for one role doesn’t have to be wildly different from job posting to job posting, but there are key elements you should consider when structuring your interview process.

First, for each job you are interviewing for, you should have a series of static criteria you are looking at in each candidate you interview for the role. This will allow you to compare candidates during your process to determine who rises to the top. It can be

Crafting a thorough job description is critical to ensuring you are getting the right candidates in the door. skills and experience required. In cases with some jobs, it may even be beneficial to list preferred skills and experience in addition to required skills and experience.

This can help you cast a wider net and get additional candidates that meet your requirements but also have skills that would be the icing on the cake for that job. Crafting a thorough job description is critical to ensuring you are getting the right candidates in the door for an interview and are appealing to people who not only have the skill set but also the right personality for your organization.

CRAFT AN INTERVIEW FOR THE JOB AND BUSINESS

If you are hiring for jobs that have different roles and responsibilities in your company how can you expect an interview process that isn’t catered to each role to be sufficient? Preparing structured interviews that are personalized for each job role is your best bet at hiring the right fit the first

as simple as listing out the main areas you want to cover in your interview, such as how well do they meet the job requirements and how are the candidate’s problemsolving skills, and then developing a basic rating system such as, poor, below average, average, above average and excellent.

From there, you’ll want to craft interview questions that will provide insight and ultimately allow you to rate the areas you have established. This is far more effective than simply reviewing the candidate’s resume with them and asking questions at random hoping to uncover the information you need.

From there, you should consider if you want to include testing (if applicable) as part of your interview process. If there are certain skills you are looking for in a role, and those skills can be tested ahead of time, it can give you peace of mind that what the candidate is saying on their resume is true and they are up to snuff with your expectations. For example, if you

have an accounting position open and one of the top skills you require is expertise in Microsoft Excel, having an Excel test as part of the interview process can really help you find a candidate that is at the level you need. Many HR softwares have specialized skills tests for job candidates that will be sufficient, and if a specific test doesn’t exist, you can always develop something basic for the role as well.

Finally, make sure you have questions prepared that ask the candidate about things that go beyond their resume and the skills they have. Take time to ask about the candidate’s interests, career plans, and ambitions. Asking questions like, what would make you excited to come to work every day, and what do you hope to get out of this job both personally and professionally, can go a long way to getting a better understanding of a potential candidate and if they will be a good, long-term fit at your company.

VERIFY REFERENCES AND MAKE YOUR CHOICE

The final step before making your ultimate hiring decision is to verify that what your potential hire has said is true. The easiest way to do this is to ask for professional references, preferably previous employers, that can speak to the candidate’s qualifications and work ethic.

Taking the time to check with references can be a key factor in hiring as sometimes, unfortunately, candidates might not be telling the whole truth on their resume or in an interview. This is a last check to make sure their experience and skills truly align with what you’re looking for.

If a candidate’s references are good after a stellar interview, you likely have found your perfect fit and are ready to make your offer.

Trying to fill a new or vacant position can seem like a daunting task but it doesn’t have to be. Taking the right steps before and during the recruitment process can create greater clarity for potential applicants as well as for you so you ultimately know you are hiring the right person. n Erica LaCentra is chief marketing officer for RCN Capital.

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LEW SICHELMAN

THE MORTGAGE SCENE

Hang On Sloopy For A Pot Of Gold You will thrive if you can survive 2024

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BY LEW SICHELMAN, CONTRIBUTOR, NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

an you hold on for one more year? If you can survive what is lining up as one miserable year for the mortgage market, there’s a pot of gold waiting at the end of the rainbow.

Next Jan. 1, nearly five million people will gain access to the mortgage market when Fannie Mae and Freddie Mac are required to use new credit scoring models from VantageScore and FICO. According to VantageScore, which has been pushing the government-sponsored entities (GSEs) to adopt more inclusive scoring models for what seems like forever, some 2.7 million of those folks are already mortgage-ready. That is, they are in the key home buying ages (25 to 65) and have scores of 620 or better.

That translates into as much as $1 trillion in loan volume annually. If only you want to hang on for 12 more months.

But as they say on those ubiquitous latenight TV ads, wait! You don’t have to stay alive quite that long, not if you take a little time to sit down with would-be home buyers and figure out how they can boost their scores. Not over the long term, but practically right away.

Mike Darne, vice president of marketing at CreditXpert, says almost anyone who applies for financing can raise their scores by 20 points, and do so within 30 days. That’s because scores are not static. Yet, when loan officers and agents pull someone’s score, they are accepted as such.

Yes, under today’s systems, scoring is a snapshot in time — no, a single moment in time — that is designed to tell us how well a potential borrower handles credit.

Does he pay on time? Does he use the maximum amount of credit to which he’s entitled? Does he have any black marks against him?

But Darne says people are anything but static. They are living, breathing organisms

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“Taking the consumer’s credit score at face value is a mistake and can rob lenders of potential business.” > Mike Darne, VP of marketing, CreditXpert who do things every day that change their scores. Perhaps they finance the purchase of a new car. Maybe they pay a loan early. Or perhaps they close out an old department store account.

MOVING NUMBERS

As a result, scores are dynamic, moving numbers. And when considered in that light, Darne maintains, lenders should look at every applicant’s score, “not for what it is but what it could be … Taking the consumer’s credit score at face value is a mistake and can rob lenders of potential business.”

Darne, who has spent his entire career in one aspect of the financial services sector or another, calls it “credit

optimization.” CreditXpert’s research, which included an analysis of nearly half of all mortgage credit inquiries, found that 74% — three out of every four — could have raised their scores from below 780 by as many as 20 points within a 30-day period.

Credit, as you know, is one of the three Cs of mortgage lending, the other two being capacity and collateral. But it is the only one over which the borrower has any control. Some aspects of a borrower’s credit take years to affect a score: payment history, for example, or the age of his credit accounts. Yet others can have an impact quickly, i.e., usage and the total number of accounts.

With that in mind, the Hampton,

Md.’s credit optimization tool uses both data science and predictive analytics to identify a borrower’s credit potential AND offers a detailed plan that will help him reach his scoring potential. The program, which also identifies aspects of the credit file that could be problematic to underwriters, is available to lenders as a white label add-on, and a consumercentric version is on the way.

The program searches for “opportunities” a borrower could take to raise this all-important score. But many applicants never get the chance to do so. CreditXpert found that 65% of a representative sample of people who bought homes in the last six months and who intended to buy in the next six were

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024 |

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THE MORTGAGE SCENE

never given the chance to improve their scores.

STEPS TO IMPROVEMENT

On the flip side, seven out of 10 of those who were told how they might raise their scores took steps to do so.

Their main reason, of course, was to save money. How much cabbage varies with each person. But in one example offered by the company, an actual borrower seeking a $400,000 mortgage raised her score 40 points, saving a boatload of moolah in the process.

By taking three steps — which CreditXpert did not innumerate — she was able to raise her score 33 points, from an original 640 to 673. By taking an additional fourth step, again not revealed, she bumped up the number seven additional points, to 680. In so doing, she was able to trim her interest

Meanwhile, back at the GSE jungle, the Federal Housing Finance Agency has given Fannie and Freddie until next January to begin accepting scores produced by VantageScore 4.0 and the new FICO 10-T model as part of their approval processes. At the same time, though, the FHFA is asking all originators to place the 4.0 and10-T programs alongside the traditional FICO model.

That way, lenders will have time to “get their internal plumbing systems in order,” said Tony Hutchinson, Freddie Mac’s senior vice president of industry and government relations, who called the current FICO program “outdated.”

TRENDS, NOT PREDICTIONS

Both new scoring models are “trended” systems, whereas the FICO score now used by most lenders is based on a predictive snapshot of a borrower’s

wheels would be scored by 4.0 but not by the current FICO program.

The other 9% are new to credit or have “young” credit files. This group has established credit, but their files are less than six months old. They receive a score of 4.0 on the day a tradeline is reported. About three-quarters of them also have a score of 620 or higher because they, too, pay on time.

To score these consumers, 4.0 uses non-traditional statistical methods. The company’s data scientists apply machine learning techniques that it says are “at the forefront” of artificial intelligence to identify the criteria that best predict future default.

To test the model, VantageScore compared 4.0 to conventional scoring models and found that predicted default rates were similar. “Therefore,” the paper says, “lending decisions can be

“[The new systems] will benefit millions of consumers who are currently underserved or excluded from home ownership.” > Tony Hutchinson, SVP of industry and government relations, Freddie Mac rate from 7.65% to a flat 7%.

The savings in principal and interest were formidable — $158 a month — as were the savings in mortgage insurance premiums — $131 — for a grand total of $289 a month. In addition, she was able to knock half a year off the time she had to keep MI coverage in force. And in the long run — queue the music, please — she will have saved nearly $74,000 over the life of her 30-year loan.

To quote Mötley Crüe, though, “Something for nothing … it’s never free.”

And so it is with credit optimization. That is to say, the steps a borrower might be asked to take may require some out-ofpocket spending. In the above example, the borrower would have to spend $2,810 to ratchet her score up to 680. In this case, she mostly had to pay down a credit card or two. (In other instances, other accounts might have to be paid down as well.) And in just 10 months, she would all but recoup her out-of-pocket costs.

The rest, as they say, is gravy.

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credit record on any given day and often excludes otherwise creditworthy people.

Even though new and innovative scoring models have found little traction in the mortgage arena, VantageScore has consistently monitored the performance of its model in housing finance. In its most recent assessment, according to a company white paper, 4.0’s predictive performance registered roughly midway between strong accuracy and perfect predictive value.

Most of the 2.7 million or so consumers who would qualify for a home loan under 4.0 are either “dormant” or “newly scorable,” according to the report. Both groups are pretty much ignored by traditional scoring systems.

Dormant consumers, which account for 91% of the unscored population with scores above 620, are infrequent users of credit but have activity beyond the normal six-month threshold. For example, that guy who paid cash for his

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

consistent for newly and conventionally scorable consumers.”

One major lender has already incorporated 10-T into its system, and VantageScore expects some of its customers to do the same with 4.0 “soon,” Hutchinson said. Those who do so sooner than the legislated deadline will have a leg up on those who wait until the last minute, he warned.

Implementing the new systems “will benefit millions of consumers who are currently underserved or excluded from home ownership,” he said. Not to mention lenders’ bottom lines. n Lew Sichelman is a contributing writer to National Mortgage Professional magazine. He has been covering the housing and mortgage sectors for 52 years. His syndicated column appears in major newspapers throughout the country.

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YOUR FIRST MILLION DOLLARS Look Inward For Inspiration

BENCHMARKS & BEST PRACTICES SWOT Your Way To Success

CAREER TICKER People On The Move

PEOPLE ON THE MOVE // > Fannie Mae

CEO Priscilla Almodovar is taking over the role of president and will oversee the SingleFamily and Multi-Family business units.

> Scott

Norman, vice president of field retail and director of government relations for Finance of America Reverse LLC, was re-elected as co-chair of the National Reverse Lenders Association Board of Directors.

> DocMagic, a

digital closing provider, announced the promotion of Chris Lewis to director of sales.

> VA lending

expert, David Smith, will assume the newlycreated position of VP of National VA Lending with loanDepot.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024 |

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BUILD-A-BROKER: HANDS ON PRACTICAL ADVICE BUILD-A-BROKER

Commissions Alert: Pop Your Profits And Don't Leave A Penny On The Table Lenders need better tech to help homeowners unlock $20 trillion in tappable equity

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BY DAN CATINELLA, SPECIAL TO NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

here’s only so much lenders can do to combat heightened interest rates and elevated home prices driving the decline in originations. But there’s a silver lining under all those gloomy headlines: The jump in home values over the past several years has existing homeowners sitting on mountains of tappable equity. Lenders have a massive opportunity in front of them to Dan Catinella help homeowners

recognize, unlock, and utilize their home equity. The trick is knowing who to talk to.

As of Q2 2023, CoreLogic says the average U.S. homeowner has more than $287,900 in home equity. That’s more than triple the average home equity in 2010 ($87,000). It all adds up to nearly $20 trillion in tappable home equity in the U.S. But as the soaring trajectory of home equity crashes into rising rates, that equity feels locked up for most homeowners. Homeowners are reluctant to move — FannieMae reports just 22% of consumers think it’s a good time to buy a home — all but eliminating the traditional path of “trading up.” And they laugh at the mention of a cash-out refi.

The Fed may be slowing rate hikes, but recent figures from Redfin show we

have a long, long way to go: More than 90% of homeowners have mortgages below 6%; 82% are under 5%; 62% enjoy rates under 4%; and roughly 1 in 4 homeowners are paying less than 3% on their current mortgage.

