National Mortgage Professional Magazine January 2019 by ambizmedia

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*Carrington Flexible Advantage A (Non-QM) product requiremen nts vary depending on the consumerâ&#x20AC;&#x2122;s crredit grade, LTV, DTI, andFICO scores and d may require reserves from 3 to 6 month hs. Ask your Account Executive for additiional details and requirem ments. Not available in MA and ND. No ca ash out available in TX. **Restrictions apply; ccontact your Account Executive for detaills. ***Carringtonâ&#x20AC;&#x2122;s Investtor Advantage applies to non-owner occup pied business purpose loans only. Loan-to o-value, debt service ratios and state restrrictions apply. Speak to your Account Execcutive for additional details and requirem ments. Does not include: Co o-ops, condotels, manufactured, unique p properties, mixed-use properties, leaseholds, rural properties, log homes, agricu ulturally zoned, properties that provide in ncome to borrower, farms or hobby/worrking farms, properties witth oil, gas, or mineral rights, builder model leaseback, non-conforming zoning reegulations that prohibit rebuilding, prop perties subject to rent control regulationss. Not permitted: Gift funds, non-traditiional %35-&, , 2 5 5.4 .4*2 351 51)4)%%5* * 2 35),4 2 &)% +52 3 3 +2 42 7 )&,2 !3&+436 362 35*&-5)%52 32 *5% )-2 # +5 2 Ineligible states: 36 s Y:: Loans require a minimum loan size of â&#x20AC;&#x153;conforming ballance plus $1..â&#x20AC;? NY CEMA loans not perm MA and ND. NY mitted. ÂŠ Copyright 2007-2018 Ca arrington Mortgage Services, LLC headquartered d at 1600 South Douglass Road, Suites 110 & 200A,, Anaheim, CA 92806. 866-453-2400. NMLS ID 26 600. Nationwide Mortgage Licensing System (NMLSS) Consumer Access website: www.nmlsconsumera access. org. AZ: Mortgage Banker BK-0910745. CA(2'&%5)*5-2$6 $62,#52"5!43,+ ,+5),2 2 *&)5** 3*& & #,2 )-532,# ,#52 4 & & 3)&42 5*&-5),& ,&4 4 2 3, , 4 4 52'5)-& -&) ) 2 %, , 21 52 928 8 2GA: Georgiia Residential Mortgage Licensee 22721. IL: Illinoiss Residential Mortgage Licensee. MN(2 # #&* &*2&* &*2) ,24) )2 532 2 53* 3&2 +!4)6 )62 5 5 &*,34,& ,& )2 7

2 )7*,4,52 %5(2 &** 3&2 5*&-5),&4 2 3, , 4 4 52' 4)2 3 532'&%5)*52 7 2 2 2 5 2'55*2 ++&, , 2 2 8 9 2NV V:: Mortgage Broker License 4068 (Resid to enter into an interest ra ate lock agreement under Minnesota Law. MO(2 &** dential urance. NY Y:: Licensed Mortgage Bankerâ&#x20AC;&#x201D;NYS Deparrtment of Financial Services. New York Mortgage Banker B License B500980/107664. RI: Rhode Island Licensed Lender, Lender License 20112809LL. VA: NMLS Mortgage Lending). NJ: Liccensed by the N.J. Department of Banking and Insu K,, AR, CO, CT T,, DE, E, DC C,, FL, HI, ID, IN N,, IA, KS, KY Y,, LA, ME E,, MD D,, MII,, MS, MT T, NE T, E,, NH H,, NM, NC C,, OH H,, OK K,, OR, PA, SC C,, SD D,, TN N,, TX T X,, UT T,, VT T,, WV V,, WI and WY Y.. NOTICE: All loans 2600. Also licensed in AL, AK ID 2600 (www.nmlsconsum meraccess.org). WA: Consumer Loan License CL-2 4352* $ $ 5%,2, 2%35-&, , 2 )-553 3&,&) ) 24)-2!3 !53,6 ,624! 4!!3 4 2 &-5 &)5* 2 5353 2 4)2!3 - %,* ,*2+46 462 436 362$6 $62*,4,5 2 # #5352&*2) 2 434),552,# ,#4,24 2$ 33 53* 3*2 & 2 4 & & 6 2 5*,3&%,& ,& )*2+46 4624! 4!! 6 6 2 # #&*2&*2) ,242% ++&,+5),2, 2 5)- 2 53+* * 2% )-& -&,& )* * 24)-2!3 34+*24352* $ $ 5%,2 to change without notice. This information is for mortgage professionals o only and is not intended for distribution to consum mers. Carrington Mortgage Services, LLC is not acting on behalf of or at the direction of HUD/FHA o or any government agency. All rights reserved.

n National Mortgage Professional Magazine n JANUARY 2019

NE W O F F E R IN G S

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table of N A T I O N A L

34 HMDA Highlights: New Rules for 2018 and Beyond By Jonathan Foxx, Ph.D., MBA

J A N U A R Y

50 NAMB, Calyx Bring New Broker Technology to Market By Rick Grant

2 0 1 9

M O R T G

V O L U

A SPECIAL FOCUS ON “BRANCHING OUT: EMPLOYMENT & GROWTH OPPORTUNITIES”

Finding Meaning in a Rapidly Changing Industry By Dee Grosso ..64

A M

Recruiting for Your New Mortgage Office? By Shachar Rand ........68

The Only Constant Is Change: Be Ahead of the Curve By Kimberly Grim & Bryan Moran ......................................................70

The Art of MLO Happiness: Appreciation, Trust, Sincerity and Honesty By Mike Eshelman ........................................................72

Hiring for Cultural Fit By Fobby Naghmi ..........................................74

The Sweet Spot: Matching Employees With Your Company’s

T t

Corporate Culture By Susan Sullivan & Quincy Amekuedi ................76

M C

Recruitment vs. Relentless Pursuing By Mary Kamelle ..................78

54 National Mortgage Professional Magazine Presents Top Mortgage Employers

Apps vs. Naps By Eric Weinstein ......................................................80

T T

Ready to Branch Out in 2019? Use the Buddy System By Michael Cooksey ..........................................................................82

U B

Branching Out Through Attraction By Lori Lite ..............................84 Culture Shock! Using Company Culture as Your Top Recruiting Tool By Shirleen Von Hoffmann ......................................86

H i

How to Keep Employees Happy: Compensation Matters By Dolores Calicchio ..........................................................................88

Boot Camp: Improve Productivity and Reduce Loan Officer Turnover By Deborah Hill ......................................................90

C S

B T

FEATURES

ARMCP Membership Hits the 1,600 Mark ........................................6

94 Taking a Strong Step Into the New Year By Ray Brousseau

V I S I T Company

Web Site

O U R

A D Page

ACC Mortgage .................................................. weapproveloans.com ......................................................7 Angel Oak Mortgage Solutions ............................ angeloakms.com ..............................................Back Cover Brokers Compliance Group.................................. brokerscompliancegroup.com ..........................................67 Carrington Mortgage Services, LLC ...................... carringtonwholesale.com ........................................1 & 66 Citadel Servicing Corporation .............................. citadelservicing.com ......................................................19 DocMagic .......................................................... docmagic.com ................................................................9 FAMP ................................................................ fampgoldcoast.org ........................................................85

The

th i w eck

th i w k

96 The Beckwith Blog: Mirror Mirror on the Wall … Who’s the Fairest of Them All? By Christine Beckwith

First National Bank of America............................ fnba.com/mortgagebrokers ..............................................5 Flagstar Bank .................................................... flagstar.com/why ..........................................................39 Genworth Mortgage Insurance Corporation .......... pages.genworth.com/opt-in ............................................29 Greenbox Loans, Inc........................................... greenboxloans.com ................................Inside Front Cover Lykken On Lending ............................................ lykkenonlending.com ....................................................84 MBS Highway .................................................... mbshighway.com/MNN ..................................................37 Mortgage News Network (MNN) .......................... mortgagenewsnetwork.com ....................................52 & 53

of contents

R T G A G E

O L U M E

P R O F E S S I O N A L

1 1

N U M B E R

Non-QM Performance Exceeds Expectations in 2018 By Tom Hutchens ................................................................................8 The Elite Performer: Be Relentless By Andy W. Harris, CRMS..........8

A Chat With David Schroeder, SVP of Quicken Loans Mortgage Services............................................................................10 Recruiting, Training and Mentoring Corner: Are You the Right Place to Work? By Dave Hershman ..................................................12 New Year Changes By Gavin T. Ales ................................................18 Cash in on the New Year..................................................................20 NAMB Perspective ............................................................................22 The Mortgage Godfather: How to Help a Quality MLO Find the Greenest Grass By Ralph LoVuolo Sr. ........................................30 MBA’s Mortgage Action Alliance: A Message From MAA Chairman Jeffrey C. Taylor ..............................................................41 Technology Adoption Will Decrease Cycle Times by More Than 85 Percent … and Here’s Why By Pat Kinsel ........................42 Upfront Precision and Use of Tools to Get Clients the Best Mortgage Should be Primary Task By Pam Marron ................44 How to Make Sure You Earn More in 2019 Than You Did in 2018 By Brian Sacks ......................................................................46 How Technology Helps Servicers Deal With Disaster By Gagan Sharma ..............................................................................48 Compliance Matters: Policies and Procedures: Specific Components By Jonathan Foxx ..........................................61 BrokerNATION: Infinity Financial Mortgage Corporation, Timothy George By Andy W. Harris, CRMS ......................................62 How to Value an Apartment Building By Stephen A. Sobin ............92

A D V E R T I S E R S Company

Web Site

Page

The National Association of Minority Mortgage Bankers Association is seeking the Top 100 Minority or Women Mortgage Loan Originators to be included in the NAMMBA Top 100, based on production by units or total loan volume (dollar amount). Selected Mortgage Loan Originators may be entitled to receive: l Recognition in National Mortgage Professional Magazine l Participation in award ceremony at NAMMBA Connect Conference l Video interview on Mortgage News Network

MortgageRight .................................................. masterthestorm.com ......................................................13 NAMB+ ............................................................ nambplus.com ..............................................................23 NAMB Focus ...................................................... namb.org ......................................................................21 NAMMBA ..........................................................nammbaconnect.org ...................................................... 83 NAPMW ............................................................ napmw.org ............................................................79 & 89 NAWRB ............................................................ nawrb.com ....................................................................77 New American Funding ...................................... newamericanfunding.com ............................................104 NMP U .............................................................. nmpucoaching.com ................................................17 & 81

Nominees must represent minorities or be women who originate loans with an active NMLS number. Production by units or total loan volume (dollar amount) must be verified by letter by a sales manager or other responsible party. Submission will be reviewed and due diligence will be conducted on a percentage of all submissions. Inaccurate data provided will result in a company ban.

NRMLA.............................................................. nrmlaonline.org ............................................................86 Paramount Residential Mortgage Group, Inc. ...... prmg.net ..................................15, 69 & Inside Back Cover

To submit your nomination, go to

Quicken Loan Mortgage Services.......................... qlmortgageservices.com/strongertogether ........................11

NMPMag.com/NAMMBA100

REMN................................................................ emnwholesale.com ........................................................33 Ridgewood ........................................................ ridgewoodbank.com ......................................................74 TagQuest .......................................................... tagquest.com ................................................................71

Any questions? Call Jaclyn Leitermann at (516) 409-5555 x315.

JANUARY 2019 Volume 11 • Number 1

FROM THE

publisher’s desk

Growing your mortgage business If you’re like most of our readers, it will still be winter as you pick up this special issue of 1220 Wantagh Avenue • Wantagh, NY 11793-2202 National Mortgage Professional Magazine. The new growth of spring is still months away, but Phone: (516) 409-5555 • Fax: (516) 409-4600 that growth has already begun. Even as Mother Nature prepares for the season ahead, the best Web site: NationalMortgageProfessional.com mortgage companies in America are developing their growth strategies for the year ahead. STAFF Eric C. Peck Joel M. Berman This issue is designed to aid you in that undertaking, to help you build stronger companies Editor-in-Chief Publisher - CEO (516) 409-5555, ext. 312 (516) 409-5555, ext. 310 and to staff them with the individuals you need to keep growing. Success depends upon your ericp@mortgagenewsnetwork.com joel@mortgagenewsnetwork.com ability to maintain your momentum and keep building your businesses. Joey Arendt Beverly Bolnick Regardless of the way a lender achieves growth, the result will be the need to build out Art Director VP-Sales & Marketing (516) 409-5555, ext. 323 (516) 409-5555, ext. 316 stronger teams. Brokers also want to create strong teams, though they may be seeking out joeya@mortgagenewsnetwork.com beverlyb@mortgagenewsnetwork.com wholesale lending partners to accomplish that. A Broker wants to work with the very best lender Scott Koondel Phil Hall VP of Operations Managing Editor in order to serve the most borrowers and achieve the highest level of success. But with so (516) 409-5555, ext. 324 (516) 409-5555, ext. 312 many strong wholesale lenders in the space, how do they choose? We can help. scottk@mortgagenewsnetwork.com philh@mortgagenewsnetwork.com In this issue, you’ll find our annual feature on America's Top Mortgage Employers. This is the Richard Zyta Francine Miller Social Media Ambassador Advertising Coordinator definitive listing of the best companies in the business. We looked at the strength of the (516) 409-5555 (516) 409-5555, ext. 301 richardz@mortgagenewsnetwork.com francinem@mortgagenewsnetwork.com company, the way they compensate, how fast they pay, training resources and a host of other Rick Grant Dylan Pollock criteria to make this the best list of potential Broker partners in the industry. Special Reports Editor Administrative Assistant But that’s just the beginning of what we have to offer you this month for growing your (570) 497-1026 (direct) (516) 409-5555, ext. 314 (516) 409-555, ext. 311 dylanp@mortgagenewsnetwork.com mortgage business. Our Special Focus section, "Branching Out: Employment & Growth rickg@mortgagenewsnetwork.com Opportunities," is packed with great information. Here is some of what you’ll find … ADVERTISING To receive any information regarding advertising rates, deadlines and requirements, please contact As always, we recommend you begin with your strategy. To help you begin thinking about VP-Sales & Marketing Beverly Bolnick at (516) 409-5555, ext. 316 or e-mail beverlyb@mortgageyour approach to growth, we offer you “The Only Constant Is Change: Be Ahead of the Curve,” newsnetwork.com. by Kimberly Grim, Senior Vice President of Sales and Recruiting for Fairway Independent ARTICLE SUBMISSIONS/PRESS RELEASES To submit any material, including articles and press releases, please contact Editor-in-Chief Eric C. Peck Mortgage & Bryan Moran, Area Manager, Fairway Independent Mortgage. at (516) 409-5555, ext. 312 or e-mail ericp@mortgagenewsnetwork.com. The deadline for submissions Then, go deeper with "Finding Meaning in a Rapidly Changing Industry," by Dee Grosso, is the first of the month prior to the target issue. Executive Vice President of Human Resources at Freedom Mortgage, and “Recruitment vs. SUBSCRIPTIONS To receive subscription information, please call (516) 409-5555, ext. 301; e-mail orders@mortgageRelentless Pursuing,” by Mary Kamelle, Marketing Manager at Mortgage Equity Partners. newsnetwork.com or visit www.nationalmortgageprofessional.com. Any subscription changes may be made to the attention of “Circulation” via fax to (516) 409-4600. When you’re ready to get tactical, may we recommend "Recruiting for Your New Mortgage Statements, articles and opinions in National Mortgage Professional Magazine are the responsibility of the Office?" by Shachar Rand, Chief Business Development Officer of Jet Direct Mortgage. authors alone and do not imply the opinion or endorsement of Mortgage News Network Inc., or the offiRecruiting great people is an art. Get some great tips from Michael Cooksey, Executive cers or members of National Association of Mortgage Brokers and its State Affiliates (NAMB), National Association of Professional Mortgage Women (NAPMW), National Consumer Reporting Association (NCRA) Managing Director of Production at Mid-America Mortgage, in his article, “Ready to Branch Out and/or other state mortgage trade associations. Participation in NAMB, NAPMW, NCRA, ARMCP and/or other state mortgage trade associations in 2019? Use the Buddy System.” And don’t miss “Branching Out Through Attraction,” by Lori events, activities and/or publications is available on a non-discriminatory basis and does not reflect the Lite, Manager of Marketing and Communications for Actualize Consulting. endorsement of the product and/or services by Mortgage News Network Inc., NAMB, NAPMW, NCRA, and other state mortgage trade associations. Part of ensuring growth for your company involves keeping the great people you already National Mortgage Professional Magazine, NAMB, NAPMW, NCRA, ARMCP and/or other state have. So, be sure to read “Boot Camp: Improve Productivity and Reduce Loan Officer mortgage trade associations do not make any misrepresentations or warranties concerning the regulatory and/or compliance aspects of advertisers, products or services and/or the editorial content conTurnover,” by Deborah Hill, Vice President of Customer Success and Operations at tained in Mortgage News Network Inc. publications. National Mortgage Professional Magazine and Mortgage News Network Inc. reserve the right to edit, reject and/or postpone the publication of any artiMortgageHippo. cles, information or data. One key to getting the right people into your growing your team is to maintain a sharp focus on your culture. This is one of the ways top companies set themselves apart. To see what we mean, check out the following … l "Hiring for Cultural Fit,” by Fobby Naghmi, Senior Vice President of the Eastern Division at Planet Home Lending l "The Sweet Spot: Matching Employees With Your Company's Corporate Culture,” by Susan Sullivan, Senior Vice President of Human Resources for Genworth U.S. Mortgage Insurance & Quincy Amekuedi, Recruiting Leader for Genworth Mortgage Insurance l “Culture Shock! Using Company Culture as Your Top Recruiting Tool,” by Shirleen Von Hoffmann. Companies that get this right end up with happier teams and that has a marked positive impact on their bottom line. Do not ignore this aspect of your growth strategy. For more, read “The Art of MLO Happiness: Appreciation, Trust, Sincerity and Honesty,” by Mike Eshelman, Head of Consumer Finance at Jornaya, and “How to Keep Employees Happy: Compensation Matters,” by Dolores Calicchio, Executive Vice President and Chief Human Resources Officer at Oasis Outsourcing. As always, Eric Weinstein provides his humorous take on the employment process in his January submission, “Apps vs. Naps.” Finally, you cannot grow without the right technology and we wouldn’t send you an issue without providing some insight in this important area. See Rick Grant’s article on the new technology that Calyx and NAMB are bringing to market and what it might mean to the industry. Overall, I’m very pleased with this issue and believe that if you study this material, you will be more successful as you grow your businesses this year. If you picked up this issue as part of our special distribution at the 2019 NAMB Focus event, be sure to come by our booth for a visit. We would love to see you. As always, you’ll find all of the fantastic trade show information, compliance news and company news that we bring you every month in the pages of National Mortgage Professional Magazine. And while we’re on the topic of compliance, don’t miss this month’s contribution from Jonathan Foxx. He offers a comprehensive update in his article, "HMDA Highlights: New Rules for 2018 and Beyond." All of us here at National Mortgage Professional Magazine hope that this issue contributes to your growth and continued success in the year ahead. Sincerely, Joel M. Berman, Publisher-CEO Mortgage News Network Joel@MortgageNewsNetwork.com

NationalMortgageProfessional.com

n National Mortgage Professional Magazine n JANUARY 2019

NAMB 601 Pennsylvania Avenue NW, South Building l Washington, D.C. 20004 l Phone: (202) 434-8250 l Fax: (530) 484-2906 l Web site: NAMB.org l E-mail: Membership@NAMB.org

NAMB 2018-2019 BOARD OF OFFICERS & DIRECTORS E X E C U T I V E

Richard Bettencourt, CRMS President Rick.Bettencourt@NAMB.org

Rocke Andrews, CMC, CRMS President-Elect Rocke.Andrews@NAMB.org

Michelle Velez, CMC Vice President Michelle.Velez@NAMB.org

B O A R D

George Burkely, CRMS Treasurer George.Burkley@NAMB.org

Chris Bettis, CMC Secretary Chris.Bettis@NAMB.org

John G. Stevens, CRMS Immediate Past President JohnGStevens@NAMB.org

D I R E C T O R S

Michael DeSantis Mike.DeSantis@NAMB.org

Wayne King, CRMS Wayne.King@NAMB.org

Linda McCoy, CMRS Linda.McCoy@NAMB.org

Matt Oliver Matt.Oliver@NAMB.org

Marty Pfeiffenberger MartyP@ NAMB.org

Kimber White, CRMS Kimber.White@NAMB.org

Valerie J. Saunders, CRMS Executive Director ValSaun@NAMB.org

Harry H. Dinham, CRMS Chief Operating Officer HDinham@NAMB.org

National Association of Professional Mortgage Women 6000 Gisholt Drive, Suite 200 l Madison, WI 53713 l Phone: (608) 886-9817 l E-mail: Admin@NAPMW.org l Web site: NAPMW.org

2018-2019 NAPMW NATIONAL BOARD OF DIRECTORS

Laurel Knight-Keane National President President@NAPMW.org

Glenda Mooney President-Elect PresElect@NAPMW.org

Tobi Libbra Vice President NVP1@NAPMW.org

Rolanda Legg Vice President NVP2@NAPMW.org

Jaclyn Weedin Secretary NatSecretary@NAPMW.org

Nicole Shea Treasurer NatTreasurer@NAPMW.org

Robin Hart Parliamentarian Parliamentarian@NAPMW.org

National Consumer Reporting Association 701 East Irving Park Road, Suite 306 l Roselle, IL 60172 l Phone: (630) 539-1525 l Fax: (630) 539-1526 l Web site: NCRAInc.org

JANUARY 2019 n National Mortgage Professional Magazine n

NationalMortgageProfessional.com

2018-2019 BOARD OF DIRECTORS

Paul Wohkittel President (410) 644-5020 PWohkittel@CISInfo.net

Mary Campbell Vice President (701) 239-9977 Mary@AdvantageCreditBureau.com

Julie Wink Ex-Officio (901) 259-5105 Julie@DataFacts.com

Helen Meyers Director (800) 782-9094 Helen@CreditInfoSystems.com

William Bower Director (800) 288-4757 WBower@Continfo.com

Mike Thomas Director (615) 386-2285, ext. 285 MThomas@CICCredit.com

Terry Clemans Executive Director (630) 539-1525 TClemans@NCRAInc.org

Janet Curtis Director (210) 224-6121 JCurtis@SARMA.com

Debbie Loyning Director (425) 264-1024 Debbie@Alliance2020.com

Jan Gerber Office Manager/Member Services (630) 539-1525 JGerber@ NCRAInc.org

Maureen Devine Director (413) 736-4511 MDevine@StrategicInfo.com

Gary Glucroft Director (800) 877-3908, ext. 100 GaryG@TheScreeningPros.com

Delia Zuniga Director (623) 889-8999 Delia@AdvantagePlusCredit.com

Roy Goodwin Compliance Services Director (630) 539-1525 RGoodwin@ NCRAInc.org

ARMCP Hits 1,600 Mark, Nears Official Site Launch Having just reached the milestone of 1,600 members, the Association of Residential Mortgage Compliance Professionals (ARMCP) is now also nearing completion of its new Web site, a state-of-the-art site designed specifically to fulfill the needs of residential mortgage compliance professionals. The design and development have taken several years to bring to the point of launch. This is just what our organization needs. If you have not yet joined the ARMCP, please contact Jonathan Foxx, ARMCP Founder and President, at Info@ARMCP.org and you will be sent an invitation. ARMCP’s current digital abode is on LinkedIn. The LinkedIn group will be kept while also moving to the larger new home at the brand new site. The association be sending announcements your way soon, via LinkedIn and other media resources, with the membership link. The site is expected to launch officially within the next 90 days. ARMCP is the first and only independent, national organization in the country devoted exclusively to residential mortgage compliance professionals. The association’s independence means it is not affiliated with any profit-oriented enterprise. Membership consists solely of those members who have joined it on their own and were not solicited to join via solicitations from third-party lists or subscriptions. Regular members pay no membership fee … independence is the key to the value of ARMCP’s advocacy! Want to join or create a committee? ARMCP would like to hear from you! For more information, visit ARMCP.org.

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n National Mortgage Professional Magazine n JANUARY 2019

Non-QM Performance Exceeds Expectations in 2018 By Tom Hutchens

or more than two years, I have been writing this column to help Mortgage Loan Officers understand how non-QM lending can benefit you, your customers and the marketplace. Over that time, we have predicted tremendous growth for these alternative loans. Entering 2019, let’s see how accurate our robust forecasts have been. Four years ago, when Angel Oak pioneered non-QM lending, we could only speculate about the market potential for these new mortgages featuring advanced ability-to repay requirements. Back then, all products without government-sponsored enterprise (GSE) endorsements were stigmatized as just like sub-prime and of no interest to most Originators. Yet, we calculated that millions of creditworthy Americans had been excluded from agency loans, especially from among the 15 million self-employed workers as reported by the U.S. Bureau of Labor Statistics. Were we right to be confident that demand would grow for these new products? Here is what we forecasted and the results.

The market potential for non-QM loans is $100 billion Non-QM lending was in its infancy in late 2015, when we first made this prediction. Recently, industry expert Tom Millon writing in HousingWire, said they “amount to $50 billion now, or about three percent of the market.” At Angel Oak, in addition to doubling our year-over-year production volume, our affiliates completed eight securitizations valued at approximately $2 billion.

JANUARY 2019 n National Mortgage Professional Magazine n

NationalMortgageProfessional.com

Non-QM borrowers will be reliable and responsible When Angel Oak Mortgage Solutions pioneered non-QM loans, I spent much of my time educating the market about the differences between these new loan products and high-risk subprime loans. In fact, non-QM loans have resulted in fewer foreclosures than agency loans. Last year, Wells Fargo Securities announced that 97 percent of non-QM borrowers with loans more than two years old have never missed a payment. Further debunking fears that only high-risk consumers would pursue these loans, studies show that 75 percent of non-QM borrowers benefitted from alternative income documentation while only 25 percent needed relief because of a credit event. Mortgage Brokers will drive the non-QM evolution In 2016, when industry apathy and skepticism about non-QM was dominant, we anticipated that brokers and their loan officers would drive market growth. We foresaw that the non-QM marketplace would be nuanced and diverse, therefore we built a system that would engage, educate and support those professionals most capable of aligning a growing portfolio of nonQM products with the consumer they serve. This Originatorcentric infrastructure has been key to our success. To find out how non-QM can propel your business in 2019, contact your Account Executive at (866) 837-6312 or learn more at AngelOakMS.com/MAP. Tom Hutchens is Executive Vice President, Production at Angel Oak Mortgage Solutions, an Atlanta-based wholesale and correspondent lender leading the non-QM space for four years and licensed in over 35 states. Tom has been in the real estate lending business for nearly 20 years. He may be reached by phone at (855) 5394910 or e-mail Info@AngelOakMS.com.

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homeownership. Thirty-eight percent of respondents said they are likely to buy a home with someone they are not married or in long term committed relationship. In terms of important life events, homebuying ranked third behind graduating from college and getting married, but ahead of having children. Housing Market in 2018 Worth $33.3T The U.S. housing market ended 2018 with a cumulative worth of $33.3 trillion, gaining $1.9 trillion in value, or 6.2 percent, from 2017, according to data from Zillow. The market is now worth $4 trillion more than it was at the peak of the housing bubble and gained $10.9 trillion in value since it bottomed out in 2012. Zillow added that the California housing market accounted for nearly one-third of the value gained during the nationwide housing recovery, expanding by $3.7 trillion since early 2012. California is the only state that has gained more than $1 trillion in value since the market’s collapse. At a metro level, the New York/Northern New Jersey area was the most valuable at $3 trillion, or 9.1 percent of the national housing market, while California had four of the nation’s 10 most valuable metros in Los Angeles, San Francisco, San Jose and San Diego. On the flip side, 10 states have yet to regain the value lost during the Great Recession, most notably Florida at $263.9 billion below its peak level. “Seen from the rearview mirror, 2018 was a year of unusually strong, stable home value growth across the country,” said Zillow Senior Economist Aaron Terrazas. “But cracks in the foundation are clearly starting to emerge. During the second half of the year, appreciation slowed sharply in the priciest corners of the country while it picked up in affordable hotspots. Periods of stability often precede periods of instability, and the outlook for 2019 is certainly both cloudier and blurrier than the outlook a year ago. Housing wealth may have touched new highs this year, but home value gains don’t translate into dollars in the bank account unless homeowners opt to sell or borrow

against their home—and, in contrast to previous housing booms, many Americans have been more reluctant in recent years to spend against their home’s worth. Moving toward an uncertain future, that may prove to be a prescient choice.” Renters Spent $504B on Housing in 2018 U.S. households spent a record amount on rent in 2018, according to a new data analysis from the Zillow company HotPads. During this year, renters spent a cumulative total of $504.4 billion on their housing—$12.6 billion more than the 2017 level. The current median rent is $1,475, up three percent from last year. However, there were fewer people renting: Roughly 43.2 million renter households, nearly 100,000 fewer than in 2017. “After several years of a booming economy, more Millennials became financially able to become homeowners in 2018,” said Joshua Clark, Economist at HotPads. “However, rent affordability continues to be a challenge, as those who still rent are paying even higher prices now than they were a year ago. If interest rates continue rising in 2019, more would-be homebuyers may decide to continue renting, which could put additional pressure on rent prices. Fortunately for renters, the housing market is also cooling nationwide, signaling that the entire market may be leveling off and making it easier for renters to keep up with housing expenses.” Your turn National Mortgage Professional Magazine invites you to submit any information on regulatory changes, legislative updates, human interest stories or any other newsworthy items pertaining to the mortgage industry to the attention of: NMP News Flash column Phone #: (516) 409-5555 E-mail: Newsroom@MortgageNewsNetwork.com

Note: Submissions sent via e-mail are preferred. The deadline for submissions is the 1st of the month prior to the target issue.

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entities and • Business trusts included to $3 million • Up loan amounts

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ou won't obtain new business, close more deals and grow existing accounts without a sales plan. A sales plan gives visibility into the year ahead. The companies who want to achieve success will push the envelope.

The companies with salespeople who go through the sales process described herein are closing at higher rates and holding more value. They’re making more per loan because they are building relationships with their customers, getting more referrals and customers are coming back to their original Loan Officers. Here are the top selling techniques (in order) to keep your pipeline full: 1. Approach-Introduction: This is the opening step where you introduce yourself, explain what you do and how it could benefit your prospect. You will also make sure they are wanting the products and services you offer. Start building a relationship with the prospect and the information gathering begins. First impressions are essential to sales success. It sets the tone for the conversation and begins the relationship. 2. Qualification-Investigation-Discovery: This is an extremely important step of the sales process and cannot be skipped. This step allows you to hear the prospects’ wants and needs. It will also let you know if anyone else needs to be present for the sale to take place.

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3. Agreement on the need–follow up on step two: In this step, you first repeat back to them what you heard in Step Two (their wants and needs). Then, you present to them your product or the best product for their situation, and how it accomplishes their goals, fulfills their wants/needs and why (or how). And lastly, find out if there is anyone else needed to move forward with the sale. 4. Sell the company: Often forgotten about, this step is crucial in overcoming objections later. This is where you build confidence in the company. People don’t buy from people or companies they don’t trust. Don’t skip it! You’ve been building trust in yourself up to this point. Now it’s time to build trust in your company. 5. Fill the Need-The Presentation-The Pitch: Focus on the benefits, rather than the features. Also, referred to as featurebenefit selling. Give them a feature of the product and then give them the benefit based on what you discovered in Step Two. 6. Close the Sale-Follow Up-Ask for Referrals: One of the main reasons sales fail is because the salesperson doesn’t ask for the sale. Always remember that the best sales plans align sales with marketing and operations, and sets a strong foundation that drives the sales force.

