The U.S. Department of Housing and Urban Development (HUD) announced updated guidance on the use and eligibility of the Rate Reduction Incentive (RRI). The RRI serves as a climatefriendly incentive program available to Public Housing Agencies (PHA) that encourages them to reduce their utility rates beyond what is already required by statute and/or regulation.
The program directly supports HUD’s Climate Action Plan, which sets forth goals to create climate resiliency, reduce greenhouse emissions, and pursue environmental justice in housing. The RRI helps HUD move towards those goals since energy efficiency solutions made possible through the program reduce a PHAs carbon footprint, promote long-term sustainability, and can improve the lives of residents. Not only do the program benefits allow for cost savings for PHAs, but they will also pave the way for the shared benefits of better property quality, additional support to families, and improved property maintenance.
The updates and changes to the guidance provide clarification on the approval process, additional supplemental direction, and changes to policy. The overarching goal is to provide a more comprehensive understanding of the RRI and serve as a reference guide that offers clear and consistent information.
Here are a few examples, including some real-world scenarios, of actions PHAs can take that are allowed under the program:
• PHAs can negotiate special rates with a utility company that are specific to the housing agency (this can be for a contract term of up to 5 years).
• PHAs can participate in the purchasing of power through a third-party supplier which can result in savings through invoice credits or a fixed utility rate.
• PHAs can work with utility providers who offer reduced rates for those who make efficiency upgrades to things like boilers, windows, or toilets.
• PHAs can take advantage of renewable energy sources, like on-site or community solar development.
HUD previously released additional guidance regarding the treatment of solar credits in August of 2022. As many states increase their offerings of solar programs, families who live in HUD subsidized properties may find themselves with the opportunity to take advantage of a renewable energy source and the cost-saving benefits that come with it.
The Federal Housing Finance Agency (FHFA) announced the deemed-issuance ratio for the 2023 calendar year in accordance with Internal Revenue Service (IRS) guidelines on the trading of the Uniform Mortgage-Backed Security (UMBS). The deemed-issuance-ratio will be used for diversification reporting on the bonds ultimately delivered to the purchaser until the bonds have been disposed of, regardless of the issuing Enterprise on the underlying bonds.
The IRS Revenue Procedure 2018-54 provides that the ratio may be rounded as long as the rounded ratio is further from 50/50 than the actual observed data. Therefore, the deemedissuance ratio for the 2023 calendar year is 53 percent Fannie Mae and 47 percent Freddie Mac.
The IRS procedure provides guidance on section 817(h) of the Internal Revenue Code diversification requirements for variable annuity, endowment, and life insurance contracts. The IRS has provided a deemed-issuance-ratio to allocate issuer exposure for TBA trades between the Enterprises. Compliance with these requirements is affected by the implementation of and trading in UMBS.
Revenue Procedure 2018-54 calls for FHFA to determine a deemed-issuance ratio for each calendar year based on the ratio of TBA-eligible securities issued by Fannie Mae and Freddie Mac during the 24-month period ending Oct. 31 of the preceding year.
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As 2022 wound down, nearly every company involved in residential lending had been impacted by higher rates, lower volumes, and revenue, and a sense that 2020 and 2021 were indeed the best years the industry may ever see. In the secondary markets, the options have changed little this year, and the projections that Non-QM volumes would skyrocket have fallen short.
And thus, we have another year where Freddie Mac and Fannie Mae are the dominant players and expected to be for some years to come. And let’s face it: having that government stability is not such a bad thing compared to private-label security shifts.
But the timing of when the loan finds its way to Fannie and Freddie (the agencies) varies. Put another way, large and small banks, credit unions, and independent mortgage banks can sell conforming conventional loans to large aggregators/ correspondent investors, or directly to the agencies. Fannie & Freddie’s end-run around the large aggregators and marketing directly to the small and mid-sized lenders is well known in the industry.
But smaller lenders may not have the expertise or experience (yet) in analyzing some basic decisions between selling loans directly to F&F (through the cash window) or securitizing loans themselves. It is helpful to have a primer on what that means and
knowing what might be going on behind the scenes influencing your capital markets decisions.
To cash or to swap, that is the question. If you work in secondary marketing, you no doubt have been asked, at some point, whether it is more profitable to trade agency product for securities, or for cash. As many know, approved lenders have the business luxury of either swapping closed loans they originate for mortgage-backed securities or selling these loans directly to FNMA/ FHLMC in exchange for cash (known as “cash-window” sales).
The share of Fannie and Freddie loans securitized through the cash window varies over time. There are some common misconceptions about cash window transactions, and the collateral and prepay differences, if any, between pools securitized through the cash window and the MBS swap programs. It’s important to understand who uses the cash-window option, why, and whether or not there are differences in pool characteristics.
When originators sell loans via the cash window, the GSEs aggregate the loans from a large pool of lenders and securitize them as an MBS; the cash window option allows both Fannie and Freddie to make short-
term use of their balance sheet without interfering with their current mandate of continued reduction in their retained mortgage investment portfolio. Why would a Secondary Marketing department choose to sell in this fashion? Simple: speed and efficiency. The agency cash window typically alleviates warehouse line concerns, a problem which plagues many small originators, by way of faster fundings. Also, borrower retention is maintained as well.
Typically, smaller lenders selling their loans to larger lender aggregators sell servicing rights as well. The cash window allows smaller lenders to retain their customer base while allowing them to continue to originate new loans. And finally, an added benefit to the cash window lies in the small arbitrage (implied or otherwise) between “best efforts” and “mandatory.”
As noted above, a lot of the benefits of selling cash window are really comparative advantages for the smaller lender; maybe this is why I hear so often the phrase “we utilize the cash window” from capital market veterans. Historically, smaller lenders had two options: sell your loans to FNMA/ FHLMC or sell to a large aggregator. As large aggregators have been closing the correspondent channel, small originators have become central contributors in the cash window securitization model.
For those of you wanting to dive a little more into the weeds, the GSEs’ co-issue portals have come a long way in the last three years: Fannie Mae’s servicing marketplace (SMP, which replaced SET) and Freddie Mac’s Xchange. What used to be a rather
ALTHOUGH RATES HAVE GONE UP, AND RATE AND TERM REFIS HAVE NEARLY VANISHED IN LATE 2022, EARLY PAYOFFS STILL MATTER.
painful experience bifurcating mortgage servicing rights (MSRs) has changed. In the past, on the day of the trade, you had two transactions, one with Fannie, one with the servicing buyer, both required separate tapes to be created. A lender was paid by Fannie in typical fashion (within 24 hours of the notes being received), but you’d normally have to wait for later in the month to settle with the MSR buyer (an additional settlement tape needed to be created).
In addition, the MSR buyers would hold back 10% of the trade until trailing docs caught up to the loans. All that’s fine on paper, but now the lender’s cash flows are a slave to the speed of county recorders and title companies. If the secondary department doesn’t have operational control over final docs/trailing docs, it becomes exponentially harder to clean up trades.
For example, in 1Q20 when COVID hit secondary departments were selling loans in January but not really realizing the full value of the cash flows until March. Using
SMP/Xchange, the lender is paid on the full trade amount at the same time. Additionally, IMBs who don’t want to sell their borrowers to an aggregator, but retaining places a strain on cash/capital, have the ability to sell to a loan servicer who wants that loan to stay on their books.
Although rates have gone up, and rate and term refis have nearly vanished in late 2022, early payoffs still matter. Between the two channels, there isn’t much of a difference in prepayments. In addition, it is possible that additional measures taken by the GSEs ensure that prepays are comparable as well. Fannie Mae specifically monitors prepayments of pools created from the cash window and compares the performance to similar pools created through the MBS swap program. To the extent that prepays on cash window pools are significantly faster than similar pools created through the MBS swap program, a conversation with the lender may occur to understand possible reasons for the differences. As an added incentive, if necessary, Fannie Mae may limit or discontinue a lender’s activity through the cash window.