Home equity originations surge as consumers look to unlock home equity

These market conditions don’t suddenly erase homeowners’ expectations, needs, and goals. Growing families need more space. Motivated homeowners want to update and upgrade home features. Then there’s all the other needs and wants for which a sizable chunk of home equity presents an appealing source of financial fuel:

PEOPLE ON THE MOVE // > Brian Devlin

was named president and CEO of Arc Home LLC, a Non-QM and non-agency wholesale and correspondent lender.

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> Veteran

mortgage expert with $1 billion career loan volume, John Pyne, joined Atlantic Bay Mortgage Group as producing area manager.

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

> Mortgage subservicer

Cenlar FSB appointed Craig Alexander to director of financial planning and analysis, Claire Taylor was hired as the new director of compliance.

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buying a car, consolidating debt, or taking other big financial steps.

That’s why we’re seeing savvy lenders shift their focus to helping homeowners unlock that value through HELOCs. In fact, 2022 was the strongest year for home equity originations since the financial crisis. After declining through 2019 and 2020, second mortgage originations turned around in 2021 and then took off: a 41% YOY jump in 2022 and a projected 24% YOY increase through 2023, according to TransUnion. That growth represents nearly 200% more originations in the last two years — from 1.9 million in 2021 to a forecasted 3.7M units by the end of 2023.

Despite massive growth, it’s worth repeating the key figures on the outstanding opportunity: U.S. homeowners hold an estimated half trillion dollars in existing HELOCs — with roughly $19 trillion remaining in untapped equity. Moreover, one in five homeowners say they plan to take out a home equity loan in the coming year — up from 8% a year ago.

As rates trend down, cash-out refinancing becomes more attractive

Despite the regional banking crisis of early 2023 and the relative easing of inflationary pressures, Fed rates continue to increase — and mortgage rates have remained fairly flat in the high 6’s and low 7’s. This adds a wrinkle to the home equity equation: As rates trend down which is forecasted to occur through 2024, cashout refinances begin to look better than HELOCs for more homeowners.

This point is particularly salient given reports around concerning levels of highinterest debt — primarily credit cards.

Credit card rates are trending up, and

total balances are rising to levels where they can become an unclimbable mountain for consumers. A recent quarterly report from the Federal Reserve Bank of New York states credit card debt has exceeded $1 trillion, a series high and $45 billion increase from Q1 of 2023. Home equity is a powerful tool for consolidating debt to get monthly cash flow back into a healthy range.

This tipping point in the rate environment happens particularly early for debt consolidation.

For example, while a cash-out refi may bump a homeowner from 3% to 5.5% on their mortgage, they’re using that cash to pay off much higherinterest debt: an 8% auto loan or a 20% credit card balance, for instance. This math means that a homeowner may be wise to take a higher-rate cash-out refi to ultimately achieve net-positive monthly savings and increase their monthly cash flow by consolidating debt.

Homeowners want education and guidance on how to tap home equity

More than half of homeowners say they don’t have a good understanding of home equity lending products. Some

don’t even know these options exist.

Lenders need to be able to walk homeowners through their options and simplify the complexity of it all: weighing the customer’s current

Three other leaders were promoted to new roles: They are: Director of Issues Management Kimberly DiLeo, Director of Claims and Loss Analysis Jennifer McKeown, and Business Control Director Nicole Savage.

> Click n’

Close, a multi-state mortgage lender serving consumers and mortgage originators, announced Kara Lamphere has joined the organization as chief operating officer.

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BUILD-A-BROKER: HANDS ON PRACTICAL ADVICE BUILD-A-BROKER

Lenders are looking at massive opportunities in home equity lending over the next few years. They just need to focus on finding that opportunity and nurturing that demand. mortgage rate against available rates on HELOCs; explaining how different home equity lending products are better suited to different use cases (i.e., home improvement, debt consolidation, etc.); and ultimately showing the customer what a given lending product means in real terms (i.e., what monthly cash flow and total debt looks like today against what it will look like after a cash-out debt consolidation refi).

The opportunity is there, but lenders struggle to find it

All of this — enormous outstanding tappable equity, growth in home equity lending, changing conditions bringing cash-out refis back into the conversation — represents tremendous opportunity for LOs that’s driven by, rather limited by, the high-rate environment.

But it still leaves lenders with the fundamental challenge of figuring out who they should be talking to about these home equity lending options. Who are the consumers in your database that have sizeable home equity? And even more importantly, which customers have had significant increases in equity since you last worked or talked with them? Lets face it: Most homeowners don’t keep close tabs on their home equity, and the nature of compound interest makes offthe-cuff estimates extremely difficult.

AI and intelligent automation uncovering home equity lending opportunities

We’re seeing many of the most successful lenders use smarter technology to crack the code on this challenge.

They’re turning to purpose-built platforms like Total Expert to get real-time visibility to customers’ tappable home equity — and AI-powered tools to help them put that insight into action.

For example, Total Expert’s equity alerts show lenders when a customer’s home equity crosses a set threshold.

Lenders can automatically build and update a queue of high-quality prospects.

Intelligent automation lets LOs use those alerts to trigger Total Expert’s automated journeys — micro-campaigns that string together hyper-personalized, multi-channel messages to engage and nurture so the lender can make a warm, human connection when the time is right.

Journeys enable lenders to position one or many product offerings, such as a cashout refinance, HELOC, reverse mortgage, or even recommend moving their mortgage insurance where applicable.

Lenders are also using this real-time home equity data to enrich other customer interactions. During annual mortgage checkups or other regular communications, lenders can have meaningful, personalized conversations with customers about how

they can leverage their available home equity to support their financial goals.

And marketing teams can use this robust equity data to automatically segment their databases — initiating targeted campaigns that alert prospects to available equity and deliver hyper-relevant education on how home equity lending products can unlock that equity.

Lenders need to use smart tech to meet homeowners where they are

Too much of the buzz in the mortgage industry today suggests we have no choice but to accept a few down years.

Like any market, changing conditions just change the mix of demand. Lenders are looking at massive opportunities in home equity lending over the next few years.

They just need to focus on finding that opportunity and nurturing that demand.

The key here is using smart technology to take a truly customercentric approach: With deeper equity insights and intelligent automation, lenders can provide genuinely useful information on available home equity to the customers who need it most. n Dan Catinella is Total Expert’s chief lending officer. He has over 20 years of experience in the mortgage technology industry.

PEOPLE ON THE MOVE // > ServiceLink bolstered its origination

division with a trio of industry professionals, including award-winning Joe Amoroso, to spearhead client growth strategy. Laurinda Clemente, joined ServiceLink, as national sales executive, along with Tom Lum, who also joined as a national sales executive.

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| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

HAVE A NEW HIRE OR PROMOTION TO SHARE?

Submit the information to Keith Griffin at

kgriffin@ambizmedia.com

for possible publication.

Announcements should include a headshot.

N O N - Q M LE N DE R RE SOU RC E GU IDE

Acra Lending Lake Forest, CA

Acra Lending is the leader in NonQM Wholesale and Correspondent lending programs. Offering a range of programs and services geared toward helping mortgage professionals and borrowers achieve their purchase and investment goals. We are committed to providing simplicity, consistency and an optimal customer experience. acralending.com (888) 800-7661 sales@acralending.com LICENSED IN: AL, AZ, AR, CA, CO, CT, DC, DE, FL, GA, ID, IL, IN, KS, KY, LA, ME, MD, MI, MN, MT, NE, NV, NH, NJ, NC, OK, OR, PA, SC, TN, TX, UT, VA, VT, WA, WI, WY

Champions Funding Gilbert, AZ

Mission Driven Non-QM + CDFI Wholesale Lender At Champions Funding, we Non-QM all day, every day! It’s our core business, and we live to serve underserved borrowers through our valued broker partners. We put diversity and inclusion into mortgage lending by empowering the mortgage broker community to provide solutions for non-traditional credit profiles and those who cannot get approved with standard financing. Through our highly coveted CDFI certification backed by the U.S. Department of the Treasury, we can offer our flagship neighborhood products and tap into a $1 Trillion market of historically underserved communities in the country.

Focused on speed to closing (in days, not weeks), smooth processes, and user-friendly access to our underwriting and support teams, we offer modern, flexible, and responsible non-traditional lending solutions. champstpo.com (949) 763-9494 Wholesale@ChampsTPO.com

Newfi Wholesale Emeryville, CA

DSCR, Bank Statement, 1099, Asset Depletion, Buydowns, Full Doc Non-QM No one knows Non-QM like us. Newfi Wholesale is an exception-based Non-QM lender dedicated to helping brokers find success. We offer a full Non-QM product suite including: Full-Doc, Bank Statement, 1099, Asset Depletion, Interest Only, Non-QM ITIN, Non-QM Buydown, DSCR 1-4 & 5-8 Units, DSCR Condotels, Graduated Payment Mortgages, and more. At Newfi about 1/3 of our funded deals have exceptions that we make in-house! newfiwholesale.com (888) 415-1620 support@newfi.com LICENSED IN: AL, AK, AZ, AR, CA, CO, CT, DC, DE, FL, GA, HI, ID, IL, IN, IA, KS, KY, LA, ME, MD, MI, MN, MS, MO, MT, NE, NV, NH, NJ, NM, NC, ND, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, WA, WV, WI, WY

LICENSED IN: AZ, CA, CO, CT, DC, FL, GA, HI, IL, IA, MD, MI, NJ, NC, OR, PA, SC, TN, TX, UT, VA, WA

Find the full list of Non-QM Lenders on page 60

A M C RE SOU RC E GU IDE

PCV Murcor Pomona, CA

pcvmurcor.com sales@pcvmurcor.com (855) 819-2828

AREA OF FOCUS: Nationwide Real Estate Valuations Management — Appraisal Management Company DESCRIPTION OF PRODUCTS OR SERVICES: Licensed in all 50 states, plus D.C., PCV Murcor provides nationwide appraisal management and valuation advisory for residential and commercial

real estate. An industry leader with over 40 years of experience managing valuation needs for mortgage lending, financial institutions, estate and litigation, real estate investors, and mortgage servicers.

Find the full AMC list on page 61 NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024 |

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HARVEY MACKAY

BUILD-A-BROKER: HANDS ON PRACTICAL ADVICE

YOUR FIRST MILLION DOLLARS

You Can Be Your Own

Inspiration Mentally stimulate yourself, especially to be creative

J

BY HARVEY MACKAY, CONTRIBUTOR, NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

oe was an ambitious young man who never missed a day of submitting a new idea to his boss, and his boss never missed a day of rejecting Joe’s idea. But one day, Joe submitted a suggestion, and his boss said, “That’s sheer inspiration!”

“No,” said Joe, “it’s 99% aspiration and one percent inspiration.”

Inspiration often starts with aspiration.

Thomas Edison had a similar take when he said, “Genius is one percent inspiration and 99% perspiration.”

The definition of inspiration is the process of

being mentally stimulated to do or feel something, especially to do something creative.

That might be why Dolly Parton said, “When I’m inspired, I get excited because I can’t wait to see what I’ll come up with next.”

Face it: sometimes it is hard to get inspired. It could be the weather or a variety of reasons. What is the best way to get back to being inspired?

Some of the most inspirational people I know are curious.

The old saying, “You learn something new every day,” should be taken very seriously. There’s certainly no lack of opportunity.

Be curious about everything around you. Do something that you’ve never done before, just for the experience.

The future belongs to the curious — the ones who are not afraid to try something, explore it, poke at it, question it, and turn it inside out. Let curiosity turn “I don’t know” into “I want to find out.” Curiosity makes us interested in a broad range of information. We learn for the joy of learning.

Curiosity is a hunger to explore and a delight in discovery.

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challenging problems. They can snap you out of a listless state and keep you inspired.

Why do most people seem to get their inspirations overnight? Because inspiration often comes from dreams.

So don’t just follow your dreams, chase them. Maybe that’s why entertainer Carol Burnett said, “When you have a dream, you’ve got to grab it and never let go.”

GOOGLE DREAMS

When we are curious, we approach the world with a child-like habit of poking and prodding and asking questions. We are attracted to new experiences.

SPARKING INSPIRATION

Another way to spark inspiration is through imagination. It’s never too late to develop your imagination, although I would caution that the longer you suppress it, the more challenging it will be. Even if you don’t think of yourself as the creative type, you can always amp your imagination up with a little effort.

Creativity, thinking outside the box, is another way to get inspired. What has always baffled me, however, is how we got in that box in the first place and why it is so hard to get out. It can get

Let curiosity turn ‘I don’t know’ into ‘I want to find out.’ downright claustrophobic.