TagQuest Inc. is a full-service marketing firm specializing in marketing for the mortgage industry. Call (888) 717-8980 or visit www.tagquest.com.

IMAGINE • INNOVATE • SUCCEED SPONSORED EDITORIAL

new to market

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within the next two to six months. The solution uses credit; wealth/asset; property and demographic data; and includes four different models which are Vendorly has announced the launch segmented based on the consumer profile: New Purchase, of its Contract Management feature First-Time Homebuyer, to enhance insights into contract Refinance and Home Equity terms, performance and spend (HELOC, Home Equity Loan). analysis within the vendor “It’s critical for mortgage management solution. Contract lenders to get off the sidelines Management is available as a new and become more proactive in feature for existing customers using identifying prospects and the Vendorly platform, or as an building meaningful relationships independent software-as-a-service with them,” said Tyler Sawyer, (SaaS) offering. Vice President of Rental and In a Vendorly survey conducted Real Estate for Equifax. “This earlier this year, 44 percent of banking and mortgage professionals solution makes the data actionable to help lenders find surveyed said their organizations the right customer at the right were responsible for managing at least 100 vendors. When asked how time, which is important in a often their organizations monitor and highly competitive market where 55 percent of buyers are starting assess vendor performance, 30 their process online.” percent of respondents said The Mortgage Lead annually. With the addition of the Generation Models allow lenders Contract Management feature, to determine their own scenarios Vendorly makes it easier to gain valuable insights into contract terms, and desired number of leads for retention or acquisition. performance and spend analysis of Equifax’s models create a score third-party vendors. Financial that appends to a name and institutions can proactively manage address provided by the lender key metadata within a contract and or even identify new leads for create action date triggers to those likely to transact in automate reminders to help avoid specific geographic areas. The missing renewal and other relevant score is based on the lender’s dates and terms. requirements and ranges from 1 “Contract management is an to 999; the higher the score, the essential component of a robust third-party risk management (TPRM) more likely the consumer is to program because many controls and apply for a mortgage loan. Armed with this information, best practices stem from the lenders can better execute their contract language,” said Jim Vaca, marketing campaigns. Senior Vice President of Vendorly. “Now is the time when “As TPRM gains more focus from lenders’ marketing dollars have the C-suite, it is important to offer to make ‘cents,’ literally,” said insight into the vendor contracts to Sawyer. “Offering greater help mitigate contractual and consumer segmentation can compliance risks by ensuring that drive stronger targeted relevant contract clauses, such as indemnifications, performance levels marketing.” and assignment terms, are in place and managed appropriately. Having Your turn National Mortgage Professional a single-vendor contract repository Magazine invites you to submit with reporting functionality will any information promoting new enable insight into not only vendor “niche” loan programs, new spend, but the contract terms and products or any other associated requirements.” announcement related to the introduction of a new program, to New Equifax Solution Helps the attention of: Lenders Better Identify Prospective Buyers New to Market column Phone #: (516) 409-5555 E-mail: Equifax has announced its Newsroom@MortgageNewsNetwork.com Mortgage Lead Generation Models, a new solution that uses Note: Submissions sent via e-mail connected and differentiated data are preferred. The deadline for to help predict the likelihood that submissions is the 1st of the a lead will apply for a mortgage month prior to the target issue. Vendorly Launches New Contract Management Feature

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N A M B

P E R S P E C T I V E

A Message From NAMB Government Affairs Committee Chair Martin Pfeiffeneberger

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NAMB’s Most Innovative Mortgage Campaign: Class Valuation

Innovation is key to thriving in a competitive market. To stay ahead of the curve, Sarah White and Class Valuation work to create a frictionless appraisal Hello to all mortgage professionals out there. If you are taking time to read experience for clients through technological innovation with the goal of your trade publications to stay current on your business climate, then you creating long-term solutions for increased borrower satisfaction. NAMB truly are one of the professionals. As it is in December as I am writing this, a presented Class Valuation with its “Most Innovative Mortgage Campaign lot is happening and will be happening shortly in the government affairs Award,” in Las Vegas. NAMB evaluated Class Valuation’s past and current sector. innovative practices, along with their dedication and commitment to future First and foremost, we have a new Congress coming in January, and as innovation in the mortgage space, as the centerpieces to presenting the we all know, the Democrats have taken back the House. As always, we will organization with this award. The company is on a clear positive trajectory be working with members of Congress from both sides of the aisle as we proven by its recent record of recruiting innovative leadership along with fight for what is best for the consumer. offering market shaping tools like Fast Track, technology allowing real-time In January, the Consumer Financial Protection Bureau (CFPB) will be status updates of appraisal orders. The company has a reputation for opening up discussions on changing any federal mortgage forms and creating frictionless appraisal experiences for clients through technological issuing some new guidance on some rules. NAMB’s Regulatory Affairs innovation, all with the goal of creating long-term solutions for increased Committee, led by Christopher Bettis, already has assembled a team and borrower satisfaction. they are working on reviewing the material. “NAMB believes Class Valuation’s ability to leverage technology and the We also have a new head of the CFPB in Kathy Kraninger. right people to manage those tools advanced their place in the marketplace In January, we will also learn of the new FHFA Chair (the department that dramatically. These are just a few of the reasons this organization is growing oversees HUD, Fannie Mae and Freddie Mac) as Mel Watts is stepping rapidly and owns elite brand recognition,” said NAMB President Richard down. Bettencourt. “We congratulate CEO Michael Detwiler and the entire team at A new VA Circular on Cash our refinances was issued on Nov. 7, 18,with Class Valuation for their continued dedication to creating robust campaigns an effective date of Feb. 15, 2019. Our VA Committee, led by Ken Bates, that actively increase customer engagement and satisfaction while also has already reviewed and put out some talking points that will be discussed setting a fantastic example for the extended NAMB family on how to leverage with the Department of Veteran’s Affairs. advanced tools and rally great internal talent.” Your Government Affairs Committee had volunteers, led by NAMB President Rick Bettencourt, fly to D.C. to meet with Ginnie Mae on the NAMB’s Community Impact Award: issues of the mass VA IRRRL and cash-out refinances that are hurting the Jake Vermillion and Vermillion Consulting Inc. pricing of VA loans. Jake Vermillion and Vermillion Consulting Inc. Our FHA Committee, led by John Porter, helped win a decision against regularly give back to their community … they the use of having to use the VantageScore model instead of FICO. This donate portions of each paycheck to housing would have been a huge cost and burden to the consumer and to the and education around the world, have spent Mortgage Broker. Thank you, John and your team! rain-soaked days moving homeless families off Our Regulatory Affairs Committee, working with Lobbyist Roy DeLoach, of the streets, and have visited places like India is constantly reading any new rules or legislation so we can stay in front of and Guatemala to help communities in poverty. any changes to make sure we all have a level playing field. The Vermillion Consulting team witnesses, If you are contributing to our PAC, I thank you. If not, please consider firsthand, the hardships that people endure and even donating $9.99 each month as it will help tremendously. It is the effort ask themselves, “What can we do to help them of all of us that keeps our business models active and successful. overcome?” NAMB presented Vermillion NAMB’s committees will continue to work on many more items as they Consulting with its 2018 Community Impact arise in continuing to look out for the best interest of the Mortgage Broker Award, as Vermillion Consulting bestows a and our consumers. high-level of involvement and investment in Martin Pfeiffeneberger is NAMB Government Affairs Committee Chair and NAMB Director. He is also President/Owner of Latham, N.Y.based Maple Tree Funding. He may be reached by e-mail at MartyP@NAMB.org.

NAMB’s Recognizes 2018 Award Winners in Vegas NAMB recently held its NAMB National Conference in Las Vegas at Caesar’s Palace. In addition to providing a forum for mortgage professionals from across the nation to network and connect, NAMB honored a number of individuals and companies for their support of the association over the past year, including … NAMB’s Best Place to Work: United 1 Mortgage Corporation Sophie Rice shared what makes working at United 1 Mortgage Corporation great. The highlights? “United 1 Mortgage Corporation is a diverse team with the common goal of going above and beyond for clients by putting their interests first. In addition to receiving great company perks, employees form a great culture … one that fosters continued learning and trust.”

making their community a better place to live. “NAMB takes great pleasure in recognizing Vermillion Consulting Inc. for their hard work in 2018 to improve the lives of so many people across several communities,” said Bettencourt. “The work Dale and his team do to create real change through giving within Mortgage Professionals Providing Hope, which they founded in 2006, as example, is second to none. Their long and honorable record of public engagement is a wonderful example of how to be a fantastic neighbor for our entire marketplace to recognize and model themselves after. Please join NAMB in congratulating Vermillion Consulting for their tireless dedication to positively impacting communities and we are eager to watch this organization continue their philanthropic endeavors within 2019 and many years thereafter.” NAMB measures applicant’s overall mentoring, time-donations and community impact for each Community Impact Award along with how applicants incorporate their community giving into their everyday operations, and how each organization creates pathways for their employees to also become actively involved. “On behalf of our entire team, I want to communicate how incredibly honored and humbled we are to have been chosen for this year’s Community impact Award,” said Dale Vermillion, President and Chief Executive Officer of Vermillion Consulting Inc. “We are so grateful to be recognized by the National Association of Mortgage Brokers and their members. Like NAMB, we believe that we are all called to help those in need in everything we do and practice that belief daily and are very privileged to be partnered with such a great organization that believes in the same ideals.”

NAMB+ is an independent, wholly-owned, for-profit marketing subsidiary of NAMB, The Association of Mortgage Professionals. Dear Mortgage Professional, It’s a New Year and NAMB+ has hit the ground running to try and make 2019 your best year yet! We rolled out some incredible new offerings for NAMB Members at the end of 2018 and we are so excited about building on that momentum and this year bringing you even more ways to save money and succeed in your business. Our NAMB+ Endorsed Provider program continues to grow and evolve based on feedback we’ve received from all of you. In 2019 you will see a significant expansion of the number of NAMB+ Endorsed Providers that want to connect with you and are willing to offer valuable savings to you simply because you are a NAMB Member. As we continue to work on NAMB’s future Association Health Plan we encourage you to explore the NEW non-traditional (non-insurance) NAMB

member benefits that we launched in partnership with Pendella at NAMB National in December. We also hope you’ll look at integrating your leads with your LOS, automating your email marketing and more with the brand new NAMB+ CRM, powered by Pulse - our customer relationship management system designed exclusively for mortgage professionals! Come see us in February at NAMB Focus to learn more and meet many of our tremendous partners! Sincerely,

Mike DeSantis President, NAMB+, Inc. mike.desantis@namb.org

See below for a complete listing of the current NAMB+ Endorsed Providers and visit NAMBPlus.com for more information. Full-service mortgage credit reporting company serving the nation’s financial community. Avantus provides custom mortgage credit reports, fraud and compliance solutions, and innovative lead generation products available exclusively to Avantus customers. NAMB members receive a discount off Brokers Compliance Group compliance support programs.

Sarma gives you access to their extensive resources including: merged reports from the three top credit bureaus, CreditXpert tools, AVM Reports, SocialValidate, TRV Verification, Interface with over 30 LOS, Fannie and Freddie connection, Verification of employment/deposit and much more. NAMB Members will receive a Twenty-Five Percent (25%) discount off of the regular price with their NAMB Membership.

SYNCRO connects mobile salespeople to their office website leads. NAMB Members receive a 10% discount off regular prices for monthly unlimited SYNCRO Web Chat 23 packages. USA Business Lending, Inc. USA Business Lending is your complete resource for everything commercial lending. With our extensive network of funding sources and specialized loan programs, you can be sure that your clients have access to the most competitive rates and terms available on the market. Universal Credit Services is a Top Ranked, National Credit Reporting Agency and Authorized Report Supplier for Fannie Mae Day 1 Certainty® offering products and services from origination to closing. Universal provides Tri-Merged Credit Reports, Verification of Employment Reports, VOD's, 4506T's, Marketing Services, Flood, Fraud, and Appraisal Management Services.

If you are not a NAMB member please visit NAMB.org and join today to gain access to NAMBPLUS.com and the many beneﬁts NAMB members receive!

n National Mortgage Professional Magazine n JANUARY 2019

CIC Credit - Tri-merge Credit, Employment Screening, & Much More. Businesses have looked to CIC Credit for expertise on Business Screening, Credit Reports, Mortgage Credit Reports, and Employment Screening for decades. With over 100 years of credit related experience, it's no surprise that CIC Credit is a leader in providing quality products to help clients qualify borrowers, mitigate risk, and ensure compliance.

MortgageHippo Swift allows loan originators of all sizes to deliver a modern borrowing experience, significantly improve borrower conversions, reduce origination costs and integrate with other innovative technologies in the mortgage industry. NAMB members will receive a 25% discount.

If you want a social and mobile marketing strategy that gets noticed contact Social5 today for a FREE consultation and demo and to receive your NAMB member discount pricing

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For over fifteen years, Camber Marketing Group has been the premier lead generation, data solutions and direct mail marketing company for the mortgage and financial services industry. From this perspective our goal is to help NAMB members generate profitable response and maximize their return on investment.

MassMutual Disability Income Through an arrangement with Massachusetts Mutual Life Insurance Company (MassMutual), NAMB members have an opportunity to apply for individual disability income insurance (DI) at discounted rates.

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P E R S P E C T I V E

Scenes From NAMB National 2018 December 8-10, 2018 Caesarâ&#x20AC;&#x2122;s Palace, Las Vegas Photos provided by Jeffrey Parry, NAMB Director of Membership and Support Services

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Scenes From NAMB National 2018 December 8-10, 2018 Caesar’s Palace, Las Vegas

01 NAMB Director Linda McCoy discusses the benefits of association membership during NAMB National

Photos provided by Jeffrey Parry, NAMB Director of Membership and Support Services

02 Attendees relax in the NAMB Plus Man Cave Lounge 03 NAMB Healthcare Partners Pendella were on hand to explain their benefits to NAMB National attendees 04 Many thanks to NAMB Double Diamond Sponsor United Wholesale Mortgage (UWM) for their support of the industry

05 NAMB Lobbyist Roy DeLoach, NAMB Conference Chair 2019 Linda Knowlton and NAMB Counsel Ryan Riesterer enjoying the event in Vegas 06 Boyz II Men woo the crowd during the NAMB National End of Event Party 07 Andrew T. Berman and Richard Svec of Mortgage News Network at the Broadcast Plaza during NAMB National 08 NAMB Director and Secretary Chris Bettis with NAMB Plus President Mike Desantis at the Man Cave Lounge 09 NAMB Director Kimber White enjoying the festivities in Vegas

10 NAMB Treasurer George Burkley with reps from NAMB Double Diamond Sponsor Franklin American Mortgage on the trade show floor of Caesar’s Palace 11 NAMB President-Elect Rocke Andrews (right) and his son enjoy the Boyz II Men concert 12 NAMB President Rick Bettencourt welcomes attendees to Vegas for NAMB National 2018 13 Rolling the dice on a new Jaguar courtesy of REMN Wholesale 14 NAMB Directors Mike DeSantis, Wayne King and Geogre Burkley raffling off $500 in casino chips

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2019 NAMB Focus: Technology Conference & Trade Show he 2019 NAMB Focus: Technology Conference & Trade Show will be held on Wednesday-Saturday, Feb. 6-9 at the Innisbrook Golf & Spa Resort in Tampa, Fla. This year’s show will feature a fun-filled Golf Tournament, a Trade Show featuring product showcases on the Exhibit Hall Floor, informative Breakout Sessions, plus much more! Innisbrook, a Salamander Golf & Spa Resort, is nestled on 900 acres of rolling hills and 70 acres of lakes on the west coast of Central Florida. Only 20 miles from Tampa International Airport, the Resort appeals to visitors seeking the ultimate golf resort experience in a locale that is

easily accessible and is within minutes of the beaches on the Gulf of Mexico. This year’s NAMB Focus is ALL ABOUT YOU! With focused Breakout Sessions geared towards helping you create a business plan, learn new marketing ideas, discover new technology and more, NAMB wants to help you make 2019 your best year ever! This year’s event will also feature Product Showcase Sessions on the latest software and products to help you and your business, an Exhibit Hall featuring a variety of vendors looking to share information and ideas plus plenty of opportunities to network with fellow mortgage professionals!

Agenda Subject to change

Wednesday, February 6 8:00 a.m.-11:00 a.m. NAMB Board of Directors Meeting

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11:00 a.m.-5:00 p.m. Certified Veterans Loan Specialist class A separately ticketed event. Cost is $99 for NAMB/FAMP Members and $199 for Non-members. Is your focus on VA loans? Would you like to separate yourself from the competition? Don’t miss this opportunity to become approved for NAMB’s newest designation, the Certified Veterans Loan Specialist (CVLS). VA loans are an amazing benefit that veterans have earned, and it’s our responsibility as Loan Originators to help them take advantage of it. But to maximize that benefit, a veterans needs their Loan Officer to know all the nuances. The designation training will cover all the basics if you’ve never done a VA deal before. Immediately following the class, a test will be given and, upon passing, you will be presented with your designation and all the marketing materials that you need to promote yourself! Noon-4:00 p.m. Exhibitor Setup 5:00 p.m.-7:00 p.m. NAMB Welcome Reception for Exhibitors and NAMB/FAMP Members

Thursday, February 7 9:00 a.m.-Noon Exhibitor Setup 9:00 a.m.-10:30 a.m. Success Track: Your Map for Success, presented by Carl White, Founder/Chief Strategist of The Mortgage Marketing Animals Have you wondered why some Loan Officers are having their best month ever, while others are seeing significant decreases? Do you find yourself having one great month, followed by a slow month, you know, the “Loan Officer Rollercoaster?” As the current Branch Manager of one of the most successful mortgage branches in the nation, Carl White is going to map out for you how to have ever increasing months of high production, by eliminating the “good month followed by a slow month,” and “who does what” with the most successful Loan Officers throughout the nation. 10:00 a.m.-10:50 a.m. Product Showcase Track: NAMB All-In Demo Session, presented by Calyx Software The name you know, a solution you can trust. The cloud-based loan origination system built for mortgage brokers will be available exclusively

to NAMB members. Our mission is to represent your interests and grow your business. That’s why NAMB All-In promotes an open market approach, providing Mortgage Brokers with the freedom to choose which lenders to do business with. Are you ready to go All-In? 10:30 a.m.-Noon Success Track: Chris Johnstone Famous for his book on local Google traffic, Chris Johnstone specializes in speaking and training business owners, corporations, franchises and nonprofits about local, online and social media marketing. 11:00 a.m.-11:50 a.m. Product Showcase Track: Breakout Session, presented by Freddie Mac Noon-1:00 p.m. Included in Success Track: An Enforcement and Audit Update Luncheon with the Florida Office of Financial Regulation Separately priced at $25 per person if not registered through the Success Track Join NAMB, FAMP and the Florida Office of Financial Regulation’s Brandon Slisz and Paul Rhoades for an update on enforcement issues discovered through audits, complaints and more. 1:00 p.m.-6:00 p.m. Exhibit Hall Open 1:00 p.m.-2:30 p.m. Success Track: The Perfect Week, Presented by Carl White, Founder/Chief Strategist of The Mortgage Marketing Animals In this session, Carl White will map out “The Perfect Week” to closing more loans, all while having less stress, and more time off. This will be a step-bystep list of very specific activities for you to do each day of the week to maximize lead generation and lead conversion with specific scripts, texts and e-mails samples all provided. 1:00 p.m.-1:50 p.m. Product Showcase Track: Breakout Session, Presented by Finance of America 2:00 p.m.-2:50 p.m. Product Showcase Track: NAMB Plus CRM Breakout Session, Presented by Paisley Coxsey, Pulse by FocusIT Paisley Coxsey is the Sales Manager at focusIT in Scottsdale, Ariz. During her session, she’ll go over the ins and outs of how a CRM can grow your business—and take time off of your plate—wrapping-up with why Pulse CRM is the way to go for mortgage professionals.

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2:30 p.m.-4:00 p.m. Success Track: Why Your Business Plan May be Failing for You, Presented by Ron Vaimberg, President and Head Coach of NMPU and Ron Vaimberg International Have you ever created a business plan, only to find that within 60 days or less, you are completely off target from implementation of your plan? If you answered “yes”, you are not alone. The vast majority of mortgage professionals suffer this same fate of business plan failure year after year. Often times, the reason for being off target is attributed to external forces that impact the originator or industry. Join Ron Vaimberg, one of the industry’s most requested speakers, for an amazing session on how to structure your business plan to ensure your success year after year. Ron will: Guide you step-by-step through all of the components for a complete business plan; share with you the pitfalls most originators make in their business plan design, and how to avoid them; show you how to quickly identify any areas of your current business plan that must be changed to make sure it works for you, and not against you; and so much more … 3:00 p.m.-3:50 p.m. Product Showcase Track: NAMB Association Healthcare Breakout Session, Presented by Michael Haffney, Pendella Michael Haffney’s passion for more than 30 years is creating and deploying innovative strategies to assist employers and their employees in controlling their health insurance spend, allowing them to get the best healthcare and move towards real wellness and total health. A proven innovator and thought leader in employee benefits with an expertise in helping stakeholders successfully navigate the ever changing, health plan market. Michael has a long history in traditional benefit plan implementation for both individual employers and members of associations and affinity groups. He is a nationally-published author and frequent speaker to groups hoping to learn more about the ever changing health plan space.

business lifestyle that will keep your pipeline as full as you desire. You’ll demand to be part of his weekly video series. You’ll want to enthrall your mind with IDEAS that are contained in his book, Tomorrow. For generations, Ralph has been helping AE’s and MLO’s become the top performers they desire to be. When your eyes see and ears hear some of the history of the development of the mortgage industry through his more than 60 years of experiences in mortgage sales, you’ll learn how he can help you formulate a set of goals, an action plan and more ideas than you can absorb in one session. Those IDEAS are the formulation of his basic principle of giving Value to those people you service, whether it be LO’s, Realtors or other referral sources. 10:00 a.m.-10:50 a.m. Product Showcase Track: Breakout Session Demo, Presented by Lending Pad 10:30 a.m.-Noon Success Track: Breakout Session, Featuring Brian Stevens With The National Real Estate Post 11:00 a.m.-4:00 p.m. Exhibit Hall Open 11:00 a.m.-11:50 a.m. Product Showcase Track: Breakout Session, Presented by Liberty Home Equity Noon-1:00 p.m. Included in Success Track: Keynote Speaker Luncheon Separately priced at $25 per person if not registered through the Success Track 27

8:30 a.m.-10:00 a.m. Success/Product Showcase Track: Only Three Conditions on the First Underwrite? Hope Is Not a Strategy! Presented by Debra Killian, NMLS State-Licensed Mortgage Loan Originator and Certified Residential Mortgage Specialist (CRMS) Session objectives: Take control of documents before they are conditions; learn to improve customer interactions by setting expectations; learn how to better document files while providing consumer education; improve customer satisfaction and reduce complaints with higher competency; and transform the way originators look at documentation requirements. In this session, we discuss how to anticipate what underwriters ask for before they ask. Learn a new way to look at applications and documents as a way, to dramatically improve your customer’s experience, real estate professional’s perspective on your competency and drastically reduce the stress experienced in a poorly documented file. 9:00 a.m.-10:30 a.m. Success Track: A Plan for Success With The Mortgage Godfather, Presented by Ralph LoVuolo Sr. With engaging and participatory activities, The Mortgage Godfather will bring out the best, novel and absolutely effective methods that will assist you in generating new business. His proven ideas will help you form a

1:00 p.m.-2:00 p.m. Success Track: How to Grow Your VA Business, Featuring NAMB President Rick Bettencourt, CRMS Come on in and learn firsthand how to incorporate your passion and love for helping our military into a system that can grow your VA production exponentially. Learn how to differentiate yourself from every mortgage originator in the industry. Whether you just passed the NMLS test or have been originating for 30 years, this program will help you help those who sacrificed so much for all of us. Learn marketing tips and tricks that can light the fires and kick the tires to grow hour VA home loan business like never before! 2:00 p.m.-2:50 p.m. Success/Product Showcase Track: A Federal Government Affairs Update With NAMB Lobbyist Roy DeLoach Don’t miss this informative session presented by Roy DeLoach, NAMB’s Lobbyist, who will provide those in attendance with an insider’s view of what’s happening in Washington, D.C. Learn more about important bills of interest and how changes in D.C. may affect the mortgage industry. 3:00 p.m.-3:50 p.m. Success/Product Showcase Track: Hey Realtors and Referral Partners!! Don’t Let Your Clients Make a $300,000 to $500,000 Mistake on Their Next New Home Purchase or Refinance, Presented by George Burkley III, CRMS, CVLS With more than 22 years of experience as a Mortgage Broker, Owner, Insurance Agent, Financial Advisor and Financial Literacy Instructor, George Burkley will provide you with some tips and tricks to help your mortgage prospects through financial literacy education. Learn some great ideas and sales presentations that will show your mortgage prospects how they can save $300,000 to $500,000 doing business with you, the independent mortgage professional. You will close more loans and increase your revenue and bottom line.

n National Mortgage Professional Magazine n JANUARY 2019

Friday, February 8

1:00 p.m.-1:50 p.m. Product Showcase Track: Breakout Session, Presented by Finance of America NationalMortgageProfessional.com

4:00 p.m.-5:30 p.m. Success/Product Showcase Track: Eight Page URLA?–The Biggest Change in Over 20 Years, Presented by Debra Killian, NMLS StateLicensed Mortgage Loan Originator and Certified Residential Mortgage Specialist (CRMS) Here we go again … see the new 1003 up close! Session objectives: Familiarize MLOS with the new URLA form; highlight new areas that will change conversations between MLOS and consumers; give new perspective on product offerings and disclosure; provide a head start on the competition to create your game plan; and introduce suggestions on best execution for better customer experience. This session reviews the new 1003/65, highlights of new questions originators will be asking and provides discussion for originators to prepare for consumers questions and answers.

N A M B

P E R S P E C T I V E

NAMB PAC 2018 Contributors

A Message From NAMBPAC Chair John G. Stevens On behalf of all of Loan Originators nationwide, thank you to the hard-working, dedicated and generous members who donated to the NAMB PAC in 2018. The list below is comprised of individuals who understand the need for a strong presence in Washington, D.C. We could not have accomplished what we did without you, and look forward to an even better 2019!

Contributor

2018 Total Contribution to NAMBPAC

Contributor

Founder’s Club

2018 Total Contribution to NAMBPAC

PAC Associates Club (cont.)

Michelle Velez

$5,000

Bill Moore

$290

John Stevens

$4,938

George Duarte

$250

Fred Kreger

$4,493

Calvin Mann

$250

FlagStar Bank Federal PAC

$3,500

Cheryl Meheula

$225

Lisa Severseike

$2,674

Andy Harris

$198

Wayne King

$2,629

Roy DeLoach

$170

Chris Bettis

$2,600

Dale DiGennaro

$125

Donna Aldrich

$110

Chairman’s Club

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Paul Marsh

$2,100

Allen Beydoun

$1,700

Rocke Andrews

$100

Linda McCoy

$1,663

Dawn Cychner

$100

George Burkley

$1,600

Nathan Dagley

$100

Mark Favaloro

$100

Gregory Giniel

$100

President’s Club

Benjamin Franklin Club

Rick Bettencourt

$1,425

Brook-lyn Hibbs

$100

Nathan Pierce

$1,400

Damion Hughes

$100

Matt Oliver

$1,300

Cathy Lee

$100

Kenneth Lindberg

$100

Gino Moro

$100

99 Club Ginny Ferguson

$1,188

Debbie Schultz

$100

Valerie Saunders

$1,188

Andrew Taylor

$100

Regina Uhl

$100

PAC Associates Club Holly Schneidewind

$1,000

Friends of PAC Club

Keith Bilodeau

$750

Amando Barbosa

$99

Kimber White

$747

Matt Brown

$99

Kathy Rubin

$670

Corrina Carter

$99

Helga James

$655

William McMullin

$99

Joe Ashton

$600

Raymond Oshman

$99

Rachelle Rowan

$500

Angel Pina

$99

Everette Ives

$400

Karen Bates

$75

Linda Knowlton

$397

Laurie Christiansen

$75

Marty Pfeiffenberger

$396

Hector Hiraldo

$49

Jon Groves

$375

Mark Ross

$49

Lauren Patterson

$365

Joe Tishkoff

$49

Audrey Boissonou

$350

Anthony Frederick

$40

Mike DeSantis

$350

Cindy Wingo

$40

Harry Dinham

$300

NationalMortgageProfessional.com

n National Mortgage Professional Magazine n JANUARY 2019

How to H Find the G or years and years, some of you have called me to ask to refer my better clients to you. Additionally, you’ve sent me e-mails. I’ve seen posts about your company on Facebook, YouTube and LinkedIn, and have seen how you spread the word around at how wonderful your company is. All of your e-mails, all of your ads and all of your calls are, as far as I’m concerned, a complete waste of time and effort. Sure, every once in a while, you snag a quality person, but know this. Your methodology is wrongheaded and not well-thought-out. Just as I have yet to see some new thought put into the marketing programs that MLO’s conduct, or better said, DON’T conduct, I have yet to see any recruitment campaigns that have any uniqueness to them. But my clients, the ones who have actually learned how to recruit, they get the best people. I did it when I had my own company, I coach people using this program, I know people who follow these steps and you should feel like a genius that you’ve read this far. You must realize that is it completely unethical for a coach to refer a client to a new company unless the client asks for help in that regard. I have never, and will never, refer a client to another company. But here is what I have said to a few hundred of you over the years …

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The

Mortgage

Godfather

“No, I won’t refer anyone to you, but I’ve got something 100 times better: A well-thought-out plan, a results-oriented plan, a success plan. I readily admit I’ve sent some of you see what is below, but most of you believe that the information that this article contains is just too much, too aggressive, too different, costly or just somehow too crazy. You need to follow the same plan than your competition is doing. What you advertise is how your company has great service, great programs, fabulous rates, and the greenest grass a Loan Officer has ever seen.”