Seasoned capital markets staffs are typically fans of MBS swaps. The transaction has more moving parts than anything, and both capital markets and accounting need to be on the same page. A lender can realize full specified pool pay-ups and really are masters of their own fate. To have the ability to hedge with the same instruments you’re delivering into, and pricing off of, is ideal for any good secondary group.
I expect smaller lenders to continue to sell to FNMA/FHLMC cash-window desks if larger lenders scale back on their role as aggregators. Consequently, it is likely that the percentage of pools securitized through the cash window continue to increase if not stay at current elevated levels. Given the comparable collateral characteristics and increased oversight by the GSEs on participating lenders, prepays on pools securitized through the cash window are likely to be comparable to pools securitized through the MBS swap program.
THIS DOWN CYCLE IS TOUGHER THAN MOST, BUT IT WILL LIKELY BE SHORTER-LIVED
The current mortgage market down cycle is different from any downturn the industry has experienced in the past, according to a recent issue of Stratmor Group’s Insights Report. Stratmor Senior Partner Jim Cameron analyzes the industry data that shows just how it differs in his article “What’s Different About This Downturn?”
“While most senior executives have managed their way through multiple downturns in the mortgage business, the universal sentiment is that ‘this one feels different.’ That’s because it IS different!” Cameron says. “It’s quite true — as down cycles go this is a bad one.” The good news is that there are many reasons to believe that the current cycle will be shorter-lived than previous ones.
This downturn “has delivered the biggest and fastest rate increase in modern history, the sharpest volume decreases ever — especially in terms of loan units — and the steepest reduction in revenue the mortgage business has ever seen,” according to Cameron.
“Yet there is some light at the end of the tunnel and there are some positive aspects
to this cycle. Absent a major recession, the duration of the downturn may be shorter than past down markets,” he says. One of the reasons is that non-banks, including independent mortgage bankers (IMBs), have a historically high market share, standing at 81 percent so far in 2022.
Non-banks are more likely than banks to move quickly to reduce capacity. “While it is true that many non-banks entered this downturn with a large war chest of cash and capital, this is more than offset by the impact of warehouse and investor covenants, which are causing lenders to move expeditiously to cut costs. In short, while this downturn is very painful, perhaps we will get through it faster.”
Other factors pointing to a shorter down cycle: positive home buyer demographics, extremely low delinquency rates and improved household net worth and debt service capability. “As we look at data on the U.S. population by age, a very large cohort is in the 28- to 38-year-old bucket, which happens to be prime home-buying age,” Cameron indicates. “This bodes well for the home purchase market in the next five to 10 years.”
“These factors may help hasten us toward
the day when we can return to ‘normal’ with revenue rationalizing, capacity adjusted, and a return to profits that are reasonable based on the risks of the business,” Cameron says.
A second Insights Report article, written by Stratmor Customer Experience Director Mike Seminari, discusses the importance of communications for lenders as they navigate the current downturn. In “How Can Mortgage Originators Improve Their Communications Skills?” Seminari points to the fact that nearly one in four borrowers who had a problem in some area of their mortgage journey attributed the issue to communication. Not only was communication the most frequently cited issue, but it was also among the most damaging of problems, causing the Net Promoter Score (NPS) to drop to -60, all but negating a chance at a referral. Seminari suggests three steps originators can take now to avoid the pitfalls of poor communication and keep borrowers on the “happy path” for their mortgage loan.
Read the complete report here: https://www. stratmorgroup.com/whats-different-aboutthis-downturn/
In order to reach, connect with and sell to your target market, you need to have a firm grasp on who they are.
Conducting market research will help you develop a fuller picture of your target customers.
There are two kinds of market research. In primary research, you conduct your own research on customers who match your target demographic. In secondary research, you get information on your target customers from outside sources, such as government statistics or industry surveys.
No matter which type of research you’re conducting, your goal is to gather the following information:
Market size: How many individuals, households or businesses make up your target market? Is the market getting bigger (good news for your startup) or shrinking (not-so-good news)?
Market demographics: If you are targeting consumers, demographics include factors such as whether they are married, their average age, marital status, gender, educational attainment, employment and whether they have children. Businesses have demographics too: Theirs include average number of employees, industry, annual revenues, age of the business, public or private company, product or service sold, and what industry they operate in.
Location: Where are most of your customers located? If the region where you plan to open for business lacks enough of your target customers, for instance, you’ll either need to locate elsewhere or adjust your business model.
Income: You’ll want to know the average household income of consumers, and the average revenues of businesses.
Purchasing habits: Beyond income, dig into your target market’s spending habits. How much do they typically spend
on the types of products or services you plan to sell? How and where do they buy? How frequently do they buy?
Last, but not least, find out what businesses that are competing for the same target market. Learning as much as you can about your competition will give you an idea of their strengths and weaknesses, and how much market share you can potentially capture.
Where do you get all this information? Generally, it’s best to start with secondary research to give you a big-picture look at your target market. Here are some secondary sources:
• Industry trade associations generally conduct and maintain current market research.
• The U.S. Census Bureau’s American FactFinder has statistics on consumers; the Census Bureau also compiles statistics on U.S. businesses.
• If you’re planning to do business globally, visit Export.gov for country-specific market research.
• Are you targeting businesses as customers? Visit Hoover’s and ThomasNet.
The SBA website links to a wide range of resources for market research on both individuals and businesses.
Once secondary research has given you a general overview of your target market, dig deeper by conducting your own primary research. You’ll need to find a representative sample of your target market, which you can do by mining your own connections, renting email lists or contacting organizations to see if their members are willing to take part. Here are four primary research methods to try:
1. Surveys: You can conduct phone surveys, surveys by mail or online surveys. SurveyMonkey, Zoho Surveys and QuestionPro are free survey apps that let you create, conduct and analyze the results of your own surveys online.
2. Interviews: Interviews can be done by phone or in person. They’re often an effective way to capture target customers who don’t spend a lot of time online, but they are more time-consuming than online surveys.
3. Focus Groups: In a focus group, individuals participate in a group discussion about some aspect of your business in exchange for remuneration. You’ll need someone to lead the focus group discussion and someone to record the results. While focus groups can yield good insights, be wary of extrapolating from a small group to your entire customer base.
4. Test Marketing: Doing a “test run” of your product or service by selling to a limited group of target customers is a good way to work out the kinks in your business model. However, you may need to follow up and ask your test customers questions to determine what influenced the test marketing’s success (or failure).
Take the time to do your market research, because understanding your market is key to your startup’s success.
The above item was originally published at SCORE.org.
It takes no skill to point out what is wrong in a business or workplace. Literally no skill. Anyone can do it. It’s like complaining. We all do it too much, and usually nothing good comes out of it. It’s just complaining. It turns out that I have done extensive research on this topic and here are the truncated results:
It’s in our human nature to complain. To point out what is wrong. To be negative and to offer criticism. It is easy for us. It is what is normal. But it doesn’t work.
So instead of doing what is easy and normal, I argue that you must do what is uncomfortable and what does not come naturally if you are to embrace your full creative and innovative potential. And unlock real solutions that will work. Here are three tips that you can use today in your quest to stop complaining like everyone else and instead be a part of the solution.
There is roughly a 6:1 ratio of negative to positive words in the English language. Isn’t that amazing?! So, for every word in English, like fantastic, there are six words that are negative, like sucks, bad, awful, horrible, terrible, dumb, and so many more.
So simply choosing your language carefully can help you become part of the solution instead of part of the problem. The next time you send an email for instance, pay close attention to the words you choose. Take a moment to greet someone and ask about their day – or perhaps ask about Timmy’s Little League game or something else important to the person you are emailing. It may set in motion a chain reaction of creativity and innovation you never knew existed. Simply because of your ability to be positive and choose your words carefully.