Connection is yet another path to inspiration. Harvard University tracked the physical and emotional health of 700 people. They followed these people and tested them (e.g., blood samples, brain scans) for 75 years. Here’s the primary conclusion: Good relationships keep us happier and healthier. Good relationships help you deal with life’s minor annoyances and your most

The creation of Google can be traced back to a Larry Page dream in 1996. Page had a dream where he was admitted into college because of a clerical error and thought he would be kicked out at any moment. That anxiety fueled a dream of downloading and storing the Internet on individual PCs. When he woke up, he was curious to see if it was possible, so he did the math. It wasn’t, given the amount of data, but he could save everything as individual links. That gave him the idea of creating a searchable database of links to web pages that led to the creation of Google.

The melody for one of The Beatles’ greatest songs, “Yesterday,” came to Paul McCartney in a dream. In “The Beatles Anthology,” McCartney recalls: “I woke up one morning with a tune in my head, and I thought, ‘Hey, I don’t know this tune — or do I?’ It was like a jazz melody … . I went to the piano and found the chords to it, made sure I remembered it, and then hawked it round to all my friends, asking what it was: ‘Do you know this? It’s a good little tune, but I couldn’t have written it because I dreamt it.’”

Speaking of “The Beatles,” John Lennon, a self-declared dreamer, said his inspiration for one of his best-selling songs came from a dream, and it was appropriately titled “#9 Dream.”

Mackay’s Moral: Aspire to inspire before you expire. n Harvey Mackay is a seven-time New York Times best-selling author with 15 books.

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MARY KAY SCULLY

BUILD-A-BROKER: HANDS ON PRACTICAL ADVICE BENCHMARKS & BEST PRACTICES

It Like It’s Hot A good analysis will put you on the right path

I

BY MARY KAY SCULLY, CONTRIBUTOR, NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

n January, everyone is gearing up to change their lives around. Whether it’s buying meal prep containers or joining a new gym, people are spending a lot of money in hopes of bettering themselves this year.

I have an idea for how to kick off 2024 that costs nothing but time and can help you see big returns for your business this year. Rather than starting with lofty and hard to define goals or resolutions, kick off the year with a SWOT analysis. Knowing your Strengths, Weaknesses, Opportunities, and Threats will show you clearly what you do well and where you can improve in the new year.

STRENGTHS

It’s easy to start with strengths. What are you good at? As we start

a new year, take time to pat yourself on the back for the accomplishments you’ve made — but don’t take your strengths for granted. Just because you’re great at something now does not mean you always will be. There is always room for growth and, as quickly as this industry changes, being an expert in something today does not guarantee you will be an expert on it tomorrow. And don’t forget to qualify that your strength is a value add to your customers.

Just like all the gym memberships that will mostly fall by the wayside, if you don’t keep working your muscles, you lose what you’ve built.

The same goes for your skills. You have to keep building on your strengths so they don’t turn into weaknesses down the road.

It’s tempting to spend all your time here, reveling in your many successes, but I’d argue that the other three areas will be the ones that give you the most ideas for how to make 2024 a more successful year.

WEAKNESSES

No one likes talking about their shortcomings,

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The

weaknesses that you don’t turn into opportunities can easily

become threats,

but there are also some threats that will be outside your control. but it has to be done. You can’t fix a problem if you can’t admit the problem exists. For example, in December, we looked at declined files. If you did last month’s homework, you should know the reasons for the rejections you saw last year. Now is the time to make a game plan so that you don’t repeat the same mistakes.

The goal of identifying your weaknesses should always be to figure out how you turn your weaknesses into opportunities. This way, it feels more like solving a puzzle than making a list of things you don’t do well. As Thomas Edison said, “Our greatest weakness lies in giving up,” so let’s attack 2024.

OPPORTUNITIES

Now that you know your weaknesses, you know where your opportunities are.

For example, if you have a lot of self-

employed borrowers, but aren’t good at tax returns, that’s a weakness — but it’s also an opportunity to educate yourself and become an expert so that you’re able to work with more self-employed borrowers and build a reputation for yourself.

The same can go for any weakness — find a solution that can turn your weak points into growth opportunities.

THREATS

The weaknesses that you don’t turn into opportunities can easily become threats, but there are also some threats that will be outside your control.

Competition, market conditions like interest rates, housing supply, etc. and other economic factors can be threats that you cannot change.

In the times where you cannot eliminate your threats, you can always plan. Knowing your potential threats helps you strategize.

Having a game plan for different situations that could arise in the coming year can help more than you would think. Instead of having a knee-jerk reaction in the moment, you can have a well-thought-out plan ready to be put into action. Take the time to prepare now while your mind is clear and you can think through your threats from different angles.

Getting your year off to the right start doesn’t require a big investment — no memberships, subscriptions or purchases are needed. You just need to take inventory of your strengths, weaknesses, opportunities, and threats and create a plan that will carry you through 2024. n Mary Kay Scully is the Director of

Customer Education at Enact, leading the development of the company’s customer education curriculum.

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DATABANK

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THE NEW ENGLAND MORTGAGE

Welcome

The nation's largest regional event is back!

T

he New England Mortgage Expo returns to the fabulous Mohegan Sun Resort & Casino in 2024!

With over 2000 attendees in 2023, you won't want to miss this opportunity to be a part of New England's largest and most exciting mortgage event — the largest regional mortgage show in the nation. Join

your peers for an exiting day of networking, product showcases, educational sessions, motivational speakers, and so much more!

Thanks for being a part of the largest mortgage show in the Northeast!

nemortgageexpo.com Presented By:

Title Sponsor:

THE NEW ENGLAND MORTGAGE

AGENDA

January 11, 2024 12:00 pm Registration Opens

1:30 pm–2:15 pm Meeting Room 2

12:30 pm–2:00 pm Rocket Pro TPO Main Stage What Will be Keeping You Up At Night in 2024?

Join us for a conversation of different issues facing our industry in 2024 that will impact all mortgage professionals.

Topics range from cybersecurity threats and liability; reconsideration of value policies and appraisal bias; fair lending and redlining under the examination microscope; REALTOR compensation lawsuits and the potential impact on homebuyers; Washington DC happenings; market compression and more. Jeremy Potter will moderate a discussion with a panel of diverse industry experts. You won’t want to miss this fast-paced discussion!

Presented By: Jeremy Potter, titleLOOK®

by Mainspring Services

Navigating Volatility: Originator Tactics for Turbulent Times Discover essential strategies and tactics to thrive in the ever-changing mortgage market at our webinar, "Navigating Volatility: Broker Tactics for Turbulent Times." Join us to gain valuable insights and tools that will empower you to confidently navigate uncertainty and provide exceptional service to your clients.

Presented By: Michael Pearson, A&D Mortgage

2:15 pm–3:00 pm Meeting Room 2 YMPA Branding Session Join the CMBA Young Mortgage Professionals for an enlightening panel discussion on the art of building a compelling personal brand through storytelling, intertwined with invaluable insights from the field, emerging technologies, and current market trends.

Our panelists, seasoned experts in the

12:30 pm–3:30 pm Salons D2/D3 Non-QM Summit Non QM loans are a critical tool for mortgage originators, but this year there have been significant shifts in the industry caused by the ripple effects of the pandemic. Many companies are now re-starting or entering the Non QM space. But the rules for borrowers

and brokers are changing.

That’s why the New England Mortgage Expo is pleased to present The Non QM Summit, a specialized half-day program that takes attendees inside the thinking, planning and programs of the nation’s leading Non QM providers.

mortgage industry, will delve into the intricacies of crafting a captivating narrative that resonates with your audience while leveraging the power of real-life experiences, cutting-edge technologies, and the pulse of the market.

Panelists include Kelly Turner, Total Mortgage; Zachary Kammerdiener, CATIC; Jim McLoughlin, Norcom Mortgage

4:00 pm–6:00 pm Exhibit Hall Opens 4:00 pm–6:00 pm Exhibit Hall CMBA Cocktail Reception Cocktail reception with exhibitors, presented by the CMBA.

THE NEW ENGLAND MORTGAGE

FULL AGENDA

* Agenda subject to change.

Please scan for latest schedule.

THE NEW ENGLAND MORTGAGE

AGENDA

January 12, 2024 7:00 am Registration Opens 8:00 am–9:00 am

Keynote Speaker Don Mann Former Member of SEAL Team Six, Renowned Athlete and Trainer

8:00 am–2:00 pm Headshot Booth

KEYNOTE SESSION

Start the year off right with a professional headshot.

Rocket Pro TPO Main Stage

Have your headshot taken for free as an attendee of the New England Mortgage Expo! Simply reserve your time slot. Walk-ins are not guaranteed and depend on availability.

How To Make Mortgages Like You're SEAL Team Six Few people on earth have fit more into a life than Don Mann. A former Navy SEAL Team Leader who was twice captured by enemy forces and lived to tell his story, Mann has played a crucial role in some of America’s most daring military missions for more than two decades.

Most recently, he trained the SEAL Team Six warriors who assassinated Osama bin Laden in May 2011.

Mann, who’s also a New York Times bestselling author, accomplished endurance athlete and mountaineer and star of the reality TV series Surviving Mann, recently has focused his attention on inspiring others to achieve goals they never imagined they could. As a soughtafter motivational speaker around the U.S., Mann addresses a wide range of audiences — from major corporations to universities, to professional sports teams. He takes crowds inside a gripping underworld of risk and courage, while relating tales from the battlefield as well as from grueling suffer-fests like the Hawaii Ironman, which he has completed twice.

His message includes equal doses of inspiration and strategy. As he likes to say, “Anybody with the proper mindset can achieve anything imaginable.” The key, which he relates in his “Reaching Beyond Boundaries” presentation, is to “turn macro goals into micro goals.”

In this special appearance at the New England Mortgage Expo, Don Mann will share his amazing stories and help you see how you can apply his principles to building the best team possible to hit your targets as a mortgage lender.

Mann received a Masters in Management from Troy State University, in Troy, AL, a B.S. in International Relations & Criminal Justice, from Florida State University, in Tallahassee, Fla, and a B.S. in Liberal Science, from State University of New York. He lives in Williamsburg, Va. Presented By : Don Mann, Former Member of SEAL Team Six, Renowned Athlete and Trainer

THE NEW ENGLAND MORTGAGE

FULL AGENDA

* Agenda subject to change.

Please scan for latest schedule.

9:00 am–9:45 am

CONCURRENT SESSIONS Rocket Pro TPO Main Stage The Rise of AI — The Future of Mortgage Everyone in the mortgage industry is wondering: what will the rise of Artificial Intelligence mean? There's no need to guess, since there's already one company that's been running on AI-powered systems since 2018. Sun West Mortgage's sister company, Celligence, created an AI underwriting and processing platform that Sun West has been using to power its company for the past five years. Underwriting is now measured in minutes, and processing tasks are primarily automated. This has allowed Sun West to make better loan decisions, expand credit to more communities, and free originators to spend more time building business rather than babysitting files. In the past year, Sun West has opened its system -- called Angel AI -- to the origination community at large, and backs loan decisions made by its system "100%" -- meaning that if an originator gets a green light from Angel AI, Sun West will commit to closing the loan, period.

Don't miss this incredible session looking inside a large mortgage lender running its operations fully on artificial intelligence.

The future is already here. So now the question is: what's next?

Presented By: Angel Elliott, Managing Director of Organizational Development, Sun West Mortgage Company

Keynote Speaker Mike Fawaz Executive Vice President, Rocket Pro TPO Meeting Room 2

With the consumer mortgage industry continuing to experience declining volume and rising rates, brokers and originators may be wondering how they can grow their businesses in 2023. Now is the time to diversify product offerings and learn how to thrive by leveraging loan programs for real estate investors like fix and flip and DSCR loans.

has closed an impressive 11,000 loans in 2020 and 2021. In this session, Thuan will share his valuable insights on how he adapted to the market downturn by shifting his focus from 95% refinance to 70% purchase, and how he managed to increase his production by over 50% from February 2023 to March 2023. You'll learn from a master in the industry and gain valuable strategies for maximizing loan production and navigating market changes. Join us and take your origination skills to the next level!

In this session presented by RCN Capital, you will learn:

Presented By: Thuan Nguyen, CEO, Loan Factory, Inc.

Grow Your Business in a Changing Market with Fix & Flip and DSCR Loans

• What opportunities exist right now in the real estate investment space • How to make more money by leveraging fix and flip loans, DSCR loans, and other private lending products • How to identify potential investor clients, accommodate their needs and retain more business • Common scenarios and how to present the best financing options Maximize your success in 2024 and don’t miss this informative session!

9:45 am–10:30 am

CONCURRENT SESSIONS Rocket Pro TPO Main Stage Lessons from the #1 Loan Originator Don't miss this opportunity to gain valuable knowledge from Thuan Nguyen, a highly successful loan officer who

Meeting Room 2 How to Find Non-QM Borrowers The mortgage market is going through a transition making business growth challenging for 2024. Agency business is shrinking, refinance volume has declined, and rates are still high. What can help replace the lost business? Non-QM. Non-QM provides you additional financing for underserved markets, options your competitors may not offer, and allows you to retain loans that you normally would not make. Let us demonstrate the benefits of adding nonQM options to your product mix.