Help a Quality MLO e Greenest Grass

BY RALPH LOVUOLO SR.

l Recruiters need to learn that to get good people to come to work at your company, it takes work, real work, real thought, real innovativeness. Oh, and one more very important thing: Just as your MLO’s cannot get business from people who don’t do business, you cannot get a good Loan Officer, one who does business, real business, unless you go after them, individually. The following is something I’ve never released publicly, but since this issue is devoted to the subject of MLO’s changing jobs, recruitment and where to find the greenest grass, I thought it appropriate to let you all know how to do it right. Recruitment campaign for MLOs I. Budget: Allocate money for your recruitment campaign depending on the number of people you’re going to pursue, plus the activities from the list below. You can only do what makes you and your company feel is comfortable. II. Administrator: Designate an individual to perform the monthly assignments required by your marketing plan. III. Target Loan Officers: Start with 20 individuals who meet your criteria for a top-producing candidate. l Check often with your present Loan Officers for names of qualified individuals. l Ask Realtors, attorneys, MI reps and title reps you use. IV. Incentives: Reward staff that provide leads for quality Loan Officers. l Reward operations staff to keep eye out for people they hear about. l Have your administrator check Realtor magazines and Web sites for MLO ads with their information. l “Brokers” are great possibilities (be willing to set up an office for them). V. Detail: Construct a dossier for every potential hire to include as much of the following

information as possible: l Name l Address l Phone numbers l E-mail address l Spouse or significant other’s name and birthday l Children’s names and ages l Bio/resume and a complete employment history with dates l Production, both current and past volumes l Prepare a questionnaire to be used by a senior officer of the company who will meet with the recruit personally with the following significant special questions: 1. What is your biggest challenge? 2. We want to help you overcome this … what do we have to do? 3. What are the most important things that you expect from management? 4. What do you expect from the company? 5. Do you know our company culture? 6. When the Officer of your company meets with the prospect, have the recruit complete a questionnaire that I’ve prepared. There is not enough room here for that form, but if you ask me, we can discuss it. 7. Prepare to answer the above questions. Be ready for them. The main concept is that although they are already top producers, you want to help them achieve even greater results. VI. Organized drip campaign: Be as imaginative as the following examples: l Send to their home a plaque: Top Salesperson at “Your Company,” for example. Be sure their name is printed on the plaque. l Plaque to significant other: “Thank you for helping (the recruits name) achieve the success they have achieved.” l Mail them a simple clock with a note that says “It’s time you saw how we could help you achieve the success you have always desired.” l Uncle Sam photo: We want you!

l Picture of golfer swinging a club: “Swing into the New Year as our top Loan Officer!” l Letter from a top MLO at your office: Outline how much he/she would enjoy working with the new prospect. l Pretend tickets to Hawaii: If you join us, the real ones could be yours in 60 days. l Invitation to family night at company. l Gift of flowers to significant other or prospect: “Thank you for supporting your significant other.” l Invitation to annual holiday party: Invite top LO’s. l Tickets to local team events: Rent a skybox, invite all present LO’s, and including operations staff. l We want you to be successful. Here is what we offer you: Consistent training in new ways to generate businesspersonal coaching; and help in securing new accounts. l Invitation to the office to meet with the company President. l Send the book, “The Greatest Salesman in the World, by Og Mandino … this can be you. We can help!” l We want to help you achieve your maximum success level. Letter from the President: “We’re professionals, so are you. We intend to be here for a long time, so if you join us, we can help you succeed.” l Pick your processor. Bring your processor with you. l Balloons delivered to their home, with the message: “Congratulations on being the number one salesperson at our company.” l Invitation: “We want you to be our number one producer. We’ll help you achieve that goal. We’ll help you find new ways to originate business, ideas you might not have thought of for a long time.” l If the prospect has children,

send them cards for their birthday. A desk plaque: Name of LO prospect with “Senior Loan Officer” as their title. We love children: “Bring your children to our family night party.” Prepare a “Brag Book” from present referral sources and send them samples. Set up their own domain name: Conrad@ConradsMortgage.com . Set up sample Web site for the prospect: “This is how we treat our top salespeople.” Make part of your recruitment the support of their pet projects, contributions and community involvement.

Recruitment campaign summary l Special treatment: Plan to treat them as a winner. Once a quarter, invite them to a dinner with the President and make them feel important and don’t be discouraged if they turn you down. There is always a next time. l All communication is directed to president/recruiter. Let your assistant know how to find you if any of them call. Be sure your assistant knows who they are. l If you have community involvement, let them know. If they want to become involved in community affairs, offer them support. l If you participate in Realtor events and associations, let them know as well. l Be aware of the various needs of Realtors and other referral sources and let them know you have a plan to help them implement it. l Explain the use of all your company software and the benefit it will bring to their referral sources. l Offer to set up their own personal Web site. l Have a contract prepared every time there is a meeting. If the subject comes up, it must be available. Be prepared to follow through every step of the way. Is this a lot to do for one person? You bet … but I know it works. Call me at (917) 576-1230 if you want to discuss it further.

Ralph LoVuolo Sr. has nearly 60 years history in the mortgage business. He was a Co-Founder/President of the NYAMB and a long-term member of the Board of Directors of NAMB. The Mortgage Godfather is available to help your salespeople do more business. He does sales rallies, Webinars, personal coaching. Call, text or e-mail (917) 5761230 or e-mail Ralph@MortgageGodfather.com.

heard street on the

Our Heard on the Street column is a chronicle of events, changes and passages in the lives of the people and companies shaping the mortgage industry.

New American Funding Acquires Marketplace Home Mortgage

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New American Funding has announced that it has acquired Edina, Minn.-based Marketplace Home Mortgage. According to the Tustin, Calif.based New American Funding, the transaction will increase its presence in the Minnesota market, where Marketplace has been operating since its founding 1995. Marketplace also has locations in Florida, Michigan, New Hampshire, South Dakota, and Wisconsin. The terms of the acquisition were not disclosed. “We felt now was the right time to combine forces with a lender such as Marketplace Home Mortgage,” said Rick Arvielo, CEO at New American Funding. “We’ve always grown organically and have been very selective about this type of move in the past. But due to the cultural and business alignment of both brands, coupled with the geographic advantage, we determined this was an excellent opportunity. We project this deal alone adds over $1 billion in mortgage production next year.” Class Valuation Acquires Landmark Network

Class Valuation, a Troy, Mich.based provider of real estate asset valuation and appraisal management solutions, has acquired Van Nuys, Calif.-based Landmark Network, a provider of real estate valuation with a specialization in the reverse mortgage lending industry.

The financial terms of the acquisition were not disclosed. Erik Richard, CEO of Landmark Network, has become chief operating officer of Class Valuation’s Western Region. “As we continue to execute our innovation strategy, we will take great interest in those firms that excel in service and reputation in markets we believe in,” said Class Valuation’s Chief Executive Officer Michael Detwiler. “With an impressive list of clients, including a meaningful percentage of the industry’s top reverse mortgage lenders, Landmark has done a fantastic job delivering quality, service, and reverse valuation products backed by innovative technology. That’s the kind of specialization and expertise we’re seeking as we continue to expand our footprint.” SettlementOne Approved as an AFR Wholesale Partner

SettlementOne has announced that it has been approved as an AFR Wholesale AMC partner. This partnership enables AFR Brokers and correspondents to utilize SettlementOne’s highly qualified nationwide appraiser panels, as well as SettlementOne’s leading technology. The relationship links SettlementOne’s appraiser partners by using the SettlementOne smart assign technology, which intelligently matches the valuation order with the most qualified appraiser partner, specific to the property and AFR loan type. “Having the right appraiser is extremely important. In fact, it’s

imperative to ensure that all the appraisers that are working on specialized loans are highly qualified to do so,” said Laura Brandao, President of AFR. “We feel that SettlementOne and their smart assignment technology and nationwide appraiser panel gives us the ability to offer best in class service to our brokers and correspondents.” AFR Brokers and Correspondent Lenders can now utilize SettlementOne’s AMC services to fulfill their appraisal orders in a more timely and precise fashion. To better service the various loan types that AFR originates, SettlementOne individually qualifies their entire nationwide appraiser panel to identify those that are most capable of appraising these standard and unique loan types. “We’re thrilled to partner with AFR to assist their brokers and correspondent lenders. We believe that AFR’s philosophy regarding affordable and specialty housing aligns perfectly with our own. AFR is a worldclass organization, and we’re looking forward to many successful years of partnership,” said Tom Hurst, Chief Executive Officer at SettlementOne. Plaza Home Mortgage Unveils New Corporate Identity Plaza Home Mortgage has unveiled a new corporate identity and tagline, “Here for You.” “After nearly 20 years in the business, we felt it was time to refresh the image of Plaza Home Mortgage,” said Kevin Parra, CoFounder, Chairman and Chief

Executive Officer of Plaza Home Mortgage. “Our new logo illustrates what we do every day: Bringing together programs, technology and expertise to consistently deliver for our clients. And our new tagline speaks to Plaza’s reliability and commitment to third-party lending and our service-first culture, which has guided our company since its beginnings.” The new identity was developed by Tim Girvin, an internationally-renowned designer whose clients include Nordstrom, Apple, Nike, American Express and Wells Fargo. New Penn to Rebrand as NewRez

New Penn Financial LLC has announced that the company will be rebranded as NewRez at the beginning of 2019. New Penn was acquired by New Residential Investment Corporation in July of this year. “We are very excited to announce the rebrand and for the growth opportunities it signals,” said Kevin Harrigan, President and Chief Executive Officer of New Penn. “NewRez combines the strength and experience of the New Penn and New Residential brands under one umbrella, and we look forward to the benefits we will collectively bring to borrowers through our Wholesale, Correspondent Lending, Directto-Consumer, and Joint Venture/Retail business channels.” The NewRez name and the decision to rebrand reflect New Penn’s close alignment with its

parent company, as well as the combined organization’s commitment to bringing value to its customer relationships and strategic partnerships. Since the acquisition, New Penn has leveraged additional capital and corporate backing from New Residential to grow and to expand New Penn’s product innovation capabilities. The company has continued to develop flexible loan products such as the SMART Series line, which create more opportunities for qualified borrowers to purchase or refinance homes. During the year New Penn has also invested significantly in technology designed to streamline the loan approval process and improve the overall customer experience. “The new brand represents a combination of our company’s successful history and the bright future ahead,” said David Haggert, Chief Marketing Officer. “More information on the rebrand will be communicated in the coming weeks, including the transition timeline and details of the new brand and logo.” TMS to Sell Its Origination Line of Business to AmeriSave

clients’ portfolio retention and amplifying customer lifetime value. “We are widely recognized as having the most advanced subservicing technology platform in the business,” said Mirshahzadeh. “Transitioning originations to a pro like AmeriSave makes perfect business sense. Now, we can champion our clients’ success and deliver what the industry so desperately needs–a world-class customer servicing platform and stellar loan performance–that we at TMS are so uniquely positioned to deliver.”

CoreLogic Drops Software Units, Emphasizes Appraisal Management CoreLogic has announced plans to realign its corporate focus by dropping several business platforms and putting a new focus on others. The Irvine, Calif.-based business said it planned to exit its loan origination software unit continued on page 41

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TMS has announced the sale of its origination line of business to national fintech lender AmeriSave Mortgage Corporation. The expected originations volume is $1.5 billion in 2019. As part of the terms of the agreement, AmeriSave will welcome TMS employees associated with the business, and assume its new Plano, Texas and Chandler, Ariz. offices. “This is a perfect fit. AmeriSave brings years of delivering a truly exceptional, tech-forward experience to homeowners during originations as we do at TMS in servicing customers for the life of the loan,” said TMS Chief Executive Officer Darius Mirshahzadeh. “We feel good knowing that they will take great care of our customers and our people while we double down on being the world’s best servicer.” For AmeriSave, the acquisition marks the company’s efforts to scale its loan originations business. “We are excited to welcome the TMS originations team and business to AmeriSave,” said

AmeriSave President Mike Berte. “While we had a strong 2018, this acquisition kickstarts 2019, allowing us to expand our market share, add talented mortgage professionals in two terrific markets, and help more people realize the dream of homeownership.” For TMS, the shift away from originations provides TMS subservicing and correspondent clients more partner programs and technology that will advance its state-of-the-art customer service offering, maximizing

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HMDA Highlights New Rules for 2018 and Beyond By Jonathan Foxx, Ph.D., MBA

get caught. Any creditor that fails to comply with a requirement imposed by the Act or the Regulation is subject to civil liability for actual and punitive damages in individual or class actions.1 Violations of the Act or the Regulation also constitute violations of other federal laws. The civil monetary penalties can be onerous! Last year a financial institution was ordered to pay a civil money penalty of $1.75 million for persistent and substantial reporting errors.2 Liability for punitive damages can apply only to non-governmental entities and is limited to $10,000 in individual actions and the lesser of $500,000 or one percent of the creditor’s net worth in class actions.3 There is not only equitable and declaratory relief but also the awarding of costs and reasonable attorney fees to an aggrieved applicant in a successful action.4 Still want to tempt the devil? When it comes to HMDA, a financial institution must make a good faith effort to record all data concerning covered transactions fully and accurately within 30 days after the end of each calendar quarter.5 The concept of “good faith” is a feature of many statutes, but the notion comes down to a simple idea: If you operate on the basis of a positive commitment to fulfill the terms and spirit of a regulation, yet despite doing so you still had some defects in implementation,

regulators will take this into consideration in determining administrative actions. How would you prove such good faith? Just show the regulator the compliance tracks which support your actions and best efforts. A financial institution is not required to record all of its HMDA data for a quarter on a single LAR. Instead, an institution may record data on a single LAR or may record data on one or more LARs for different branches or different loan types (such as home purchase loans, home improvement loans, and loans on multifamily dwellings). A financial institution may maintain its quarterly records in electronic or any other format, provided it can make the information available to the regulatory agency in a timely manner upon request.6 Whatever the case, institutions must submit their LARs to their regulatory agencies by March 1st following the calendar year for which they are reporting.7 The required data requested on the LAR must be entered for each loan origination, each application acted on, and each loan purchased during the calendar year.8 An application must be reported in the year when final action is taken. Originations must be reported in continued on page 36

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patterns, and compliance with the Equal Credit Opportunity Act, the Fair Housing Act, and the Community Reinvestment Act. Inaccurate HMDA data can make it difficult for the public and regulators to discover and stop discrimination in home mortgage lending or for public officials and lenders to tell whether a community’s credit needs are being met. Yet I was told by a senior executive that there is nothing to be concerned about these days, given that under the current Administration there has been a reduction of regulatory enforcement. The same person told me that regulators have been advised to go easy on examinees. So, that means you can get away with lowering the compliance bar. After all, less enforcement means less worries, right? Wrong! The bird of compliance flies on two wings: examination and enforcement. Examination is intrinsic to supervision; and enforcement is intrinsic to ensuring implementation of the regulatory framework. If an examiner finds violations and defects, administrative actions can ensue. If you want to be a test case, go ahead, tempt the devil, see what happens! In compliance, virtually all transactions and policies leave tracks. If “don’t get caught” is your game plan, I am going to tell you straight-out that you will

NationalMortgageProfessional.com

iling the HMDA LAR annually often seems like a Rite of Passage. Most filers vacillate between dread and certitude in their evaluation of the data integrity, let alone enduring the stress of submitting the report by the deadline. The acronyms HMDA LAR refer (of course) to the Loan Application Register (LAR) of the Home Mortgage Disclosure Act (HMDA or “Act”) and its implementing Regulation C (“Regulation”). By the way, the HMDA acronym is pronounced “hummda”–not “himmda.” Each year about this time, we get a lot of calls for HMDA support, especially in LAR preparation and filing. In the last few years, changes in filing requirements seem to have pushed filers to the point of reaching for the bottle (of Maalox). But the filing requirements are not that complicated, though they are now more involved in obtaining data and include partial exemptions (more on that later). If you don’t think HMDA data is all that important except to the PhD’s at the Federal Reserve, you should spend some time with financial institutions who have undergone fair lending examinations. One of the first data sets a regulator asks for in a fair lending audit happens to be the HMDA LAR. The data is used to help identify possibly discriminatory lending

hmda highlights

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continued from page 35

the year they close; if an application has been approved but not yet closed, it must be reported the next year.9 Beginning in 2020, quarterly reporting is required for institutions that reported a combined total of at least 60,000 applications and covered loans in the preceding calendar year (excluding purchased covered loans). In addition to their annual LAR, these institutions must submit HMDA data for the first three quarters of the year on a quarterly basis, with the first submission due May 30, 2020. These institutions must submit the data within 60 calendar days after the end of each calendar quarter except the last quarter.10 For instance, in calendar year 2019, if a financial institution reports 60,000 covered loans, excluding purchased covered loans, it must comply with the quarterly reporting requirement during 2020. Similarly, for calendar year 2019, if a financial institution reported 20,000 applications and 40,000 covered loans, combined, excluding purchased loans, it must comply with quarterly reporting in 2020. But, for calendar year 2020, if a financial institution reports fewer than 60,000 covered loans and applications, combined, excluding purchased loans, it would not be required to file quarterly reports in 2021. By the way, I am often asked about the last day to file the HMDA LAR if the deadline falls on a weekend. The answer is, when the last day of submission falls on a Saturday or Sunday, a submission is considered timely if it is submitted on the next succeeding Monday.11 Now let’s go to the electronic format requirements. For some reason, people are usually spooked by these requirements, especially the intricacies of ensuring data integrity. But such worries are overblown. After all, there is plenty of software around that is already set up to handle the data reporting requirements. Even the Federal Financial Institutions Examination Council (FFIEC) provides very good HMDA software tools.12 The Consumer Financial Protection Bureau (CFPB or “Bureau”) has a website page with resources for filers.13 My firm has an entire group

devoted to HMDA data collection reviews, scrubbing for accuracy, and fair lending risk assessments. We come across the data gathering complexities all the time. The big problem is this: garbage in, garbage out! Whatever the software, and whatever the expertise you retain, such as Lenders Compliance Group, it is critical to make sure the data in the loan origination system is accurate. Otherwise, you will be left with all sorts of mismatches and edits, and may also need to conduct a HMDA scrub. Beginning Jan. 1, 2019 for data collected in 2018, a financial institution must submit its data electronically in the format prescribed by the CFPB at ConsumerFinance.gov/HMDA. Let me now zoom in to some basics for data collection. Effective Jan. 1, 2019, a financial institution must provide the following basic information in an electronic transmittal sheet with its submission: l Its name; l The calendar year, or calendar quarter and year, the submission covers; l The name and contact information of a person who may be contacted with questions about the submission; l Its appropriate Federal agency; l The total number of entries contained in the submission; l Its Federal taxpayer identification number; and, l Its Legal Entity Identifier (LEI).14 If you do not know about the Legal Entity Identifier, you might want to check out my White Paper, Legal Entity Identifiers and HMDA 2018, Questions and Answers, available in the Articles section of the Lenders Compliance Group’s Web site (LendersComplianceGroup.com).15 You might also be interested in my article, “Home Mortgage Disclosure Act–Big Changes on the Way!,”16 published by National Mortgage Professional Magazine, also available at my firm’s Web site. As usual, FFIEC publishes an excellent guide to HMDA data collection and filing, called A Guide to HMDA Reporting: Getting It Right! It was last

edited on Jan. 31, 2018 and may be used for reports to be submitted by March 1, 2019.17 Beginning with data collected in 2017, LARs must be submitted in a “pipe” (also referred to as a “vertical bar”) delimited text file format. This means: (1) each data field within each row must be separated with a pipe character (“|”); (2) zeros need not be added for the sole purpose of making a data field a specific number of characters; and (3) the LAR must be a text file with a .TXT file format extension. Text entries in alphanumeric fields do not need to use all uppercase letters, with the exception of “NA” when a reporting requirement is not applicable, and the two letter state codes. As in the past, the first row of the LAR must begin with the numeral “1” to indicate that the data fields in row one contain information relating to the particular institution (that is, the transmittal sheet), all subsequent rows of the LAR will begin with the numeral “2” to indicate that the data fields beginning in row two contain data fields for the LAR with information relating to the reported loan or application, and each row must end with a carriage return. Let’s now zoom out a little more to some high points regarding the submitting of the HMDA LAR. There are new rules for mergers or acquisitions. If the merger or acquisition takes place in the calendar year, effective Jan. 1, 2019 the surviving or newly formed financial institution must file quarterly reports, effective the date of the merger or acquisition, if a combined total of at least 60,000 covered loans and applications, combined, excluding purchased loans, is reported for the preceding calendar year by or for the surviving or newly formed financial institution and each financial institution or branch office merged or acquired. For instance, let’s say, in 2020, financial institution A and financial institution B merge to form financial institution C. Financial institution A reports 40,000 covered loans and applications, combined, excluding purchased loans, for 2019. Financial institution B reports 21,000 loans and applications, combined, excluding purchased loans, for 2019. Financial institution C is

not required to file quarterly reports, effective the date of the merger. Similarly, for example, in 2020, financial institution A acquires a branch office of financial institution B. Financial institution A reports 58,000 loans and applications, combined excluding purchased loans, for 2019. Financial institution B reports 3,000 loans and applications, combined, excluding purchased loans, for 2019 for the branch office acquired by Financial institution A. Financial institution A is required to file quarterly reports in 2020 effective the date of the branch acquisition. The year following a merger or acquisition also has filing rules to follow. Effective Jan. 1, 2019, in the calendar year following a merger or acquisition, the surviving or newly formed financial institution must file quarterly reports if a combined total of at least 60,000 loans and applications, combined, excluding purchased loans, was reported for the preceding calendar year by or for the surviving or newly formed financial institution and each financial institution or branch officer merged or acquired. For instance, in 2019, financial institution A and financial institution B merge to form financial institution C. Financial institution C reports 21,000 loans and applications, combined, excluding purchased loans, each for financial institution A, B, and C for 2019, for a combined total of 63,000 loans and applications. Financial institution C is required to file quarterly in 2020. Similarly, financial Institution A may report 58,000 loans and applications, combined, excluding purchased loans, for 2019. Financial institution A or B reports 3,000 loans and applications, combined, excluding purchased loans, for 2019 for the branch office acquired by Financial institution A. Financial institution A is required to file quarterly in 2020. By the way, if there is a change in the regulator as a result of a merger or acquisition, there are important rules. If the appropriate Federal agency for a financial institution changes (for instance, as a consequence of a merger or a change in the institution’s charter),18 the institution must identify the new appropriate Federal agency in its LAR for the year of the change. Here would be a typical scenario: if an institution’s

revised rules that took effect on Jan. 1, 2018) and reported in 2019 “unless data errors are material.” Perhaps the way to understand this issuance is that the Bureau does not intend to assess penalties with respect to errors in data collected in 2018 and reported in 2019. In effect, the Bureau seems to be viewing 2018 as a practice year that will provide financial institutions “an opportunity to identify any gaps in their implementation of amended Regulation C and make improvements in their HMDA compliance management

systems for future years.” However, the subject issuance states that “the Bureau does not intend to require financial institutions to resubmit data unless data errors are material, or to pay penalties with respect to data errors.” [Emphasis added.] Note the weasel word “intend.” And note, also, the wiggle room the Bureau leaves itself on resubmissions by inserting the caveat “unless data errors are material.” Such a position is what horse races and lawsuits are made of!19 There has been some

controversy about how to understand the partial exemptions. The 2015 HMDA Final Rule (“Rule”), which amended the Regulation, established a new reporting exclusion and optional reporting for certain transactions and data points, and it clarified certain key terms defined in the Rule.20 The Rule established transactional thresholds to determine whether a financial institution is required to collect and report data on open-end continued on page 38

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Federal agency changes in February 2018, it must identify the new agency beginning with the annual submission of its 2018 data by March 1, 2019. An institution subject to quarterly reporting must identify its new agency beginning with its submission for the quarter of the change, unless the change occurs during the fourth quarter. Thus, if the agency changes during February 2020, the institution must identify its new agency beginning with its quarterly submission for the first quarter of 2020. On the other hand, if the agency changes during December 2020, the institution must identify the new agency beginning with the annual submission of its 2020 data by March 1, 2021. With regard to the Legal Entity Identifier associated with a merger or acquisition, effective Jan. 1, 2019, Regulation C requires a financial institution to provide its Federal Taxpayer Identification Number with its data submission. If a financial institution obtains a new number, it should provide the new number in its subsequent data submission. For example, if two financial institutions that previously reported HMDA data merge and the surviving institution retained its Legal Entity Identifier, the LEI, but obtained a new Federal Taxpayer Identification Number, the surviving institution should report the new Federal Taxpayer Identification Number with its HMDA data submission. One other point, with respect to defining subsidiaries. A financial institution is a subsidiary of a bank or savings association, for purposes of reporting HMDA data to the same agency as the parent, if the bank or savings association holds or controls an ownership interest in the institution greater than 50 percent. The financial institution should be prepared to retain its HMDA LAR for not less than three years in an electronic or paper form. Said otherwise, effective Jan. 1, 2019, a financial institution may satisfy the requirement to retain a copy of its annual LAR for three years by retaining a copy of the LAR in either electronic or paper form. Let me clear up some confusion caused by a CFPB announcement on Dec. 21, 2017, which advised that it did not intend to require data resubmission for HMDA data collected in 2018 (under the

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lines of credit or closed-end mortgage loans, implemented the new data points specified in the Dodd-Frank Act (“DoddFrank”), added additional data points using the Bureau’s DoddFrank authority, and made revisions to pre-existing data points, among other changes. The Bureau further amended Regulation C in August 2017 (“2017 HMDA Final Rule”) to temporarily increase the threshold for open-end lines of credit to 500 for calendar years 2018 and 2019 and make certain clarifications and other changes. On May 24, 2018, the President signed the Act into law.21 Keep this date of May 24, 2018 in mind, as this is the date on which the amended Act was made official, adding partial exemptions from HMDA’s requirements for certain transactions made by certain insured depository institutions and insured credit unions. For the sake of clarity, I will call this final amendment the “2018 Rule.” The 2018 Rule set forth several changes, whose highlights I will enumerate, as follows: 1. Adds partial exemptions from HMDA’s requirements for certain transactions made by certain insured depository institutions and insured credit unions. 2. Provides that an insured depository institution or insured credit union does not need to collect or report certain data with respect to closed-end mortgage loans if it originated fewer than 500 closed-end mortgage loans in each of the two preceding calendar years. 3. Provides that an insured depository institution or insured credit union does not need to collect or report certain data with respect to open-end lines of credit if it originated fewer than 500 open-end lines of credit in each of the two preceding calendar years. 4. Provides that these partial exemptions are unavailable to an insured depository institution if it received a rating of “needs to improve record of meeting community credit needs” during each of its two most recent

Community Reinvestment Act (CRA) examinations or a rating of “substantial noncompliance in meeting community credit needs” on its most recent CRA examination.22 The CFPB provided clarification of the 2018 HMDA requirements with respect to partial exemptions.23 The guidance clarifies that, for purposes of the partial exemptions, “closed-end mortgage loan” and “open-end line of credit” mean only those loans or lines of credit that would otherwise be reportable under HMDA.24 Such loans are counted towards the respective thresholds to determine whether an insured depository institution or insured credit union’s closed-end mortgage loans or open-end lines of credit qualify for a partial exemption. An insured depository institution or insured credit union must have originated fewer than 500 closed-end mortgage loans in each of the two preceding calendar years for its closedend mortgage transactions to qualify for the partial exemption. Likewise, an insured depository institution or insured credit union must have originated fewer than 500 open-end lines of credit in each of the two preceding calendar years for its open-end lines of credit transactions to qualify for the partial exemption.25 An insured depository institution or insured credit union has the option to voluntarily report exempt data points for transactions that qualify for a partial exemption. An insured depository institution or insured credit union that opts to voluntarily report an exempt data point must report all data fields that the specific data point comprises.26 In any event, the Bureau seems to recognize there are going to be transition issues. The 2018 Rule applies to data collected or reported under HMDA on or after May 24, 2018. An insured depository institution or insured credit union that is eligible for a partial exemption for a transaction does not need to

collect exempt data points on or after May 24, 2018. Additionally, such institutions are not required to report certain data that may have been collected on or before May 24, 2018. For instance, if an insured depository institution is eligible for a partial exemption for its closed-end mortgage loans and the institution collected data for its closed-end mortgage loans prior to May 24, 2018, the institution is not required to report in 2019 any data covered by the partial exemption for its closed-end mortgage loans.27 As mentioned above, an insured depository institution or insured credit union may opt to voluntarily report data that is covered by a partial exemption. If you want to review the HMDA Data Points that are or are not covered by partial exemptions, I would refer you to the Filing Instructions Guide.28 However, the reporting requirements under the Regulation, as amended by the 2015 HMDA Final Rule and 2017 HMDA Final Rule, remain unchanged for these data points. The wheels of HMDA continued to turn right up to Dec. 21, 2018, when the Bureau issued final policy guidance describing modifications that the Bureau is going to apply to the loan-level data that financial institutions report prior to its disclosure to the public. This final policy guidance, which I will dub “2018 Final HMDA Rule,” applies to HMDA data compiled by financial institutions in or after 2018.29 The main purpose of the issuance is to notify whether and how HMDA data should be modified in order to protect applicant and borrower privacy while also fulfilling HMDA’s public disclosure purposes. In other words, certain HMDA data will be excluded from the public-facing report. Additionally, the publicly available information will disclose certain information with “reduced precision,”30 for instance, by disclosing ranges rather than specific values for an applicant’s age, the amount of the loan, and the number of units in the dwelling.31 To accomplish this modification, the Bureau is changing the proposed treatment of the following data fields: (1)

The ratio of the applicant’s or borrower’s total monthly

(2)

(3)

debt to the total monthly income relied on in making the credit decision; The number of individual dwelling units related to the property securing the covered loan or, in the case of an application, proposed to secure the covered loan; and The number of individual dwelling units related to the property securing the covered loan or, in the case of an application, proposed to secure the covered loan, that are income-restricted pursuant to Federal, State, or local affordable housing programs.

Thus, the Bureau will be modifying the public loan-level HMDA data to exclude: (1)

(2)

(3)

(4)

(5)

(6)

(7)

The universal loan identifier or non-universal loan identifier; The date the application was received or the date shown on the application form; The date of action taken by the financial institution on a covered loan or application; The address of the property securing the covered loan or, in the case of an application, proposed to secure the covered loan; The credit score or scores relied on in making the credit decision; The unique identifier assigned by the Nationwide Mortgage Licensing System and Registry (NMLS) for the mortgage loan originator; and The result generated by the automated underwriting system used by the financial institution to evaluate the application.32

Additional exclusions are the free-form text fields used to report the following data: (1) applicant or borrower race; (2) applicant or borrower ethnicity; (3) the name and version of the credit scoring model used; (4) the principal reason or reasons the financial institution denied the application, if applicable; and (5) the automated underwriting system name. With respect to the reduced continued on page 40

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precision,33 modification of the public loan-level HMDA data will be accomplished by reducing the precision of most of the values reported for the following data fields. For instance, the Bureau will modify the amount of the loan or the amount applied for by disclosing the midpoint for the $10,000 interval into which the reported value falls. Another modification would involve the age of an applicant or borrower by binning reported values into categorical ranges.34 There will be a modification to the reporting of the DTI ratio, the total monthly debt to the total monthly income, which is relied on in making the credit decision. No change will take place for values greater than or equal to 36 percent and less than 50 percent; however, there the Bureau will bin reported values into the following ranges: 20 percent to less than 30 percent; 30 percent to less than 36 percent; and 50 percent to less than 60 percent; bottom-code reported values under 20 percent; and top-code reported values of 60 percent or higher.35 With respect to the value of the property securing a covered loan or, in the case of an application, proposed to secure a covered loan, the Bureau will disclose the midpoint for the $10,000 interval into which the reported value falls. The number of individual dwelling units related to the property securing a covered loan or, in the case of an application, proposed to secure a covered loan, the Bureau will bin reported values into the following ranges: 5 to 24; 25 to 49; 50 to 99; 100 to 149; and 150 and over.36 Finally, with respect to the number of individual dwelling units related to the property securing a covered loan or, in the case of an application, proposed to secure a covered loan, if these are incomerestricted pursuant to Federal, State, or local affordable housing programs, the Bureau will disclose reported values as a percentage, rounded to the nearest whole number, of the value reported for the total number of individual dwelling units related to the property securing the covered loan.37

Obviously, in matters involving individual privacy versus the public’s need to know, there is often going to be a trade-off. The Bureau’s issuance, for instance, contemplates the risk that a potential adversary, such as an applicant’s or borrower’s neighbor or acquaintance, may be able to re-identify the HMDA data by relying on personal knowledge about the applicant or borrower. We should not lose sight of the purpose of HMDA: it is a disclosure statute – public disclosure of HMDA data is central to the achievement of HMDA’s goals.38 The reality is, these modifications to the loan-level HMDA data disclosed to the public do not completely eliminate privacy risks. So, the trade-off is to offer the public a broad notion of the loan-level data as a heuristic to reducing privacy risks to individual applicants and borrowers. The rationalization is based on the view, relied upon by the Bureau, that public loan-level HMDA data have always displayed a high level of record uniqueness and included fields that are also found in identified public records.39 Given this premise, the Bureau appears to believe that some degree of reidentification risk in connection with the public disclosure of the data is acceptable, because HMDA requires the Bureau to consider not only the risk posed by disclosure but also the benefits of disclosure to HMDA’s purposes. Consequently, the initiative seems to endeavor a balance between privacy risk, such as re-identification, and the disclosure benefits to the public. Footnotes 1—12 CFR 202.16(b); see also the Act §§ 702(g), 706(a), and 706(b). 2—In the Matter of Nationstar Mortgage LLC, Consent Order, Administrative Proceeding, File No. 2017-CFPB-0011, Consumer Financial Protection Bureau. 3—See §§ 702(g), 704(b), 704 (c), and 704 (d) of the Act. 4—§ 706(c) and § 706(d), respectively. 5—Regulation C, 12 C.F.R. §?1003.4(a). Other State or Federal regulations may require a financial institution to record its data on a LAR more frequently. See Regulation C Commentary 4(f)-2. 6—Regulation C, 12 C.F.R. §?1003.4(f) and Regulation C Commentary 4(f)-1 and-3. 7—Regulation C, 12 C.F.R. §?1003.5(a).