When we choose our language carefully, we enable a world of positivity to emerge. And in that positivity is opportunity. Take a few extra minutes in your communication with folks to ask about their day or their family or hobbies, or something that is important to them. You may awaken some
latent topic that may bring in more work or opportunity simply by choosing to be positive. And that is a worthwhile affair.
Take a moment before you react to things as they happen at work. I know it’s hard, but we have to do it to become more creative and innovative. Most of the time, we are so busy putting out fires and running around like a chicken with its head cut off that we forget to use the “Thoughtful Pause,” which is exactly as the name suggests.
NIR BASHANoverabundance of customers. What would you do? Would you ramp up marketing to keep that market share? Would you hire new folks? Would you come up with ancillary products? Now apply these inversion techniques to the problem in the first place.
So, for a lack of customers, act exactly as you would in case of an abundance of customers, and you may unlock great creative and innovative potential.
Take a thoughtful pause before reacting to a situation. It may be the best decision you have made all day.
Instead of flying off the handle and reacting instinctively to a situation, take a moment to assess it and choose to alter the outcome as a part of the solution. Leaders often mistakenly add fuel to the fire unknowingly, simply because they react too fast. When we react too fast, we sometimes make decisions that we regret. And those decisions then become part of the problem and not part of the solution. When we practice the Thoughtful Pause, we allow a moment – however brief – to catch ourselves from going down the rabbit hole of showcasing the error and protect ourselves from the blinding force of negativity.
One of my favorite techniques to help manage negativity and be a part of the solution is the inversion method. This is a method I had learned very early in my career, and it worked exactly the same as it works now. Its effectiveness lies in its simplicity: when we have an issue or crisis or problem in the business invert it: Do the exact opposite.
So, for instance, if the crisis of the moment happens to be a shortage of customers for a particular product, then invert the problem and imagine a world in which there is an
With the economy headed in the direction we all think it’s heading (down) and applications now at historic lows, what can we use from the boom days (not that long ago!) that may help us invert the problem and find a solution? You’d be surprised at how effective this technique is if you try a shift of mindset to help become part of the solution instead of part of the problem.
Anyone can be part of the solution – it just takes some effort to go against human nature. Yet we are all hardwired from the days of the caveman to approach life with pessimism and negativity that were necessary at some point in human development – pessimism and negativity about not eating the blue wild mushroom or drinking that brown water saved our ancestors lives!
Yet today, the stakes are not life and death anymore; it’s more about solving problems and making a difference to your customers with your product or service. So, choosing to employ these three methods above will take the negativity out of your decision making and open up the light of positivity that enables you to solve problems innovatively and creatively. And that way will help you be a part of the solution, no matter what happens.
Nir Bashan is an all-time Top 100 nonfiction book author and speaker. He helps folks become more creative at work.
In the mortgage world, when someone says Rocket, most in the industry assume they’re talking about Rocket Mortgage But that might be a surprise to the regulators at the SEC.
That’s because Rocket, at the top of every filing, says it’s primarily not a lender. It officially defines itself as a Detroit-based FinTech holding company consisting of tech-driven real estate, mortgage, and financial services businesses.
In a conversation with friends or fellow brokers, call Rocket a lender all you’d
like, but you’ll stand corrected if CEO Jay Farner is in the room.
Rocket Mortgage is a lender, but what about Rocket Auto, Rocket Solar, Rocket Homes, Rocket Loans, Amrock, and StockX — after all, what do shoes have to do with mortgages? Why did Founder Dan Gilbert buy Dictionary.com and a computer game called Deck’n Dice? Are these superfluous purchases or is there an actual plan here?
In an exclusive interview with Mortgage Banker Magazine, Rocket CEO Jay Farner, I had the opportunity to ask him these exact questions. Farner told me there is indeed a plan, and a goal that no other company in the mortgage industry is striving for.
“Our clients don’t come to us to get a mortgage; they come to improve their financial situation… they come to figure out the next step in their lives,” Farner said. “So any acquisition or any company that we can build that brings value to the client in that way is where we’re focused.”
Ideally, in the next 10 years, Rocket will become a one-stop-shop where consumers can manage all their finances. They’ll go to Rocket for a variety of financial services, whether it’s to cancel subscriptions, get an auto loan, get a mortgage, or even a loan to install solar panels on their house.
“There’s a huge opportunity to place all of this on one platform,” Farner said. “I wake up this morning and I can save $50 by refinancing my car loan. I should be able to press a button to make that happen, and because of the data that Rocket has, by tomorrow, I should start receiving savings on that car loan.”
So if you’re still calling Rocket a mortgage lender 10 years from now, it’ll be like calling Amazon an online bookstore. Not entirely wrong, but not entirely right either.
As you may know, Amazon started off as an online bookstore before expanding into a behemoth company with a large e-commerce business. But the Amazon web store isn’t what made Jeff Bezos filthy rich. The majority of Amazon’s total operating profits — nearly 75% in 2021 — comes from Amazon Web Services (AWS).
AWS, a cloud platform (or, in other words, a collection of hardware and software), offers computing services like storage, servers, and networking to other enterprises that don’t want to spend a ton of money building their own servers. AWS is rented on a metered billing model, bringing in tons of recurring revenue for Amazon.
Now think about Rocket offering its technology and resources to help banks provide services they otherwise couldn’t afford, like mortgages. They’ve already begun doing so with Santander Bank.
“That’s the same exact thing that Rocket is thinking about, but from a financial services perspective,” Farner said. “So yes, we do mortgage, but – and I think you’re picking up on it – comparing us to a mortgage lender will become more and more challenging as time goes on.”
Rocket’s journey to Amazon-level success begins with dominating both retail and wholesale channels, as well as rebranding as a fintech company.
During the pandemic housing boom,
Mortgage companies never used to go public on the NASDAQ, but when the pandemic housing boom hit, a number of banks and mortgage lenders filed IPOs. These include Rocket Companies (RKT), United Wholesale Mortgage (UWMC), Guild Holdings (GHLD), loanDepot (LDI), Home Point Capital (HMPT), Pennymac Financial Services (PFSI), and a few others.
These stocks are provided ratings by multiple analysts, all of whom look at the same data but sometimes come away with different opinions. In November, Argus Senior Analyst Kevin Heal caused a slight disruption when he published a report that downgraded the stock from “hold” to “sell,” causing RKT value to tumble 10.6%.
However, Rocket’s SEC filings show that some of Rocket’s executives, including CEO Jay Farner and Director of Rocket Companies Matthew Rizik, bought more shares of RKT after the downgrade from Argus, proving that top executives are not sweating over recent stock performance. As of the end of November, Jay Farner owns 5,574,507 shares of RKT and Rizik owns 515,502 shares.
It should be noted that since Heal’s report was released on November 16, he has issued a number of corrections, but stated that his sentiment and rating on RKT remains the same.
it became harder for nearly everyone in the mortgage industry to keep up with burgeoning demand. The unprecedented rise in mortgage applications created a need for faster turnaround times, forcing many banks and lenders to make technological improvements. As a result, fintech boomed throughout the course of the pandemic, streamlining appraisals, underwriting, and applications processes.
Rocket has bolstered itself, its brokers, and its correspondent partners with industry
leading fintech over the past few years with programs like Correspondent Assist, Pathfinder, Rocket Connect, and Rocket Pro TPO Client Portal.
“So it’s a mind shift from a company that produces mortgages to a company that takes its thousands of technology people and empowers them to build these great projects for our clients,” Farner said.
Don’t be mistaken. You wouldn’t call Rocket a fintech provider — at least not yet. Fintech providers sell their technology for a fee, but Rocket only provides its technology to its partners.