Angel Oak Mortgage Solutions presentation, will cover: • Why non-QM is in demand in today’s market • Details on the types of non-QM programs

New England Mortgage Expo is brought to you by American Business Media, Connecticut Mortgage Bankers Association, Inc., and Rocket Pro TPO.

• The borrower profiles for each program • Common scenarios and questions • How to close more loans using non-QM • Where to find non-QM borrowers 10:30 am–11:15 am

KEYNOTE SESSION Rocket Pro TPO Main Stage

The Power Of Choice In a world where you are pushed in so many different directions, how do you empower your team to fight for what makes them win everyday? For brokers and originators, the key lies in one simple super-power: optionality.

Everyday you get to choose who you want to be; you get to choose how to be the best for your clients. That's what lets brokers win. Learn how to create motivation, inspiration and innovation as you build success. Join Mike Fawaz, Executive Vice President of Rocket Pro TPO, as he demonstrates what can be achieved using the power of choice.

Let's make the right choice together.

Presented By : Mike Fawaz, Executive Vice President, Rocket Pro TPO 11:15 am–2:00 pm Exhibit Hall Opens 2:00 pm Conference Adjourns

Finding A Market In

Gen Z To achieve their home ownership dreams, young borrowers need guidance

BY SARAH WOLAK, STAFF WRITER, NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

G

eneration Z has a lot of stereotypes to battle. Known for being chronically online, Gen Zers are often described as social justice warriors, social media addicts, and impossible to please. So why add financially irresponsible to that list?

FinLocker, a data analyst that focuses on consumers’ financial data, partnered for the second year in a row with students — this time, a different cohort — in the American Marketing Association’s group at the University of Southern California.

The goal of the partnership was the same as 2022’s: discover the financial goals and attitudes of Gen Zers.

This year’s survey was conducted over three weeks in April 2023 and targeted Gen Z individuals, with 84% falling within the age range of 18-22 years. Similar to last year’s study, the

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survey also raised questions about how mortgage professionals and others in the financial services industry can better understand and help the upcoming generation of homebuyers.

The survey kicked off with an eyebrow-raising statistic: nearly 56% of respondents admitted that they aren’t actively managing their finances. Yet their goals were aligned with last year’s cohort to eventually be financially free from debt.

“The biggest finding year-over-year was overall the survey told us that this particular cohort is very much thinking about ultimately owning a home,” said Brian Vieaux, FinLocker’s president and chief operating officer. “Where ultimately, that was not as much evident in last year’s survey.”

Learning about Gen Zers’ short and long-term financial goals was a key area in the survey. The top priority of being financially free came with a desire for financial education, unlike last year’s

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

“I don’t think we’ll see 100% online [mortgage experiences], especially for first-time buyers.

That means the role of the local LO today is more important than it’s ever been, especially if

they’re able to combine digital with their expertise and trusted experience.” > Brian Vieaux, president and chief operating officer, FinLocker

findings. Other priorities identified were paying off student loans, car loans, and credit card debt. The survey also included that the average Gen Zer is just shy of $21,000 in debt.

G

IT STARTS AT HOME

ood financial habits aren’t developed overnight. FinLocker’s findings included that most of the respondents focused on learning and exercising good financial practices based on what their families and friends taught them. Jade Bahng, a member of the American Marketing Association at USC

and a sophomore, says that something that alarmed her about the survey was how her peers weren’t integrating good credit practices into their daily lives, even though they knew it was necessary. “Gen Zers are still learning how to be financially fit and how to build a credit score, but a lot of people in the focus groups weren’t putting that into practice yet, they were still in the stage of learning and gathering financial information,” said Bahng, who is also a member of Gen Z. “Our habits and actions and methods of using credit and using debit were still very based on what we learned from our families.”

Vieaux said that the survey identified the concept of a “fin-fluencer,” meaning a social media talking head who offers financial advice.

“Where these young folks are going for information is logically first their parents but then the

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next source is social media and following financial influencers who are educating through social channels on financial fitness and wellness,” he said. “Those influencers become a part of their trusted resources.”

Like the survey’s findings, Bahng says she was in the majority group that sought financial advice from relatives and friends, and she admitted that many of her credit habits came from her parents. But she also noted that her definition of homeownership — and her peers' — differed from the previous homebuying generation. “I think the idea of homeownership has evolved from my parents’ age to my age, and [for] Gen Z now … homeownership has become this eventual, later, idealistic goal, but not something that we’re looking into right now,” Bahng explained, alluding to the 43.5% of survey respondents who said they hoped to buy between ages 28 and 32. “Maybe that’s because Gen Z has become known as this proactive, entrepreneurial generation and nobody knows what our next step is going to be. There are jobs that didn’t exist before that we’re coming up with, so that means Gen Z has a moving and migrating mindset.”

But even though Gen Z is focused on saving and paying off debts, they’re

still hopeful to buy early. Only 13.89% of respondents anticipated buying between ages 33 and 37 — close to the National Association of Realtors (NAR) national average of first-time homebuyers age, which was 36.

Bahng also noted that many of the focus groups in the survey identified financial influencers as an educational resource to refine their financial fitness. Gen Z doesn't accept at face value what experts say even if they are deemed credible and are verified by social media platforms, Bahng said. “You never know who can give good financial advice; we asked what Gen Zers value and how they cross-check information. And it turns out that they’re tuning in to many different platforms and seeking a wide array of information before making financial decisions.”

B

PLAYING IT SAFE

ahng doesn’t seem to suggest that Gen Zers are behind on financial education and homebuying knowledge. She says that being able to use advice from other adults as well as find what works for her — like integrating a financial tracking service into her daily life — has helped her create a plan for when she graduates.

“I just completed my freshman year,

“I think the idea of homeownership has evolved from my parents’ age to my age, and [for] Gen Z now

… homeownership has become this eventual, later, idealistic goal, but not something that we’re looking into right now.” > Jade Bahng, a member of the American Marketing Association at USC

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| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

so learning about homeownership and finances opened a lot of doors for me to start planning early,” she said. “Luckily I have side jobs, scholarships, and workstudy programs that allow me to live while in school. I’m putting away my other money with the eventual goal of buying property after graduation.”

The survey revealed that Gen Zers prefer to play it safe when it comes to their saving strategies. A good chunk of respondents — 41.98% — say they’re primarily saving in a savings account.

Last year, Vieaux pointed out that 5% of survey respondents reported putting their savings into crypto assets. But this year, that number shrunk to below 1% — potentially due to the crypto crash.

So it makes sense that survey respondents also expressed the desire for a hybrid mortgage experience for when they do buy a home, meaning both online and in-person interactions with trusted financial professionals. “This cohort wants to self-serve to a degree: they want to have access to information and have the ability to do things themselves, but it’s important for them to connect with a trusted resource and professional when they have questions,” said Vieaux. “I don’t think we’ll see 100% online [mortgage experiences], especially for first-time buyers. That means the role of the local LO today is more important than it’s ever been, especially if they’re able to combine digital with their expertise and trusted experience.” n

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MORTGAGE ROUNDUP

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The Club Nobody Wants To Join Getting on the Freddie Mac Exclusionary List is one thing;

escaping is another

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BY SARAH WOLAK, STAFF WRITER, NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

icture this: it’s the one club that doesn’t have a line out the door, and the people in it want out. And the VIP list isn’t so glamorous to be on. Behold the ominous and enigmatic Freddie Mac Exclusionary List, casting its shadow upon the mortgage industry like a brooding storm cloud. This so-called “blacklist” has the power to banish individuals from the sacred realm of Freddie Mac, both directly and indirectly, according to Freddie Mac’s website. In simpler, layman’s terms, it’s their secret weapon to keep the mortgage industry’s miscreants in check.

Per a Freddie Mac spokesperson, the list contains individuals and whole companies. The spokesperson reiterated that the contents of the list, however, are confidential.

The list, which isn’t available publicly, represents a scarlet letter for some loan originators. But what does the list stand for? Per Freddie Mac’s Single-Family Seller Servicer Guide, the list “protect[s] the integrity of its Mortgage purchase and Servicing functions. The names of persons or entities whose conduct presents risks to Freddie Mac, as determined by Freddie Mac in its sole discretion, may be placed on the Exclusionary List.”

With no publicly available copy of the list, the list in itself poses a slippery slope for originators. And, in other words, it’s a big, mysterious club where Freddie Mac

gets to play Santa Claus — sans the elves — and decide who’s naughty and who’s nice, without any pesky regulations or due process to cramp their style.

LIMITED SUCCESS

S

hawn Yesner, an attorney for Yesner Law in Tampa, Fla., specializes in Chapter 11 bankruptcy, asset protection, and financial cases. But one of his specialties is helping clients get off — or attempt to get off — the exclusionary list. But even as an experienced attorney, Yesner says it’s not necessary for those on the list to jump the gun and hire a lawyer immediately after receiving the notice, but he says lawyers may

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offer up an edge to a client’s argument.

“I think the benefit of an attorney is that we’re trained and practice thinking about things in a certain way and arguing on behalf of our client,” he explained.

“While some non-attorneys have that skill, it is the same concept as using an auto-technician to change your oil, a CPA to file your taxes, a Realtor to sell your house, etc.”

So what’s the cost? Yesner disclosed that he charges a flat rate for helping with letters to Freddie Mac instead of hourly or contingency fees. Yesner’s careful not to mention a ballpark rate because he admits that getting a client off the list is only successful half of the time.

While this statistic sounds grim, Yesner explains that Freddie Mac is elusive about their reasoning behind why someone in

criminals,” said Yesner, even though the list has no accordance with the law.

And being on the list isn’t the only enforcement action that Freddie Mac could take. The spokesperson explained “Freddie Mac may refer matters to an individual’s employer and to trade or professional organizations whose rules govern that conduct. In some circumstances, Freddie Mac has an obligation to report suspected unlawful activity to the relevant government authority.”

all was said and done he was on the list.”

Thompson said that he called his friend Fred Taylor, the former president of Ginnie Mae, for advice. They both approached Freddie Mac, who was adamant that Thompson’s client had committed fraud. “There was no court in this situation,” Thompson said. “They had made a decision and put him on the list, and he couldn’t defend himself. It took about two years for him to show proof that he wasn’t involved in fraud.”

TRIAL AND ERROR

LAST-DITCH EFFORTS

S

o how do LOs and others in the industry end up on Freddie Mac’s death row? Greg Thompson, founder and CEO of Californiabased Secondary Marketing Solutions,

F

reddie Mac offers one final catch to those on the list: the ability to appeal their case after a year, provided they were unsuccessful in persuading the GSE

“I try to identify trends amongst all my clients: what did I say in one letter that I didn’t in another?

I don’t spend a lot of time on a lengthy explanation because Freddie Mac doesn’t care; they want to be shown the evidence, not told.” > Shawn Yesner, attorney, Yesner Law the industry is on a list, which in turn hurts his statistics. The GSE gives an offender 21 days to prove that they didn’t do anything wrong. And most times, the “proof” is rejected because Freddie Mac doesn’t believe the person can change in 21 days’ time. They may be kind enough to drop a breadcrumb by revealing the initial “why” Yesner says, but don’t hold your breath for a heartfelt response. Per Yesner’s experience, Freddie will send either a cookie-cutter congrats or a polite brush-off letter. It leaves folks in the industry feeling like they’re participating in some shady underworld operation because the list’s legality is about as clear as mud.

To add to the list’s grim reputation, Yesner cited an emotional component to it. “It makes people feel like they’re

36

has experience helping clients attempt to get off the list. Unlike Yesner, Thompson doesn’t practice law and says he only became involved in helping people when a client expressed to him that he was on the list after finding out four of his loans with Freddie Mac defaulted.

Thompson says that the loans in question involved brokered loans not funded on the client’s warehouse line.

“He didn’t have control of the due diligence after he brokered the loans. He didn’t even know how to defend himself, it was quite an unusual situation,” Thompson said. “Freddie Mac sent him a notification that the loans were fraud …

It was around 2007 or 2008 and he ended up being in a position where he had to shut his company down and then when

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

during the initial 21-day assessment period. The same spokesperson said “Freddie Mac will generally provide an individual or company written notice of the proposed placement of their names on the Exclusionary List, along with an opportunity to submit a written response … We consider removal requests on a case-by-case basis.”

To appeal or not to appeal is the ageold stressor that comes as a side effect of being on the list. After all, Freddie Mac has a rule that the offender can appeal a max of one time per year. Yesner says that in his experience, clients who are on the list express concerns first about how to do business while on the list. “I’ve had clients who have been on the list for over a decade,” Yesner said. “Many of

them have to survive by doing all-cash, commercial, or conventional loans.”