8—Regulation C, 12 C.F.R. §?1003.4(a). 9—Regulation C Commentary, 12 C.F.R. §?1003.4(a)–1(v) and 4(a)(1)-5. 10—In April 2017, the CFPB proposed numerous technical revisions to Regulation C to reflect the fact that this quarterly reporting requirement was not scheduled to take effect until 2020. See Federal Register 19142, 19162 (April 25, 2017). 11—Regulation C, 12 C.F.R. §§?1003.5(a)(1)(ii)–(iii). 12—See CRA/HMDA Software Downloads at https://www.ffiec.gov/software/software. htm. Each software version is yearspecific. 13—See Resources for HMDA Filers at https://www.consumerfinance.gov/dataresearch/hmda/for-filers. 14—Regulation C, 12 C.F.R. §?1003.5(a)(3). 15—Legal Entity Identifiers and HMDA 2018, Questions and Answers, Foxx, Jonathan, April 7, 2017, available in Articles section of LendersComplianceGroup.com. 16—Home Mortgage Disclosure Act: Big Changes on the Way, Foxx, Jonathan, published in the December 2015 edition of National Mortgage Professional Magazine, available in Articles section of LendersComplianceGroup.com. 17—A Guide to HMDA Reporting, Getting it Right!, Federal Financial Institutions Examination Council, Edition Effective Jan. 1, 2018 (For HMDA Submissions due March 1, 2019). Resources for HMDA filers are available at ConsumerFinance.gov/dataresearch/hmda/for-filers and www.ffiec.gov/hmda. 18—The enforcement agencies are: the OCC, for any national bank, federal savings association, or Federal branch or Federal agency of a foreign bank; the FRB, for any State member bank, any branch or agency of a foreign bank (other than a Federal branch, Federal agency, or insured State branch of a foreign bank), any commercial lending company owned or controlled by a foreign bank, and any organization operating under Section 25 or 25A of the Federal Reserve Act; the FDIC, for any State nonmember insured bank, insured State savings association, mutual savings bank, insured State branch of a foreign bank, or any other depository institution not already mentioned; NCUA, for any insured credit union; and the CFPB, for any company subject to the Consumer Financial Protection Act of 2010 (Dodd-Frank Act Title 10). See 12 U.S.C. §§?2804 and 1813(q). 19—The CFPB statement is available at https://www.consumerfinance.gov/aboutus/newsroom/cfpb-issues-publicstatement-home-mortgage-disclosureact-compliance/. 20—Home Mortgage Disclosure (Regulation C), 80 FR 66128 (Oct. 28, 2015). 21—Public Law No. 115-174, 132 Stat.

1296 (2018). 22—Community Reinvestment Act (CRA) requirements are not treated in this article. 23—Executive Summary of the 2018 HMDA Interpretive and Procedural Rule, Aug. 31, 2018, Bureau of Consumer Financial Protection, formerly known as Consumer Financial Protection Bureau, and, as of this writing, once again called the Consumer Financial Protection Bureau. 24—The 2018 Rule specifies that a “closed-end mortgage loan” is any closed-end mortgage loan as defined in 12 CFR § 1003.2(d) that is not excluded under § 1003.3(c)(1)-(10) or (13), and that “open-end line of credit” is any openend line of credit as defined in § 1003.2(o) that is not excluded under § 1003.3(c)(1)-(10). 25—Op. cit. 23. 26—Op. cit. 23. 27—Op. cit. 23. 28—Filing Instructions Guide for HMDA Data Collected in 2018 is available at https://www.consumerfinance.gov/dataresearch/hmda/for-filers. 29—The Bureau released this final policy guidance on its website on December 21, 2018. For the transmittal statement and final guidance, see https://www.consumerfinance.gov/about -us/newsroom/consumer-financialprotection-bureau-announces-policyguidance-disclosure-home-mortgagedata. 30—Idem. 31—Idem. 32—Disclosure of Loan-Level HMDA Data, Bureau of Consumer Financial Protection, Dec. 21, 2018. 33—Idem. 34—Binning, sometimes known as “recoding” or “interval recoding,” allows data to be shown clustered into ranges rather than as precise values. Topcoding and bottom-coding mask any value that is above or below a certain threshold. For instance, 25 to 34; 35 to 44; 45 to 54; 55 to 64; and 65 to 74; with bottom-code reported values under 25 and top-code reported values over 74; and indicia for whether the reported value is 62 or higher. 35—Op. cit. 32. 36—Op. cit. 32. 37—Op. cit. 32. 38—Op. cit. 32, F 32, 12 CFR 1003.1: “This part implements the Home Mortgage Disclosure Act, which is intended to provide the public with loan data that can be used:” to help determine whether financial institutions are serving the housing needs of their communities; to assist public officials in distributing public-sector investment so as to attract private investment to areas where it is needed; and to assist in identifying possible discriminatory lending patterns and enforcing antidiscrimination statutes. (Emphasis added) 39—Op. cit. 32, F 33.

Jonathan Foxx, Ph.D., MBA, is Chairman and Managing Director of Lenders Compliance Group, the first and only fullservice, mortgage risk management firm in the United States, specializing exclusively in mortgage compliance, offering a suite of services in residential mortgage banking for banks and nonbanks. If you would like to contact Jonathan, please e-mail Compliance@LendersComplianceGroup.com.

heard on the street

Finicity Partners With Princeton Mortgage on Digital Originations

Mr. Cooper Group Buys Setereus Servicing Platform

Mr. Cooper Group Inc. announced that it acquired the mortgage servicing platform from IBM’s Seterus along with a $48 billion servicing portfolio. Mr. Cooper, formerly Nationstar, stated that it would fund the acquisition with financing on the mortgage servicing rights and cash. The Seterus portfolio consists of $24 billion in government-sponsored enterprise mortgages and $24 billion in conventional mortgages. Jay Bellissimo, General Manager, Cognitive Process Transformation, IBM Global Business Services, noted that IBM acquired Seterus “in the wake of the 2008 financial crisis to help a client manage a portfolio of distressed loans,” adding that the sale comes at a time when the portfolio is enjoying a strong degree of stability. “The time is now right to divest this business, which is no longer core to IBM’s portfolio, to a continued on page 45

A Message From MAA Chairman Jeffrey C. Taylor continued on page 84

The year 2019 brings big changes to the financial services industry. With more than 100 new members between the House and Senate, now is the perfect time to join the Mortgage Action Alliance (MAA), get up to date on key issues, and introduce yourself to your newly-elected officials. MAA is pleased to announce this year’s 2019-2020 MAA Steering Committee: l Chairman: Jeffrey C. Taylor, Co-Founder and Managing Director, Digital Risk LLC l Vice-Chair: Thomas Dennard, Chairman and CEO, Grandbridge Real Estate Capital l Vice Chair: Laura Escobar, President, Eagle Home Mortgage l Immediate Past Chair: Gene Lugat, Executive Vice President, PrimeLending l MORPAC Chair: Eddy Perez, CMB, President, Equity Prime Mortgage l At-Large Member: Chad Church, Director, New American Funding l At-Large Member: Tonya Ellis, AVP Operations, Crescent Mortgage Company l At-Large Member: Mary Rzucidlo, SVP, Director of Operations, South State Bank MAA’s Steering Committee is dedicated to making your voice heard and aims to accomplish the following in 2019: l Grow MAA membership from 27,000 to 35,000 members l Exceed 7,500 downloads of the MAA mobile app (currently at 3,220) l Recruit more than 350 individuals to attend MBA’s National Advocacy Conference (NAC), April 2-3, 2019 in Washington, D.C. (MBA.org/NAC) l Expand our presence and effective utilization of social media We cannot accomplish these goals alone. Only with your help can MAA continue to be the leading voice of the real estate finance industry. Join MAA if you haven’t done so already. You can join for free at MBA.org/JoinMAA or search “Mortgage Action Alliance” in the App Store or Google Play to download the MAA mobile app. We have tools and materials available to help you connect with your current and newly-elected policymakers, and MBA staff can help you every step of the way. If you are interested in running an MAA enrollment campaign at your company, please contact MBA’s Associate Vice President of Political Affairs Alden Knowlton at (202) 557-2816 or e-mail AKnowlton@MBA.org.

Jeffrey C. Taylor is Chairman of the Mortgage Bankers Association’s Mortgage Action Alliance. Jeffrey is also Co-Founder and Managing Director of Digital Risk, a provider of mortgage risk, compliance and transaction management solutions. His is a frequent guest on financial television networks, such as Fox Business News and CNBC, as well as a source to top tier new outlets including The Wall Street Journal, sharing keen insights on the U.S. mortgage market and the economy.

n National Mortgage Professional Magazine n JANUARY 2019

Finicity has announced that it is working with Princeton Mortgage to automate borrower asset verification for lenders. The agreement will provide Princeton Mortgage Loan Officers and borrowers with a faster, simpler loan origination experience that reduces both paper chase and headache. Princeton Mortgage’s digital mortgage platform, SnapApp, will leverage Finicity’s Verification of Assets (VoA) solution to give lenders access to the data insights they need to streamline the loan application process, reduce mortgage fraud, free up resources and shorten time to close. Automation cuts the verification process from days to minutes as borrowers no longer need to search for bank statements, and lenders have

more time to focus on high-value activities, such as approving more loans. “We’re thrilled to work with Princeton Mortgage and provide its customers with an innovative, paper-free and hassle-free experience,” said Steve Smith, Finicity Chief Executive Officer. “As the leading financial data aggregator in the mortgage lending industry, we are always looking for partners who share our goal of transforming outdated loan origination processes into seamless digital experiences.” Princeton Mortgage Sales Enablement Manager Nicole Gordon said, “Borrowers want an effortless mortgage experience, and with our new SnapApp they get just that. Through SnapApp’s automated digital mortgage process, borrowers can apply, verify their income and assets, pull their credit, run an automated approval and even receive a pre-approval letter in the middle of the night, at their convenience. We are excited to partner with Finicity to help make this digital mortgage process seamless and simple.”

MBA’s Mortgage Action Alliance

NationalMortgageProfessional.com

and its remaining legacy default management related platforms over the next 24 months. The company added that these noncore software platforms brought in approximately $40 million in revenue during the first three quarters of this year. While this is taking place, CoreLogic plans to accelerate its appraisal management company operations through what it described as “the greater use of data-driven analytics, automation of workflows and enhanced utilization of its dedicated staff appraisers.” CoreLogic acknowledged that this focus is “expected to initially result in lower revenue in 2019,” but will bring greater profit margins in 2020 and beyond. CoreLogic’s appraisal management revenues in the first three quarters of this year came to roughly $65 million. “CoreLogic remains focused on capitalizing on our scale and market leadership and the opportunities presented by our must have workflow solutions in the U.S. mortgage market,” said Frank Martell, President and Chief Executive Officer of CoreLogic. “The actions we are announcing today should further position the company to achieve its 30 percent margin target and enhanced organic growth rates in 2020.”

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Technology Adoption Will Decrease Cycle Times by More Than 85 Percent … and Here’s Why By Pat Kinsel

e can all agree that it shouldn’t take 46 days to get a mortgage. Houses sit on the market for too long, buying agents are compensated more if you spend more, and fees and commissions are too high … the list goes on. The phrase, “Time kills all deals” couldn’t be more true for millions of homebuyers every year. This will soon be a phrase of the past, however, as we’re seeing the biggest shift in the industry thanks to the adoption of technology. For each pillar of the home buying experience, cycle times are being reduced, making it easier than ever to apply for a mortgage and close on your home in days.

Reducing closing times from 52 days to one week Historically, the dozens of digital platforms in the mortgage space have made little impact on the overall mortgage process. Closings in 2016 still took an average of 52 days, while fintech companies completed their applications an average of eight days earlier than traditional lenders. Much of this time is dedicated to human processing of the loan, which is becoming costlier by the quarter. Processing a loan in the first quarter of 2018 was almost $9,000, as independent banks lost money on each loan they originated for only the second time since 2008. If we could get home closings down to a week, it would reduce mortgage processing by more than 85 percent. A recent article in National Mortgage News stated that lenders rank “Increased Borrower Satisfaction” and “Faster Cycle Times” as greater than four out of five in terms of good investments. And we’re seeing this in the field as well. One of Notarize’s customers reduced their cycle time

by 10 days. They went from 40 percent defect rate to basically zero percent, and helped save people time and money overseas by creating a more efficient and effective process. But this is bigger than time savings. Technology is starting to be used to truly impact the customer experience for the first time, which has the potential to not only make it easier to buy a home, but for more people to have access to this American Dream. The ability to achieve this has actually been a dream. The process to apply for, and get approved for, a mortgage has been cumbersome. For decades, it involved driving to a bank and spending hours on paperwork. If you were lucky, your parents were around to put the kids on the school bus, and you found street parking with no need to feed the meter. Technology will increase borrower savings and connect the entire real estate industry Buying a home is considered a milestone moment in a person’s life. Instead, the home buying process is widely regarded as one life’s most stressful events. As technology makes this process seamless and efficient, borrowers will save time and money through shorter rate locks and a digitized workflow. Borrowers won’t be the only beneficiaries, though. Title agents will see a considerable spike in volume due to quicker closings as much as 15 percent to 20 percent—and lenders will see a quicker return-on-investment (ROI) while providing a greater experience and better support to its borrowers and partner companies. This means more profit for the industry even as borrowers see savings. To get to this unrealized vision of a future focused on customer experience, we need to understand the context in which

this industry operates. The real estate market is an interconnected ecosystem. At the end of the day, every transaction is filed with a county recorder, insured, often funded by someone other than the lender, and the mortgage is typically sold into the secondary market and securitized. Virtually every company is built on top of this infrastructure and is required to comply with it. Take Quicken Loans’ Rocket Mortgage. Everyone assumes it’s a digital mortgage, but it’s really only a digital mortgage application. They’re still printing 280 pages and driving to your house for the closing, then mailing the documents across the country numerous times. Their entire operation grinds to a halt as a result. We need an end-to-end mortgage experience that’s better than the analog equivalent. The strengths of digital are choice, speed, and convenience. The race is to be the first to marry these. How to build an end-to-end experience focused on the customer The end-to-end experience will unleash extraordinary cost savings for the providers and for buyers and sellers. The average cost to originate a mortgage has gone up 400 percent in 10 years, to $8,900. Today, Fannie Mae estimates that the digital execution of a mortgage will save an originator $1,100. There are similar costs for title companies that average more than $5,000 in processing costs. We think there’s potential for even greater savings. Any cost savings can go right back into customer acquisition to gain share. And data shows 74

percent of customers will actually switch brands for improved customer experience, which they’ll finally have by going digital all the way. Moreover, we’ll see AI lay the foundation for automation in an industry that has historically operated in the purview of FedEx and a slow chain of passage. A.W. Pickel, President of Waterstone Mortgage, predicts that there will be more e-closings than ever in 2019 because Millennials will demand that mortgage companies move to the beat of their drum— and mirror the convenience delivered by the likes of Amazon and Uber. As more companies become digitally-savvy marketers, everyone is fighting for consumer eyeballs. The ones that will win, however, will focus on experience first, which will fuel lead acquisition through wordof-mouth and reputation. It won’t be about who can reach more people by shouting loudest from the tops of the mountain. It will be about companies that build solutions for borrowers. For decades we’ve been promised a solution that made homebuying easier. Ever since the GI Bill was introduced nearly 50 years ago, homeownership was the basis of the American Dream. The challenge, truthfully, is that we’ve made it harder than ever for someone to get approved for a loan and buy the home of their dreams. Technology “innovations” have been used for those in the industry, not those they serve. Now, we have the opportunity to truly use technology to redefine the homebuying process, and make it super simple. This is just the beginning, but the start of the best consumer experience the industry has ever seen.

Pat Kinsel is the Founder and CEO of Notarize. Notarize was also the first company to complete a home closing online. Pat is a Partner at Polaris Partners, where he specializes in building and investing in technology companies. Before Notarize, Pat co-founded Spindle, a social search company that was acquired by Twitter in 2013.

Addressing Post-Housing Crisis Issues

Upfront Precision and Use of Tools to Get Clients the Best Mortgage Should be Primary Task Getting the best rate with the best cost is automatically expected BY PAM MARRON

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hose of us who have been in the mortgage industry for decades are often more attuned to the changing industry around us. This isn’t meant to be boastful. When you’ve been in this business for a long time and have seen ups and downs, there are more points of reference to compare to. To stay relevant, all of us must keep on top of changes and if you don’t know how pieces of technology work, you’d better learn how. Many who know how to assist clients with specific help in hard times know how not because they are brilliant, but because they learned during those downturns … and frankly don’t want to see the same problems repeated. During the housing crisis, specific problems never dealt with in the past occurred. Two mortgage industry avenues became evident during this time: 1. Because mortgage business became scarce, many who had the knowledge to correct a problem and help were reluctant or could not because they did not have the time. Most were struggling to keep their business doors open. 2. With the introduction of qualified mortgages (QM)1 or loans with certain stable features where “ability-torepay”2 could be proven compared to non-QM loans where risks could exist, it appeared that lenders were less interested in a root fix of problems.

This left the industry wide open to the growth of non-QM mortgage products, where small changes in underwriting criteria resulted in products with higher interest rates and greater down payment. Non-QM mortgages appeared to become the trade-off to an actual fix. Some of these problems still exist, but an industry wide awareness has occurred over the last 10 years. Being able to spot these problems sometimes not visible on a first look requires the use of credit technology tools and awareness of differences between the Fannie Mae and Freddie Mac automated underwriting systems (AUS). Using both upfront, especially when a chance of an issue exists, saves time at the back end where problems are often caught. There are too much upfront costs at risk for the consumer to not put a loan through every possible tool even it looks good at face value. Mortgage Loan Originators who run loans through both Fannie Mae and Freddie Mac automated underwriting systems upfront, rather than waiting later in the mortgage process, better serve their clients by proactively receiving written approval findings. Did you know that Fannie Mae and Freddie Mac do not charge to run loans through their AUS systems? Sometimes an issue, specifically when it comes to credit, is not visible on the face of a credit report, but is caught when the loan is run through an AUS. And in the case of specific

products, that may need a housing counseling certificate, having the automated approval can give your client a head start on their counseling class. Pushing attention to detail and getting all information upfront when the client has time with no money at risk prepares for a smoother entire process. Housing inventory is tight right now, which makes sellers less likely to give an extension if needed midcontract. There are some savvy tech tools available for mortgage professionals out there. If your credit reporting agency works through the Meridian Link platform, this enables you to go into a creditor account and see the individual credit for Trans Union, Experian and Equifax and see how each of the bureaus is reporting for the same credit account (this is how the foreclosure code erroneously placed on past short sale credit

was initially pinpointed with precision). The CreditXpert Wayfinder accessible through many credit reporting agencies spells out what debt needs to be paid down, to what dollar amount, by what date, to reach the credit score for each specific credit bureau that you designate. Details can be printed so your client knows exactly what to do. PitchPoint can provide the ability to see an exact foreclosure date hidden behind a bankruptcy and LexisNexis can provide the ability to see if a judgment is hidden by a bankruptcy. All of these products or products that can provide the same benefits need to be on your list of available needs with your credit reporting agency. Details matter. Provide the greatest attention upfront before your client even signs a contract. Take the time to look at what your vendor products provide and understand their benefit.

Footnotes 1—CFPB|What is a Qualified Mortgage? ConsumerFinance.gov/ask-cfpb/what-is-aqualified-mortgage-en-1789. 2—CFPB|What is the Ability-to-Repay Rule? ConsumerFinance.gov/ask-cfpb/what-isthe-ability-to-repay-rule-why-is-it-important-to-me-en-1787.

Disclaimer: While I am a member of the HUD Housing Counseling Federal Advisory Committee, the opinions noted are those of the author only. Pam Marron (NMLS#: 246438) is Senior Loan Originator with Innovative Mortgage Services Inc. (NMLS#: 250769) in Tampa Bay, Fla. She may be reached by phone at (727) 3758986, e-mail PMarron@InnovativeMortgage.onmicrosoft.com or visit HousingCrisisStories.com, CloseWithPam.com or 8Problems.com.

l Gateway Mortgage Group has named Steven Patrick as its new Chief Risk Officer, where he will provide executive oversight to the company’s Credit and Risk management teams.

ROCKWELL

POLLISON WITTMAN

l Mortgage Network Inc. has named Beth Vega Wittman Branch Manager of the company’s Mansfield, Mass. office.

l Waterstone Mortgage Corporation has announced that the company has hired Area Sales Manager Rocky Rockwell to assist homebuyers in California. Rockwell has more than 32 years of successful wholesale and retail sales management experience. l Element Funding has named AJ Pasquale as its newest Loan Originator on its expanding team in West Palm Beach, Fla. l Draper and Kramer Mortgage has announced the opening of a new branch in the Washington, D.C., suburb of McLean, Va. The branch and

to its Federal Way branch in the Puget Sound region of Washington State. Home Point Financial Corporation has announced that Dan Sheehy has joined the company as Correspondent Institutions Manager, where he will support Home Point’s Delegated Correspondent clients in Maryland, Delaware, Northern Virginia and Washington, D.C., reporting directly to Michael Bender, Division Manager–Institutions Group East. Vellum Mortgage has announced the hiring of Greg Kingsbury and the Kingsbury Mortgage Team, extending their reach into the Maryland market. This follows recent additions, Carlos Larrazabal and Shannon Leydig, to the start-up mortgage company’s growing sales team roster. SingleSource Property Solutions has added Beth Davis to its executive team as Vice President of People Development. Proper Title LLC has announced three new hires and one new promotion to support the firm’s continued growth. Industry veterans joining the firm include Angela Castillo as Senior Title Examiner, Carol King as Escrow Officer and Dawn Wheatland as Sales Coordinator. The firm also announced the promotion of Beth LaSalle to Education and Compliance Manager. LBA Ware has appointed Mari Denton Director of Client Success. An experienced finance professional, Denton has spent the last decade of her career in senior roles at some of the nation’s largest banks and independent mortgage lenders

Your turn National Mortgage Professional Magazine invites its readers to submit any information, events, passages, promotions, personal or professional occurrences that seem appropriate and/or other pertinent data to the attention of: Heard on the Street/Mortgage Professionals to Watch column Phone #: (516) 409-5555 E-mail: Newsroom@MortgageNewsNetwork.com

Note: Submissions sent via email are preferred. The deadline for submissions is the 1st of the month prior to the target issue.

n National Mortgage Professional Magazine n JANUARY 2019

l Lenders Compliance Group (LCG) has announced that Joyce Wilkins Pollison has been appointed to the position of Executive Director. Pollison will also retain her position as Director of Legal and Regulatory Compliance.

l Cloudvirga has appointed Tim Von Kaenel Chief Product Officer, where he will oversee product strategy, design and goto-market planning for Cloudvirga’s growing suite of digital mortgage point-of-sale products. Cloudvirga has also announced that mortgage industry veteran James Vinci has been selected to fill the firm’s newly created Executive Vice President of Technology position.

much of its staff, led by topproducing mortgage originator Chris Channell, joined the company from another local lender. IndiSoft has tapped Dennis Forget as Vice President of Business Development, where he will be responsible for IndiSoft’s efforts to further develop its market presence with small- and mid-sized lenders with an emphasis on credit unions. Matthew McVay, a mortgage quality control expert with 19 years of experience in the financial services industry, has joined The StoneHill Group as Quality Control Audit Manager in the company’s Jacksonville, Fla. office. Valuation Partners has announced that Jon Forrester has joined the company as Vice President of Valuation Services. In his new role, Forrester will oversee the development and deployment of the company’s next generation of valuation tools, including hybrid appraisals, as well as help create new efficiencies in the appraisal process. New American Funding has announced that Lisa Steinke has joined the company as a Loan Originator for the Cedar Rapids, Iowa area. New American Funding has also announced that Eric Glick has joined the company as Area Manager for the Southeastern region, covering the Georgia, South Carolina and Jacksonville regions. Ellie Mae has announced that Dave Ard has joined the company as Senior Vice President of Enterprise Sales, where he will manage the enterprise team of Account Executives and relationship managers responsible for providing digital mortgage technology to the largest lenders across the United States. Primary Residential Mortgage Inc. (PRMI) has announced the retirement of two of its co-founders and long-time executives, Chief Executive Officer Dave Zitting and Chief Financial Officer Steve Chapman. Former Vice President of Finance and Board Member Kenneth Knudson will assume the role of CEO and president at the conclusion of 2018. Bay Equity Home Loans has added 25-plus-year industry vet Mortgage Loan Originator Josh Westmark and his team

NationalMortgageProfessional.com

l The Appraisal Institute has named Stephen S. Wagner at its President for 2019. Wagner is a Senior Appraiser in the appraisal firm of Terzo & Bologna Inc. in Indianapolis. He has served on the Appraisal Institute’s Board of Directors and as Chairman of its Finance Committee and Vice Chairman of its Professional Standards and Guidance Committee.

VINCI

WAGNER

Mortgage professionals to watch

PATRICK

mortgage servicing specialist whose domain expertise and scale can further advance this business,” said Bellissimo. “We are excited to welcome more than 300,000 customers and the Seterus team to the Mr. Cooper Group family,” said Jay Bray, Chairman and CEO of Mr. Cooper Group Inc. “We are confident our new team will be energized by our people-first culture, and our new customers will benefit from our userfriendly mobile and online tools designed to help them manage their home finances.”

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VON KAENEL

heard on the street

How to Make Sure Y in 2019 Than You D e all expect 2019 to be a bit more challenging than 2018 was, but there will always be transactions being done in every city in the United States. The question then becomes: How can you get your share of these transactions? They could be purchases or forced refinances for renovations, divorces or removal of mortgage insurance and bill consolidations.

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46 There are three things to consider to ensure your 2019 is better than 2018 First: You must have a realistic goal and plan for accomplishing it There is something magical about writing down your plan, but you must do more than just commit it to writing. You must actually have a plan for accomplishing it. For example, if you want to earn $120,000 and you earn 100 bps per loan and your average loan is $250,000, then you know that you must close 48 loans a year. But instead of focusing on the 48 loans for the year, it is far better to break it down into much more manageable chunks. If you need 48 loans for the year, then break that down to four loans per month, which breaks down to one loan per week. That is a far more manageable goal and makes it more realistic to accomplish. Second: You must have proven tactics and not fall for the scam artists I am sure I don’t need to tell you that there are so many “characters” offering us new

ways to generate business, but you need to have some criteria for who you will listen to. So let me share my criteria with you and see if you agree. The person should be originating loans currently so they can share what works and what doesn’t, and of course, what is compliant and what is not. They should be able to show real life examples from what is working today. The truth is that your marketing should resemble a four-legged chair: You must have more than one way to generate business. For example, your business could come from:

tuning it. If you see other tactics that you thought would work but have not than you need to either revise that tactic or replace it with another one. My sincere hope is that you will not just read this and move on. Actually break down these three steps and implement them.

Once you do, your business will immediately increase because of your new focus. If you are interested in having a software that will track all of this along with “48 Proven Ways I Generate New Business,” visit https://briansacks.samcart.com/pr oducts/48-books-delay.

l l l l l

Direct-to consumer methods Publicity Realtor referrals Past client referrals Referrals from other professionals like accountants, attorneys and financial planners l Your area of expertise, like Boomerang Buyers or other niches Third: You must track your progress and always be adjusting course Many originators will create a plan, but most stop at that and look back 12 months later to wonder how they actually did. I suggest strongly that after you have created your goals and decided on the tactics you will use, that you track your progress. Each time you originate a loan, track it. Write down or enter the loan amount, the source of loan and what tactic you used that generated it. Then at the end of each month you can go back and see what worked and what didn’t. If you see one of the tactics working than continue fine

Brian Sacks is a national mortgage expert with Homebridge Financial Services Inc., located in Owings Mills, Md. He has compiled more than 30 years of mortgage experience and career closings of 8,000 loans in excess of $1 billion. He is a recognized leader in the mortgage industry, and is the resident expert for NBC Channel 11 and has also appeared on the local CBS and ABC stations. Brian has appeared nationally in more than 42 states. Brian is considered the national expert on working with credit-challenged buyers. He is also a respected coach, and speaker and the founder of the Top Originator Mastermind. You can watch his four-part, free video series on “How to Close More Loans: Make More Money and Still Enjoy Life” at http://TopOriginatorMastermind.com/NMP.

e You Earn More Did in 2018 By Brian Sacks

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How Technology Helps Servicers Deal With Disaster By Gagan Sharma

coordinate with third parties, including the insurers that may be responsible for handling claims on damaged property.

Using technology to stay connected with borrowers During a disaster, it becomes harder to reach borrowers, and harder for borrowers to reach servicers. Fortunately, most servicers leverage technology in

multiple ways to help homeowners manage their mortgage payments and communicate with their servicers. When disaster strikes, however, technology assumes a much bigger role. In these cases, a servicer that leverages mobile apps can be of huge assistance to homeowners. Even if a borrower has no Internet access, they can still open a mobile app and retrieve phone numbers and a list of to do’s that they can tackle. Through these apps, borrowers are able to verify their mortgage status and make one-time payments through their bank accounts. Even if they are in default, they can use the apps to apply for loss mitigation, monitor events in the loss mitigation process and track milestones. However, it’s not enough to simply have a mobile app for borrowers. They’ve not only lost their homes, but they may have also lost their cell phone or they may be having trouble getting reception. That’s not uncommon if local infrastructure has been damaged or borrowers are unable to regularly charge their phones. In cases where borrowers may not have access to a cell phone, servicers must have apps that are available on any device, including tablets and desktops. As we’ve seen in recent disasters, social media has played a critical communication role during and following natural disasters, from locating missing family members and pets and organizing relief efforts by helping continued on page 91

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Understanding a disaster’s impact on defaults When looking at the big picture, it’s not hard to see how mortgage servicers can be lulled into complacency when it comes to natural disasters. According to CoreLogic, the number of mortgages in delinquency in September was just 4.4 percent, down from five percent one year prior. The country has had a decade of economic growth and increasing employment rates, and it doesn’t appear likely there will be a correction as bad as the one in 2008 on the horizon. That crisis prompted stronger regulations in the mortgage business, which will help ensure mortgages won’t be a major contributor to any future economic downturns. Since the 2008 housing crisis, we have also seen enormous investments to improve mortgage servicing operations. The increased adoption of automation and process improvement, along with enhanced processes to work under new mortgage servicing regulations, have helped servicers reduce costs and remain compliant. When natural disasters happen, however, all of these improvements do not seem to matter much. According to a recent report from CoreLogic, the Kilaueu volcano in Hawaii this past summer created a 10 percent jump in serious delinquency rates

on the Big Island. Outside of Redding, Calif., wildfires generated a 19 percent jump in 30- to 60-day delinquencies. And in one month, Hurricane Florence in North Carolina and Hurricane Harvey in south Texas doubled the number of 30-day delinquencies those areas. Of course, servicers have no control over natural disasters. Unless you have personally lost a home in a disaster, it can be difficult—if not impossible—to comprehend the wave of emotions and confusion that a homeowner goes through. It is a life-altering experience, made even more devastating when loss of life is involved. A borrower’s first instinct is to do whatever it takes to survive and get through the days after, such as taking care of family members, and securing adequate food and clothing. The normal monthly expenses, including the mortgage payment, quickly fall by the wayside. Often times, a homeowner who has low equity in a home that is lost in a fire or other disaster will simply walk away from their investment. This poses a unique risk to servicers who are legally obligated to provide distressed borrowers with assistance—and it is an area where technology can have the biggest, most immediate impact.