“They recently introduced the rewards program that can only be used if you basically get a mortgage through Rocket,” Argus Analyst Kevin Heal said. “It’s like having airline miles. I’ve got 30,000 miles on United, but United doesn’t fly into this place that I’m going to, so I can’t use these miles. With Rocket, you can only use those rewards for paying down closing costs on your mortgage from Rocket.”
In 2022, Rocket formed an exclusive partnership with Santander Bank to provide mortgages for the bank’s two million customers with “exclusive discounts and dedicated resources” to help them buy a home. Specifically, Rocket Mortgage provides discounts on loan costs and closing costs with enhanced discounts for Santander Private Clients and employees who close loans within the program.
In February 2022, Santander, the Bostonbased bank with 650 retail offices in the U.S., had to exit the mortgage business because the cost to originate was too high and it wasn’t seeing enough of a return on its business.
Rocket spokesperson John Perish said Santander was prompted to reach out to Rocket after it announced in 2021 that it formed a relationship with Salesforce to make its mortgage origination technology available to banks, credit unions, and other financial institutions.
In August, Rocket also announced its partnership with Q2 Holdings, provider of digital banking solutions, to enable Q2 banks and credit unions to offer Rocket Mortgage’s digital home loan application experience. Rocket offers perks such as live mortgage assistance inside of Q2’s online banking platform.
But, wait. Retail banks are brokers’ competitors, aren’t they? How do Rocket’s broker partners feel about their lender offering its technology and resources to their competitors for a discount?
“The way we think about the brand and the technology that we’ve built is that it is a benefit to the partners that we work with,” Farner said. “We’d like to reach the client everywhere we can and it may be through a broker or it may be through a partner bank.”
“If you’re not partnering with us, then clearly we’re a direct competitor, and we will be using all of the resources we have to go out and win the clients that we’re all competing for,” Farner added.
When it comes to which lender has the best marketing, Rocket blows everyone else out of the water. The everyday consumer may recognize them from their commercials on TV and social media (now more geared towards Rocket Money), the Anna Kendrick 2022 Super Bowl Ad, or if they went to see the Cleveland Cavaliers at the Rocket Mortgage Fieldhouse. Their 2019 commercial “Push Button, Get Mortgage” certainly caused a stir amongst the broker community, making it easy for consumers to submit applications, manage autopay, view loan information, and
attain a current home value estimate.
United Wholesale Mortgage, Rocket’s cross-town rival, also has a mobile app for brokers that it rolled out in 2016 called Blink+, providing a point-of-sale, loan origination system, and customer relationship manager all-in-one package. Never heard of it? Well, that’s the point.
Because of its retail business, Rocket has the power to market to consumers directly — and it does a mighty fine job doing it.
“Within the pandemic, they had very high margins relative to the peer group,” Barker said. “And they weren’t as competitive on prices, which told me that customers would go to Rocket, not necessarily looking for the best rate, but just because they knew who Rocket was.”
However, Rocket’s successful marketing tactics do not negate the amount of business their broker partners bring in — roughly 42% of their mortgage originations come from their partner network. Homebuyers, making the biggest financial decision of their lives, like to work with real estate agents, brokers, and lenders they trust. They appreciate guidance from a professional who
will get the loan closed and on time.
“I think it’s part of Rocket at this point and the brokers are essentially Rocket’s distributed sales force, right?” Barker said. “Who do you trust to get this loan done at the right time and get all the paperwork ready? Because, let’s say, I’m moving my family halfway across the country to get this done. So trust and relationships are much more important, and that requires a localized sales force,” Barker said.
So, the success of Rocket’s direct-toconsumer channel and these partnerships with banks does not mean they’ll be ditching the wholesale channel. The partner network is an integral part of Rocket Mortgage’s business, but there are other, less expensive ways to get customer leads, than through brokers. Rocket Money has the potential to do just that.
You may have heard this piece of advice before: Be careful who you share your dreams with, not everyone
nationalagency.fnf.com
.
As you plan on ways to reach new horizons this new year, think about how your underwriter relationship fits into those plans. All year long, the FNF Family of Companies works to provide top service and resources to its agents throughout New England.
Whether you’re already part of the FNF family or need an underwriter who always works for you, our teams have the expertise needed just for you. Don’t let an opportunity disappear. Come talk to us, and let’s push forward together.
shares your enthusiasm.
As a public company, your goals and dreams are no longer private. Shareholders with a vested interest in the company need to be convinced they’ll come to fruition, and how profitable they’ll be.
When Argus Analyst Kevin Heal came out with a report in November that downgraded RKT’s stock from “hold” to “sell,” he cited a number of difficulties the company is facing, though they are not much different from what other companies across the industry are facing. Although Rocket has a long list of ancillary services, like Rocket Solar, Rocket Auto, Rocket Money, etc., Heal’s report states, “We believe that these acquisitions and expansion into other financing and partnerships will not generate enough revenue to substantially move the needle.”
Rocket Money, formerly known as Truebill, was acquired last year for a hair under $1.3 billion, and has generated a little over $84 million this year. Heal calls these earnings “inconsequential” compared to the amount of revenue from mortgage business.
Rocket Money is an important acquisition if the company wants to succeed in becoming a one-stop-shop for consumers to manage their finances. It’s essentially the mouthpiece to their funnel, working as a lead generator bringing in consumers who will eventually need auto loans, mortgage loans, and maybe even solar panels for their house.
“Subscription revenues from Rocket Money were $32.6 million (for the third quarter),” Heal said. “That represents 2.5% of Rocket’s total revenue. To me that is inconsequential when you are deriving well over 90% of revenues from the mortgage business.”
Sure, at this point Rocket Money’s revenue is no match to their mortgage business, but the app was just acquired last year and seems to be performing well.
When Rocket first acquired Truebill in December 2021 it expected the service to generate $100 million in annual recurring revenue, so generating $84 million in premium subscription revenue by the third quarter puts them well on track to reach their goal. TechCrunch also speculates that since Truebill was acquired in all cash, Rocket may have gotten a discount of sorts, making this a very cheap deal.
Other analysts, Barker and WedBush Analyst Jay McCanless, believe that Rocket’s acquisition of Truebill was a wise move.
“Gen Z’s almost as large as the millennials, almost as large as the baby boomers,” McCanless said. “And so having an asset like Rocket Money that people are gravitating to
is very beneficial. It seems like the subscriber growth is headed the right way as long as those young people still have jobs and the job picture doesn’t fall apart for them.”
McCanless said when the market is healthy and business is looking good, that’s the time to make long-term strategic investments and acquisitions that will carry the company through future market downturns. Rocket Money is one of these acquisitions.
“Rates will go up and rates will go down, and that will impact the short-run growth of your business,” Farner said. “But if you’re focused on the long run engagement and acquiring of a client, then you’ll stay on the right path to grow your organization regardless of what interest rates are.”
Moreover, Rocket Money is a viable alternative to generating leads at a lesser cost, Barker says.
customers happy. It allows services and creates stickiness to the customer base,” Barker said. “What it also creates is a significant amount of leads for customers. I believe (Rocket Money) has over two and a half million customers at this point, growing at about a hundred percent rate. So if you run that out a couple years, you’re gonna have over five to seven million customers within Rocket Money.”
‘VERY CHEAP LEADS’Fmargin that they generate — that will generate a couple billion worth of earnings.
For now, the service exists to please customers and make the company “stickier” as analysts like to say, but ultimately what it generates are very cheap leads.
It’s expensive to generate a mortgage customer. If you go to a broker, you have to pay 1.5% on that mortgage, or one and a half points for generating that mortgage. For a $300,000 house you’re paying a broker $4,500 for that customer. But if you get a Rocket Money customer that you’re already servicing, there’s no real incremental cost or it’s very minimal.