However, not all stay afloat. Travis Salisbury, an attorney with Mahdavi, Bacon, Halfhill & Young, PLLC, says that he’s seen the list destroy the lives of his clients. Salisbury and his firm, like Yesner, work with those on the blacklist frequently. “I think a lot of people in the industry are unaware of the consequences of being put on the list,” he said. “It will essentially render your career in purgatory until you get removed from that list.”

Salisbury estimates that the success rate of getting off the list is about a 40-50% chance if they wait the one-year period to appeal. “[However,] better success happens when people try to appeal immediately after getting the notice from Freddie [Mac] that they could be added to the list. Probably 6070% chance,” Salisbury elaborated.

letter detailing a company’s processes and procedures to ensure that the loans are actually secure. I’ve even sent credit reports to prove that information wasn’t falsified. Think of it this way: if someone is asking for parole, they don’t argue with the parole board. Instead, they argue that they understand what they did was wrong and that they know how to avoid the situation.”

Salisbury and his firm, on the other hand, vet clients who are on the list. “In our experience, we kind of have an internal theory that there are two ways to get off the list: one, exculpatory evidence and definitive proof that someone wasn’t involved in a bad loan process. For that, they go into detail about the company structure and how someone’s name might have popped up even if they weren’t directly involved,”

A THORNY PATH

I

f and when a client decides to appeal, the firm representing them will send a package of evidence, including a letter to Freddie Mac, defending the client and explaining in detail why they should be removed from the list. A lot goes into a successful package, Salisbury and Yesner both say. “The biggest issue is that Freddie gives you nothing [and they have] no online resources,” Salisbury said. “Freddie has their justifications so you need to present a strong argument to keep someone off.” Yesner agreed, saying “I haven’t been able to talk to someone from Freddie Mac or create close ties with anyone there.”

So a lot of the appeal process is a guessing game. Yesner admits that a lot of guessing goes into what he puts into a package. “I try to identify trends amongst all my clients: what did I say in one letter that I didn’t in another?” he said. “I don’t spend a lot of time on a lengthy explanation because Freddie Mac doesn’t care; they want to be shown the evidence, not told.”

Some trends Yesner identified are Freddie Mac being weary about a company’s processes and being meticulous about W2 forms, credit reports, and employment records. “[Freddie] doesn’t like it when a person has a ‘lack of control’ over their Freddie Mac products or processes,” Yesner said.

“So in that case, I spend my time in the

>Travis Salisbury, attorney, Mahdavi, Bacon, Halfhill & Young, PLLC

Salisbury said. “And two, mea culpa: You were caught doing something wrong that you didn’t know you were doing wrong. This approach involves apologizing and showing what they’ve done since then to rectify the problems to ensure this doesn’t happen again.”

of any issue, they are quick to jump on it, especially if the incident involves a small brokerage or small LO.” Salisbury theorizes, though, that Freddie Mac tends to be more forgiving to large producers. “Freddie tends to be more lenient on people that bring them more business,” he observed. “At the end of the day, they’re a business cloaked in a government shield.”

But for Yesner, the experience has been different. “I had a top producer for [Freddie Mac] on the list and in the letter, I was sure to write that it didn’t make sense that the more time this guy was on the list, the more money they were losing by not having this top producer writing loans,” Yesner said.

“This client eventually got off the list but I’ll never know which part of the letter I wrote was the selling point.”

Intimidation tactics could also play a role, Salisbury reasoned. “A lot of the time, we deal with people who are not officially on the list but have received the initial notice, and in that case, we will send a notice to Freddie that we have been retained and we are looking into it,” he said. “This is an attempt to have Freddie back off while the firm investigates the claim. And, if the client is cooperative, it’s a quicker turnaround for us to send a package back to Freddie — about 4-6 weeks.”

Those who manage to get off the list are tight-lipped about their experience, causing more ambiguity around Freddie Mac’s Exclusionary Club. Thompson, Yesner, and Salisbury all reached out to past clients to speak on behalf of their experiences on the list. All of them declined. “This industry is so tight and everyone knows each other … you don’t know if there’s going to be backlash as a result of being quoted,” Thompson explained. “This experience is like [them] versus the world.” n

THEORIES BEHIND THE LIST

A

t the end of the day, Salisbury says that Freddie Mac is out to protect itself.

“Since the housing collapse, this has been something they put great emphasis on,” he said. “They’re trying to make sure false loans don’t slip through the cracks. If there’s any whiff

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“I’m a Life Changer Extraordinaire.” > Todd Zelcer, American Financial Network

Purpose-Driven Pros SAY YOU'RE IN MORTGAGE WITHOUT SAYING YOU'RE IN MORTGAGE

BY ERICA DRZEWIECKI, STAFF WRITER, NATIONAL MORTGAGE PROFESSIONALMAGAZINE

Above, From LEFT TO RIGHT TODD ZELCER, mortgage loan officer, American Financial Network • MOISÉS J. PEREZ, mortgage loan officer, Yireh Finance & Lending MIKE FARACI, founder and CEO, Red Button Media • ANTHONY SABRI, division manager, E Mortgage Capital 38

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

R

emember that long take in Goodfellas where Henry Hill steers his thengirlfriend Karen into a restaurant through the back? He passes $20 bills to waiters who greet them, hustling to get the couple the best table in the house. “What do you do?” she asks him. “I’m in construction,” Henry says. And her, stroking his hand: “You don’t feel like you’re in construction.”

We here at NMP Magazine put forth that same inquisition on social media, challenging mortgage professionals who follow our publication to say they’re in the business without actually saying they’re in the business.

UP TO THE CHALLENGE

help families with their dreams.”

Mike Faraci, founder and CEO of Red Button Media and Video Marketing Marvels in Orange, Calif., did not take the question ‘What do you do?’ lightly. In fact, he came up with a whopping total of seven responsibilities.

“I help renters become homeowners.”

“I build strategic debt and equity strategies for homeowners.”

“I help people buy homes with no money down.”

“I help the self-employed qualify to buy a home.”

“I provide home financing in underserved communities.”

“I help investors build real estate portfolios.”

“I build generational wealth strategies for young families.”

And in conclusion, Faraci beckoned, “Come on, mortgage people ... WHAT DO YOU DO?!”

The prompt, “What do you do?” drew a lot of interest, especially among the West Coast crowd.

Respondents were not nearly as elusive as the young mobster with so much to hide, most opting to INSTA FEEDBACK take a clear and focused approach to defining their Photo and video-sharing platform Instagram professional purpose. drew in more feedback.

Anthony Sabri, division manager at E Mortgage “I help take the fear out of buying a home,” Deb Capital in Irvine Calif., who goes by “The Debt Barone with JWK & Associates in Post Falls, Idaho, Alchemist” — enjoyed the challenge. said, adding a smiley face emoji for color.

“One way to describe what you do without saying An individual who bills themselves as ‘Donxjvan ‘I sell mortgages’ — is to say ‘I help people achieve Juan Munoz’ presented a woebegone perspective. their dreams of owning their own homes.’ As a “I’m an alcoholic who happens to help educate mortgage professional, you’re not just selling a clients about real estate financing,” this user wrote. product; you’re making people’s dreams come true,” And from the self-described “Prince of MLO” Sabri said in his response Moisés J. Perez of Yireh to the prompt, posted on Finance & Lending the employment-focused came a simple, “I help social network LinkedIn. people build wealth.”

“I say I’m a That’s just a sampling Life Changer of the literal, inspired, > Mike Faraci, Red Button Media Extraordinaire,” Todd and cynical career Zelcer with American Financial Network in Brea, manifestos of those who loan others money for Calif. wrote. decades at a time. Advocate for the homeless. Put Zelcer was one of several people to employ the word families closer together. ‘life’ in a description, suggesting the belief that some Mortgage professionals who chose to contemplate part of their nine-to-five impacts others’ lives. their existence in this industry. Who responded to Vickie Lasher, a branch manager for the same our challenge. company, said, “I am a life coach, a counselor, and I Now, it’s your turn. n

“I build generational wealth strategies for young families.”

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| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

COVER STORY How Lending To Cannabis Workers Can Provide A Growing Opportunity For LOs

BY ERICA DRZEWIECKI, STAFF WRITER, NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

A

rmed with an 800 FICO Score, a 40% down payment, and visions of picket fences dancing in their head, they saunter into the bank ready to apply for a home loan. But then, the financiers find out what they do for a living and all hell breaks loose.

This is the unfortunate tale many would-be homebuyers have to tell these days, as their work in the legal cannabis industry is unacceptable to many — if not most — lenders.

Those who are banking on this market are at an advantage, for now.

MEETING A NEED

“H

aving everything every other borrower has and then immediately walking in the door and being told no — we won’t touch you.

There are no options for you. You’re just persona non grata, go away. That’s the terrible thing that happens,” says Paul Jones, Non-QM director at Paramount Residential Mortgage Group in Corona, Calif.

PRMG recently expanded its Non-QM programs to allow employees and business owners in the medical or recreational cannabis industry to apply for loans.

“It’s been pretty seamless because all we’re using are the same Non-QM features that we’ve had all along. We’re just opening a doorway to more borrowers, who unfortunately were sitting on the sidelines,” Jones says. “It’s been interesting to see how many borrowers are in this space that are sitting on a tremendous amount of cash who have not been able to participate in home buying or refinancing the homes they already own.”

A mortgage professional for 21 years who holds a medical marijuana card in his home state of Florida, American Bancshares Mortgage Unconventional Lending Program Director Derek Bissen saw a need and met it.

“We started to get phone calls about this … banks

were turning down what seemed like perfectly normal, everyday loans that we would approve under any other circumstances except for the borrower’s employment,” Bissen recalls.

One of the most common calls his office gets is from someone who has already been through 95% of the origination process with another lender.

“They have gone under contract on a home, purchased an inspection, purchased an appraisal.

They’ve got their insurance lined up; their loan is actually underwritten and approved. And then the day before they’re supposed to go to the closing table, their loan officer calls them and says, ‘I’m sorry, but we can’t fund your loan.’ And it is crushing, especially for first-time home buyers.”

ON THE BOOKS

T

he lenders who deny have their reasons: federal law, public perception, risk mitigation.

Cannabis workers are indeed barred from the government-backed USDA, VA, and FHA loans, and limited to conventional and Non-QM loans.

Most banks’ charters stipulate that they operate within the confines of all federal, state, and local laws. But those are changing.

In a letter dated Aug. 29, 2023, the U.S. Dept. of Health and Human Services called upon the Drug Enforcement Agency to consider reclassifying marijuana as a Schedule III substance within the framework of the Controlled Substances Act. The recommendation is still under DEA review, and no timeline has been established. Analysts say the move would have far-reaching impacts on banking and finance.

Additionally, the Senate passed the Secure and Fair Enforcement Regulation Banking Act on Sept.

27, 2023, easing marijuana businesses’ access to banking and insurance services.

“Naturally, banks are more risk averse, so they tend to stay in a narrow pocket of lending,” Jones says. “They can hold money from people that are

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> Jayson Hardie, CEO and Co-Owner, Homestead Financial Mortgage

in these businesses legally, but they’re resistant.

There’s still a little bit of a stigma to offering solutions because the federal government hasn’t recognized cannabis nationally. Some banks are open to it, but very few are.”

Fannie Mae allows marijuana dispensary workers to apply for loans as long as their income is legal under state law, among other stipulations.

Homestead Financial Mortgage, out of St. Louis, Missouri, serves 10 states and lends to cannabis workers in all of them.

“Because Fannie is its own entity, that’s where this thin line of distinction lies,” explains Homestead CEO and co-owner Jayson Hardie.

Conventional loans require the borrower to have a larger down payment and/or credit score, so sometimes, his LOs have to work a little bit harder to help these folks get there.

“However,” Hardie says, “you’ve got a real cooperative borrower because they weren’t sure if they could qualify, and they needed somebody to hold their hand and navigate the landscape of their special circumstances.”

Bissen likes to joke that it might be easier for a borrower who sells cocaine as a side hustle to get a loan than the marijuana worker whose source of income is legit.

Cocaine is a Schedule II drug, a government classification designating it for “safe and accepted medical uses.”

Marijuana is and always has been a Schedule I, connoting it has high abuse potential like a Schedule II, but “no currently accepted medical use.”

Huh? “Until that changes, these banks are looking around, reading the terrain and saying, we would rather not take the risk on a particular loan and jeopardize our entire business,” Bissen says. “They’d rather play it safe, and understandably so. We’re all aware of the regulatory environment in our industry.”

HOW IT’S DONE

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merican Bancshares is licensed to originate residential loans in 29 states, which is more than some of the other lenders who serve this niche market.