NationalMortgageProfessional.com

hen the late civil rights leader Benjamin Mays said, “The tragedy of life is often not in our failure, but rather in our complacency,” he certainly wasn’t thinking about mortgage servicers. But Mays’ famous words are something servicers should pay close attention to, particularly in light of the unforeseeable natural disasters the country has experienced in the past few years. Those catastrophes have exposed some major weaknesses in servicing practices, and unless they are corrected, those weaknesses may create even more damage in the face of another natural disaster, or perhaps an economic downturn. To be sure, human beings are ultimately helpless against the wrath of Mother Nature. And there is no amount of preparation that will keep mortgage servicers from experiencing spikes in default rates when floods or fires strike. But the tools they leverage in the wake of natural disasters should be used to improve the rate in which servicers can handle a large increase in defaults, as well as the rapid increase in borrower calls and emails. When a catastrophe strikes, servicers are responsible for taking reasonable action to determine property conditions and whether the damage is insured. Technology helps servicers and sub-servicers

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NAMB, Calyx Bring New Broker Technology to Market As TPO heats up, a new platform promises to connect brokers to wholesale lenders By Rick Grant

One platform to connect them all Given that each lender wants control of their own process, leaders at NAMB began asking if there was a way to make Brokers’ lives easier and still deliver what wholesale lenders

want? Rick Bettencourt, President of NAMB, says there is and now it’s available for free to NAMB members. Earlier this month, NAMB announced the launch of its new platform, NAMB All-In, available to all NAMB members at no cost. Powered by Calyx Software, NAMB All-In provides mortgage professionals with the three essential components they need to conduct business: A point-ofsale solution (POS), a cloudbased loan origination system (LOS), and a single point of access to premier wholesale lenders. The LOS is free to the Broker, as is access to the marketplace. Brokers only pay $10 when a consumer uses the Web-based POS tool, but Brokers can just use the LOS and Marketplace for free. “The main goal is to enhance Broker independence and give them the ability to do what they do best,” Bettencourt said. “NAMB All-In gives Brokers a consumer-facing, digital POS, the ability to originate a loan in the same system, and access to an open marketplace that promotes the true independence of the Broker community.” Calyx is well-known as it has long been a leader in the broker LOS space. In fact, Bettencourt has gone on the record saying NAMB chose Calyx as its partner because its solutions are wellaccepted by the Broker

community, as well as fast to learn and easy to use. “We kept the experience sleek and easy to use,” said Raj Parekh, Digital Mortgage Strategist at Calyx Software. “We want Brokers to sign up and be ready to go within an hour.” As previously reported in National Mortgage Professional Magazine, NAMB All-In makes it easy for Brokers to manage loan apps that come in through the online channel. Borrowers can complete the app in less than 10 minutes, thanks to built-in intelligence. Uploading documents can be done with the snap of a camera phone and they can be signed electronically. Pulling credit and verification of assets is also part of the system and apps can be sent through Fannie Mae’s Desktop Originator with a single click. But what has most people we talked to for this story excited is the third component, the Calyx Wholesaler MarketPlace. In pursuit of an open marketplace Designed to be a single portal Brokers can use to seamlessly exchange data with any wholesale lender that accepts data from the platform, Parekh says the Wholesaler MarketPlace lets Brokers work with the lenders they want. Using the portal, wholesale continued on page 91

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Connecting brokers and wholesale lenders First, every wholesale lender operates differently, requiring the Brokers they work with to adjust their process to fit the lender’s needs in order to send them business. At the very least, the Broker must log into another lender’s Web site to submit the information required to get the loan in process. It would be far easier and more efficient for the Broker if they had access to an “open marketplace,” where they could send their loan application to any wholesale lender they want and seek out the best deal for their

borrowers. Until very recently, no such platform existed. While the idea of standardizing a process across all wholesale lenders has been kicked around for years, it hasn’t received any serious consideration from the nation’s top wholesalers in the past. When the National Association of Mortgage Brokers (NAMB) called the top wholesalers together for its Wholesale Summit and asked them if they would consider standardizing, the proposal was met with blank stares. Finally, an attorney present at the meeting explained the situation. Every wholesale lender considers their internal process for originating mortgages a differentiator. Whether it is or not, their individual processes have been approved by their legal departments and that’s not going to change. The idea of accepting someone else’s documents or stacking order was simply not an option for the nation’s largest firms. But saying it cannot be done to a mortgage technologist is a rookie mistake. There is always a way …

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fter losing twothirds of the industry’s Mortgage Brokers in the days following the financial crash, their ranks are growing again and for good reason. With refinances accounting for only one in three loans written today, the relationships Brokers enjoy with prospective borrowers in their local markets are once again valuable assets. Now, all Brokers have to do is find a way to get those borrowers into their wholesale lender’s pipeline before some big online lender convinces the consumer to punch their launch button. That has been a bit of a challenge.

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National Mortgage Professional Magazine is proud to announce its annual list of Top Mortgage Employers. We polled our readers about their employers based on the following criteria: l Compensation

l Corporate culture

l Training resources

l Speed

l Long-term strategy

l Industry participation

l Marketing support

l Day-to-day management

l Innovation

l Technology

l Internal communications

Based the above criteria, we weighted factors that are more important to our readers (i.e. our readers told us that factors like corporate culture was considerably more important to them than speed of company), collected votes and factored in industry reputation to create a list of Top Mortgage Employers.

Mortgage Lenders: Regional (Up to 500 MLOs) Company Name

Web site

Phone #

NSERT: 1st_Priority_Logo]

1stPriorityMortgage.com

(716) 651-5626

All employees have the opportunity to excel by living the values, practice teachings, and seeking individual lives of abundance.

AcopiaHomeLoans.com

(888) 859-5537

Bright, enthusiastic professionals who share our values and commitment to providing exceptional customer service and doing the right thing.

AtlanticHomeLoans.com

(877) 598-6500

Operations and support team dedicated to driving Originator’s sales results, through their dedication and commitment.

[INSERT: Bell_Bank_Logo]

BellBanks.com

(952) 905-5000

People whose everyday interactions show they “live” our core values of family, unequaled service and giving back to the community.

[INSERT: Carrington_Logo]

CarringtonMS.com

(800) 561-4567

Customer-focused individuals who are driven to serve the underserved markets with excellence and passion.

CastleCookeMortgage.com

(866) 461-7101

Service-oriented individuals who embrace technology and strive to create more efficient workflows.

[INS

[INSERT: Castle_Cooke_Logo]

[INSERT: Encompass_Logo]

[INSERT: Equity_Prime_Logo]

(407) 869-0008

Entrepreneurial mortgage professionals with a passion for technology, speed and the highest level of customer service for their borrowers.

DelmarMortgage.com

(314) 434-7000

Knowledgeable Mortgage Loan Originators that can convey proper expectations to clients and trust the office support to handle the rest.

ELGLoans.com

(281) 693-5363

Top Originators that are customer-focused and driven by achieving goals.

EnvoyMortgage.com

(713) 993-2200

Mortgage individuals that are driven to make a difference in a borrower’s life see their careers excel at Envoy.

EquityPrime.com

(877) 255-3554

Dedicated employees who believe in the goal of helping families and individuals become homeowners.

CallEquity.net

(740) 349-7082

Service-driven individuals who are passionate about helping to improve the lives of families in the modern technology era.

Fam1Fund.com

(732) 505-4600

Loan Officers that take advantage of modern marketing and technology will reach their full potential at our company.

FCLoans.com

(866) 970-3424

Dedicated professionals who excel in a culture that both encourages independence and is family-centric.

n National Mortgage Professional Magazine n JANUARY 2019

[INSERT: Envoy_Logo]

CFIMortgage.com

NationalMortgageProfessional.com

]

Who excels at this company?

Mortgage Lenders: Regional (Up to 500 MLOs) Company Name

Web site

Phone #

FGMC.com

(703) 556-3333

Team-oriented employees who are committed to improving our customer experience excel at FGMC.

HancockMortgage.com

(888) 391-8237

Hard-working, community-minded professionals who are driven to provide the American dream of homeownership.

GMMLLC.com

(800) 867-6859

Goal-setting and effective communication allows every employee the opportunity to further advance their expertise.

JetDirectMortgage.com

(855) 553-4732

Management that recognizes the value and talent of its team members, providing an environment for success.

MyKeyMortgage.com

(847) 296-5757

Anyone who knows their best years are ahead of them and who strives to make THIS their best year—year-over-year.

LHFS.com

(800) 672-9470

Individuals who are heavily involved and care about their community excel at Land Home.

MidAmericaMortgage.com

(866) 544-7013

Driven, tech-savvy Originators with a passion for outstanding customer service and innovation.

MortgageCorp.com

(800) 964-5363

Conscientious, hard-working employees who consistently go the extra mile to provide uniquely personalized service to their clients and colleagues.

MEPLoans.com

(781) 309-1800

Employees that are committed to the customer and getting the job done right!

[INSERT: Mountain_West_Logo]

MWFInc.com

(888) 793-6470

We are a full-service, privately-held Mortgage Banker with outstanding reputation built on trust, ethical lending practices and family values.

[INSERT: Nations_Lending_Logo]

NationsLending.com

(877) 816-1220

Individuals who aspire to become a top performer, while helping to achieve the company’s vision of becoming a top lender.

NeighborhoodLoans.com

(630) 246-4777

Motivated individuals who strive for growth, even when at the top.

NewPennFinancial.com

(888) 673-5521

Make your job as big as you can … contribute, add value, achieve!

NFMLending.com

(888) 233-0092

Loan Originators who embrace technology to provide a better customer experience, while assuring a personal touch in every home purchase.

[INSERT: Jet_Direct_Logo]

[INSERT: Key_Mortgage_Logo]

[INSERT: Land_Home_Logo]

Who excels at this company?

JANUARY 2019 n National Mortgage Professional Magazine n

NationalMortgageProfessional.com

[INSERT: MEP_Logo]

[INSERT: New_Penn_Logo]

[INSERT: NFM_Lending_Logo]

Mortgage Lenders: Regional (Up to 500 MLOs) Company Name

Web site

Phone #

NRLMortgage.com

(713) 275-1300

Motivated associates who know no boundaries excel at NRL with the unlimited potential of positions, training and upward mobility.

PlanetHomeLending.com

(844) 358-8163

Self-generating, purchase-focused Mortgage Loan Originators looking for increased market share.

[INSERT: RCN_Capital_Logo]

RCNCapital.com

(860) 432-5858

Talented individuals who are dedicated to providing superior customer service in a fast-paced work environment.

[INSERT: Ruoff_Home_Logo]

Ruoff.com

(260) 999-6200

Our operations team is top-notch, delivering unprecedented turn-times and superior service.

SDCapitalFunding.com

(732) 549-7001

Individuals who are able to adapt to changes and adjust to technology will succeed in our company.

UNFCU.org

(347) 686-6000

Originators who understand the value of a great portfolio lender in the market.

[INSERT: SD_Capital_Logo]

[INSERT: UNFCU_Logo]

Who excels at this company?

57 VanDykMortgage.com

(888) 482-6395

Originators who want the opportunity to focus on the most important component of their business—client relationships.

[INSERT: WA_First_Logo]

WAFirstMortgage.com

(425) 576-5462

Mortgage professionals who love change, technology and want to take every opportunity to champion their own success.

WVMB.com

(307) 634-5941

Customer service-driven individuals who have a reputation for quality, knowledge and integrity.

Company Name

Web site

[INSERT: Alderus_Logo]

Alderus.net

(702) 255-5783

The Senior Loan Officers really set the pace for the organization and take the company to the next level!

DirectMortgageLoans.com

(410) 878-9730

Industry leaders in innovation and customer experience.

KFCU.org

(228) 385-5500

Service-focused team members who excel at providing an amazing member experience.

TheMMMortgage.com

(651) 639-9800

Three Originators named “Super Mortgage Professionals 2016, 2017, 2018” by Twin Cities Business Magazine. Three individuals voted to the “40 Under 40” presented by National Mortgage Professional Magazine.

[INSERT: Direct_Mor

[IN

[INSERT

Phone #

Who excels at this company?

n National Mortgage Professional Magazine n JANUARY 2019

Mortgage Lenders: Independent (Less than 25 MLOs)

NationalMortgageProfessional.com

[IN

Mortgage Lenders: Independent (Less than 25 MLOs) Company Name [INSERT: MFG_Logo]

Web site

Phone #

Who excels at this company?

MFGLends.com

(352) 742-7900

Each employee, from the top down, treats each client like family. It is what sets us apart from the rest!

[INSERT: Princeton_Mortgag

MLO.PrincetonMortgage.com

(609) 737-1000

People who want to build something great, be part of something bigger than themselves, and reach their full potential.

[INSERT: Vantage_Mortga

VantageMortgageGroup.com

(503) 496-0431

Those who seek to embrace independence, transparency and competition to expand their career in ways they never imagined possible.

Mortgage Lenders: Larger (More than 500 MLOs) Company Name

Web site

Phone #

AcademyMortgage.com

(800) 660-8664

Professionals who to want to identify, build upon and develop their strengths to become Academy Strong.

AFNCorp.com

(888) 636-7573

Anyone motivated to thrive as an individual and contribute as a vital team member will excel at AFN.

APMortgage.com

(916) 960-1325

Employees who make it their personal mission to deliver the best possible loan experience and solutions to their borrower.

CaliberHomeLoans.com

(800) 401-6587

Caliber is continuing to expand to new and established markets, and is currently hiring talented producers in all sales channels.

CMGFI.com

(925) 983-3000

Innovative Originators looking to try new programs and products to grow their market share.

GatewayLoan.com

(877) 406-8109

Team members who are passionate about strengthening communities through homeownership.

MovementLO.com

(877) 314-1499

Relationship-driven competitors looking for a purpose instead of just a job.

NewAmericanFunding.com

(800) 450-2010

Those who work hard, go the extra mile and have a strong desire to succeed, will reach their full potential.

[INSERT: PRMG_Logo]

PRMG.net

(855) 776-4326

If you are a motivated individual looking for opportunities to advance your career with an extraordinary company, then PRMG is the place for you!

[INSERT: SNMC_Logo]

SNMC.com

(844) 542-5626

Our top Originators are self-starters who are empowered to provide superior customer service and products with a unique personal touch.

UnitedFidelityMortgage.com

(866) 760-0600

Go-getters and team players who go above and beyond to make the customer happy, as well as those who leverage technologyautomation for next-level lending efficiency.

go]

[INSERT: AFN_Logo]

JANUARY 2019 n National Mortgage Professional Magazine n

NationalMortgageProfessional.com

[INSERT: American_Pacific_L

[INSERT: Caliber_Logo]

[INSERT: CMG_Financial_Logo]

[INSERT: New_American_Logo]

[INSERT: UFF_Logo]

Who excels at this company?

Service Providers Company Name

Web site

Phone #

Who excels at this company?

ARMCO.us

(800) 858-1598

Loyal employees who are passionate about their work and genuinely want the company as a whole to succeed.

ClassValuation.com

(866) 333-8311

Class Valuation looks for employees who are passionate and willing to go the extra mile for our customers.

[INSERT: Credit_Plus_Logo]

CreditPlus.com

(800) 258-3488

Individuals committed to their professional growth and contributing for the betterment of customers and the company excel at Credit Plus.

[INSERT: DocMagic_Logo]

DocMagic.com

(800) 649-1362

Employees who thrive at DocMagic are smart, tech-savvy, highly-motivated, service-oriented and take extreme pride in what they do.

Info.IDSdoc.com

(800) 554-1872

Thorough, thoughtful, fun-loving, tech-savvy individuals with a passion for customer service.

LBAWare.com

(478) 202-2222

Motivated problem-solvers who take a hands-on approach to fully examining and creatively solving the business challenges facing lenders today.

[INSERT: IDS_Logo]

[INSERT: LBA_Ware_Logo]

(619) 543-5111

MCT Employees are 100 percent team players, always collaborating and helping each other out, and are laser-focused on always providing excellence in lender client support.

[INSERT: MortgageFlex_Logo]

MortgageFlex.com

(904) 356-2490

A diverse tech-savvy individual witha hunger to achieve more. People with a customer-serving and optimistic attitude thrive at MortgageFlex.

OpenClose.com

(561) 655-6418

Employees who have unique insight working both at the vendor and lender levels, and are dedicated to work autonomously (often remotely).

TagQuest.com

(866) 376-5540

Ownership is driven to succeed by drawing out the best in all the employees and playing to their strengths.

[INSERT: OpenClose_Logo]

[INSERT: TagQuest_Logo]

Wholesale Lenders Company Name INSERT: Angel_Oak_Logo]

Web site

Phone #

Who excels at this company?

AngelOakMS.com

(855) 539-4910

Service is in our DNA, so individuals who strive to go above and beyond to provide an extraordinary experience.

[INSERT: Citadel_Logo]

CitadelServicing.com

(949) 900-6630

Our staff consistently offers excellent customer service, espouse a positive attitude and have an insatiable appetite for success.

[INSERT: Greenbox_Logo]

GreenboxLoans.com

(800) 919-1086

Professionals who are passionate about providing our customers with superior results!

n National Mortgage Professional Magazine n JANUARY 2019

MCT-Trading.com

NationalMortgageProfessional.com

[INSERT: MCT_Logo]

Wholesale Lenders Company Name INSERT: Nations_Direct_Logo]

Web site

Phone #

Who excels at this company?

MyNDM.com

(866) 762-3940

Motivated learners and associates with a great attitude.

[INSERT: REMN_Logo]

REMNWholesale.com

(732) 738-7100

Highly-motivated and passionate self-starters really excel at REMN Wholesale!

[INSERT: UWM_Logo]

UWM.com

(800) 981-8898

Driven, team players who demonstrate a strong work ethic, a positive attitude, and are committed to delivering elite client service.

JANUARY 2019 n National Mortgage Professional Magazine n

NationalMortgageProfessional.com

Free print subscription ($59 value). Go to Sub.NMPMag.com/nmp0511 The NMP Daily Email Newsletter is your source for breaking news, insights and tips. Get free access to full articles including the hottest industry headlines, featured articles and other mission critical stories isdelivered inbox each day.and tips. Get free Themortgage NMP Daily industry Email Newsletter your sourcetoforyour breaking news, insights access to full articles including the hottest industry headlines, featured articles and other mission critical mortgage industry stories delivered to your inbox each day.

The NMP Mortgage News Ticker is a daily news feed that gives you a snapshot of the hottest

around Stay most recent headlines and blogs, all news stories from Themortgage NMP Mortgage News Ticker is a daily news the feed web. that gives youinformed a snapshotof of the the hottest mortgage news stories fromconvenient around the web. Stayemail. informed of the most recent headlines and blogs, all compiled into one daily compiled into one convenient daily email. Your State SpeciďŹ c Digital Edition Your State SpeciďŹ c Digital Edition Want to stay informed on a moreon local contents of ourThe statecontents e-editions include of the content from include all of the content from Want to stay informed a level? moreThelocal level? of ourall state e-editions our national publication plus state-specific mortgage association information, including the President's Message, our highlights nationallocal publication plus state-specific mortgage association including the President's Message, which issues, such as regulatory and legislative matters, along with the state information, calendar of events. which highlights local issues, such as regulatory and legislative matters, along with the state calendar of events. Mortgage News Network (MNN) features regularly scheduled and special event video programming with industry experts sharing insights that impact your business today and in the future. MNN provides Mortgage News (MNN) features and special event video programming market forecasts, proven salesNetwork and marketing strategies, interviewsregularly with industryscheduled leaders and more.

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NationalMortgageProfessional.com

By Jonathan Foxx

Policies and Procedures: Specific Components

Answer Although there is a tendency to standardize the structure of policies and procedures, there are many instances where one size does not fit all. Nevertheless, in my view there are 12 basic features of a well-designed policy document. Before drafting the policies, it is important to consider many factors, such as the institutions size, risk, and complexity; the nature and frequency of information updates; and the technology to be used in implementation. I could provide an outline of the steps involved in determining the choice of policies needed by a financial institution, as well as how best to establish their implementation. But your question asks for the specific components of policies and procedures, so I will offer the 12 features that we recommend. Here are the 12 basic

Outline the system that is appropriate to the nature, size, complexity, and scope of the business operations, as it pertains to a regulatory, statutory, Best Practices or institutional policy solution. Use standard data reporting formats and standard procedures for compiling, maintaining, monitoring and furnishing information. Maintain records for a reasonable period of time but not less than required by statute or any applicable record keeping requirement. Establish and implement internal controls regarding the accuracy and integrity of information, such as periodic, preferably independent, internal audits, and provide standard procedures and means to verify random reviews. Train staff involved in activities relating to the policy and procedure requirements, with attention given also to the reporting or filing requirements that may be mandated. Provide appropriate and effective oversight of relevant service providers whose activities affect the fulfillment of the policy initiatives. Ensure that information is

specific to the financial institution; however, be mindful that mergers, acquisitions, change in corporate structure, and other obligations may affect re-aging and reporting. 8. Delete, update, and correct information, as appropriate, to avoid inaccurate information, and be sure to state the date of the update. 9. Conducting investigations, reviews, audits, procedural remedies, and process undertakings whenever there is an apparent breach of the policy, so as to ensure that the policy has accounted for any systemic failures. 10. Provide technological methods or other means to prevent a compromise of the Compliance Management System. 11. Keep information ready for periodic updating of the policyâ&#x20AC;&#x2122;s approved content and reporting requirements, and be sure to review all information with management, including an understanding that management will ratify the update.

12. Conduct a periodic evaluation of the practices, acquired information, disputed information, corrections of inaccurate information, means of communication, and other factors, that may affect the fulfillment of the policyâ&#x20AC;&#x2122;s purpose. Track and document any practices or activities that may compromise accuracy or integrity of information. This means you need to review existing practices and activities, technologies, and other methods. Review historical records, too, and consider any previous disputes. Consider feedback from consumers, regulatory agencies, federal and state statutory frameworks. Include all relevant company departments in the discussion. Finally, meet periodically with management and affected company departments to review the policies. Information contained in this article is not intended to be and is not a source of legal advice.

Jonathan Foxx, Ph.D., MBA, is Chairman and Managing Director of Lenders Compliance Group, the first and only fullservice, mortgage risk management firm in the United States, specializing exclusively in mortgage compliance, offering a suite of services in residential mortgage banking for banks and non-banks. If you would like to contact Jonathan, please e-mail Compliance@LendersComplianceGroup.com.

n National Mortgage Professional Magazine n JANUARY 2019

components to a policy and procedure.

NationalMortgageProfessional.com

Question We are a medium-sized lender located in the Midwest. Recently, we decided to redraft our policies and procedures. However, we want to be sure we cover important features of a policy. It came to our attention that you provide policies and procedures for your clients. So, I am writing on behalf of my company to get your view. What are some specific components of policies and procedures?

Independent Mortgage Originators By Andy W. Harris, CRMS

Timothy George Infinity Financial Mortgage Corporation InfinityFinancialMortgageCorp.com Company NMLS: 1762546/Personal NMLS: 229194

JANUARY 2019 n National Mortgage Professional Magazine n

NationalMortgageProfessional.com

This month, I had a chance to sit down with Timothy George, President and Loan Originator with Infinity Financial Mortgage Corporation in Peoria, Ariz. During a successful tenure in the automobile sales industry back in 2001, Timothy discovered his natural aptitude for numbers. He made a slight shift to focus on the financing portion of vehicle sales, a role in which he thrived from 2003 to 2007. Then, on the hunt for a new path that would allow him to serve others while engaging his skillset, Timothy decided to forge a career in the mortgage industry. That was 10-plus years ago, and today, Timothy is founder of his company, Infinity Financial Mortgage Corporation, pairing his knack for numbers and problem-solving with his passion for helping others achieve the American Dream of homeownership. Tony, tell me a little about yourself and your career. I started in mortgages in 2007. I was previously a Finance Director for Larry Van Tuyl, who has joined forces with Warren Buffet at Berkshire Hathaway. Maybe I was too late getting in the game as Larry just sold to Berkshire within the last three years. I don’t care. I still have a relationship with Larry and am so proud he taught me everything he did. I learned to cold call, and will always be grateful for his teachings in my journey there. I spent my career from 20022004 learning to take “no” for an answer nine out of 10 phone calls, which meant that I had to learn closing skills. This is basic sale mathematics: 10-3-1. You have to make the 10 phone calls to get the three people that’ll actually talk to you, which should lead to one person who will actually do business with you. I wasn’t a good salesman. Sales in life is a “Learned Skill,” which should be awesome, because everybody can learn it! I understand you are a Mortgage Broker now after previously working as a Mortgage Banker. What else motivated you to make the change? My coach and I were talking about my struggles, and he was concerned that I had the effort put in, but the results were no longer the same. He and I decided that after our coaching call, he wanted my LP1 to start tracking the types of conversations that I was having. After a week of this, we jumped on a private one-onone coaching call, and he asked me, “What did Gloria track?” So, I went to Gloria and asked to see my “Greatness Tracker,” which is a

form we use to help us determine if we are spending our working hours on $10 an hour types of things, or $500 an hour types of conversations. She had pointed out that I was spending about triple the time trying to overcome the “Rate and Fees” conversations. At that point, my coached asked if I could send him a price quote on three different scenarios. I did, and he came back and said, “You’ve got a bad deal. You need to go re-negotiate your comp and rates with the company.” So, like a good student, I tried that, and I was told that the rates are the rates. Everybody has the same rates, and it’s just what people have to deal with. So, I started looking around, and I found a couple of places with similar comp plans, I found some that were willing to allow me to make less, so that I could offer the consumer a better rate, but they also wanted me to cut the salaries of my two assistants, which is a non-negotiable thing for me. I would much rather sacrifice more of my income than a little of theirs. People in the correspondent world all think that they drive the business, and I quote, “Without us, they wouldn’t have jobs to begin with.” That is exactly the mentality of a corporate environment. This is why, during the crash, people hated the big banks that were failing. The leaders at the top of the organizations were taking these astronomical bonuses, while we all watched the median income bread winners leaving their jobs, only to go home and say to their families, “Honey, I can no longer provide for our family. We are going to need to figure out what to do because I lost my job today.” Anyway, I was struggling with the fact that the solution wasn’t one I could figure out on my own. So, I reached out to another guy on my coaching call that happened to be in San Clemente, Calif. He and I talked, and while we had been in coaching together for over a year, we only discussed sales skills, how to build meaningful relationships, and strategies on how to help our clients get into homes. So, I told him about my private call with our coach and asked him if he was having the same issue. He too asked if I could price out a few loans. I did, and he said, “Dude, why aren’t you a Broker? With your rates and your production, you need to look into becoming a Broker.” Then, later that week, we had our regularly scheduled coaching call with our coach and he asked me in front of the other two students if I had figured out the solution to which I responded, “Not yet, I’m still working on it.” His reply was, “Okay, so here’s your assignment for the next coaching call, you need to meet with all of your referral partners and tell them that you are only accepting tough files, and you are not their number one go-to LO for their clients. You’re charging between 5.5 points to eight points on every loan, and only getting paid 143bps.” Reality hit me, and I was pissed, but I also knew that I signed up for coaching in order to become a better person for everybody I am in a relationship with … from my family, to my referral partners, to

my team, and to our clients. heard on the street Coaching day is every other Thursday, and on that next Friday, I walked into Lisa Lund’s office of Lund Mortgage in Glendale, Ariz., kind of afraid of getting kicked out, because all of the people in the mortgage industry I knew told me that Brokers are mean, only care about themselves, and I’m not very seasoned at mortgages. I came into the industry and have always been a correspondent, so I didn’t know what to expect. I sat with Lisa and Matt Oliver and they graciously opened their doors, answered all of my questions, and showed me pricing. They explained that deals get done just as fast, and probably with a better process for their clients, when comparing real life scenarios. My eyes had just been opened. I had absolutely no confidence in making outgoing sales calls and knew at that minute I was going to do what I had to do for my family, my clients, and my Realtors. I would sacrifice the income for a while so that my team didn’t have to. I would keep paying their salaries out of my savings account, while I opened my brokerage.

How would you compare pricing when compared to the Mortgage Banker world? That’s not a fair comparison. That’s like asking if you’d be better off getting a shirt from Nordstrom, and driving an hour to paying $495 for your Salvatore Ferragamo, or would you rather get it online for $245. I bought mine online.

I know the myth as you mentioned of losing control

What would you say are your best forms of marketing today to generate new business? This is definitely not the area of my expertise. My marketing is a phone, a list and then ultimately, a face-to-face meeting. I’ve tried to do some marketing, but it costs money and takes more time. I’d rather do what I was taught by my good friend Josh Signman. When I was struggling to get over the eight loans a month mark back in 2015, he said something that resonates with me to this day: “We need to change your mindset.” So, we did an exercise where he asked me to hold out my left and right hands. Then, and I’ll quote him because this changed my life forever, “I want you to feel the weight in your left hand of going into bankruptcy. Feel the weight of not putting food on the table for your wife and two daughters, feel the weight of not being able to give your daughter the surgery she so desperately needs. Now, erase your mindset, and in your right hand, I want you to feel the weight of working 40 hours a week on calling to help people solve their problems, being told no 90 times a week.

Which hand is heavier?” That was it! He actually grabbed my phone because we were in San Antonio, Texas, and I live and work in Arizona. He opened my e-mail and e-mailed my assistant and wrote, “Please block off one hour a day for me to call my Top 40 Realtors on Monday, call all clients in the pipeline on Tuesdays for updates, and update both agents as well, call all of my pre-approved borrowers on Wednesday to help answer any questions they have, then Thursday call all of the business partners I send referrals to, and Friday, call all of the people important to me in life.” That’s all I do for marketing. I can’t really help with the magic talents that some people have. Anything you would choose to share with Retail Loan Officers considering the change to becoming an Independent Mortgage Broker? It was the best choice I made for my business, my relationships and my family. If you’re going to do it … go all in! Commit yourself to waking up at 2:00 a.m. every day, sometimes earlier to build the business. Figure out ahead of time what your vision is for the company. Make sure you know “Why” you are doing it. If it’s to make more money, and have less stress, then maybe consider going to work for a Broker instead. Either way, your life will change. If you’re doing it, and you know your “Why,” then it’ll be the best thing you’ve ever done for your clients and your referral partners. Do your research, and then decide where you fit in, if at all. Some people need the Banker model. And that’s okay too. Just be openminded because I wasn’t “Sold the Dream” when I talked to Brokers. I was told the truth, which felt a lot more authentic.