Sure, it takes money to operate Rocket Money and there is some technology associated with it. It will take some investments to develop it and update it over time, but these costs are inconsequential compared to what it costs to bring in
In the third quarter earnings call, Rocket Chief Accounting Officer Brian Browns said, “One of the biggest challenges in the mortgage industry is the cost to acquire a client, which typically runs in thousands of dollars. In contrast, Rocket money can acquire a new client for less than $100, which is a significant difference.”
The beauty of this funnel system Rocket is building where they initially acquire the client through Rocket Money then lead them to use the rest of their services to fulfill financial needs is that it’s a huge money saver.
“Acquiring a client one time for one product or service will cost you a certain amount of marketing dollars,” Farner said. “But if you can engage that client daily, weekly, monthly, and bring them back for another service, let’s say it’s Rocket Solar… you’re able to help the client reduce cost and generate revenue without paying to acquire
The whole reason for creating that onestop-shop is to generate lower cost customer acquisition goals, Barker said. “And no one’s ever done that in mortgage, like from a mortgage lead. It’s all been very episodic. And so when you think about what Rocket wants to do… I think it’s great that they’re doing it,” Barker added.
magine one platform where you can manage all your payments and acquire the loans you need throughout your lifetime. You could cancel your Netflix subscription, refinance your auto loan, and apply for a mortgage all in the same day by pressing a few buttons. An app like this could be an absolute game-changer, and especially attractive to the younger and more digitally advanced generations.
“When you think about the engagement that we have with that client on a monthly base basis as they make payments, there’s an opportunity much like Amazon to offer other related services, and that’s exactly what we’re doing as we talk about Rocket Money and Rocket Rewards and Rocket Loans and Rocket Homes,” Farner said.
Once a person graduates college and lands their first job, they’ll have to step into the real world of managing monthly bills, subscriptions, insurance, credit card debt, and begin to take ownership of their finances. They’ll need
new businesses, is leverage this great core of mortgage, but wrap it with these financial services and this engagement platform that we’re building,” Farner said. “To allow our clients to constantly keep up to date on their finances, but also allow the company to have the experience and the relationship with the client on an ongoing basis so we can leverage the marketing costs time and time again… So I think Amazon is a great blueprint for where you’re seeing Rocket going.”
But Rocket is not the only company with this vision. There are strong competitors out there looking to do the same thing.
“SoFi is a good one,” Barker said. “I mean, they’re doing it in different ways. They’re growing a lot faster and they’re a bank. They do student loan refinances. They outsource mortgages. They do personal loans, and they have a fintech franchise that does payments processing for neo ads.” NEO is a cryptocurrency often described as a rival or alternative to Ethereum.
In February 2022, Insider Intelligence came out with an article stating that SoFi could be the next Amazon of the banking world, providing a one-stop-shop for all banking services.
—JAY FARNERto gain some financial literacy in order to understand how to apply for their first loan or credit card.
“Every experience is separate and so it’s hard for clients to connect all of those experiences to manage their finances,” Farner said. “And so there’s a huge opportunity to place all of this on one platform.”
By centralizing these transactions into one platform, it eliminates confusion, delays, and costs for the consumer.
“When I think about where Rocket’s headed, Amazon is a great example,” Farner said. “I may later today recognize that I’ve gotta buy a light to install in my garage. I may do it on Amazon. Later today, I may have to buy some Halloween costumes for my kids. I’ll do it on Amazon. It offers many different types of products, but it’s one company that knows me, that can execute on a delivery that I have confidence in.”
Rocket’s goal is to have the same kind of centralized platform that will serve consumers’ financial needs.
“That’s exactly what you’re seeing us do as we grow out these businesses or acquire
SoFi said that its Technisys deal will help it with its ambition to become “a one-stop shop financial services platform.”
Barker emphasizes that SoFi may be in a better position to become a one-stop-shop for consumer finance because they are a bank. Opening a bank account is the first step to becoming financially independent and many consumers begin opening their own account in high school or college, before they even have to manage subscriptions, bills, or debt. The main advantage banks have is being able to see customers deposits and paychecks – that creates stickiness.
“If you have a sticky customer base that wants to utilize your products over and over again, that creates lower customer acquisition cost and the ability to sell more products,” Barker said.
Then again, Amazon had to deal with competitors too. Having an original idea is not what led the company to win.
“Back in the internet heyday, there were plenty of internet shopping malls where they were aggregators,” Heal said. “So, you know, basically Amazon is kind of a big shopping mall. They’re the one that survived. But there were countless others that had the same business model that went by the wayside.
“Our clients don’t
come to us to get a mortgage; they come to improve their financial situation; they come to buy a home; they come to figure out the next step in their lives.”By AMERICAN MARKETING ASSOCIATION, SPECIAL TO MORTGAGE BANKER MAGAZINE
Researchers from University of Miami and New York University published a new Journal of Marketing article that examines how voice technology can affect what consumers reveal about themselves.
The study is titled “Information Disclosure in the Era of Voice Technology” and is authored by Johann Melzner, Andrea Bonezzi, and Tom Meyvis.
We live in an era where consumers constantly interact with technological devices connected to the internet. Whenever consumers search for information online, make purchases, or consume videos, music, and other content, they disclose information about themselves. This disclosure has allowed technology companies to collect consumer information at an unprecedented scale – which they in turn have monetized directly, mined to identify unmet needs, or used to optimize marketing activities such as segmentation, targeting, and pricing.
disclose information about themselves both verbally, that is, by voluntarily providing information through language, as well as nonverbally, that is, by involuntarily revealing information through vocal paralanguage and ambient sound.”
The researchers also identify mechanisms that arise from fundamental differences between oral and manual communication. They integrate these mechanisms into a verbal disclosure decision-making framework illustrating the complex ways in which communication modality can affect consumers’ likelihood to disclose information. This modality-dependent framework not only provides impetus for future research, but can be used as a tool by marketers to gauge when and how oral versus manual communication may increase or decrease consumers’ likelihood to disclose information verbally.
from such auditory nonverbal disclosures. Additionally, it provides an overview of industry patents attesting both to the wide range of information about consumers that can be extracted from audio data and to industry interest in leveraging such data.
Of interest to marketers: Practically relevant suggestions for marketers to aid them in counteracting processes that reduce consumers’ likelihood to disclose information verbally when speaking with connected devices.
How vocal paralanguage and ambient sound as new sources of information in oral interactions with connected devices can be used to improve targeting effectiveness, specificity, and context-awareness.
Of interest to policy makers: Suggestions for consumer protection measures against mechanisms that may misleadingly increase consumers’ verbal disclosure likelihood when speaking to connected devices.
Privacy challenges of collecting and using information inferred from vocal paralanguage and ambient sound inherently captured in oral interactions with technology in light of both U.S. and European privacy legislation.
Until recently, consumers interacted with technology largely through manual communication, which entails typing or selecting options by clicks or touches. Voice technology (brought about by artificial intelligence) has enabled interactions to also occur through oral communication and consumers increasingly engage with their phones, tables and other devices using their voices.
Melzner explains that “The rapid propagation of voice technology raises a vital question: Do consumers disclose more or less information about themselves when they interact with technology orally rather than manually? To answer this question, one needs to consider that consumers can
Oral communication with connected technologies allows one to capture information beyond language in the form of nonverbal disclosures, which are largely absent in manual communication. When consumers speak to connected devices, vocal paralanguage (e.g., the sound of their voice or how something is said) and ambient sounds (e.g., sounds in the current environment and from activities) are inherently captured and reveal information about consumers. The article provides an overview of marketing relevant information around consumer states (e.g., emotions, health conditions, current activities) and traits (habits, ethnicity, personality, identity) that can be inferred
“Our analysis suggests that voice technology can increase, but also decrease, disclosure. From our research, policy makers can gain a better understanding of how to regulate the collection and use of information disclosed to voice-technology in the interest of consumer welfare. In particular, our analysis calls for higher privacy protections for information disclosed in oral interactions with technology,” says Bonezzi.