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

“Many of the competitors I see are limited to one state or two states,” Bissen points out. “Because of my experience in it, generally I get the calls internally on, ‘what we need to do to make sure that this customer gets to the closing table?’ So I’m constantly training loan originators on this particular subject.”

Cannabis workers wanting to buy a home someday must be mindful they don’t keep their money in a piggy bank or buried under the shed for too long.

“We find, unfortunately, people who have what we call mattress money,” Jones says. “They leave it in a safe somewhere, and then they need to have it in a bank seasoned in order to even use it for the program. So, they might have to wait several months to move that money into those accounts. And then it becomes an issue with sourcing those funds.”

Pulling in business carries the same strategy applied to other Non-QM types. Go to the places where these types of potential borrowers are plentiful.

“No pun intended, it’s grassroots marketing,” Jones says. “We’re trying to get more of our loan officers to really pound the pavement and use good old-fashioned marketing to introduce themselves to the spaces where these borrowers and potential borrowers exist. The key with Non-QM is understanding the niche and knowing where to go find it instead of waiting for it to come to you.”

LOs can’t simply post up outside their local dispensary and see who’s buying. But nowadays, there are cannabis capital conferences, online communities and even celebrities who are open about their use and their sources.

QUALIFYING INCOME

“1

t’s a very supportive industry because of the challenges,” Jones says. “So there are referrals.”

Bissen keeps a blog, so that, combined with word of mouth, has led to success in tracking down these particular borrowers. The hard part is making sure they are income-qualifying.

PRMG calculates a potential borrower’s income upfront before submitting the full case to underwriting to ensure the income is workable.

“So if I have someone who’s just paid a W-2 and has a pay stub, we can qualify them using those standard methods,” Jones says. “But then we move to the self-employed business owner, and we’re going to use things like bank statement loans with as little as 12 months of business or personal bank statements and qualify them with pretty simple methodology.”

They can also qualify with a 1099, a verified profit and loss statement, or by treating assets like income without requiring they be pledged or liquidated.

“And the best part is,” Jones says, “any of those things that I just described, we can combine them. So we can leverage multiple income streams at the same time for an individual borrower or multiple borrowers.”

He applies Non-QM standards to loan applicants, keeping referral partners apprised of the timeline for structuring the loan.

“You really have to do your homework with these products. You really have to dig a little bit deeper into the guidelines.

Everyone’s slower now, right? Whether they like to admit it or not, we have more time on our hands. And why not invest in yourself and your future and other borrowers by learning these products more?”

The advice he has for LOs who are ready to take on cannabis worker-borrowers?

“Recognize your resources, leverage them, capture a full 1003 as soon as you can and review your credit reports for trade lines. All those things are just part of making sure that loan will perform on the secondary market. And that’s important.”

There’s still a … stigma to offering solutions because the federal government hasn’t recognized cannabis nationally. Some banks are open to it, but very few are. > Paul Jones, Non-QM Director, Paramount Residential Mortgage Group

THE SECONDARY MARKET

“T

he secondary market really appreciates Non-QM,” Jones says. “They love these loans because they perform very well. They have a very high margin, which is good in times like this when margin compression is still occurring with traditional products.

These are not subprime loans. The borrowers, on average, if you look at the securitizations, have a weighted CLTV of 70%. We call that skin in the game.”

Some of the cannabis workers who are applying for loans at the company are not only out to fund their primary residence, but also investment properties.

“There’s always an ongoing array of borrowers out there, despite whatever is happening in the economy with concerns about inventory and rates,” Jones says.

“If you look at the agencies today, they’re not really in love with those types of occupancies at certain LTVs, and the loan level price adjustments have been pretty painful. So the consumer who’s maybe not even your typical Non-QM borrower right now is taking part in some of these products because of the rate opportunity and just offsetting some of the other costs in other products. So the performance is great. The securitizations are in the hundreds of millions at a time.”

The Unconventional Lending program at American Bancshares takes two

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Homestead Financial Mortgage serves 10 states and lends to cannabis workers in all of them.

> Homestead Mortgage owners Jayson Hardie, Andros Ioakimides, Greg Aftayev.

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different avenues. They offer conventional financing for W-2 wage earners, but selfemployed applicants, they need the OK from private investors they work with.

“We do have servicing rights to hold paper. And that is key,” Bissen says. “That’s critical for us being able to lend in a conventional environment. And we have investor channels, and arrangements and relationships with these investors to make sure that they’re okay with this type of income. This is one of those gray-area-kindof loan requests that is not always written into the standard guidelines, so it requires that as an originator we dig and understand the actual guidelines for the program we’re offering. If you understand it, then you know whether or not the company you work for has avenues for your borrower so that you can either approve them or deny them quickly and let them move on to a different source for funding.”

Bissen recommends LOs be upfront with investors, underwriters, servicers and title companies.

“A staffing agency can conceal the source of the income a little bit. But It may not cover it 100%. So you can always make money betting on the side of the underwriter figuring things out. They’re very crafty and intelligent people.”

MISTREATMENT

S

ometimes, people pivot their financial strategy after being denied by other institutions and are not as forthcoming with the information needed to get them qualified, according to Jones.

“It’s always pretty seamless for the most part, but every once in a while, a borrower might be a little hesitant to disclose so much information on their business bank statements using that income to qualify,” he says. “There might be confidentiality in terms of who they’re working with, if they’re growing cannabis, and if there’s business networking opportunities. So, there’s still some friction from time to time with the borrower. But we’re much more accommodating and flexible than banks can be due to a lot of the regulations.

We can move through different product options that banks don’t have. So it makes it a lot easier.”

Hardie calls it “amazing” that more

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Banks are looking around, reading the terrain and saying, we would rather not take the risk on a particular loan and jeopardize our entire business. > Derek Bissen, Unconventional Lending Program Director, American Bancshares Mortgage financial institutions haven’t jumped into this space yet, where there is still so much opportunity.

“They’re just not educated enough in this space to be able to get people to qualify,” Hardie says.

“It’s just another niche component of mortgage lending that you have to be familiar with. And if you’re comfortable in that niche, it just becomes a niche that you exploit.”

It’s not a huge market, but it is an underserved market. And these days, LOs need all the borrowers they can get.

“What I like most about it is that we’re able to help people that the banking and finance industry have kind of pushed to the curb,” Bissen says. “It’s tragic to see the way the lack of knowledge about this particular topic intersects with our industry.

If your company can’t handle cannabis, then knowing that upfront will enable you to be a more efficient originator as well. If you can’t help them, you need to be able to send them on their way to the next call. And if you can help them, be reassuring and let them know that this is something that your company does and that

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you’re OK with it.”

A PEOPLE BUSINESS

T

he lenders in the know all agree on the fact that these borrowers are taxpayers, and that makes them eligible for home financing to the same degree as anyone else.

“There shouldn’t be a stigma about where you get your money, in my opinion,” Bissen says.

Being an LO often means playing double duty as a therapist.

“We’re in the people business. So we want to make sure that we’re treating people with sensitivity, professionalism, empathy, and efficiency as well.”

If federal officials were to make moves that open up this market, the competition might increase for these lenders, but that would be good for these borrowers.

“The change of stigma is a slow, glacial-moving thing in this country, no matter what the topic is,” Jones says. “But I think it would open up greater awareness for the borrower. It would free them up to weigh their options and consider their next financial steps more succinctly.”

At the end of the day, success in lending all depends on the borrower, no matter where they get money for the mortgage payment.

“The people that apply for mortgages that work in the cannabis industry are no different than anybody else,” Hardie says. “They’ve got a wife, kids, a spouse, and plans. They pay their bills. They’ve got to be able to try and make a living, and they’re trying to buy homes too. They’re trying to have a life.” n

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Acra Lending is a registered dba name of Citadel Servicing Corporation, 3 Ada Parkway, Ste 200A, Irvine, CA 92618; (888)-800-7661 (“CSC”) NMLS ID# 144549, Licensed under Arizona Mortgage Bankers License # 1034431, California Department of Financial Protection and Innovation under the California Residential Mortgage Lending Act license # 41DBO-74196, Finance Lenders License # 60DB0-94450, CA-DRE #01799059, Florida Mortgage Lender Servicer License # MLD523, Georgia Mortgage Lender License/Registration # 23462, Minnesota Residential Mortgage Originator License Other Trade Name #1 MN-MO-144549.1, Nevada Mortgage Company License # 4449, North Carolina Mortgage Lender License # L-160722, Oregon Mortgage Lending License # ML-5599, Tennessee Mortgage License # 125315, Utah-DRE Mortgage Entity License - Other Trade Name #1 12074249, Virginia Lender License # MC-5845. For mortgage professionals only. This is for informational purposes only. For legal and professional advice on applicable state and local licensing requirements that apply to you, please contact an attorney.

Acra Lending is an equal opportunity lender. Rates, terms, and programs subject to change without notice. Offer of credit subject to credit approval per applicable underwriting and program guidelines, applicant eligibility, and market conditions. Not all applicants may qualify. Not valid in the following states: AK, ND, and SD.

INDUSTRY TITANS

2024

2024

Meet The NMP 2024 Industry Titans

A

ccomplishments matter, especially when they benefit the entire mortgage industry.

In this issue, National Mortgage Professional Magazine honors 17 individuals who stand out for their achievements. Their years in the industry range from 15 to over four decades. Some are firmly ensconced in the C Suite, while others have become Titans as they climb the career ladder.

All share the common traits of innovation

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and leadership. Yet what strikes us most is how consistently our Class of Titans come across as good people who value the contributions of others and want to see them succeed and excel as they have themselves.

NMP Magazine honors the 2024 Industry Titans — the key players who have dedicated their expertise and years of experience to the mortgage business and represent the industry with professionalism and pride.

INDUSTRY TITANS

2024

Laura Brandao

William Dawes

CEO/Partner

Producing Branch Manager

LIGHTHOUSE ADVISORS

FAIRWAY INDEPENDENT MORTGAGE CORP.

I

ndustry Titan Laura Brandao has upbeat, practical advice for mortgage loan originators feeling stressed by current market conditions.

“Adaptability is your armor,” she says.

Laura adds, “In our industry, we weather different seasons, from the icy winters to the flourishing springs. Prepare for the winter by saving your ‘acorns’ to sustain your business. Use this dormant season for personal growth — master social media, embrace new sales techniques, and build your brand. Recognize that growth is constant.

Spring brings new opportunities, and in summer, evaluate your progress and adapt for the next season.”

Speaking of armor, Laura says, “Collaboration, to me, is like Sir Thomas Malory’s, ‘The Round Table,’ where King Arthur and his knights met as equals and trusted companions. It’s the notion of equality and trust that resonates deeply with me. No one person possesses all knowledge, and our diversity — in age, culture, and experience — enriches the collaborative process. The exhilaration of sharing ideas, experiences, and perspectives fuels my passion.”

Also, Laura says, “The supervillain of the mortgage industry is affordability, and its weakness lies in our collective actions. We must delve into down payment assistance programs, support federally subsidized building projects, promote renovation initiatives, expand chattel lending for manufactured housing, and provide educational programs for low to moderate-income families.”

No one person possesses all knowledge, and our diversity — in age, culture, and experience — enriches the collaborative process.

R

eaching peaks takes teamwork. That is what William Dawes believes when it comes to collaboration. This Industry Titan says, “A great thought doesn’t come out of a vacuum.

If I show up with a thought and you show up with a thought, then we both leave with more. Through open communication with an abundance mindset and active listening without judgment, we can reach peaks we couldn’t reach alone. By understanding another person’s perspective, we open our mind to solutions and opportunities that we would otherwise not be aware of.”

“A major benefit of this collaboration is just knowing that I’m not alone in the struggles I’m facing. I am energized … because we are leveraging our collective expertise for the benefit of everyone,” he adds.

William offers advice with a sporting touch on getting through challenging times. He says if a professional basketball player is on a losing streak before every game, they practice the fundamentals. “Every game is different, every player is different, but the fundamentals remain the same. We have been in a never-ending 3-point competition for the past few years with a never-ending supply of basketballs. If we miss a shot, no big deal; there’s another ball right behind it.

“Now, we have the last ball in our hand, and … there’s someone in front of us trying to take it from us. We are forced to remember footwork, dribbling, positioning, jump shots, etc. Let’s go! This is the drama of life, opportunity side by side with danger.”

A great thought doesn’t come out of a vacuum.

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INDUSTRY TITANS

2024

Michael Dresden

Mike Fawaz

President

EVP of Rocket Pro TPO

DART APPRAISAL

ROCKET MORTGAGE

F

or Industry Titan Michael Dresden, the biggest influencers in his life have been his parents, especially because he lacked a professional mentor as he achieved success.

Michael said his parents taught him the ways of being a good Christian, the importance of hard work, integrity, love for others, gratitude, and kindness … mixed with a healthy dose of competitive spirit and drive.