Are you an Independent Mortgage Broker? Do you have something you’d like to share? Reach out to me at AHarris@VantageMortgageGroup.com for future article considerations. Andy W. Harris, CRMS is President and Owner of Lake Oswego, Ore.-based Vantage Mortgage Group Inc. and Past President of the Oregon Association of Mortgage Professionals. He may be reached by phone at (877) 4960431, e-mail AHarris@VantageMortgageGroup.com or visit VantageMortgageGroup.com.

n National Mortgage Professional Magazine n JANUARY 2019

What are you seeing in your local market on trends, inventory, and consumer/realtor mortgage education? My market is great right now. Inventory is starting to become more available and housing is becoming more affordable because we have strategies that we can offer people to help them with our different products. I’d say that from January to June 2018, I suffered a lot, and so did the agents I was working with. But now, I’ve spent a lot more time interviewing the agents and coaching them on getting more specific with people when they are going to make their offers. I make sure to have the agents convince their clients to meet me face-to-face so that I can really ask the deeper questions to get to the real goals. Then, we give them the exact options that fit their needs, and I’m finding that they are happier than before with less buyer’s remorse. I’ve received more “Current Client Referrals” and “Past Client Referrals” than ever before which also helps my agents, because we are able to not only provide great financing, but are also able to turn around to the agent that referred their client to us, and give them back a client. I don’t know that the question or discussion has been, “Broker vs. Banker” so much as it has been, “I have done what you’ve asked me to. I have created my own mortgage company to serve you and your clients better, with better options for rates, and fees without sacrificing the same service you’ve been accustomed to.”

as a Mortgage Broker is finally being exposed to the market and quite the opposite. What are your experiences on controlling the process? Quite the opposite. I actually have much more control because the buyers, agents and referrals come to me. Then, the banks that want the loans come to me. I let them know what I expect, and they let me know what they expect as far as loan quality, etc. If we find that there is a common set of core values, we partner up and the ones I am working with give more service, with better rates and I definitely feel like I have more control.

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What would you say so far are the biggest differences you’ve experienced coming from the retail side since you were a Broker before? The people and the willingness to help each other out. The cutthroat mentality is not the same. The process is a lot easier. I can get more accomplished with less time, once I’ve built this company and have it set up the right way. The tools that are provided by our partners and the support provided by not only our partners, but also our peers … it’s just almost too much to explain. It’s like, I am learning about mortgages, and having to unlearn what I have learned for the last 10 years. But it also gave me the motivation that I needed to go the extra distance and make the right call when I was able to. This is going to be the toughest stretch, because you go from being employed by a lender that interprets things so differently than how someone else might interpret. It’s kind of like being a fan of eating burgers every day for lunch, but every day you could only go to SmashBurger. And while there are plenty of burger options to choose from,

it was always just their burgers, versus someone giving you a choice like “Hey, let’s go to Red Robin today.” So, maybe the better way to phrase that is to say, “Freedom!”

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A SPECIAL FOCUS ON

Branching Out: Employment & Growth Opportunities Finding Meaning in a Rapidly Changing Industry By Dee Grosso ou can probably remember at least one speaker at your high school graduation telling you to “Go out in the world and make a difference.” Then “The Real World” eventually was upon you, and if you’re like most people, you’ve probably wondered from time to time whether you actually are making a difference—or you ponder what making a difference even means.

I bring this up because I see more mortgage professionals contemplating that question right now. While the housing market is still relatively strong, the shifts we are seeing in the market today are giving people reason to pause. Rates are rising, volume is tightening and layoffs and mergers among independent bankers are increasing. Meanwhile, technology is revolutionizing the mortgage business, inside and out. Even for an industry that is constantly changing, this is serious stuff. If you find yourself wondering what the future holds for you, you’re not alone. If you want to grow your career, however, you’ll need to understand the nature of these changes, how they will impact you, and what skills you’ll need to keep moving forward. Above all, success will require you to find meaning in what you do. Where your future is concerned, no factor will be more important.

Learning to adjust to rapid change After several years of strong origination growth, the mortgage industry is beginning to lose its steam. Originations are expected to drop this year, and the GSE’s Q4 2018 Mortgage Lender Sentiment Survey reported that lenders’ profit outlook fell to an all-time low. Meanwhile, a growing number of large banks are either exiting the mortgage business or laying-off staff. Recently, the MBA reported that between end of 2017 and mid-2018, the number of Mortgage Loan Originators had fallen by seven percent. The mortgage business itself is also seeing dramatic technology changes. Over the past couple of years, our industry has seen exponential growth in the use of digital technologies, which has led to the adoption of artificial intelligence (AI) and machine-learning technologies. Those technologies are being used to increase operational efficiencies and improve the borrower experience during the loan application, origination and underwriting stages. So what does this mean for mortgage professionals? The manual tasks that used to be performed by humans are now being handled through automation. That doesn’t necessarily mean that humans are being replaced—humans are still certainly needed— but it does suggest mortgage professionals will need to develop new skills to maintain their value. It also means they’ll need to be more agile in how they approach their work. Mortgage professionals will need to develop good coping skills so the stress of change won’t derail their careers. While this may seem daunting, it’s important for mortgage professionals to remember that AI and digital technology will make many aspects of their work easier, and that human experts are still needed to make the more difficult decisions on manufacturing and selling loans. This applies whether you are an underwriter responsible for making credit decisions or whether you are a loan officer trying to help a borrower who may have an unusual financial situation. The people who are buying homes and the people working in our industry are changing as well. The U.S. is continued on page 66

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finding meaning in a rapidly changing industry

becoming more racially and ethnically diverse. There is a heavy push in the mortgage industry towards diversity and inclusion initiatives, which are being driven by the MBA, the Consumer Financial Protection Bureauâ&#x20AC;&#x2122;s (CFPB) Office of Minority and Women Inclusion (OMWI), and new industry organizations such as the American Mortgage Diversity Council. While most people believe our industry has a ways to go to achieve its diversity goals, generally speaking, diversity is smart business. Lenders that foster diversity in their ranks are better suited to serve a more diverse clientele. They are likely to perform better as well, according to a growing body of research. A McKinsey study, for instance, found that companies in the top 25 percent for racial and ethnic diversity are 35 percent more likely to have higher-than average financial returns in their particular industry.

Making sense of it all So how do we find meaning with all of this change going on? First of all, donâ&#x20AC;&#x2122;t ignore changeâ&#x20AC;&#x201D;embrace it. For example, what does it mean to be working in an industry that is growing more diverse? For me, it means we must gain an appreciation for each otherâ&#x20AC;&#x2122;s differences, so we can bring out the best in each other. Doing so helps us develop empathy for others. All of the other changes that are happening within our industry should be faced head on too. We cannot control whether the market will head up or down. But in order to find meaning in your work, itâ&#x20AC;&#x2122;s important to be proactive and try to anticipate where you will be needed most, beyond the ways you are contributing to your organization today. A good first step is to make a commitment to constantly â&#x20AC;&#x153;feed your brainâ&#x20AC;? and stay up-to-date on whatâ&#x20AC;&#x2122;s happening in the industry.

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You can start by reading everything you can get your hands on about the latest technologies, strategies and tools that lenders are using today. Another way to feed your brain is to surround yourself by people who may know more than you, or who are doing the things you would like to do. What are they doing that you arenâ&#x20AC;&#x2122;t? Find the experts in your field, ask questions, and be ready to listen and learn from their experiences. Move outside your comfort zone Lastly, and this is very important, in order to find meaning in your career, find a way to give back to others, whether itâ&#x20AC;&#x2122;s through coaching, charity work or getting involved in community events. By getting outside of our personal comfort zones and becoming involved in the lives of others, we become better, more well-rounded human beings. I truly believe there is no faster way to find meaning in your life than to be of service to others. For example, at Freedom Mortgage, we have Freedom Mortgage Cares, our non-profit arm that provides donations of time and money to a wide range of causes, including the USO, Feeding America, Homes for Our Troops and the American Red Cross. Through Freedom Mortgage Cares, any employee can donate their time, money and support to those in need. We help our fellow neighbors, as well as countless others who have made personal sacrifices in service to our country. What better feeling is that? By the way, empirical data has shown that happiness is closely tied to having meaning and purpose in your life. Thatâ&#x20AC;&#x2122;s not surprising. Deep inside, we all want our work to be meaningful; we all want to contribute to a greater good. You can help others and develop new competencies in just about any position. Consider the following roles: l Probationary Officer of young teenagers l Better Business Bureau Arbitrator

resolving complaints between manufacturer and buyer l Social Worker for abused and neglected children in Trenton, N.J. Iâ&#x20AC;&#x2122;m very familiar with these positions because I have held each role over the course of 20 years while I shaped my career as a human resources executive. What did I learn? My work as a Voluntary Probation Officer taught me how to counsel others and teach people that they are not victims and do have choices. As a Better Business Bureau Arbitrator, I learned invaluable lessons on how to negotiate and influence others and guide their decisions. Lastly, my role as a Social Worker taught me that community support can move mountains! Each position taught me that you can help others and at the same time develop new skills. The awesome thing about the mortgage industry is that there is already huge meaning in helping families buy their own homes. And many mortgage companiesâ&#x20AC;&#x201D; including the one I work forâ&#x20AC;&#x201D;go far beyond this goal and offer opportunities to donate time, money and support to others. Yes, the rewards of making money are greatâ&#x20AC;&#x201D;but being able to give while you receive can make your choice of career so much more meaningful. If you find your current company lacking when it comes to community engagement and charity work, find one that is more involved. Not only will you reap financial rewards through your work, but you will be happier being part of a company that does meaningful work. Iâ&#x20AC;&#x2122;ll leave you with some final thoughts: During periods of tremendous change, itâ&#x20AC;&#x2122;s natural to question whether we still find meaning in our work. Often times, we feel powerless when so much change is happening at once. But the reality is, we do have powerâ&#x20AC;&#x201D; the power to choose how we react to change. Whether itâ&#x20AC;&#x2122;s learning from other peopleâ&#x20AC;&#x2122;s successes, learning new skills, or finding new opportunities to help others, the options are endless. If you want to make a difference, the choice is truly yours.

Dee Grosso is Executive Vice President of Human Resources at Freedom Mortgage, where she is a member of the executive leadership team and accountable for all facets of HR. Grosso has 25 years of experience as a human resources leader in pharmaceutical, biotechnology, information services, and financial services companies. She can be reached by e-mail at Dee.Grosso@FreedomMortgage.com.

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Recruiting for Your New Mortgage Office? Use these tips to find and retain quality talent

By Shachar Rand

f you are in the midst of hiring employees for your new branch office, you may want to ponder these questions:

l Is it time to revamp your recruitment? l Is your workforce aging and do you need new blood? l Have you fallen behind in your social media recruitment efforts? l Does your compensation structure need a facelift?

This article addresses these critical questions that impact hiring success in terms of finding the right fit for your company culture, expanding your reach to a young talent pool, and selecting as well as retaining talent.

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Increasing the Millennial presence in your workforce Loan Officers today are typically in their 50s. Fewer Millennials can be seen in this role and it is not exactly a popular career choice amidst options such as statistician, Web developer, occupational therapist, event planner, logistician, TV/video/motion picture camera operator and editor, and advertising manager, to name just a few. Given that Millennials are expected to overtake Baby Boomers as the country’s largest living adult generation, a lack of Millennials in Loan Officer and Branch Manager roles is problematic. For recruiters, it calls for more focus on targeting this generation, and the hiring playbook will look a lot different than the one used for the now 50-somethings for many of whom their job was a means to an end rather than their life’s passion. The good news is that Millennials are on the Internet: You can connect with a potential Loan Officer on social media, a professional networking channel and online job boards. Some more ideas to consider whether you’re recruiting entry-level salespersons or managers: l Request referrals from Loan Officers in your network. They will know at least a few who are parents of Millennials; this can be your starting point for further inquiries and engagement. l From your database, make a list of past customers who are

“To find the right person-job fit, it is imperative to create a clear understanding of your brand ethos across the recruitment journey.”

parents. Let them know that your branch office is seeking fresh talent with no prior sales experience. l Reach out to Generation Y and experienced Millennial professionals who can make a seamless switch from their current role (a car dealership finance manager or restaurant manager for example). As they have experienced the ups and downs of their present job, the unique and compelling perks of a new role and your company are likely to resonate with them.

Recruiting in the age of social media Social media acceptance has been hearty among all age groups, although generational preferences do exist, as tabulated below for Facebook, Twitter, LinkedIn and YouTube: Create or renew social engagement An understanding of the most effective channels for recruitment for different age groups can help you create a targeted outreach plan and measure results less

Age group

Social media reach

60-plus

• Facebook most popular • YouTube second most popular • LinkedIn (15 percent) and Twitter (16 percent)

30-59

• Facebook most popular • Biggest presence on LinkedIn compared to other age groups (21 percent) • Spend considerable time on YouTube (52 percent) and Twitter (39 percent)

18-29

• Facebook most popular • Good reach on YouTube (71 percent) and Twitter (47 percent) • LinkedIn (19 percent)

Source: Statista

confusingly. If your social media pages are inactive, brainstorm ways to fill them up with content (example, a link out to your blog, a trending industry news piece, or anything that homebuyers, sellers or industry stakeholders would find interesting or useful) and show engagement. Do this for a couple of weeks regularly–updated social media pages and consistent engagement drive marketing in the digital age. There is a huge probability that candidates will take a look at your company Web site and social media pages to get a sense of who you are. If you last tweeted in 2016, you will look less appealing in comparison to a socially engaged competitor. Be yourself A purposeful social media strategy will also allow you to communicate your brand values with clarity. The important thing to note here is to be yourself and present an authentic image of who you really are. Avoid trying to speak in Millennial lingo and appearing too slick or “salesy” to attract a certain segment of candidates. The other advantage of being authentic is that you will connect with people who are likely to align with your company values. There is a mountain of research suggesting that engaged and productive employees are in harmony with their company’s culture. To find the right person-job fit, it is imperative to create a clear understanding of your brand ethos across the recruitment journey. Enlist employees’ help Request that employees share job postings on their personal social feeds. This may be a bit of a slippery slope if many of your current staff doesn’t have an active social media presence. It is also possible that unengaged members of your company/team may disregard your request. On the other hand, if you have a healthy culture of employee recognition and reward, you should have no trouble spreading the word about job openings online (and offline), including positive word-ofmouth from the happiest of the lot! The legalities of social media recruitment Adhere to the legal do’s and don’ts of using social media for recruitment. For instance, you cannot make statements that can be construed as promising all applicants a job at your company. Include the appropriate affirmative action or equal employment opportunity statements. Also, as a best practice, let applicants know that

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factored in for a creative and compelling compensation structure. They include: Referral sources, type of lien, quality of loan Interview tips Interviewing shortlisted candidates files, loan type, loan purpose, is a high stakes’ affair for both you origination channel and metropolitan statistical area. and the job aspirants. As it is the As far as career advancement is culmination of your recruitment concerned, the ‘rise up’ is usually a efforts, your expectations to find lateral move with a designation the perfect individual for the job change to “senior” and salary bump. will naturally be high. These questions will help you gain a more While this may sound compelling to some, many–particularly the younger well-rounded understanding of generations of Loan Officers and whether or not the officer or manager can make a difference to your company. l What is your system to process requests? What considerations have gone into creating the system? l How would you handle an angry client? What has been your toughest client interaction and how did you resolve the matter? l What is your risk assessment methodology? Why do you think it works better than what other managers/officers use? l What are your strategies to bring in business in a weak market? Is there an instance when you managed to pull through in challenging circumstances? you will be reviewing their publicly posted social media accounts.

Shachar Rand is Chief Business Development Officer of Jet Direct Mortgage. He can be reached by phone at (516) 993-3223, e-mail S.Rand@JetDirectMortgage.com or visit Careers.JetDirectMortgage.com.

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Formulate creative compensation programs Mortgage Loan Officers are typically not paid on an hourly basis, but rather, paid commissions for the loans they bring in. Commissions are calculated based on the basis points per loan. There are additional criteria that can be

In conclusion A well-laid-out recruitment plan and compensation considerations can help mortgage companies recruit quality talent. It is important to test the results of recruitment strategies to make adjustments and position yourself as a desirable employer.

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When recruiting into entry-level positions, you will want a deeper glimpse into candidates’ personality traits: l What are your strengths and what weaknesses have you overcome or believe you should overcome? l What do you find most interesting about our company? l Where do you see yourself in three years? l What sales style would you feel most comfortable stepping into? l Do you enjoy the prospect of travelling frequently for job purposes? l Can you briefly describe an online engagement plan to find leads/keep in touch with customers/spread brand awareness? This is a pertinent question to ask a Millennial candidate whose social media skills you plan to leverage.

Managers–may not feel adequately incentivized to stick around and switch companies or earn new credentials that offer career advancement opportunities. Explore reward, recognition and career development opportunities that encourage Officers to stick around for longer.

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The Only Constant Is Change: Be Ahead of the Curve By Kimberly Grim & Bryan Moran

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few examples would be: l How did you get into the industry? l Describe your typical week and take all of the time you need. l Describe your personal strengths and weaknesses, if any. l Have you been as successful as you wanted to be; why or why not?

they will treat their customers and this is key to attracting and retaining new talent. Additionally, it is well-known that the average age of a Loan Officer and the average age of a buyer are Is the grass greener? All companies are the same in that not the same. As a larger segment of our buyers are part of the Millennial we are all producing the same generation, it is important to attract goods. Sure, there might be some who have a few different programs, innovative Loan Officers with the latest and strongest technology and rates may vary, compensation Do you align? allow them to learn from those who might be slightly different, but at To us, the most integral part of have had success in the business, end of the day, we are all selling growth is finding a company that but also provide a different the same thing. So what makes you believe in. It is of the utmost perspective and knowledge base. one company better than the importance that the place in which other? You. As the person seeking Compensation and pricing are also you work and those that you work two of the biggest driving factors for a new employer, you have to be with align with your core vision and Loan Officers when deciding if a clear on what you want out of this values. In this market, providing company is right for them. business. Whether you are in excellent customer service is Developing a compensation plan management, in a sales role or nonnegotiable. In addition, you must both, you have to really be clear on that is competitive in every market, also be innovative, competitive, and but also has flexibility based on the what it is that you want from this quick to respond and close. If your Loan Officers model (referral-based career. The company you are current company does not provide vs. lead generation, for example) is a working for is merely the window all of those necessities, then perhaps dressing for your business. great way to bring new people into Look under the hood the industry. It allows for a true This is a very competitive business, it’s time to find somewhere that does. In addition to finding a mentorship program, while also Attracting new talent and as a result, we often find helping new Loan Officers begin to ourselves chasing the person at the company that aligns with your vision, Having worked for many to truly be successful you also have generate business in what has companies, we now understand top of the leader board, a shiny shown to be a hard industry to break object/product or the company that to find a company that’s culture you that different companies have into. different values. We are in a is leading the pack. Oftentimes, this can truly buy into. Success always transcends mere results. If you do business of people and how we leads many down a path of not share the same vision and values treat people will result in us either I’ve joined … now what? disappointment and failure. You as the company you work for and if Being able to “sell” your company is getting more or less business in must really take a hard look at the you cannot completely trust your the future. There is a question that only one piece of the puzzle, and person or company to fully leadership, you will not be able to truthfully, it is very short-lived. The is often asked in the mortgage understand what you are chasing. most important part is after you join a business and that is, “Who is our The easiest way to find out about a thrive. new company. Does the new customer, the Realtor or the company is to pick up the phone What’s my value add? opportunity live up to what you were borrower?” Before answering this, and call branches around the Before considering making a move sold? It is our responsibility to we should consider the definition country to interview other and before considering hiring continuously provide value to our of a customer. A customer is employees. After a few calls, you teams by providing them with as traditionally someone who will have a healthy understanding of somebody new, both parties must understand the “why” of and for the purchases or consumes the goods many tools and opportunities as they who the company really is and an or services of a business. A repeat need to meet their goals and understanding of their value system. candidate. Consider this, for a candidate, their “why” is the reason customer is someone who will objectives. Retention would not be Social media is a must in they’re successful, what motivates an issue if we all did our due continue to purchase the services today’s recruiting world. Whether, them to push through those diligence in ensuring everything was or goods from the same company the prospective employer or because they feel highly valued by a match before hiring. Once we hire, prospective employee, you should particularly long days and what keeps them coming back again and that company. The simple answer we need to remember that the be scouring social media to find again. Once a candidate salesperson is our valued customer. to our question above is both, but out information to support the understands their “why,” it makes it in reality, there is a third customer The industry is constantly evolving correct alignment. It doesn’t take and the companies and Loan in our business and that is the long to understand who the person easier for them to find a company that is in alignment. Officers who lead the evolution will Loan Officer. The number one or company is by what they When beginning the recruiting be in a better position to achieve reason that Loan Officers leave a choose to share. Remember, they and interviewing process, both success than those who are company is because they do not are using social media as their parties need to have a clear constantly chasing what others are feel valued. The value system of a stage and what they are choosing understanding of the reason for the company is directly linked to how doing. to say will speak volumes. change, what motivates them and Double-blind questions are a what their vision for the future looks great tool for getting to know Kimberly Grim brings nearly 35 years of mortgage experience like. For us, it always comes down someone. These questions are to her role as Senior Vice President of Sales and Recruiting open-ended with no right or wrong to two things: Would they benefit by and Branch Manager for the Delaware branches of Fairway joining our team; and would the answer. Asking them allows the Independent Mortgage. Bryan Moran joined Fairway person to expand on a situation or team benefit from having them Independent Mortgage Corporation in 2016 as an Area here? If the answer to either of provide an example and you can Manager with more than 20 years of experience in the those is “No,” then it’s not the right learn a lot about who they are by mortgage industry. their answers. The recruit can also match for either party. Both the company and the new hire need to learn a lot from the questions. A

here are few things in life that are a certainty: Death, taxes, and if you are in the mortgage business, change. As we begin 2019, we are once again in an environment of change and it is only natural as a Loan Officer to wonder where your place is in the ever-changing landscape. To begin this dialogue with yourself, you must start by asking what we believe are two simple questions: l What value you do you add to your company; and l What value does your company add to you? If you cannot answer what your company is truly adding to your career, and quite honestly to your life, it may be time to consider making a change.

be able to concretely describe what each brings to the table that is better and/or more efficient than what they have now.

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The Art of MLO Happiness: Appreciation, Trust, Sincerity and Honesty By Mike Eshelman processing cycle, it’s very difficult to take any meaningful time off to rejuvenate because they’ll lose out on new business and risk loans falling out of their pipeline that they could have helped save. When considering the economic factors outside of their control, it makes sense to work hard when rates are low, “strike while the iron is hot,” then, when rates increase, work harder to keep producing decent numbers. Simply put, mortgage sales is an absolute grind and is not for the faint of heart. In this scenario, it just makes sense for mortgage companies to create an environment supportive of the high-stress position. A not-sosecret weapon is a simple “thank you.” Sounds simple, right? “Appreciation” is the thing employees value most when determining how they feel about their company. According to global studies, the majority of people quit their jobs due to a “lack of appreciation,” and if there’s one thing Loan Officers love, it’s when they feel others in the company (especially their Direct Manager, care about their loans funding as much as they do). Thirteen years ago, I was promoted to a Sales Manager position, overseeing a team of 15 Loan Officers who were fairly new to the industry. I was passionate about helping them fund as many loans as possible, and we worked tirelessly to push their loans in processing, satisfy conditions, and speak with their borrowers when they hit bumps in the road. I spent the weekends reviewing loans that were about to be denied or canceled to see if there was a way to save them. Within two months, we had a top team and received tremendous praise from the executives. We were truly a team and my number one goal was seeing my Loan Officers exceed their individual goals. We knew each other’s strengths and weaknesses and Teamwork makes everyone knew their role on the the dream work team. The mortgage industry is incredibly But I got greedy … two months competitive and full of ups and later, nearly half of my team quit the downs resulting in its fair share of day after I jumped all over them for a stress. Mortgage Loan Officers, week of low production thinking it will especially, have a tough job push them to hit my production goal. because they have to hunt for new I was dead wrong. I lost their trust business in addition to keeping a watchful eye on their pipeline. Since because they felt unappreciated. The the majority of their compensation is team’s success went to my head and I started to view them as my directly tied to monthly loan employees who are working to hit my production, which has a 45-day hen rates go up, production goes down. When production goes down, Mortgage Loan Officers (MLOs) make less money. When MLOs make less money, they become frustrated, unhappy and start looking for a new job. It’s especially noticeable in areas such as Orange County, Dallas, Kansas City and Charlotte, where there are plenty of mortgage companies. There, you’ll see Loan Officers jumping from one company to the next, searching for the right fit where they can enjoy where they work and make a good living. Losing Loan Officers and having to train new ones is expensive, time consuming, and causes negative ripple effects across the production floor because it requires managers to spend time with the new agents, instead of time helping existing Loan Officers find new business and fund their current pipeline. In this tight market, how can you retain your Loan Officers? The “best” mortgage companies offer more than just a paycheck. At these companies, Loan Officers stay put even through rough patches. They have very little turnover and acquire new talent easily when a seat becomes available. The competition assumes their success in talent recruitment and management is due to the Loan Officer compensation package, which must be paying top dollar commissions. Well, typically, the best places to work aren’t the places paying top dollar because they don’t need to. We’ve learned that there are some simple, yet effective factors at play which are more meaningful to employees … after all; happiness is not all about money.

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enabling a culture that fosters great ideas. Having an office and telling everyone you have an open door policy doesn’t cut it. Many employees are intimidated to walk into their boss’s office, especially if they are not considered a top producer. goal, rather than the goal being an Executives and managers should aggregate of their individual goals. When I unloaded on them, it was the constantly walk the floor and engage with as many employees as possible straw that broke the camel’s back because they knew I valued my goal on a regular basis. Ask how they are doing and if they are encountering any over their individual goals. hurdles. If a Loan Officer’s production is low, ask how they are doing Build an environment of trust personally and if there is anything that We’ve all heard the saying, “Employees don’t quit their job; they can be done to help bring production back up. This provides team unity that quit their boss,” and I firmly believe employees embrace and appreciate. that to be applicable to the hyperI was fortunate to work with an competitive and fast-paced world of executive who really embodied mortgage lending as well. The sincerity. He would walk up and down foundation of great companies is built on trust. As entrepreneur, best- the sales floor at least two times a day, which made a positive difference selling author, and speaker Seth on our outlook. The more you engage Godin says: “Earn trust, earn trust, with your employees, the more insight earn trust. Then you can worry you gain. As Leang says, “The free about the rest.” It’s vital that your employees trust you have their best lunches, pool tables and other ‘next level amenities’ is company lust. It interest as a top priority. But it’s fades.” also important that your team feels you trust them to get the job done. Be honest and be direct Tee Leang is the Founder of InspireHire and a long-time in-house Celebrate wins immediately—as they happen! Whether it’s a positive Talent Acquisition Strategist for customer review or breaking a record, some of Orange County’s top don’t wait until your next week’s allmortgage companies, recently hands meeting to recognize the shared his advice for companies individual. Something as simple as aspiring to recruit and retain walking up to your superstar with talented MLOs. genuine gratitude goes a long way. “Most companies I work with Do this often and make it loud enough realize they aren’t losing loan officers because of compensation,” for others to hear. When things didn’t go as planned, such as low Leang said. “In fact, some of my production or a negative customer clients have phenomenal review, have a side chat and try to get compensation packages plus free to the root of what happened. lunches and still have issues keeping loan officers happy. Having Celebrate the lesson learned just as a great compensation structure and you celebrated the wins because that catered lunches alone will not win in is a win in and of itself. Leaders are talent acquisition in 2019. It’s about listeners, not talkers. It’s your job to work for your employees not the other the company culture.” way around. Allow your employees to Leang encourages trust, help you help them. especially when hiring top level Bottom line, employees want to Loan Officers. “They are great at their craft for a feel that they are contributing to the company, have a voice to make a reason, let them conquer their domain. Build a great culture around difference, to be appreciated, and that management cares about seeing trust,” said Leang. them succeed and grow in their career. The economics of happiness Be sincere and accessible are such that the more a company There are some people who think has in the above characteristics, the leadership is about having the big less of a factor compensation office and coming up with the best becomes creating a much more ideas. It’s not. It’s about having a stable employee base. big, approachable presence and Mike Eshelman is Head of Consumer Finance at Jornaya, a data-as-a-service platform that delivers consumer journey insights to publishers, marketers, analytics and compliance professionals with the highest-resolution view of the consumer buying journey. Mike can be reached by e-mail at MEshelman@Jornaya.com.

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Hiring for Cultural Fit ulture affects everything about your company, from the way it treats customers, to the way colleagues treat each other. Culture can help accelerate growth to a pace that exceeds expectations, or slow growth while the company tries to find and identify problems. Yet, hiring employees who share your companyâ&#x20AC;&#x2122;s culture, values and mission can be a tricky task. Weighing applicants against a rigidly determined corporate â&#x20AC;&#x153;fitâ&#x20AC;? may lead to hiring only employees who look, think and act like existing employees and overlooking people who could add value and diversity to your company. At the other end of the spectrum, when a company

By Fobby Naghmi

does not consider the role of culture in recruiting, interviewing and hiring, it can end up with employees who are not happy because their personal goals do not align with company goals, or worse yet, employees whose actions hurt the brand. Whatâ&#x20AC;&#x2122;s a mortgage banker to do? Take a middle approach. Here are a few factors to consider: Think about what is really at the core of your values, mission and culture. Trim down to the essentials that truly matter: What we value in business and in life, and what we want to reward our employees for doing. Knowing those essentials enables a company to make an enlightened decision to hire people who share those characteristics, or to hire people whose values will positively expand or change company

culture going forward. For example, at Planet Home Lending, we want to serve borrowers in the widest possible credit spectrum, so we have a no overlays on government loans and will manually underwrite. Highlighting that viewpoint in our recruiting and interview process brings us loan originators and branch executives to whom broadening access to homeownership is important. Highlighting important traits in your recruiting and interviews and incorporating them into your selection process not only helps you find people who are a good fit, it also helps people realize they may not be a good fit with your company. First, know yourself The first step in finding employees who will be mindful of your core corporate culture

and represent your company well is to define what makes your company unique. If you have already got a mission statement and a set of written values, you are ahead of the game. If not, it is important to take the time to define your mission and values and communicate them consistently to employees, candidates and customers. Some values are universal in mortgage banking. Everyone wants employees who are honest, trustworthy and committed to compliance. It is important to go beyond the obvious values and define the others that set your company apart, like a commitment to collaboration and teamwork. You might also consider what cultural changes it would benefit your company to make. By purposely seeking out people whose values are different (in a desirable way) than the prevalent values of your companyâ&#x20AC;&#x2122;s current employees, you can influence

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Supplement that list with micro-level culture traits based on a department, team or individual job. The quick way to do that each time there is a position to fill is to ask what three problems the current employee most often must solve and what traits help them do the job well. Put culture into recruiting, interviewing and hiring With a well-defined culture, made up of mission and values, you can create messaging to weave through your recruiting, interviewing and selection processes. In recruiting, make culture part of your job posts by including specific behaviors and traits that would make someone successful. A LinkedIn post we ran for a correspondent sales and service representative position asked: “Are you a correspondent Mortgage Sales Support Rep with the smarts to keep our pipeline moving and the enthusiasm to keep lenders happy?” Recruiting posts in social media offer many opportunities to share your culture. My company runs a series of posts based on our company values. They ask questions like: “Do you think about what’s right for the customer–what’s ethical, compliant, and provides a good benefit? So do we.” During recruiting, look for ways to demonstrate your values. For example, one of our core values is “Transparency.” We demonstrate our

“Everyone wants employees who are honest, trustworthy and committed to compliance. It is important to go beyond the obvious values and define the others that set your company apart, like a commitment to collaboration and teamwork.” 75 commitment to transparency during our branch recruitment process by sharing the financial pro forma with candidates. Showing them how much they will earn and how much we will earn is more powerful than simply telling potential employees we’re committed to “Transparency.” During interviews, cultural fit is best assessed by asking behavioral or value-based questions. A company with a culture emphasizing innovation and flexibility might ask a Mortgage Loan Originator: Tell me about a time you had to market a new product. You could delve into any characteristic by asking: Tell me about a time you had to be persistent (or innovative or a team player) to close a deal (or get a loan underwritten or complete a project on time). A question that can engage a candidate in sharing their values

may be most informative. Asking during an interview: “Tell me your what your ’Why’ is?” can provide deeper insight into a candidate’s values and give them comfort to share something that might have been otherwise left out. Culture affects everything Whether or not you expressly define it, culture influences everyone within your company and everything your company does. The right culture helps your firm succeed and keeps risk at bay. The wrong culture can send new hires and even employees running for the door. By being mindful about the role of culture and including considerations for it in recruiting, interviewing and hiring, you can help ensure your company continues to foster its current culture and manage it properly if it needs to head down a new path.