You can read the complete article at ScienceDaily.com https://www.sciencedaily. com/releases/2022/11/221130114606.htm
Join hundreds upon hundreds of your colleagues as they explore a packed two-day agenda.
Gather with your peers for a packed program of networking, product showcases, educational sessions, motivational speakers, and so much more!
Learn in-depth about the impact of blockchain on the mortgage industry. Find out why you should be using LinkedIn to build your business.
You can also learn a proven 3-step process to gain more Realtor referrals than you can handle as well as how to have your best week ever as a loan originator and unlocking the mysteries of Non-QM loans.
In short, there is something for everybody! Of course, you won’t want to miss out on our packed exhibition hall, which opens Friday at 11:15. It’s where you’ll learn about the latest product offerings as well as networking with your peers and enjoy lunch and refreshments!
January 12 – 13, 2023
Thursday, January 12, 2023
Please note, exhibit hall will not be open on this day.
12:00 pm Registration Opens
1:00 pm — 2:00 pm
Impact of Blockchain on the Mortgage Industry
Hear from a panel of experts about latest initiatives in the mortgage industry to adapt secure new technologies and processes. Presenters include Pavan Agarwal, CEO, Sun West Mortgage; Jeromy Potter, Head of Legal & Capital Markets, Stavvy; Mike Dimech, Executive Vice President, Operations Manager, Norcom Mortgage; Hailey Rice, Chief Legal Officer & EVP, Compliance, Canopy Financial Technology Partners; and Zachary Kammerdeiner, Sr. Business Strategist, CATIC Corporate.
1:30 pm — 5:00 pm
Build-A-Broker
Pre-Conference Event. Must pre-register.
Build-A-Broker is an in-person training event designed to help you establish the solid foundations of your business. This program is designed to show you the basics of setting up your business — from how to rent space, to what accounting programs are recommended — and will also cover topics including choosing your loan origination systems, how to pick a CRM system, and more.
Brokerage 101 focuses on the
foundation for establishing your business, presented by experienced mentors. This course includes topics such as:
• How to lease an office space that will grow with you
• How to furnish your space with a budget
• Choosing an accounting program and payroll provider
• What is the right corporate form for you? (LLC vs. Corp.)
• How to determine if your workers are employees or independent contractors.
We have a panel of technology providers to discuss innovative tech tools you can use to set your brokerage up for success, such as:
• Marketing automation
• Finding better LOS systems
• Tracking & mobile tools to dramatically increase your brokerage’s effectiveness
Few brokerages can fully grow without offering more than the standard-vanilla residential home mortgage. We bring in product experts to discuss an array of diverse products such as:
• Non-QM loans, and the pros and cons
• Reverse Mortgages
• Fix & Flip mortgages
• and more
Brokerage 102 focuses on the additional foundational issues for establishing your business, with topics such as:
• Policy & Procedures that every company needs, including BSA/ AML, Sexual Harassment, and more
• Marketing & Compliance — under RESPA, TILA, Reg. N, the CFPB, getting leads, co-marketing with Realtors, and more.
• Compliance training, auditing, and testing.
2:00 pm — 3:30 pm
Legislative Update
A federal perspective on the status of the mortgage industry and major regulatory issues and an update on Connecticut, Massachusetts and Rhode Island legislative developments and what to expect in 2023. Panelists include William Kooper, MPA, Vice President, State Government Affairs and Industry Relations
Mortgage Bankers Association; Norman H. Roos, Robinson & Cole, LLP; Deborah Sousa, Executive Director
Massachusetts Mortgage Bankers Assoc.; Lawrence M. Garfinkel, Greene Law, P.C.; and David Pellegrino, SVP, General Counsel & Chief Risk Officer, Navigant Credit Union
4:00 pm
Why You Should Pay Attention to LinkedIn
• Current statistics and reach of LinkedIn
• How LinkedIn will help you and your business
• Profile basics and Engagement / Q&A
Presenter: Debbie Wemyss, Founder, DW Consulting Solutions LLC, Independent LinkedIn Specialists
8:00 PM — 10:00 PM Networking After
Friday, January 13, 2023
7:00 am Registration Opens
8:00 am — 8:45 am Concurrent Sessions
In this rising rate environment, learn why real estate investor loan origination is likely to remain robust even while the consumer mortgage industry softens. Don’t assume that rising rates mean tough times ahead. Join Roc Capital, one of the nation’s largest capital providers in the business purpose loan industry, as we show you how you can pivot and thrive. This session can change the path of your career; be ready to ask questions.
PRESENTED BY Melissa Deal, VP, Haus Lending
Despite the pandemic, the past two years have been some of the best the mortgage industry has ever seen. But what’s just over the horizon? There are still many questions concerning the outlook for originations and regulation. This interactive session will answer:
• What can we expect for 2023?
• What will rates do? Will they continue their roller coaster ride up and down?
• Housing inventory: What is really the problem?
• With the new Administration, what does this mean for the CFPB and the mortgage industry?
These and other answers will be shared with the audience in a highly informative presentation by David Luna, president of Mortgage Educators and Compliance.
PRESENTED BY David Luna Mortgage Educators & Compliance
After getting into the mortgage business in 2008 with no connections and just $1,900 in savings, Shashank Shekhar went on to build referral relationships with 100+ Realtors in 3 years, eventually becoming one of the Top 15 Loan Officers in the country with a $350M+ annual production. He is also a best-selling author, a podcast host, and CEO of InstaMortgage, one of America’s fastest-growing mortgage companies. Shashank will teach you the exact proven steps so you can attract more Realtor partnerships and referrals in 2023.
PRESENTED BY Shashank Shekhar
InstaMortgage
8:45 am — 9:30 am Concurrent Sessions
SESSION
Who are your customers? What drives them? How do they make decisions? What do borrowers expect from mortgage brokers and finance companies, and what value do you provide them? If you can’t answer these basic questions, growing your mortgage business will be difficult.
Most people only see the results of marketing, but rarely the research and strategy that drive its success.
January 12 – 13, 2023
If you want to grow your business around a solid marketing strategy, join us as we dive into the world of marketing for mortgage brokers. Learn how to find new clients and build a messaging and media approach to attract them while positioning your company for continued growth even in a changing market.
PRESENTED BY Michael Oddi Velocity Mortgage CapitalSESSION B
Your Best Week Ever as an LO
Discussing the proven tactics and strategies that make loan officers most effective with their time. How to replicate an efficient day 5 times to get the most out of your week. Hear what top producers focus on to drive high dollar per hour activity and see tangible results. Next Level will also lay out their proprietary Actions that Matter™ process so that you can focus on the things that matter most to your business for your customers in your community.
9:45 am — 10:30 am Concurrent Sessions
SESSION A
Transitioning from the Refi Boom to Untapped Opportunities: Leveraging Commercial Mortgages for Residential Properties
While the pandemic has affected many aspects of the real estate industry and the refi boom is showing signs of slowing down, real estate investor activity and demand for single-family homes remains stronger than ever. Now is the time to expand your product offerings to cater to this segment of the market. Private lending continues to offer flexible, lucrative options for fix and flip, long-term rental and other real estate investing scenarios that don’t fit traditional guidelines.
RCN Capital CEO & Private Lending Expert, Jeffrey Tesch, will teach you how to:
• Identify profitable solutions for some of your most commonly overlooked leads
• Leverage fix & flip loans, long-term rental loans, and other private lending products to make more money now
• Guide investors through the origination process so that you can develop and retain more business
PRESENTED BY Jeffrey Tesch RCN CapitalThe mortgage market is going through a transition that is making business growth more difficult in 2023. Agency business is shrinking, refinance volume is declining and rates are on the rise. What can help replace the lost business? Non-QM.