“They taught me to care and that the little things matter.

I owe any successes that I’ve achieved to them and the love they provided me at an early age, “ he says, adding, “I’ve never had the benefit of having a work mentor … a single person guiding, coaching, coursecorrecting, reassuring, listening and at this stage in my career, that seems unlikely that I ever will. I need to make sure I break that cycle and give back as much as I can to tomorrow’s leaders.”

Michael was asked whom or what he considers to be the industry’s supervillains.

He says, “Like any industry, we have many villains. Currently, we are focused on the villain known as high interest rates but there are others like affordability, inventory shortages, and regulatory constraints that quietly create as many challenges as do rising interest rates.

“The way to combat this collection of villains is through industry leaders coming together to work for the reform of regulatory and zoning constraints and the creation of incentives to increase overall housing stock, including affordable housing. Fighting supervillains is a team sport.”

Michael says the four villains facing the industry are: high rates, affordability, supply, and regulatory constraints.

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personal approach and listening are two key elements for getting through difficult times, says Mike Fawaz.

“Building community and trust, particularly with brokers, goes a long way in this unpredictable market,” this Industry Titan says.

“Through meeting with our partners in person, I’ve built positive relationships where brokers will share their unique needs. This handson approach has helped us develop programs that brokers actually need in order to be successful in this market.

Mike says, “In July 2023, we put broker feedback into action by introducing ‘Target Profit Control,’ a product aimed at giving our correspondent partners added confidence in reaching profitability goals.

My main goal is to continue innovating regardless of the current market.”

The supervillain in the mortgage industry is those who take away choice, Mike says, explaining, “Anyone trying to take the broker community’s freedom is a supervillain in my book. Rocket Pro TPO has already started combatting this villain, and I am continuing my mission to spread the message that brokers need choice – assuring brokers that Rocket is in their corner to support their business, no matter the market.

“Before I started my current position, I served as an ambassador to brokers and traveled around the country … to stay in touch with the community. I got to know brokers on a personal level and built strong relationships. I saw firsthand the challenges brokers go through and vowed to dedicate my time as EVP to helping our broker partners grow.”

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My main goal is to continue innovating regardless of the current market.

INDUSTRY TITANS

2024

Tiffany Fisher

Retta Gardner

Regional Manager

EVP of Wholesale

SUPREME LENDING

A MORTGAGE BOUTIQUE, A DIVISION OF FIRST COMMUNITY MORTGAGE

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hen it comes to mentoring and helping others, Tiffany Fisher has an advantage. This Industry Titan is a certified life coach.

Tiffany says, “I love coaching others to become a better version of themselves and help them achieve personal and professional goals. I believe in people; I see the good and positive abilities and help them develop to believe in themselves. It has been an absolute honor to educate people whether it’s specific loan products, sales, operations, marketing, out of the box thinking, time blocking and scheduling, organization or just being someone a person can trust during a time they need it the most in life.

She adds, “I love to fix things, build people up, encourage them and really just show people love and respect they deserve. In return, it blesses me in abundance to see others succeed and reach their goals. Every year, my team picks One word to guide them for the year and many people complete vision boards every year to focus on the things they want to accomplish, not the things I want them to accomplish. Coaching my team takes a lot of time, but it’s the greatest blessing.”

She offers upbeat advice for those struggling with the current market. “Don’t give up! Prioritize your day and focus on sales activities every day! There are numerous opportunities. You have to recognize and seize them. In our business, mortgage professionals typically are not limited to one demographic. Expand your demographics and extend your networking groups,” Tiffany says.

“Don’t give up!

Prioritize your day and focus on sales activities every day!”

Y

our network is a powerful collaborative tool, says Industry Titain Retta Gardner. “I am a big believer in the power of your network,” she says. “In fact, building my network was one of the reasons that I sought out my CMB. I wanted a network of professionals throughout the industry that I could reach out to and discuss the everyday challenges.

“My only regret is that I didn’t start building that network earlier in my career.

This industry has some amazing people in it who want to help; this includes me … I’m always happy to assist fellow mortgage professionals.”

With over 27 years of experience, Retta knows how to deal with hard times. “My advice would be to stay positive, stay consistent, and keep doing what has made you successful so far. This, too, shall change. It always does in the mortgage industry. We just don’t know when it will change.”

Retta has actively steered others in their professional development.

“I’ve been fortunate enough to have the ability to hire many people into the industry from other professions and straight out of college. Many of those individuals have thriving careers now, so I hope that, in some small way, I have helped them find careers that challenge them. As a CMB, I have also sponsored several CMB students and helped them to complete the courses and tests required. Also, the MBA allows me to teach in their School of Mortgage Banking, which is a fun way to give back.”

“I am a big believer in the power of your network.”

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INDUSTRY TITANS

2024

Brian Hale

Justin Harris

CEO / Founder

EVP, Production

MORTGAGE ADVISORY PARTNERS LLC

ACADEMY MORTGAGE

W

ant to know who the “supervillains” are in the mortgage industry? Brian Hale has a succinct answer.

“The supervillains are the things you cannot control.

Interest rates and regulatory compliance environment come to mind,” he says.

This Industry Titan has an active stance when it comes to things he can control to battle issues affecting the mortgage industry. He cites the glass ceiling for women, for one.

“I have always promoted and placed exceptionally competent women in very senior roles on my team and many have moved to CEO, COO, CLO roles in other companies. Foolish prejudice regarding minorities, women, etc., is a waste of time. You fight that by showing how and proving that your company is better for it,” Brian says.

There’s another supervillain that needs to be fought: mediocrity. “The other great threat in our business is finding excuses to accept mediocrity. It kills more cultures than anything I can think of,” he says.

Brian has three key pieces of advice for those who may be struggling in the current environment.

“First, go back to what made you successful in the first place and redouble your efforts. Secondly, data, data, data. It is true that if you do not know the math of your business at an exceptionally granular basis, then you do not really know your business. Third, how you format the data is critical to decision-making; get it right.”

Foolish prejudice regarding minorities, women, etc., is a waste of time.

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ike other Titans of the industry, Justin Harris knows the best advice people can have in difficult times is this: focus on the things you can control rather than the things that you can’t.

Justin says, “We can’t control the rates or where they are going, but we can focus on our own processes and activities. Be consistent and stay positive.”

One of Justin’s strongest influences on his way to becoming an Industry Titan is former boss and eventual business partner Buzz Moore.

As Justin explains, “He is a pillar in the community who taught me so much about business and the importance of ethics. His leadership and values instilled in me the importance of always doing the right thing, no matter how challenging it might be.”

Values are important to Justin. “In our industry, our values are constantly being put to the test.

For me, in those moments, it’s imperative to do the right thing, even when it may be difficult,” he says.

Optimism is important in difficult times like these. Justin says, “I think in today’s industry, we can become our own villains. When faced with a challenging market, many of us tell ourselves that things are too hard and get in the way of our own success. When we become paralyzed by challenges, we make it far more difficult for ourselves to overcome the obstacles or hurdles we face. To combat this, it’s important to remember to focus on what you can control and tune out the noise.”

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When we become paralyzed by challenges, we make it far more difficult for ourselves to overcome the obstacles or hurdles we face.

INDUSTRY TITANS

Karthik Kumar

Jocelyn Martin-Leano

EVP and Chief Operating Officer

CEO and Founder

LENDARCH LLC

ENIZIO STRATEGIES LLC

F

or Karthik Kumar, there is one constant to corporate life: challenges. Leaders face these challenges every day and in every way.

This Industry Titan says, “throughout the various phases of transitioning between roles in corporate life as I moved from ERP to banking, then to BPO, technology, and fintech, I faced some specific challenges that have helped me develop into the leader I am today, including the following: • Figuring out how to build relationships while navigating an ever-changing economic landscape.

• Appreciating the significance of taking an audience-centered approach to presentations.

• Gaining domain knowledge so I could lead by example.

• Embracing continually evolving technologies and continuous learning to understand the best ways to leverage those technologies in my industry.

Fortunately, I did not face any of these challenges alone. I was lucky to have amazing mentors throughout my career who gave me advice when I encountered a challenge and helped me figure out the best way to lead through each one. I would like to credit my mentors for their instrumental roles in helping me get to where I am today.”

Like other Titans, he knows change is a constant.

“It is imperative to keep abreast of the changes and trends that the mortgage industry is subject to. I have encouraged my team to seek knowledge-based and news updates on a regular basis and share with others any change that could be an interesting impact for us,” Karthik says.

“I was lucky to have amazing mentors … who gave me advice when I encountered a challenge and helped me figure out the best way to lead.”

2024

S

ometimes your best mentors are those who do not know they are mentoring you. Such was the case with Industry Titan Jocelyn Martin-Leano who learned from her mom.

Jocelyn recalls, “My summers were spent hanging out at my mother’s office.

She was the regional head of a large drugstore chain. She had four small kids, ran a household and excelled in her profession. I would hide under her desk and listen as she gave feedback to her people. I learned courage, resiliency, and empathy from her.

“Most of all, my mom mentored employees outside of work. Our house had frequent visitors in the evenings of people seeking her professional and personal advice. From my mom, I learned the mantle of leadership is worn not for personal gain but as a sacred mandate to invest in and lead people that come under your care.”

She pays those lessons forward.

“Mentoring and leaving a legacy are important to me. The currency of my success is measured in terms of leaders whom I have mentored, many of whom have surpassed my accomplishments.

One is now the CEO of a global tech company, another a director at a GSE, and another became president at a correspondent lender. Most recently, a person I groomed succeeded me. The biggest part of mentoring is by example daily. The mentees learn from me, but equally important, I learn from them.”

“The biggest part of mentoring is by example daily.

The mentees learn from me, but equally important, I learn from them.”

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INDUSTRY TITANS

2024

Sean Moss

Kevin Parra

EVP, Product & Operations

Co-Founder, Chairman, CEO

DOWN PAYMENT RESOURCE

PLAZA HOME MORTGAGE

T

ough times require touch by practical actions. That philosophy makes Sean Moss an Industry Titan.

“Tough times require creativity, diligence, persistence, and a willingness to think outside the box and operate outside your comfort zone. Get outside your lane. Try something new.

And most of all, don’t get complacent,” he says.

For Sean, his approach to collaborating with others can be surmised as adopting a culture of service. He says by listening to the incredibly thoughtful feedback of customers and partners, the Down Payment Resource team has been able to solve some very complex challenges and build better solutions for affordability challenges.

How Sean responds to challenges says a lot about him. “After the market crash of 2008, I was at a crossroads in my career. My employer, who had been paying for me to get my MBA, went out of business, and my wife and I had a baby on the way. After finishing my degree while working multiple unglamorous jobs, I was offered an opportunity to join Down Payment Resource. Back then, the company was in its infancy. Even though the prospect of building out a startup was truly daunting, I believed in the mission, put faith in the knowledge I had acquired in my MBA program, and went all in to be a part of something that makes a difference in people’s lives. It’s been an exhilarating and rewarding experience.”

“Get outside your lane. Try something new. And most of all, don’t get complacent.”

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his, too, shall pass is the phrase Industry Titan Kevin Parra uses for people concerned about current conditions. “It will take time, and it won’t be pleasant.

But the market will stabilize and gradually return to more normal levels. The companies and the mortgage professionals that are able to ride it out will be in a good position to capitalize on the next cycle.

“Use this time to determine your goals and figure out strategies and tactics to grow your business in this changing market landscape. The broker channel, specifically, is in a strong position to grow market share due to the relationship-based nature of their business,” says Kevin.

“These past six to nine months certainly have tested our company and our industry,” Kevin admits.

“But I’d say the mortgage crisis of 2008-10 … was probably the most challenging time that I have faced.

Plaza Home Mortgage was able to weather that storm because we had capital, strong relationships with our clients and counterparties and … managed our business conservatively. This is the same approach that we are taking today.”

His career benefitted from his association with Brenda Lynn, who ran wholesale production at a previous company with the same name and taught him how to identify a strong team. “She was really good at picking the right skill sets in individuals to be successful in the organization, which in turn made the organization successful. Her leadership skills were excellent and were something I worked hard to emulate,” he says.

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Use this time to determine your goals and figure out strategies and tactics to grow your business.

INDUSTRY TITANS

Max Slyusarchuk

Dan Sogorka

CEO

CEO and President

A&D MORTGAGE

SAGENT

C

ollaboration in the mortgage industry is not just beneficial; it’s essential, says Industry Titan Max Slyusarchuk. “I have always believed that the complex challenges we face, such as navigating economic fluctuations or evolving regulatory landscapes, are best tackled through collective effort. To facilitate this, I actively participate in industry roundtables and serve on advisory boards where open dialogue is encouraged.