Fobby Naghmi is Senior Vice President of the Eastern Division at Planet Home Lending, has been in the mortgage industry for more than two decades. He is responsible for strategically building and managing the branch network in addition to recruiting, onboarding and transition activities in the division.

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Questions to highlight culture If you need help coming up with specific cultural values and traits to use in recruiting and interviews, you can ask yourself these nine questions: 1. What employee actions are praised and rewarded? 2. What would cause the dismissal of an employee? 3. What personality traits do the most successful employees have? Integrity, persistence, attention to detail, a customer-first attitude, persuasiveness, extroversion, ability to roll with changes? 4. How conservative are we in our dress and manners? 5. What are our quirks? 6. What five things do we most value: Transparency, sales

skill, flexibility, innovation, teamwork, being on the cutting-edge of IT, resourcefulness, commitment, etc. 7. What benefits do we have that make us unique and to whom do they appeal? A company cafeteria with a sushi chef? Flexible hours? Unlimited income potential? Growth opportunities? 8. What market or mission changes do we have coming and how will/should those changes influence company culture? 9. What are we known for, what makes us unique and what is our current company reputation? Why would individuals want to join our team?

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corporate culture over time. Company culture is not static, so it is smart to regularly adjust your recruiting, interviewing and hiring practices to reflect changing corporate culture. Startups often seek employees with entrepreneurial traits, like thinking outside the box, tolerance for less structure, and comfort with frequent structural change. After achieving a certain size, a startup might need a more complex operations and reporting structure to run smoothly. In this case, continuing to hire only employees who prefer a less structured, entrepreneurial culture may no longer support the company’s mission and values. Instead, the startup can consciously change its idea of who fits in culturally to also include employees whose personal values align with risk reduction, operational ease and excellence in reporting. Any entrance into a new business channel should also lead to a re-examination of culture. The culture of a servicing operation can be very different than the culture of a retail-only organization. The bottom line: Moving into or out of a channel, growth and the passage of time can influence your culture. Think about how you might need to change your hiring and recruiting messaging and processes to reflect those changes.

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The Sweet Spot: Matching Employees With Your Company’s Corporate Culture By Susan Sullivan & Quincy Amekuedi ver the past decade, you couldn’t step into a boardroom, job interview or onboarding session without hearing about “Company Culture.” You’ve probably asked or been asked one of these familiar questions: l How do you define your company’s culture? l Do you think he/she is a cultural fit? l What is the ideal company culture for you?

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Matching the right employees with your company’s culture can be a challenging but rewarding process. Many executives and talent acquisition teams will tell you, with conviction, that they’ve defined their company values—but have they really? When it comes to the hiring process, are you focused more on screening for technical skills or experience than behaviors and how employees work with others? Let’s not forget about onboarding. When you welcome new employees, are you missing out on additional opportunities to connect them with mentors and help them find a place for themselves in your culture? It’s time to take an honest look at how you’ve defined your company culture and figure out how to not only properly match employees to your culture, but also support them throughout their journey within your organization. Step 1: Explicitly define your values Candidates want to know what your company stands for and what behaviors are expected and rewarded. Your values are the most effective way to articulate those ideas, as they serve as the foundation of your culture. In order to properly define your company’s values, you have to take an honest look at the shared beliefs, behaviors and practices that make up the personality of your business right now—not what you want them to be. This is sometimes easier said than done, especially if your stakeholders aren’t all on the same page about how things get done and what defines success at your company.

“In order to properly define your company’s values, you have to take an honest look at the shared beliefs, behaviors and practices that make up the personality of your business right now—not what you want them to be.” —Susan Sullivan, Senior Vice President of Human Resources, Genworth U.S. Mortgage Insurance

“While it’s important to verify that skillset during the interview, you should also take care to ask questions that will allow you to gauge– and the candidate to get a view of—how well they’ll fit into your culture.” —Quincy Amekuedi, Recruiting Leader, Genworth Mortgage Insurance

And there’s not much worse than selling a candidate on a culture that isn’t reflected in their experience once they join the organization. If you haven’t defined your values already, take the time to speak with employees at all levels of the organization to better understand their view of the behaviors that are rewarded. This gathered intel should point you to the words or phrase that serve as your values. At a minimum, it’s critical that employees see themselves and their current behaviors in the values you select, as well as that your values allow room to translate as your strategy and organization change over time. As the foundation of your culture, you won’t want to change your values often, if ever.

Step 2: Interview for behaviors, not just technical skills and experiences Now that you’ve defined your values, how do you integrate them into your hiring process? While you can screen for technical expertise fairly well from a resume, your best bet for determining whether a candidate will thrive in your company’s culture is the in-person interview. Interviews, if executed properly, help organizations find great fits among candidates. However, if executed improperly, they can set up new employees for the bad kind of surprise once they’re hired, which can then lead to decreased engagement and/or increased attrition. To avoid that, you’ll want to sit down and take another honest look at the questions you ask during

your interview process. Let’s say you’re hiring for a highly technical role where a specific skillset is nonnegotiable. While it’s important to verify that skillset during the interview, you should also take care to ask questions that will allow you to gauge– and the candidate to get a view of—how well they’ll fit into your culture. That skillset may be important, but if they can’t apply it effectively because of a mismatch between their working style and your values and culture, both parties are probably best off looking elsewhere. On the flipside, let’s say you’re hiring for a role where specific technical experience is not key to success or can be learned on the job. Screening resumes for evidence of the behaviors that reflect your values and culture, rather than specific expertise can open up a wider—and probably more diverse—candidate pool. Continuing that focus on behaviors during the interview process will lead you to employees that feel comfortable and aligned with your organization on Day 1. Either way, ask tangible questions around how they would respond in certain situations. Provide real life scenarios to see how they’d react and determine if that lines up with how you’ve defined your company’s values. Many times, we get in our own way, because we’ve already created an image of who the “perfect” candidate is, and we assume we know what that person should look like on paper and in person. Check your preconceived notions at the door and zero in on how they work. This will allow you more opportunities to find candidates that may be able to help shape and grow alongside your business by providing fresh ideas, finding and creating efficiencies and creating new processes that aid in the overall advancement of the organization. We’ve all scoured the internet for the perfect interview questions, but for a values-based interview, here are some of our favorites: l Describe a time you messed up. Who else was impacted and what did you do to resolve the issue? l Give an example of a goal you didn’t meet and how you handled it.

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l Did you ever make a risky decision? Why? How did you handle it?

your new team members throughout their journey into your organization. This not only engages employees, but also breeds loyalty,

hard work and dedication to the success of your business. It’s not always easy, but it will always be worth it.

Susan Sullivan is the Senior Vice President of Human Resources for Genworth U.S. Mortgage Insurance, responsible for all HR accountabilities across Genworth’s USMI organization. Quincy Amekuedi is the Recruiting Leader for Genworth Mortgage Insurance, where he works with various business partners to set strategies for recruiting, employment branding, and diversity and inclusion across the organization.

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Step 3: Support new employees through effective onboarding, affinity groups Traditional onboarding typically comes in one form: The all-day (or majority of the day) blitz. On your first day, you sit in a room with the other new employees, likely learning about the company’s history and products, how to select and set up benefits, create your new email account and gain access to the company’s network. You might hear from some of the leadership team, live or via video, and take a tour of the building. While this is all vital information for your success as an employee, why not try something different? Instead of focusing on your company’s past and information they (hopefully) already researched for the interview process, try reallocating that time to showing how your culture and values are exhibited throughout the organization on a daily basis. Share stories, include teambuilding activities, give your new team members a feel for the experience, rather than just a view, of working at your company as soon as they arrive. You’re putting your company’s values front-and-center immediately and what type of message does that send? One that aligns with and reinforces where your organization stands, where it’s going and what it represents. If you have affinity groups, talk them up! Share what they’re doing in the workplace and the community, as well as how their efforts are reinforcing inclusivity and equity in the workplace. Even if you’ve already made a good match through your values-based interview process, pointing new employees to groups of people that share their same life experiences or background can add an extra layer of support as they join the organization. They may even find a mentor to guide them through those crucial first few months. While formal mentorship programs are a great way to guarantee that new employees have a “buddy” in their first days, some of the greatest mentor relationships have been born out of the common interests and backgrounds that lead to strong interpersonal connections and real investment in the success of others over time.

A match made If you want to match your employees with your company’s culture, invest the time it takes to put these steps into practice. Define your values and make sure they’re reflected throughout the organization. When you’re hiring, don’t only focus on technical skills, but also interview for behaviors that align with your values. Bring those values into your onboarding process—and then live your values by really focusing on supporting

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Recruitment vs. Relentless Pursuing By Mary Kamelle

or those in management who are tasked with recruitment as an objective in 2019, do you follow the philosophy of getting the right candidate at the right price for the right reasons, or getting any candidate at any price? There are two sides to the recruitment process, and both have high costs and risks. For an employer, there are the obvious expenses to get someone to sign, but are they to making a bad hire worse? How will this prospective employee help or harm the company culture? Will they fit in, and more importantly, will they stay? For a potential employee, will they get what they were promised, will they be happy, or will the never-ending pursuit of the perfect mortgage lender continue? Who takes the most significant risk is difficult to say, but a lot is riding on a successful hire in either case!

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Employers Employers need to be diligent in their screening process. Has this candidate had a history of jumping from one place to another? The Nationwide Multistate Licensing System & Registry (NMLS) does a fantastic job of answering many of questions about a candidate by providing a detailed employment history and a disciplinary record. The licensure process also knocks out the need for a background check and credit scrub. So, is an active NMLS MLO number enough? Hardly! In your zeal to get someone on board, you mustn’t forget to consider how this individual will fit in with your corporate culture. If your organization is highly techoriented and the prospective employee is not open to learning new technology, will they be a good fit? If your portfolio of loan products doesn’t suit the potential employees’ customer base, even if the compensation plan

is right, will this be the best place for them long-term? An employee who doesn’t assimilate will be a drain on internal resources. They will require more training and could cause frustration with your existing team. Employee A prospective employee must do their due diligence as well. Think about what is essential in the decision-making process: l l l l l l l

Work/life balance Loan Officer Assistant Earning potential No ceiling Marketing support Leads provided Accountability

A recruitment manager might make a lot of promises to get the contract signed, but does the rest of the team know about these promises? If you are promised a sign-on bonus, how much is it and when will it be paid? Make sure that if you are assured unlimited marketing support or an exclusive Loan Officer Assistant that these things are not only in writing, but have the potential to happen. Are these staff member currently employed and, if so, do they know they are part of the bargain? If you are promised lead generation expenses, what does that mean? How much will be paid and by whom? If your prospective employer claims to be Loan Officer-centric what does that really mean? And more importantly, does the corporate culture support these taglines because without the whole team buying into the philosophy you only end up with slick slogans. Collateral damage Any Loan Officer who has been in the business for a while knows that you are only as good as your team. If the processing, underwriting and support staff are not educated on the companies’ philosophy, then you could be on your own. You can bring in the business, but the

“The endless jumping from one company to another in search of the perfect job is exhausting and costly for everyone.”

loans don’t close themselves. How does management treat the operations staff? How the staff is treated should matter to you greatly as happy employees tend to do a better job! “We work hard to support both our Loan Officers and our operations team. Everyone needs to feel appreciated and recognized for their efforts. We have incentive programs and team-building events to build trust and camaraderie between sales and ops,” said Melissa Speer, Sales Production Manager at Mortgage Equity Partners. “We can’t be successful unless all of our employees feel valued and empowered. We work diligently with executive management to build relationships between our employees that transcend the traditional workplace experience.” It’s interesting that when looking for a school for a child, you might send them to do a shadow day. The purpose of which is to make sure that he/she is the right fit and viceversa. And, yet, when you take a new position, you accept the Recruiting Manager or the employee on their word.

Best practices What methods work best for recruitment? There are many options today. Social media presents many more online opportunities to get the word out. Leveraging social media for recruitment is a common Google search term, but can you leverage social media for this type of position? Social media recruitment is all about finding candidates that can relate to your brand. But, like any effort, you make to grow your business or team you have to know where to look for your candidates? If the average age of a Loan Officer is 54 years-old is Instagram the right platform? Not if you follow conventional demographic wisdom. There is a whole other school of thought on recruiting new Loan Officers, keyword “Millennials,” but for seasoned Loan Officers, it seems the best methods of recruitment are still word of mouth with LinkedIn and Facebook following closely behind. Putting the word out there that you are hiring, or you are looking for a new opportunity on social media can be valuable, but a personal recommendation

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goes a lot further. This presents an unusual situation in the industry because lenders want folks that can close loans today, but with the average age of 54, this could mean that there may not be enough new Loan Officers in the coming years. Also, studies show that most Millennials want to work with like-minded professionals, so there is a massive opportunity for younger people to enter to enter this industry. These techsavvy potential recruits will be well-suited for the changes taking place in the industry today. While shoes on the ground office visits to Realtors are still an essential part of the business, Loan Officers must embrace social media and digital marketing to build their book of business. And recruiters must do the same to get younger recruits. So, there seems to be a dichotomy when it comes to current recruiting philosophy. We need Loan Officers who

have customers right now, and we need to prepare for the next generation of Loan Officers. The job will be different in the future, so to recruit Millennials you need to brand your company as a forward-thinking, progressive company that embraces technology. But to speak to Baby Boomers as both customers and Loan Officers you must consider that they might want to sit down and go over documents in person or at least over the phone! Best-case scenario The best-case scenario when recruiting is to know who your customer is, where your company is heading and what type of Loan Officers will best carry out the corporate vision. As a recruit, you need to know that promises are kept, and you need to be clear on the company vision. The endless jumping from one company to another in search of the perfect job is exhausting and costly for everyone.

Conclusion It is an exciting time in the mortgage industry. There are two growing customer bases: Millennials and Baby Boomers. Mortgage professionals need to be able to market to them both while not forgetting the other emerging groups. According to an article in US News and World Report in July 2018, single women are buying homes at a rate that is much greater than single men. Hispanics and non-traditional households are surging into the

housing market. Your staff should mirror the communities that you will be serving. Recruiting needs to be more than just empty promises to get the candidate to sign on the dotted line. Recruiting should address the requirements of the Loan Officers and the customers to get the right fit. In few other industries does the customer base so perfectly reflect the entire population of the country. Diversity in the staff is critical and will continue to be so in the future.

Mary Kamelle is Marketing Manager at Mortgage Equity Partners and a content writer based out of Lynnfield, Mass. She can be reached by phone at (781) 309-1773 or e-mail MKamelle@MEPLoans.com. 79

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Apps vs. Naps By Eric Weinstein

n Dec. 13, 2018, I turned 60-years-old. You can send your belated birthday presents to me care of the publisher’s address. Coincidentally, this is also the average age of a Mortgage Broker in this day and age. The average borrower is aged 32. I am not bragging, but basically, I never thought I would live this long. While other people treat their body like a temple, I treat mine like a carnival tent. I smoke, have diabetes and don’t watch what I eat unless it is particularly fast and hard to catch. One business trait I have taken pains to cultivate my whole professional career is to answer my phone on the second ring, as answering on the first ring makes you look soooo desperate. With modern communications and a phone holster, it is not too hard. I always get Realtor and customer positive feedback on how easy it is to reach me. I am convinced, more than anything, that one simple fact gets me the most business. When I started my company, Carteret Mortgage, in the 1990’s, it was not to grow to be the largest Mortgage Broker in the country (which it was in 2003). It was for the simple fact that I wanted to work from home and no mortgage company was set up like that at the time. As I hired Loan Officers to work out of their homes, I tapped into a huge employee demand. Lots of people also wanted to work from home. The more Loan Officers I hired, the more loans we did … the rest is history. But here is the dirty little secret that I never, ever told anyone. I will tell you, but don’t tell anyone else. I like to take naps in the middle of the day. “Sure,” you say. “Of course you do. You are SO OLD.” True dat, but I have also been taking naps since my 30’s, so there! After lunch, it only takes a one hour “power nap” and I am good to go

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again. And THAT, more than anything, was the main reason I wanted to work from home. Taking a nap in the office makes you look so lame. Now, as I reach that age where you are constantly bombarded with AARP junk mail reminding you of your ancient longevity, I have made concessions to my fragile body. I have gone to the “two nap system.” Since I wake up at 6:00 a.m., I notice my naps are usually at 11:00 a.m. and 4:00 p.m. lately. This has thrown me into a real existential quandary. While I pride myself on always answering my phone, this is two hours per day that I let it go to voicemail. I don’t think I have lost any business due to this, but how do I know? You cannot quantify a negative. Philosophically, it is the age old conundrum of work versus leisure time. How much time do you devote to working, supporting your family and helping others, compared to the selfishness of catering to your own physical needs and pleasures? We can all agree that too much devotion to work is not a good thing, just as, not working at all, is disadvantageous for the budget. We all have to find that fine balance. As my doctor would tell me every visit, “You don’t want to be the richest man in the grave yard.” Yeah, but I don’t want to be the poorest one, either. One good thing about being so timeworn you remember Ronald Reagan as President and when you actually had to “dial” a phone, is that hopefully, you have created, what I call “a body of work” by now. By this I mean, my kids are all grown and moved out, reducing my expenses, and I have a constant flow of referrals and business which does not take too much to maintain. Compare that with younger Loan Officers’ at lower commissions, families to feed and still scratching for Realtor business. If you were not a complete moron in your youth, by the age of 60, one would hope that your business would

“As I hired Loan Officers to work out of their homes, I tapped into a huge employee demand. Lots of people also wanted to work from home. The more Loan Officers I hired, the more loans we did … the rest is history.”

be less grueling by now. While I am not perfectly certain I am losing business due to these more frequent bouts of unconsciousness, the guilt still racks me. In my frontal cortex, the logical part of my brain says,” Go on, you deserve a nap.” Still, the primitive reptilian instinctual survival part of my brain is having a temper tantrum: “Get back to work, you lazy old man.” Given the average age of Mortgage Brokers in the industry

currently, I am assuming that many of my readers are going through this same major crisis. In fact, this may be the driving force in the slowdown of residence originations in the recent market. I am not sure, but, I have come up with the perfect solution which will answer everything and it just may be the solution to elderly Mortgage Broker prosperity over the next century. I will tell you … but first, it is time for my nap.

Eric Weinstein worked in banking, on the commercial real estate side until 1991, when he fell in love with residential lending. In 1995, he started a small mortgage company in his basement called Carteret Mortgage Corporation, which in 2003, grew to one of the largest mortgage broker companies in the United States. Eric is semiretired, doing mortgages by referral only. He may be reached by phone at (703) 505-8692 or e-mail EWeinstein4U@gmail.com.

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Ready to Branch Out in 2019? Use the Buddy System By Michael Cooksey

s we begin 2019, thoughts naturally turn to changes one would like to make for the coming New Year. For high-performing Loan Officers, that change may look like a transition into a Branch Manager role. With both overall volume and per-loan profits down, top producers have become a hot commodity in the mortgage industry. As Independent Mortgage Lenders continue to woo top producers by dangling the carrot of “Branch Manager” status, it is imperative that Loan Officers have a keen understanding of what this role traditionally entails and seek opportunities that will allow them to flourish both professionally and financially.

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Branch manager: Fantasy vs. reality In terms of career path, Branch Manager is usually viewed as the next step up from the Loan Officer role. The thinking behind this is that once a Loan Officer has proven themselves capable of generating significant volume, that skill can then applied at scale through the development of a branch. With any sort of promotion, a corresponding increase in salary is also usually expected. For the Branch Manager position, the salary bump is offered in the form of the Branch Manager receiving a portion of the revenue generated by each Loan Officer within the branch, with the expectation that multiple, though smaller, revenue streams will ultimately add up to more compensation than the manager previously enjoyed as a producing Loan Officer. In reality, the leap from top producer to Branch Manager rarely works out this way. For starters, the Branch Manager role requires more than just the ability to source leads and close loans. There is a significant operational aspect to running a successful branch that most LOs are unfamiliar with because those functions

have typically been handled for them, and the learning curve for that particular skill set can be steep. For example, most top producers operate using a “Lone Wolf Mentality.” While they may have a dedicated Loan Processor and/or a handful of Loan Assistants, ultimately success is dependent on their individual actions and effort alone. Being successful as a Branch Manager requires a shift in perspective, as it’s no longer about the individual, but rather, about the team. Thus, management skills, as the position title would imply, are critical to the Branch Manager role. In addition, it is unlikely that most new Branch Managers have had the opportunity to recruit and hire talent. They most certainly will have experience in cultivating Realtor and builder relationships, and while the two skill sets aren’t that dissimilar, there are enough differences to warrant a distinction between the two. Underlying all of this, of course, is the money. The revenue increase most new Branch Managers anticipate is, in reality, much harder to achieve than they are initially led to believe. A top producer can easily net close to $250,000 in annual income. Assuming this producer closes an average of three to five loans per month, that roughly translates to $20,000-plus in total monthly income and between $4,000 and $6,000 in per-loan revenue. On the flip side, if that top performer moves into a Branch Manager role, he or she may only receive 10 percent of that total from each of the loans that the Loan Officers working for them close. Using the industry Loan Officer origination average of two loans per month, this newly-minted Branch Manager would need between 16 and 25 Loan Officers working under them just to break even with their previous level of revenue. This disconnect between expectation and reality ultimately sets up new Branch Managers for failure, which is a scenario that’s not in either

“It is in everyone’s best interest that top producers continue to be successful in their transition to the Branch Manager role, and ensuring this outcome requires taking a different approach to the on-boarding process.”

party’s best interest. From the lender’s perspective, current market conditions require a “shake up” in standard operating procedure in order to survive. Stagnation usually leads to decline. With volumes shrinking, lenders can ill afford to continue relying on strategies that fail to yield toplevel results consistently, and the current branch recruitment model certainly qualifies. A new approach Today’s branch recruitment strategy relies heavily on a “sink or swim” mentality—either new Branch Managers will succeed, or they won’t. This strategy is not only shortsighted, but it also wastes significant time and resources on both sides of the equation. New Branch Managers invest a tremendous amount of time and effort into building a branch with little to no guidance from the parent company, and the

lender invests significant resources in branch onboarding with little to no assurance of success. The current lending environment leaves little room for failure. For a lender to succeed, they need their branches to succeed and viceversa. It is in everyone’s best interest that top producers continue to be successful in their transition to the Branch Manager role, and ensuring this outcome requires taking a different approach to the onboarding process. Instead of throwing new Branch Managers into the deep end immediately, why not invest in some training and mentorship on the front end? Almost every lender can point to their most successful branch, and chances are, that branch has established some best practices that have helped it achieve long-term success. Just as a rising tide lifts all boats, a successful branch can

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help other branches succeed simply by sharing lessons learned and proven strategies for success. Furthermore, what if lenders took this approach one step further and set up new Branch Managers as interns under their most successful branches so that these Branch Managers have the opportunity to learn the specialized skill set needed to operate a successful branch? What might that look like? For starters, this approach requires lenders to make an assessment of where a new Branch Manager may lie on the readiness spectrum. A rare few, by virtue of their natural gifts and/or previous experiences, may already possess the skills they need to be successful in the Branch Manager role. In that instance, the focus should be on allowing these Branch Managers to simply utilize the more successful branch’s resources while they learn the ropes, especially if the Branch Manager has been recruited from outside the organization. For the rest, the goal of this “internship” should be as follows:

traditional approach to Branch Manager recruitment and development can make all the difference between success and failure.

Michael Cooksey is Executive Managing Director of Production at Mid-America Mortgage Inc. and founder of Mid-America’s most successful branch to date, The Cooksey Team. He may be reached by phone at (972) 767-5701 or e-mail Michael.Cooksey@MidAmericaMortgage.com.

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To be clear, the goal should not be a “like-for-like” scenario where new Branch Managers are instructed to build an exact replica of the branch under which they are learning. Every manager is different and has a unique goal and vision for his or her branch. Forcing a Branch Manager to build their business according to someone else’s vision is going to be equally as unsuccessful as throwing a new Branch Manager into the management deep end. Instead, the goal should be to tap into that Branch Manager’s motivation, talent and vision to help them build a branch in their own image using a proper foundation to ensure long-term success. Having the

role entails is crucial. Furthermore, working with a lender that’s willing to invest in the long-term success of its managers by taking a non-

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1. To develop the skills necessary for success in the Branch Manager role. 2. To define the Branch Manager’s goals and vision for the branch. 3. To build a unique plan of action that draws on the branch manager’s goals and vision to help them turn their vision into reality.

Branch Manager take this journey under the tutelage of an experienced, successful branch ensures that, when the time comes, that Manager is equipped with the tools and expertise needed to flourish. As we enter 2019, now is the time for top producers to consider their options for the coming year. If “Branch Manager” is at the top of the wish list, taking an “eyes wide open” perspective on what that

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Branching Out Through Attraction By Lori Lite

y company, Actualize Consulting, is celebrating a year of learning and growth; branching out to new countries, clients and adding significant functional and technical capabilities to our Treasury and Mortgage/Fixed Income client services and software products. This expansion created several employment and location growth opportunities to include, hiring talent and acquiring new office space. By staying true to our mission statement, “Our Expertise and Commitment— Driving Your Success” and the 3 A’s (Accountability, Acumen, Aspiration) set forth by our Culture Infusion Department, we have successfully hired 17 new people and opened offices

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in the United Kingdom and Canada. How do you find talent in this fiercely competitive job market? This year, we put an emphasis on engaging and utilizing social media alongside encouraging internal referrals. We have been able to shift the model of finding talent to an even more successful formula … having talent find us. By find us, we mean attraction. Attraction is an energy that starts with your people and shows how your company shines in areas beyond the actual work. Staying in touch with the alwaysevolving needs of today’s employees requires you to turn your focus to your company culture. Just as good leadership starts with self-awareness, good company culture starts with

objective assessments, coupled with a willingness to change from the inside out. How do you make your company shine? The light emitting from the stars appears effortlessly, or so it seems. The real work is happening deep in the core and the light is a byproduct. Much like a star, in order for a company to shine, there must be an internal core that fosters a thriving culture with a focus on happiness, wellness and work/life balance. Having a robust and creative benefits package, offering flexible hours, wellness programs and aligning goals to rewarding performance will make your company shine. Goals help keep us focused, accountable and motivated. Goal-setting is a tangible pen and paper exercise that leads to synchronized collaboration and employee satisfaction. Aligning goals to rewarding performance: Accountability–Acumen– Aspiration Kerry Wekelo, our Chief Operating Officer and creator of our Culture Infusion program, shifted the way we approach goal-setting as a company and individual. “Instead of focusing on the negative perceptions of goalsetting, take goal-setting seriously and with a positive attitude, viewing goals as a way for leadership to cultivate inspiration,” said Wekelo. “The idea is to actually spend time with your team on creating meaningful and achievable goals that are aligned with the areas in which each person excels and is most interested. Then, work with each person to create a plan that will align their personal goals with the firm’s goals, while ensuring they are focusing on their areas of expertise and interest.” At Actualize, we start with setting our annual firm-wide goals, which then allows for individual goals to be linked with the firm’s goals in order to create a win-win situation: Individual goals provide

important individual motivation and help move the company forward. For years, we had a goalsetting process for employees that offered little guidance and we wondered why employees didn’t engage with the process. Then, we streamlined the process and structured it around the 3P’s (People, Projects, and Profitability). It has been beneficial to have a laser-focus for all our firm’s initiatives by setting firm-wide goals in each of these areas. For instance, Projects goals are around client growth and providing excellent customer satisfaction. The Profitability goals denote our revenue and utilization. Now, our team members can choose how they can help us achieve our overall goals by choosing their own goals for each of the 3P’s. Given that our people are our best asset, we have a subset of People, called the 3A’s, which helps foster inspiration in goal setting. Here we break it down: l Accountability: We advocate bi-directional accountability, which helps employees know they are part of a team in all decisions and leads to satisfied team members. From the time team members begin their employment with our company, we discuss how we will support them and take accountability for ensuring their success. However, they also must take accountability for letting us know what they want, what is not working well for them, and what they enjoy most. For example, I take accountability for organizing and planning our social media posts. When the entire firm is aligned on accountability, the focus shifts. For example, maybe you are frustrated with a complicated process and have an idea to streamline it. Instead of complaining to co-workers about how the process is broken, set a goal to develop a proposal noting what is working now and how it can be enhanced. We have seen that as our team members take accountability for their own happiness at work, we

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are more focused on adding value and bringing opportunities to the table to expand our success. l Acumen: When setting inspiring goals, “acumen” means working with your team on what they want to learn more about in relation to their area of expertise. Because my company is a boutique consulting firm, we coach our team members to make every effort to become the expert to ensure they are adding value and are the goto person in their specialty. We ask them to determine what they can do to become better known, such as conducting internal training, mentoring others, writing articles or speaking at conferences. As the saying goes, you learn something new every day, and learning keeps you young. It will also help you be more inspired. Not only should you encourage your employees in their personal and professional development,

but you as a manager should be working on your own development. Acumen also applies to personal interests and goals. If your company has a training allowance, you can encourage employees to spend a portion of the money on something more personal versus only professional development. That will show your commitment to them and the organization’s wellness culture. l Aspiration: The third step of setting inspirational goals is to encourage all personnel within your organization from top to bottom to discover the aspirations that will light them up by determining their preferences for career and personal life. Many times, we will ask, “What do you aspire to achieve? What do you desire out of your career?” Once they focus on the aspects that excite them professionally and personally, they can then link

their goals to areas they most enjoy. It is important to look at your personal life as well to ensure you have an outlet for all the things you gain pleasure from. When we focus on the areas that bring joy, there’s no doubt we will be successful and advance in our work. Branching out through attraction With the 3 A’s in place, you will see management and team members take accountability in

their roles at work, we stop blaming the politics, culture or managers, and instead, get clear on what they truly want. When leaders have this clarity, we can together formulate goals with our team members to inspire them to do fulfilling work. All branches of your company will begin to flourish and attract the attention of others. You will have created a sought-after workplace where people are happy. When your people are inspired and happy, your company will shine.