Non-QM can help you serve underserved markets to keep your pipelines full. Get up to speed and learn to close non-QM volume now. This presentation explains how!
You will learn:
• Why non-QM is in demand in today’s market
• Details on the types of non-QM programs
• The borrower profiles for each program
• Common scenarios and questions
• How to close more loans using nonQM
• Where to find non-QM borrowers
Angel Oak Mortgage Solutions is the leader in non-QM, educating originators since 2014.
SESSION C
Learn How To Divorce Your Processor & Double Your Business
Learn how to divorce your processor and then invest that time and money
you save into doubling your business.
A productive Originator should spend 100% of his time marketing, sourcing, and harvesting new relationships. Unfortunately, Originators burn 80% of their time on unproductive workbabysitting their loan or they spend a lot of money hiring ”processors” to do the babysitting. With Sun West’s exclusive Morgan (tm) and Instant Underwriting (tm) technologies, the drudgery of the loan origination business is gone: following up with customers, reviewing conditions, interpreting the DU/LP, understanding and applying a myriad of guidelines and regulations. Free up 80% of your time and double your business!
10:30 am — 11:15 am Harnessing Your Superpower
Discover how a 3-person brokerage firm grew, re-invented and went head-to-head with big banks to become America’s largest mortgage lender. Chris Behrns, Divisional Vice President at Rocket Pro TPO, shares philosophies that you can use to shape innovation, client service, marketing, technology and partnerships. Learn what top brokers are doing to grow their business and how you can leverage your superpower. Bring your questions. This is an interactive presentation.
PRESENTED BY Chris Behrns Rocket Pro TPO
11:15 am
Exhibit Hall Opens
Luncheon and refreshments are served in the exhibit hall
2:30 pm
Expo Adjourns
Exhibit hall closes, raffle prizes announced, conference adjourns.
Adapting to today’s dynamic mortgage market has changed the way we analyze trends and track competitors. Luckily, we have the tools you need to determine your competitors’ market share and see how individual loan originators are performing in their market.
Our Mortgage MarketShare Module provides real-time market insights on all lenders, helping you easily benchmark your company’s market share, identify new and emerging markets, and measure your sales performance against your competition.
Our Loan Originator Module provides you with access to the largest and most comprehensive loan originator database in the country. Take advantage of this access to identify top-producing loan officers, verify production, and monitor competitors.
To show you just how powerful our modules are, we’re offering a free customized mortgage competitor analysis. Simply visit www.thewarrengroup.com/competitor-analysis and provide us with a few details. You’ll receive an updated 2021 vs. 2022 Quarterly Mortgage MarketShare Report at the company level paired with a Loan Originator Report highlighting top LOs and individual performance.
Visit www.thewarrengroup.com to learn more today!
Questions? Call 617.896.5331 or email datasolutions@thewarrengroup.com.
BENEFITS
• Monitor Residential and Commercial Lending
• Measure Sales Performance and Market Activity
• Identify High-Performing Competitors
• Uncover Emerging Markets and New Opportunities
• Pinpoint Top Loan Officers for Recruitment
• Identify and Verify Loan Originator Performance
• Measure Loan Activity Against Competition
• Highlight Success for Market Positioning
Inquire about our NMLS Data Licensing and LO Contact Database options.
AppraisalWorks, a leading provider of real estate appraisal management technology, announced a partnership with Mortgage Cadence that will allow lenders to consolidate multiple appraisal vendor and order management systems onto the AppraisalWorks platform – for centralized management and automation of the complete appraisal management function.
Mortgage Cadence is a comprehensive, customizable platform that is uniquely positioned to provide a complete, end-to-end loan lifecycle experience. The integration with AppraisalWorks will enable lenders to quickly select the best-fit property valuation model directly within the Mortgage Cadence platform. Lenders benefit from real-time communication, on-demand access to appraisal information, customizable workflows, greater efficiency, and complete transparency throughout the appraisal process.
“Adding the AppraisalWorks solution to the Mortgage Cadence suite of partner integrations will further help lenders accelerate their appraisal modernization efforts and improve their ability to deliver faster, more accurate appraisals” said Jim Rosen, executive vice president of services at Mortgage Cadence. “This partnership furthers Mortgage Cadence’s commitment to provide access to service providers of choice for lenders on the Mortgage Cadence platform.”
“AppraisalWorks is on a mission to modernize appraisal management. Our partnership and integration with Mortgage Cadence strengthens our commitment to delivering the visibility and control lenders need to achieve exceptional customer service,” said Ben Wiant, vice president of AppraisalWorks. “By consolidating appraisal vendor and order management on AppraisalWorks, lenders gain greater efficiency, control and agility.”
Climate Check, Inc., a leading provider of climate risk data, has announced an agreement with Black Knight, Inc., a software, data and analytics company. Black Knight has added ClimateCheck’s physical Climate Risk Scoring to its Rapid Analytics Platform.
The adoption comes amid growing regulator demands for climate disclosures from companies, including a proposed rule from the SEC that would make such disclosures mandatory. As part of Black Knight’s Climate and Natural Hazard Risk Data Solutions Suite, the ClimateCheck integration will make it easier for companies to keep up with evolving regulations. More importantly, it will make
it easier for them to understand and adapt to climate scenarios that will impact their assets.
“To understand the value of our data, think about a lender’s assessment of risk associated with a loan - The lender must not just consider the creditworthiness of the borrower, but also risks to the collateral. An individual property’s susceptibility to climate-driven disasters such as wind, flood or fire is a material component in that calculation,” said ClimateCheck CEO, Cal Inman.
ClimateCheck distills more than 50 different climate simulations from peer-reviewed government and academic sources into an easy-to-understand risk assessment. Our scoring tool proactively analyzes portfolios and pipelines for potential climate-related environmental exposures and assigns a risk score, continuously updated with the latest climate data. We forecast risk related to heat, storm, fire, drought, and flood hazards down to the individual property level. We do this for multiple climate scenarios, decades into the future.
Black Knight is incorporating ClimateCheck’s data into turnkey client solutions that enable clients such as mortgage lenders, servicers, and investors to understand how different potential climate risks will impact things such as property valuation and mortgage default rates.
to address a key pain point for its core customers. Mortgage payoffs comprised 45% of all wire fraud incidents reported to the CertifID fraud recovery services team, the single largest use case over the past two years.
“The recent addition of PayoffProtect to our CertifID software agreement reduces this major source of risk for our operations,” said Bob Taylor, Vice President of Escrow Accounting at Stewart. “Since we began using CertifID two years ago, I have seen a substantial drop in the number of wire fraud attempts reported.”
CertifID also provides fraud recovery services to any consumer or business that becomes a victim of wire fraud. The team provides a single point of contact for customers to help them navigate across multiple parties, including banks and law enforcement, who need to work together during a fraud recovery process. Trained by the U.S. Secret Service, the CertifID team recovered over $50 million in funds from cybercriminals over the past two years.
ActiveComply, a provider of cloud-based solutions that help companies in highly regulated industries stay compliant, has launched Remote Office Inspection, a new digital service that uses the latest encrypted technology to help companies document their compliance with agency guidelines and state and federal laws when using remote employees.
CertifID And Stewart
CertifID Inc., a leader in wire fraud protection, and Stewart Information Services Corporation, a global leader in real estate services, announced a significant reduction in wire fraud risk for the title company, home buyers and sellers, and lenders as a result of their partnership. This is in the face of the 64% year-on-year rise in overall cybercrime losses, most recently available from the FBI Internet Crime Complaint Center (IC3).
In 2020, the companies entered into a partnership agreement to enable Stewart direct offices and independent agencies in Stewart’s Trusted Provider network the ability to collect and send wire instructions to customers. Since then, the partnership has continued to grow successfully in scale and scope.