“These platforms allow us to pool our diverse experiences and expertise, fostering a culture of shared success. This approach has led to the development of innovative solutions, such as standardized response strategies to regulatory changes and collaborative educational initiatives to better prepare for market shifts,” says Max. Collaboration also helps combat difficult markets like those currently being experienced. “My expanded advice would include a strategic focus on partnership and leveraging technology. A concentrated strategy of working exclusively with one lender can be beneficial, particularly in a fluctuating market. This approach allows for a deeper understanding of the lender’s products, underwriting criteria, and processes, which can lead to more efficient transactions and better client service.

It fosters a strong relationship, often leading to better support from the lender and potentially more favorable terms for clients due to the volume of business.

Max says by combining a strategic partnership with a single lender and the use of a CRM, professionals can streamline their workflow, improve client satisfaction, and make informed decisions.

A concentrated strategy of working exclusively with one lender can be beneficial, particularly in a fluctuating market.

2024

D

an Sogorka has spent two decades helping financial institutions modernize the homeownership experience: first as division president at Black Knight, then as EVP at ServiceLink, and as CEO of digital origination software pioneer Cloudvirga.

Now, he leads the charge as Sagent conquers mortgage and fintech’s final frontier: the $14 trillion mortgage servicing market.

Dan took over Sagent in March 2020 as COVID lockdowns forced emergency relief policy from FHFA, requiring software development to power America’s servicers to be operational on real-time forbearance and deferral programs for millions. Sagent-powered servicers were ready on day one of every major CARES homeowner relief policy effective date. Sagent’s the only fintech that enabled day-one compliance for realtime policy change of this magnitude.

Sagent-powered servicers operationalized self-serve forbearances for consumers, facilitating homeownership stability and flawless accounting for servicers — plus loan lifecycle clarity, a compliant process, and real-time visibility for servicers, investors, and regulators.

Dan’s primary superpower is a singular ability to see how all of Main Street, Wall Street, Washington, and Silicon Valley must fit together to deliver on the American Dream of homeownership while keeping the system and consumers safe and also rewarding responsible banks and lenders.

Dan’s … singular ability [is] to see how all of Main Street, Wall Street, Washington, and Silicon Valley must fit together to deliver on the American Dream of homeownership.

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INDUSTRY TITANS

2024

Jeff Tennyson

Lee Trice

CEO

Managing Director

LIMA ONE CAPITAL

OPTEON

C

ollege had a strong impact in shaping Industry Titan Jeff Tennyson. He says, “I lived with five men [at Harding University] who have meaningfully influenced my personal and professional career. All are now senior executives within their industry, and we just celebrated our 38th annual reunion trip together.

“These friends have been by my side through the highs and lows of the mortgage industry and my personal confidants who have always been merely a visit or phone call away. I’m blessed to have the mentorship and friendship of these men over the past 40 years.”

Ask him what the mortgage industry’s supervillain is, and Jeff says, “the industry’s reliance on the interest rate environment and the associate business practices it creates.”

He explains, “The industry continues the unhealthy practices of massive overhiring in the good times that create massive layoffs as rates rise.

“This only supports the financial interests of company owners within our industry and is horribly disruptive to the lives of employees trying to build a career. I would encourage leaders to be more disciplined in their growth to provide more reliable and permanent career options.”

For those struggling with their careers in these tough times, Jeff says, “Work hard and be patient.

The mortgage industry is a terrific career, but it will always be cyclical. When times are good, work hard and save some money. When times are challenging, as they are today, work harder and be patient. Good times will return!”

When times are challenging, as they are today, work harder and be patient. Good times will return!

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t is easy for Lee Trice to identify the supervillain in the mortgage industry.

This Industry Titan says, “The Federal Reserve has long been my supervillain.

Yes, we have been on the ‘winning’ side of an interest rate boom, but that eventually leads to a severe hangover. In my humble opinion, the Fed overamplifies the normal business cycles. Easing creates overstimulation, which then leads to over-tightening to attempt to ‘fix’ what was intentionally caused. The economy is simply too complex to maneuver with a crude and heavy hand on the interest rate lever.”

Lee says his strongest influence was his family.

“Being the youngest of six children and of older parents, I was very independent from an early age. I had my first job by 14 (actually a bit younger, as I lied about my age!), and that was a strong influence in my life. I learned responsibility and accountability.

“And starting to get paychecks at an early age reinforced the simple lesson of how to work harder or smarter to be rewarded.

Consequently, I later had my own two children work in ‘real jobs’ at the earliest opportunity. Even now, they thank me for that same life lesson and note how well it served them becoming adults.”

Lee has an intriguing favorite historical figure.

“Winston Churchill had many failures in his career leading up to his defining moment as the prime minister during WW2. His tenacity and resilience during the extremely daunting periods are a lesson to us all.”

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“ … starting to get paychecks at an early age reinforced the simple lesson of how to work harder or smarter to be rewarded.”

INDUSTRY TITANS

2024

Greg Vacura President

AGILE TRADING TECHNOLOGIES

V

alues are important to Industry Titan Greg Vacura. He recalls, “My values were put to the test constantly over the last decade. My previous organization had its share of self-inflicted incidents.

Always do what you can within your position to try and influence and change the situation to match your values, but also be aware of the implications.

“Certainly, a strong stance needs to be taken in the face of legal and ethical issues, but aside from that, reacting appropriately to the situation is warranted.

I have found that trying to push values onto another is largely ineffective, but having a discussion to reach common ground can be beneficial. That said, I am more likely to move on and disengage versus fight for the sake of fighting.”

Greg says the supervillains in the mortgage industry are unethical people. “I believe the number one villain is anyone or any organization perpetuating fraud. Being vigilant to detect individual consumers is one thing, but systemic organizational fraud is much worse. Fraud affects more than just the individual involved but also the shareholders and the entire perception of the industry.”

Ask his advice for those struggling in this market, and Greg says, “The great times don’t last forever (even though we did have a very long run of low rates), and the tough times will ease. In the middle of all of that, continue to innovate, serve your internal and external customers well, and invest in growth for yourself and, if applicable, growth for your organization.”

Always do what you can within your position to try and influence and change the situation to match your values

2024

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024 |

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S P E C I A L A D V E R T I S I N G S E C T I O N : NO N- Q M LE ND E R D I R ECTO RY

COM PA N Y

A R E A O F FO C US

STAT ES L I CENSCED

WEB SI T E

Acra Lending

Non-QM / Jumbo

AL, AZ, AR, CA, CO, CT, DC, DE, FL, GA, ID, IL, IN, KS, KY, LA, ME, MD, MI, MN, MT, NE, NV, NH, NJ, NC, OK, OR, PA, SC, TN, TX, UT, VA, VT, WA, WI, WY

acralending.com

Champions Funding

Mission Driven Non-QM + CDFI Wholesale Lender

AZ, CA, CO, CT, DC, FL, GA, HI, IL, IA, MD, MI, NJ, NC, OR, PA, SC, TN, TX, UT, VA, WA

champstpo.com

LoanStream Mortgage

AZ, CA, CO, CT, DC, DE, FL, GA, HI, ID, IL, IN, KY, Home Loans

LA, ME, MD, MA, MI, MN, MT, NV, NH, NJ, NM,

loanstreamwholesale.com

NC, OH, OK, OR, PA, RI, SC, TN, TX, UT, WA, WI,

Newfi Wholesale

DSCR, Bank Statement, 1099, Asset Depletion, Buydowns, Full Doc Non-QM

AL, AK, AZ, AR, CA, CO, CT, DC, DE, FL, GA, HI, ID, IL, IN, IA, KS, KY, LA, ME, MD, MI, MN, MS, MO, MT, NE, NV, NH, NJ, NM, NC, ND, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, WA, WV, WI, WY

newfiwholesale.com

Quontic Bank

Quontic specializes in nontraditional borrowers.

All 50 U.S. States

quonticwholesale.com

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| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

S P E C I A L A D V E R T I S I N G SSPEECCTI A I OL NA: DWHO D IOL R ECTO V E R T LE I S ISA N GLE S ELE C T ND I O NE: RWH E SALRY E L E N DE R DIRECTORY CO MPA N Y

SP EC I A LT Y/ N I C H E

STAT ES L I CENSCED

WEB SI T E

ACC Mortgage

Non-QM

AZ, AR, CA, CO, CT, DE, DC, FL, GA, ID, IL, IN, KS, MD, MI, NV, NJ, NC, OK, OR, PA, SC, TN, TX, UT, VA, WA

ACCMortgage.com

First National Bank of America

Non-QM

All 50 U.S. States

fnba.com/mortgage-brokers

Newfi Wholesale

DSCR, Bank Statement, 1099, Asset Depletion, Buydowns, Full Doc Non-QM

AL, AK, AZ, AR, CA, CO, CT, DC, DE, FL, GA, HI, ID, IL, IN, IA, KS, KY, LA, ME, MD, MI, MN, MS, MO, MT, NE, NV, NH, NJ, NM, NC, ND, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, WA, WV, WI, WY

newfiwholesale.com

S P E C I A L A D V E R T I S I N G S E C T I O N : OR I GI NATO R TEC H D I R ECTO RY CO MPA N Y

A RE A O F FO C US

WEB SI T E

wemlo

Loan Processing

wemlo.io

Zero 1 Solution LLC

Software

1smtg.com

S P E C I A L A D V E R T I S I N G S E C T I O N : AMC D I R ECTO RY

CO MPANY

AR E A OF FOCU S

WE B S ITE

ACT Appraisal, Inc.

ACT Appraisal is a nationwide AMC focusing on residential appraisals

actappraisal.com

Class Valuation

AMC

classvaluation.com

PCV Murcor

Nationwide Real Estate Valuations Management — Appraisal Management Company

pcvmurcor.com

SingleSource Property Solutions LLC

Appraisals, BPOs, AVMs, Hybrid Valuations, and Value Reconciliations

singlesourceproperty.com

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024 |

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FACEBOOK THOUGHTS

NICK ROBERSON

What’s In Your Air Fryer?

I Bet It’s Not Dino Nuggets

I

62

Nick Roberson is a long-time mortgage industry veteran and a board member of the California Association of Mortgage Professionals. He’s a forthcoming and giving guy, who shares his … unique … perspective on work and life on his Facebook account. Here are some of Nick’s FB thoughts this month:

Nick Roberson

am not saying I drink too much caffeine, but I do believe my body will keep moving 48 hours after my death.

••• Pros of wearing all black: I look badass. Cons of wearing all black: People know I had powdered donuts.

••• Raise your hand if you try to breathe quieter while walking up a hill so bystanders don’t hear you fighting for your life.

••• I’m gonna need some of you guys to start getting weirder. I cannot keep pulling all the weight like this.

••• One of my biggest fears is that I’ll marry into a family that runs 5ks on holidays.

••• I hope Elon Musk never gets involved in a scandal … Elongate would be really drawn out.

••• Accordian to a recent survey, replacing words with the names of musical instruments often goes undetected.

••• Hey Nick, what are you making for dinner?

Dino Nuggets, thanks for asking. I’m classy like that.

••• It’s OK to talk to yourself … and OK to answer yourself.

But sad when you have to repeat what you said because you weren’t listening.

•••

My morning walk was cool and crisp, but exactly what I needed to start a new week.

A full moon was shining down from a blanket of dark sky pierced by the stars. The sky wrapped the earth with a faint glow of the sun on the horizon, acting as the ribbon on a perfect gift, the gift of a new day. As each of you unwrap your own gift, I hope it fills you with wonder, love, and faith. As this gift is whatever you want it to be, so make the most of it, my friends.

••• “You cannot slow down the sun setting. You can only choose how to spend your time in the light.” > Blake Auden ••• Memories with my daughter from 2019: Yesterday, my daughter and I were driving through downtown near our new home. We passed by a Mexican grocery store, and I told her I wanted to stop by there at some point over the weekend and check it out.

Savannah: Okay, but the only thing I really know how to say in Spanish is (and understand, she is in her second year of Spanish); “Give me all of your money.”

Me: You probably shouldn’t use that one in there.

Savannah: Dame todo tu dinero, y ponlo en mi mochila.

Me: Translate.

Savannah: Give me all of your money, and put it in my backpack.

Me: (giving her my best “dad look”) Savannah: (busting up laughing) Yes, Dad, let’s go in there on the way home.

I would ask what I have done to deserve this, but unfortunately, I am very aware of what I have done.

••• The only time I’ve ever had a chip on my shoulder was when I tried to dump the entire bag into my mouth at once.

••• Age is irrelevant. Ask me how many sunsets I’ve seen, hearts I’ve loved, trips I’ve taken, or concerts I’ve been to.

That’s how old I am. n

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | JANUARY 2024

To see more by Nick, just go to www.facebook.com/nickroberson.

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