Many of Stewart’s Direct Operations and independent agency partners have moved to CertifID software as their primary solution for wire fraud protection. CertifID is now available nationally through Stewart‘s Direct Operations across 35 states.
“Wire fraud is one of the largest and underpriced risks to our industry, and that’s why Stewart has been making significant investments into the right technologies, including companies like CertifID,” said Fred Eppinger, CEO of Stewart. “The partnership has provided winning solutions for consumers through both our direct operations and our agency services, who take advantage of the CertifID protections.”
CertifID launched PayoffProtect earlier this year
While a growing number of banks, mortgage lenders, credit unions and investment banking firms allow employees to work from home or a remote office, they remain subject to stringent industry rules and regulations that make compliance difficult to manage remotely. For instance, the Department of Housing and Urban Development (HUD) requires lenders to meet certain rules about protecting FHA loan files, which has proven difficult for employers to prove their due diligence.
Remote Office Inspection is an accessible way for companies with remote employees to ensure compliance, workplace safety and supervision. It includes a customizable survey that enables organizations to remotely inspect branch offices to ensure they have the proper signage, business license display and adequate security, which saves the expense of sending someone out to do a physical inspection. Remote Office Inspection’s survey features can also be tailored to prove the compliance of at-home employees, which is useful for regulated institutions subject to governmental oversight.
“When it comes to consumer privacy, the same rules apply whether an employee is working from their company’s headquarters or their living room couch,” ActiveComply Co-Founder and CEO Rob Nunziata said. “Given the recent increase in privacy violations and data breaches—some of which resulted in regulatory enforcement and multi-million-dollar class action settlements—ensuring that remote offices and employees do not create liability is a sound strategy.”
These attorneys are universally recognized by their peers as setting the highest standard for the legal profession, excelling in all fields — knowledge, analytical ability, judgment, communication, and ethics.
sluna@ravdocs.com 469-730-4607
Scott Luna’s practice is focused on real estate law with an emphasis on mortgage document preparation and land title issues. Scott managed a successful multistate highvolume title and document preparation business for over 20 years before joining RAV and is recognized throughout the real estate legal community for his expertise. As a past President of the Oklahoma Land Title Association, Scott’s ongoing involvement in the industry adds to his wealth of title-related knowledge. Scott received his Juris Doctor degree from the University of Tulsa College of Law in 1991 after receiving his Bachelor of Science degree from Texas A&M University. Scott is currently licensed in Texas, Oklahoma, Missouri, Minnesota, Nebraska, and Kentucky.
Mitchel H. Kiderkider@thewbkfirm.com 202-557-3511
Mitch Kider is the Chairman and Managing Partner of Weiner Brodsky Kider PC, a national law firm specializing in the representation of financial institutions, residential homebuilders, and real estate settlement service providers. Mitch represents banks, mortgage companies, homebuilders, credit card issuers, and other financial service companies in a broad range of litigation and regulatory and compliance matters. He defends clients in investigations and enforcement actions before the Consumer Financial Protection Bureau, Department of Housing and Urban Development, Department of Justice, Department of Veterans Affairs, Federal Trade Commission, Fannie Mae, Freddie Mac, Ginnie Mae, and various state and local regulatory authorities and Attorneys General offices. In addition, Mitch acts as outside general counsel to smaller companies and special regulatory and litigation counsel to Fortune 500 companies.
ggraham@bmandg.com 972-353-4174
Black, Mann & Graham CoManaging Partner Gregory S. Graham has practiced in the areas of real estate, litigation, and bankruptcy law since 1989, and is currently licensed in Texas and admitted to practice before the United States District Courts for the Northern and Eastern Districts of Texas.
Mr. Graham is also currently licensed to practice law in Georgia and has been since 2017. He received his Juris Doctor degree from Southern Methodist University School of Law in 1989 after receiving a Bachelor of Arts cum laude from UT Dallas.
Mr. Graham’s affiliations include the Dallas MBA, where he previously served as a Director & Chairperson of the Legislative Committee; DFW Mortgage Brokers Association, where he previously served as Legal Counsel; MBA; NAMB; Texas AMB prior to its closure; and Texas MBA.
James W. Brody, Esq. Mortgage Banking Practice Group Chair jbrody@johnstonthomas.com 415-246-3995
James Brody actively manages all the complex mortgage banking litigation, mitigation, and compliance matters for Johnston Thomas. Mr. Brody’s experience centers on those legal issues that arise during loan originations, loan purchase sales, loan securitizations, foreclosures, bankruptcy, and repurchase & indemnification claims. He received his B.A. in International Relations from Drake University and received his J.D., with a certified concentration in Advocacy, from the University of the Pacific, McGeorge School of Law. He was a recipient of the American Jurisprudence BancroftWhitney Award. He is licensed to practice law in California and has been admitted to practice in front of the United States District Courts for the Central, Eastern, Northern, and Southern Districts of California. In addition, Mr. Brody has served as lead litigation counsel for numerous mortgage banking and commercial related disputes venued in both state and federal courts, in a direct capacity or on a pro hac vice basis, in AZ, CA, FL, MD, MI, MN, MO, OR, NJ, NY, PA, TN, and TX.
Attorney
marty.green@ mortgagelaw.com 214-691-4488 ext 203
Marty Green leads the Dallas office of Polunsky Beitel Green, one of the country's top residential mortgage law firms. Mr. Green is an accomplished attorney with more than 20 years of experience in the legal, banking and financial services industries. He is the former Executive Vice President and General Counsel for Dallas’ CTX Mortgage Co. and previously worked with the Baker Botts law firm in Dallas as Special Counsel. In his role as leader of the firm’s Dallas office, Mr. Green advises clients on the latest rules and regulations covering residential lending, in addition to building on Polunsky Beitel Green’s long tradition of delivering loan closing documents with speed and accuracy. Mr. Green is admitted to practice before all Texas state and federal district courts in addition to the U.S. Court of Appeals for the Fifth Circuit. An honors graduate of the University of Texas School of Law, he earned his undergraduate degree at Southern Utah University. Texas Monthly has selected him as a Super Lawyer multiple years.
Multi-channel mortgage leader with exceptional service and comprehensive mortgage solutions.
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The Carrington Advantage Series is a full suite of Non-QM Loan solutions that “Delivers More” for you and your borrowers. Ideal for borrowers, like the self-employed, that don’t fit Agency or Government Qualified Mortgage standards based on credit quality, property type, documentation type, income documentation, or other borrower situations.
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Offers warehouse lines to correspondent lenders, community banks, credit unions, and secondary-market investors.
*Ease of use (Support staff, technology an other tools to support mortgage bankers)
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LICENSED IN: CT, DC, DE, FL, GA, IL, MD, MA, NH, NJ, NY, NC, OH, PA, RI, SC, TN, TX, VA
Clear Capital is a national real estate valuation technology company with a simple purpose: build confidence in real estate decisions to strengthen communities and improve lives. Our commitment to excellence is embodied by nearly 800 team members and has remained steadfast since our first order in 2001.
clearcapital.com
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Alpha Tech Lending is a trusted direct lender, with over a combined 30 years of experience in the private lending sector. We offer a variety of loan programs for non-owneroccupied residences that are customizable to suit your real estate investment needs. From fix and flips, long term rental, new construction, commercial bridge, and more. We lend to both new and experienced real estate professionals throughout the country. We value long term relationships built on trust. Our brokers are protected.
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LICENSED IN: CT, DC, DE, FL, GA, IL, MD, MA, NH, NJ, NY, NC, OH, PA, RI, SC, TN, TX, VA
Stratton Equities is the leading Nationwide Direct Hard Money & NON-QM Lender that specializes in fast and flexible lending processes. Our Hard Money and Direct Private Money loan programs support the following investment projects:
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strattonequities.com (800) 962-6613 info@strattonequities.com
LICENSED IN: All States except for: AK, ND, NV, SD, UT