Lori Lite is the Manager of Marketing and Communications for Actualize Consulting, a company that specializes in optimizing financial services technology and operations. Lori builds brand awareness, an online presence and upgrowth for Actualize Consulting’s Financial and Culture Infusion services. She may be reached by e-mail at LLite@ActualizeConsulting.com. 85

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Culture Shock! Using company culture as your top recruiting tool By Shirleen Von Hoffmann ulture shock is a real syndrome and it occurs when an employee is not a good fit in a new company when the culture from one company to another is different. Company culture is usually the first thing to attract like-minded employees, and the first thing that will ruin your recruitment efforts. Many employees panic when they arrive in a new culture and don’t have the support to get around culture shock. I remember in 2004 when a bignamed bank purchased a smaller mortgage company of about 1,000 employees. The mortgage company was a tight-knit, successful group and everyone trusted each other. They were a family. Then along came the big bank that bought them out. The employees didn’t want to be

bought out, but unfortunately, the deal was written and cast in stone. The big bank didn’t give a second thought to the fact that the cultures of these two companies didn’t match. It was a huge omission. They barged in with a ton of ego, big ideas and it fell upon deaf ears. Within a year, 90 percent of the employees from the smaller company left. Within two years, they were all gone. The acquisition was a waste of money because the producers who produced the volume for the smaller company eventually all left and production was gone. “What was the primary reason they left, you ask?” Culture! The smaller company was a warm, family culture, a friendship of sorts, where they could call the President and he’d pick up the phone. They knew each other, and spoke to Underwriters and Managers openly. There was

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support, respect, and it was one big, happy family … until the big, unwanted bank stepped in. Culture is the first thing to attract or detract great employees With that being said, in recruiting new hires, take a hard look at your culture and the culture of the recruit first and foremost. Where they are coming from and how will they fit? Making a nice match is the first step to bringing on a great, lasting, relationship for your company. Because the point of the story above is, if there isn’t a fit in company culture, then your recruit will not feel as if it’s home and they will have a short-lived tenure. It’s essential to do your best to match up the culture question first and foremost. Ask yourself: “What is the culture of our company?” and “What is the culture that would attract great employees?” Ask your employees: “What is the culture of this company? and “What makes you love working here?” Then, begin to build your recruiting and your recruiting package, based on culture first, from the answers you find. Your employees are your best asset and best testimonial. Are they in love with your company? If they are, why are they in love with your company?

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l You must seek out and sort through who you want to work with. l Are they a good fit for your company culture? l You get an appointment. l You ask questions to find out their needs, wants and desires. l You develop rapport and trust. l You must know what your company culture is all about, be able to state your company culture and value proposition in a convincing, compelling way. l You prepare a recruitment package that speaks to their needs, wants and desires. l Don’t overpromise and under-

deliver. This will be a long-term business relationship. Many people give the attention upfront, but there’s no substance for the long haul. The new employee feels like all the promises made upfront were a sham. Here’s your recruiting and retention checklist for loan officers 1. Culture fit? You should consider if they fit in your company culture, your branch and or your team? These are really important questions when considering bringing on an employee. Are they a fit? Are you a fit? Is the company a fit? Do you have what it takes to support them, make them happy and most of all, will you enjoy working with them? 2. Discovery Have great discovery questions, that you have practiced and memorized, so in your initial meetings you have them talking 80 percent of the time and you are busy taking notes about needs, wants and dreams. 3. Brand and name recognition The good news is, you don’t have to be the biggest name in the business to attract Top Producers. Actually, some Producers prefer mid-level and smaller companies because they can mold their own world and don’t have the restrictions of a large company. 4. Relationships and trust Trust is 80 percent of the relationship. If you gain trust, you will be in a relationship with them. Be ready to talk a bit about yourself, your accomplishments and what makes you a great Manager. They will need to know you have their back and what it takes to support them. They are strong, you have to be stronger in ways that matter to them 5. Products Having a variety of products is essential to maximize their customer needs. Be ready to discuss the fine details of your signature products, as they are always looking for that edge they can use in their marketing. 6. Pricing Though it doesn’t have to be the best, it needs to be in the game. Since they do a ton of business,

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large producers will have more pricing challenges. Be ready to talk about a plan for them to overcome these challenges quickly using win-win strategies for them and your company. 7. Pay Be prepared with an extraordinary compensation package that is reflective of the volume they bring, current and competitive in the marketplace and honor it, no matter what. 8. Branding/marketing Branding and marketing at onboarding and establishing themselves quickly will be very important. Make sure to have a plan with your marketing team for a quick execution of a full-scale marketing plan, prior to boarding so they can hit the ground running. That means as soon as the license is activated, they have full marketing pieces and cards in their hands … ready to go! 9. Support It can be lonely at the top. Sometimes a Branch Manager or Regional Manager is the only other

person that will share the burden of large volume production with the large producer. You are their partner. You have to be ready to drop everything to get their problems solved. The relationship will be rigorous and rewarding. 10. Positive boarding Make sure they have full support and a positive onboarding experience. You want them to immediately feel like a part of the family and feel the love! You know the way around the company, they don’t, so make sure they have everything they need at their fingertips. Giving them a list of who to call for different needs and having an onboarding team on hand, for the first month to help with their onboarding and training, will solve a ton of problems. 11. Prestige Top producers are competitive by nature, work hard and like to be acknowledged, awarded and go on trips. They also like to have a voice in the organization and be heard. If you develop a forum for them to be heard at the top levels, exchange ideas with their peer

group and listen to them for suggestions, you will benefit greatly. They are out and about in the field and have their finger on the pulse of the marketplace and know about products and competition, so it’s valuable for a company to utilize that street knowledge. 12. Power hours Have regular “Power Hour” with your new hires and always be listening to their needs, new ideas and thoughts. They dream big and fast, and have a ton of potential and always need to be challenged on a different level. 13. Promise Last but not least, keep your promises, honor your word and tell the truth, no matter what. There are always times as a Manager when you have to deliver

corporate decisions that are not yours and may be tough, but it is always easier when you tell the truth. There is no way quicker way to lose an employee than to not be honest with them. The good news is new employees want to stay in one place and thrive. If you do your job to match the culture, so it feels like home, honor your promises and support them, your new employees won’t want to leave. It’s hard to leave home and harder to move your business … it can be damaging to your career. If you take care of them, they will be around for a long time to come. You will be a critical part of their success the entire time they are with your company. You will be in relationship with them, so be ready for the commitment and the reward!

Shirleen Von Hoffmann is a nationally-known top producer, author, speaker and writer for many real estate magazines. She is a California Broker, MIRM, CMP CSP and President and Sales Coach of Home Builders Edge a National Consulting firm for Mortgage Professionals, Builders and their teams. She may be reached by phone at (866) 600EDGE or e-mail Shirleen@HomeBuildersEdge.com. 87

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How to Keep Employees Happy: Compensation Matters By Dolores Calicchio

ow do you know if you are compensating correctly to recruit a strong team of talented mortgage professionals? Is your organization’s salary budget on target? Do you have data to benchmark your lending institution against others, align your goals to be competitive in the market and retain your best talent? When it comes to keeping employees happy, compensation matters. It drives retention and commitment, and when done right, it can heighten both employees’ performance and contribution to your organization’s success.

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Compensate with confidence Recruiting and retaining talent is a top concern for CEOs of lending institutions, along with acquiring new customers and conforming to regulatory mandates.1 Compensating employees fairly and equitably is a critical factor in attracting and keeping the best talent available in your marketplace. When deciding what to pay your employees, there are many factors to consider. We recommend mortgage firms follow a three-step process to ensure you are doing it right: Consider a total rewards package, know what the law mandates and benchmark for key positions. 1. Consider a total rewards package Explore what would make for a meaningful total rewards package for your employees. Many people place more value on perks and benefits than they do a higher salary or a bigger commission. Evaluate your total reward package and incorporate some popular options such as: l Flexible schedules l Remote/work-from-home opportunities l Education reimbursement programs l Health benefits l Flexible job titles and the ability to learn new skills l Positive work environment l Free food, drinks, products or programs

Many mortgage firms align their total rewards with the values of their organization. For instance, Adonna Allen, President of Alpine Bank advised, “We support our employees to get out and volunteer in the community, so we provide them with paid volunteer time. We encourage them to get involved.” Further, PJ Wharton, CEO of Yampa Valley Bank, said, “Our Millennial employees really want to make a difference in the community they serve and also have a great lifestyle. After experiencing the camaraderie among the team, how we take care and celebrate one another as well as the difference we make in the community–supporting employees with volunteering and backing their social causes, it’s that emotional connection that gives them purpose and why they choose and continue to stay with us.” 2. Know what the law mandates Take some time to understand what the law mandates for you to provide to employees. Employment laws can vary by state, federal and municipality. It’s quite complex, and this is an area where you might benefit from outside expertise from a third-party firm such as an employment lawyer, a payroll specialist or a Professional Employer Organization (PEO). Relevant employment laws might include: l Overtime and commission calculations specific to mortgage lenders l Paid sick/family leave l FMLA coverage l Disability Insurance l Workers’ compensation l Unemployment benefits l Minimum wage l Overtime pay in covered situations 3. Benchmark salaries for key positions Salary or compensation benchmarking is the process by which internal job descriptions are matched to external jobs with similar responsibilities to identify the market rate for each position. Having market intelligence, as well as a good understanding of

“… according to one study by RiseSmart, company culture is the number one reason employees accept job offers with 81 percent of the survey participants saying this is ‘Extremely’ and ‘Very Important.’”

where your organization sits in relation to the market, is essential in order to establish an effective rewards strategy. For mortgage firms, consider these salary benchmarks as an example:2 l Mortgage Broker: $93,741/year l Mortgage Loan Originator: $68,225/year l Mortgage Underwriter: $65,215/year l Mortgage Banker: $57,476/year l Mortgage Consultant: $52,919/year l Mortgage Processor: $44,103/year l Senior Mortgage Specialist: $42,525/year l Mortgage Specialist: $37,260/year Without proper compensation analysis to benchmark key positions, companies may be under or overpaying employees. This can lead to retention issues, particularly in the current environment where the labor market is tight and mortgage firms are competing for a limited supply

of talent. Or if employees are being overpaid, this can negatively affect the profitability of the business. Your analysis can ensure your company has the right information and insights to retain employees and operate cost-effectively. Set expectations and manage performance Compensation is most effectively used when employees have a clear understanding of what is expected of them so they can manage their own performance to deliver on those expectations and maximize their total rewards opportunities. There are three core elements in this process: 1. Conduct performance evaluations Develop customized performance management tools and training and position-specific evaluation forms, performance objectives, 360-degree feedback programs, etc., to efficiently and thoroughly manage employees against agreed expectations.

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2. Gain efficiencies with a Performance Management System A Performance Management System will enable you to align your employees’ performance expectations with the company’s defined goals and strategy–all in one automated system. This will ensure you are using resources effectively, developing employees thoughtfully, and focusing on the main priorities in order to improve business performance. 3. Invest in employee development and retention strategies Take a deep dive into the development of reward and recognition programs, compensation programs (e.g., salary bands, job grades, market analysis) and policy and benefits reviews to provide competitive positioning in the market.

l Define and know your organization’s values: Don’t leave it to chance that employees know what the company’s values are. Define them and communicate them to all employees, stakeholders, consultants and partners. l Establish expectations: Set clear expectations with employees about what behavior is okay and what is not. Be sure to reinforce the right behaviors and call attention to the ones that are wrong. l Model the right behaviors: Be mindful that as a senior team member you are being watched closely and others in the organization will likely model the behaviors that you exhibit. Walk the talk. l Equip people with tools: Provide appropriate training, feedback, coaching and management to employees to be successful in the culture.

The consequences of not getting it right Compensation is a key element to get right if you want to keep employees happy. Happy employees are engaged and productive. They turn up every day and they want to do their best. However, there are detrimental consequences to be expected if you don’t get your compensation strategy right, such as: l Lower morale l Lackluster performance from employees who feel undervalued

If you have concerns about the accuracy and relevancy of your compensation strategy, perhaps you could benefit from compensation analysis. Consider the following: l Has one or more of your employees recently left you for a competitor? l Do employees cite pay as a reason for quitting during exit interviews?

l Do you have any reason to believe your employees don’t feel they are fairly compensated? One or more “Yes” answers to these questions could mean you need help with compensation analysis from a PEO or compensation consultant. This type of thirdparty relationship will provide you with the tools and expertise to perform compensation analysis on a local and regional basis, ensuring you have the right information to retain employees and operate cost-effectively.

Footnotes 1—Community Bank CEO Priorities for 2018, American Bankers Association, 2018. 2—Indeed.com. 3—“Banks are finding it harder to attract young recruits,” The Economist, May 4, 2017.

Dolores Calicchio is the Executive Vice President and Chief Human Resources Officer at Oasis Outsourcing. Oasis provides HR solutions in the areas of payroll, benefits, HR services and risk mitigation to help mortgage lenders to improve productivity and profitability, to focus on their core mission and to grow. Oasis has been servicing businesses in the mortgage industry for more than 20 years. 89

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PJ Wharton commented, “We compete on a daily basis for talent with other banks, both large institutions and local banks. People join Yampa Valley Bank to obtain solid professional employment, but they stay with us for the long-term because of our reputation and culture. Our average tenure is 10 years, and we’ve only been in operation for 18 years. Sure, our team members deserve and expect a competitive pay package and an opportunity to participate in our employee stock program. But it is our culture–working with Officers they trust, the reputation of the bank and enjoying the people they work with–I believe this is the compelling reason why they stay at our bank.”

l Top talent defecting to competitors l Negative employer brand, making it difficult to attract new employees l Possible legal problems

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Culture counts when attracting talent With recent scandals at companies such as Uber and Wells Fargo, many lending institutions are sensitive to the need to build a culture that is grounded in strong business ethics. Reputation accounts for a lot when attracting talent. Those who experienced the throes of the 2008-2009 financial crisis are wary of traditional financial service providers, at least to some degree. As an example, this is playing out with Millennials steering clear of banking as a career choice. In 2006, MIT’s Sloan School saw 31 percent of its graduates go into banking. By 2016, that number had shrunk to 15 percent. Columbia reports a similar trend: 55 percent of its business graduates in 2006 chose banking as a career compared to 37 percent in 2016.3 People are looking to join a company that has a positive reputation and to find a role that is a good fit both professionally and financially. It’s not all about the compensation. In fact, according to one study by RiseSmart, company culture is the number one reason employees accept job offers with 81 percent of the survey participants saying this is “Extremely” and “Very Important.” As a senior member of your organization, it’s important to set the tone for what it means to be ethical at work, not only in the context of the letter of the law but

also in the spirit of the law. Here are four tips to help you create an ethical culture:

a special focus on BRANCHING OUT: EMPLOYMENT & GROWTH OPPORTUNITIES a special fo

Boot Camp: Improve Productivity and Reduce Loan Officer Turnover By Deborah Hill he mortgage industry has a higher turnover, or jobhopping, rate than other industries. Experienced Loan Officers can earn signing bonuses and other perks by changing jobs—so finding ways to keep your Loan Officer talent can save you thousands of dollars. Studies show a positive correlation between company culture, onboarding and retention. This article shares six easy steps to a positive onboarding experience for your Loan Officers—an experience that acclimates your new Loan Officer to your culture, reduces their frustration with new systems and measures their compliance acumen. By the end of this article, you’ll know how to run a boot camp—a rapid training program for new hires that also reduces turnover. It’s a great approach if your team is growing fast, you’re hiring several people into similar roles and you worry that turnover might become a problem.

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Step one: Hiring Schedule your boot camps a few weeks in the future then give several of the Loan Officers you’re hiring the same start date. Start dates that leave a gap before the next boot camp can erode your bottom line because untrained Loan Officers aren’t as productive. By joining a cohort of new hires your prized Loan Officers, they immediately makes friends and starts to feel like a part of your organization. The advance notice also allows the Loan Officer to make adjustments to their personal lives in advance of the training— freeing them up to learn without distractions. Step two: Think about travel, equipment set up and human resources (employment forms and benefits enrollment) onboarding I hire people from all over the country and my company has a standard half-day human resources orientation program.

With this in mind, I know my training has to start Monday afternoon after the HR onboarding. Scheduling time for new employees to work with IT to make sure they can log into key systems and have all the software they need comes right after HR onboarding so my new hires aren’t distracted by basic access problems during the rest of their training. I also want to leave Friday afternoon free for travel. In return for letting my new hires off early on Friday afternoon, I run boot camps from 8:00 a.m. to 6:00 p.m., Monday through Thursday, and from 8:00 a.m. to noon on Friday. Step three: Variety Most new hires need a mix of systems, compliance and loan product training. You’ll get better results if you mix the three throughout the week. Two-hour time blocks that rotate through these three types of training help new hires stay engaged. Also, segments should work together to build skills. For example, a software system training segment that covers your compliance process followed by training on the compliance requirements for your Loan Officers’ target market will help your new hire pick up your offerings faster. Intermix mandatory continuing education sessions on topics like data security, harassment, or nondiscrimination with more relaxed sessions like company branding, partner relationships or your organization structure to help your new hire quickly fit into their new responsibilities and team. Step four: Guest speakers Add variety to the schedule (and give yourself a break) by inviting people from other parts of your company to share information about their area. These speakers help you socialize your new Loan Officer to your company—they help them know where to go with questions or how the teams work together. For example, in a credit union, someone from senior management might talk about the credit union’s founders, attitude toward members or examples of how members

benefit from the credit union’s services. This helps your new Loan Officer accurately communicate the benefits of your organization to their borrowers. You should include all the departments adjacent to your own–for example IT, processing and member services. Step five: Be flexible Boot camps have a lot of moving parts, new hires, guest speakers, trainers and things you really cannot control like flight delays and weather. Be prepared to move sessions around. Step six: Evaluate what they are learning Use quizzes, and if appropriate, tests to measure progress. Use self-graded pop quizzes to help your new Loan Officers gauge their understanding of complex compliance topics then give them a graded test their manager can use for ongoing professional development and coaching. Since Loan Officers are often competitive, think about providing a small prize to the person with the highest score. However, be careful with egos— especially if you have a class with varying levels of experience and training. Make sure the playing field is level or you may create resentment. Step seven: Fun Plan some fun breaks and time for your new hires to meet your team. Ordering lunch for your existing team plus the new hires, taking everyone out for a beverage after work, playing human bingo or even sitting in on a regularly scheduled team meeting will help your new hires feel comfortable and bond with their new co-workers. Create experiences for your new Loan Officers that are different and enjoyable–help them bond with

their new team and you’ll keep them longer. Also, use these fun times to learn more about their personalities and what they enjoy–then plan events similar to the ones they like throughout the year to deepen their attachment to your company. Now that you’ve learned how to structure a one-week boot camp, let’s explore what happens when you need more than one week of boot camp to fully train a new Loan Officer. This often happens when you are training people with less experience or those who need to pass a licensing exam. In this case, you may want to mix weeks of formal boot camp training with weeks of hands-on shadowing. When your new hires shadow, they work closely with a more experienced team member for one or two weeks– applying what they learned in their boot camp classes and gaining confidence. Alternating boot camp, exam prep classes, and shadow weeks allows new hires to put training into context, develop a list of questions to ask in the next class and gives your existing team members the opportunity to demonstrate their ability to lead others. Once you master new hire boot camps you can apply the same principles to ongoing professional development and other internal training needs. Whether your training lasts a day or a week, creating a compressed, lively and interactive training experience shows your Loan Officers their time is valued, and you care about their employment experience. You can stand out by being a different kind of employer–an employer who treats your relationship with your Loan Officers as more than a business transaction. The best part … you’ll actually save money, have higher productivity and enjoy your own job more!

Deborah Hill has more than 10 years of experience helping financial services customers gain efficiencies through their implementation and use of software. She is Vice President of Customer Success and Operations at MortgageHippo. Before joining MortgageHippo, Deborah consulted and held board positions with several earlystage FinTech firms. Prior to that, she was Managing Director at Backstop Solutions Group.

technology helps servicers

victims find temporary housing and gathering donations of food and clothing. Likewise, smart servicers should leverage social media in order to share important information about disaster relief to borrowers.

Gagan Sharma is President and Chief Executive Officer of BSI Financial Services. Gagan acquired BSI from its former parent in 2006 and transformed the company from a small lender into an innovative and thriving loan servicing provider, growing BSI by more than 70 times since his acquisition.

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“NAMB All-In gives Brokers a consumer-facing, digital POS, the ability to originate a loan in the same system, and access to an open marketplace that promotes the true independence of the Broker community.” —Rick Bettencourt President, NAMB

“This effort will make it more expedient for Brokers to deliver loans so they can better compete with the outside world and the big online lenders. I’m in favor of anything that will improve the Broker’s life.” —Allen Middleman Senior Vice President for Freedom Mortgage

lenders can import the completed 1003 and then deliver completed documents, such as the loan estimate (LE), closing disclosure (CD), conditions, locks, etc., directly back into the Broker’s software. If a wholesale lender is not on the platform or does not accept data through NAMB All-In, the broker can still export an FNMA 3.2 file to work with any wholesaler that is not yet in the network. Bettencourt says that NAMB leadership did not see that open market concept anywhere else. “Our goal is to enhance Broker independence and give them the ability to do what they do best,” Bettencourt said. But given the independence of the wholesale lender community, can NAMB expect the lenders to embrace its new tool? Apparently so, as some lenders are already doing so. Early support for an open system Wholesale lenders are already signaling that they are open to the platform and will participate. NAMB reported earlier this month that Stearns Lending, Plaza Home Mortgage, Quicken Loans, Freedom Mortgage, Caliber Home Loans and United Wholesale Mortgage (UWM) would all accept loans through NAMB All-In.

“We will be on the platform,” confirmed Allen Middleman, Senior Vice President for Freedom Mortgage. “This effort will make it more expedient for Brokers to deliver loans so they can better compete with the outside world and the big online lenders. I’m in favor of anything that will improve the Broker’s life.” Even better, Middleman says that NAMB All-In won’t change anything about the way Freedom Mortgage already does business because the platform will feed the data directly into the wholesale lender’s Web site. But he added that even if it did require the lender to consider changes, it would still be a tool his company would likely embrace. “Tech rolls out and regardless of your position or stance, you must consider it, analyze it and if it makes sense you have to do it,” Middleman said. “If you can’t change … you die, so you have to be willing to adapt.” In addition to that, Middleman said Freedom Mortgage would embrace the platform because it was better for Brokers. “In any marketplace, parties must have the flexibility to get the best price,” Middleman said. Since the platform is agnostic, the Broker can simply download continued on page 98

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a disaster area and that day comes and goes with no payment made, that should be a red flag. With the right tools, servicers can be notified immediately when this happens and make an effort to reach the borrower and offer help. One of the best proactive strategies servicers can take— particularly if they have portfolios with exposure to natural disasters—is to partner with a specialty servicer with a strong technology competency and a track record of disaster planning. The key is to look for partners that have made extra investments in processes, technologies and automation, and have scalable operations that can handle a sudden and rapid increase in defaults. For example, companies that use strong security measures and network redundancy are better prepared to keep borrower communication flowing in the wake of floods, hurricanes and fires. That’s especially helpful when it comes to coordinating services with third parties and getting life-saving information to borrowers. It’s important to note that managing defaults in the wake of an emergency takes more than technology. Servicers should be focused on helping borrowers normalize their lives after a catastrophic event. Servicers need the skills and experience to determine how to scale quickly in an emergency situation, all while staying compliant. The role of technology is to make the process frictionless – or at least as frictionless as possible. The key is to never become complacent. While technology can’t prevent natural disasters or the ensuing disruption in the lives of borrowers, the right technology can reduce and eliminate complacency, streamline the loss mitigation process and get help to borrowers who need it most. Indeed, the proper application of technology can reduce the impact of rising defaults and even help borrowers who are struggling to put their lives back together in the wake of a disaster. And of course, that is what is most important.

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The benefits of AI and process automation From a portfolio management standpoint, back end technology—including robotic automation—helps servicers streamline defaults in the wake of a disaster. Servicers must also be ready to adopt AI and machine learning technologies, which are quickly becoming part of the technology fabric in the financial services industry. According to Capgemini’s Digital Transformation Institute, AI and robotic process automation could generate $512 billion in additional revenues for financial services firms by 2020. The global consulting firm’s study also found other businesses have seen a 60 percent increase in customer satisfaction after using these technologies. These statistics are not just academic. At BSI Financial, our own work in combining machine learning with robotic process automation has yielded increases in default decision-making speeds from 20 to 60 percent. That being said, servicers shouldn’t get caught up in trying to use technologies that simply sound cool—they must focus on the end benefits and the business problem they are trying to solve. In the case of natural disasters, the tools they leverage should be used to improve the rate in which they can handle a large increase in defaults as well as the rapid increase in volume of borrower calls and e-mails. As servicers learned during the last financial crisis, not every borrower who needs help is going to ask for it. That’s why it is important servicers have technology that enables them to identify borrowers who are experiencing financial issues before they ever miss a payment. For instance, many borrowers pay their mortgage at a specific time of the month. If a borrower lives in

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How to Value an Apartment Building By Stephen A. Sobin

Now we must address the actual expenses necessary to run the property on a day-to-day basis. Most commonly, we should anticipate expenses for real estate taxes, property insurance (hazard, liability, flood, etc.), utilities (gas, oil, electric, water, sewer, cable TV, etc.), garbage, landscaping, snow removal, cleaning, service contracts (elevator, pool maintenance, etc.), professional fees (legal, accounting, etc.), payroll and payroll taxes, repairs/maintenance, and reserves for replacements. These expenses will vary widely from property to property and location to location. Some tenants have separate meters while some landlords pay for all utilities. Some buildings are new and don’t need lots of repairs, while older properties might need extensive budgets for renovations and repairs. A potential purchaser needs to fully review all of the expenses disclosed by the seller AND perform a complete review of the property in order to

We started with a gross potential of $228,000, and after a thorough analysis of the expenses, we arrive at a net income, or Net Operating Income (NOI) of $106,655. The NOI is the important figure in our analysis and not the gross of $228,000. The value of this property will be determined by this NOI amount. Now that we know what type of cash return this property provides, it is time to consider value. What is a property that generates annual income of $106,655 worth? The answer depends on what we call a cap rate, or capitalization rate. A cap rate is the annual rate of return that an investor seeks to earn on his money. Today, most bank deposits yield less than one percent. Anything more than one percent is a better return than the bank. However, owning real estate is riskier than putting your money in a federally-insured bank account. Back in the early 1980’s, when interest rates were sky high, banks paid double digit returns to their investors. Back then, investors in real estate needed to earn outsize returns if they were going to earn more than a bank deposit. Today, cap rates might range from a low of four percent for superior properties in top notch locations to 10 percent or more for low quality properties in more difficult locations. Let’s assume that the cap rate for the apartment property in our example above is six percent. That means that our investor would expect to earn a six percent return on the purchase price. We would take the annual cash flow of $106,655 and divide by six percent (0.06) and arrive at a value of $1,777,583. Assume for a moment that the going cap rate is lowered to five percent. Now, the value would be $2,133,100. The value will increase or decrease based on the cap rate used. Back in 1980, when cap rates were expected to be 15 percent or more, this property might have appraised at $711,033. The lower the cap rate (meaning the lower return expected by the investor), the higher the value. Conversely, the higher the cap rate, the lower the value. Let’s recap what we have been discussing. The two main figures that we must have in order to determine value are the net operating income and the cap rate. Everything else is a sideline. The NOI is developed after a thorough analysis of the subject property. The cap rate is determined by local market conditions and will change as interest rates in the market change. Most increases or decreases in property value result from either changing the net operating income (raising rents, cutting expenses) or due to economic changes in the market which affect cap rates. Stephen A. Sobin is an industry veteran with more than 35 years of mortgage lending experience. He is the President and Founder of Select Commercial Funding LLC, a nationwide commercial mortgage brokerage company. Stephen is a member InterCapital Group, a nationwide alliance of commercial mortgage professionals. He may be reached by phone at (516) 596-8537 or visit SelectCommercial.com.

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As stated above, this potential gross income is just a starting point. At this point, we do not have enough information to determine valuation or appraised value. The next thing we need to do is consider management costs and vacancy factors. Very few selling brokers or apartment owners will factor in these costs, but management and vacancy are a part of any good underwriter’s calculations. In most markets, a property of this size will call for management costs of four percent to five percent of the gross income. Next, we look at current vacancy rates in the market for similar properties. If similar properties renting in the local market have, say, a five percent vacancy rate, we need to assume a five percent vacancy factor for this property as well. Our worksheet now shows the following: Gross Potential Income = $228,000 Vacancy allowance (five percent) = $11,400 Gross Income = $216,600 Management (five percent) = $10,830 Gross Income (after management )= $205,770

budget for overlooked items. Let’s make some estimates and continue to develop our pro-forma: Real Estate taxes = $30,000 Insuranc e= $5,000 (estimated at $250/unit) Gas/Oil = $10,000 Electric = $5,000 Water/Sewer = $15,000 Repairs/Maintenance = $15,000 (estimated at $750/unit) Staff/Salaries = $15,000 Reserves = $4,115 (estimated at two percent of gross income) Total expenses = $99,115 Net Income = $106,655 ($205,770-$99,115)

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hese days, due to the seemingly endless need for rental housing, more and more investors are looking to invest and own apartment buildings. Investors are drawn in by the strong demand from renters and the potential upside for appreciation in value. Many inexperienced investors tend to overpay as they often overvalue rental income and undervalue expenses. How much should an investor pay for an apartment building? Sellers and their Brokers often value their properties higher than buyers and their lenders. As a Commercial Mortgage Lender and Broker with more than 35 years of lending experience, I would like to create an easy-to-follow format for arriving at a fair and reasonable estimate of value when investing in this asset class. Many investors rely on gross rental income, gross rent multipliers, and other valuation methods that rely strictly on the property’s gross income. These methods are flawed in that they neglect to account for the variation in a property’s expenses. A proper analysis requires an understanding of potential gross income, actual gross income, management costs, vacancy allowances, reserves for repairs and replacements, normal operating expenses, and net income. We then need to analyze cap rates in order to arrive at a value based on the capitalized value of the net income. We will start our analysis by discussing with the income. The potential gross income is the maximum income available assuming 100 percent occupancy at full market rents. Let’s take a hypothetical 20-unit apartment building with average monthly rents of $950. We will begin our pro-forma valuation as follows: 20 units X $950/month = $19,000/month $19,000 X 12 months = $228,000/year

Taking a Strong Step Into the New Year Companies will need to shift their business to grow in a tough market By Ray Brousseau

ince interest rates started to increase, we’ve been dealing with a largely flat market, and that trend is likely to continue. According to projections from the Mortgage Bankers Association (MBA), total mortgage originations will hit $1.63 trillion in 2019, a decrease from $1.64 trillion in 2018.1 In addition, the MBA expects refinance originations to decline significantly to just $395 billion, while purchase originations will increase to $1.24 trillion. To create strategic growth in

this kind of market, most of us will need to make some changes in the way we do business. For brokers and originators, it may mean learning new products and aligning yourself with lenders that are shifting their business to where there’s need and demand. For mortgage companies to grow in this environment, they’ll need to look beyond just one simple switch in focus to bigger changes necessary in leadership, product offerings, and lending channels. Make a shift Changing from refinance business to purchases is just one possible

avenue to accommodate a shifting market. You should also consider moving your focus within the refinance market from the typical, easy, streamlined refinances that focused on getting a lower rate to more complicated refinances that may help borrowers with their overall financial health. With interest rates still around historic lows and housing values high, many homeowners are sitting on valuable equity. According to the Federal Housing Finance Agency’s House Price Index, home prices increased 6.3 percent from third-quarter 2017 to third-quarter 2018, echoing the year-over-year

gains seen since the beginning of 2012.2 At the same time, consumer debt is now reaching all-time record levels and was expected to top $4 trillion at the end of 2018.3 That translates to the average American owing more than 26 percent of their annual income for nonmortgage debt. This may make a debt-consolidation refinance attractive to a lot of consumers, particularly if lenders look at their entire financial picture. Rising mortgage interest rates get most of the press in our business, but nonmortgage debt, particularly credit cards, have seen ever-increasing rates in the past

few years. According to CreditCards.com, the average credit card interest rate was 17.15 percent in early December, an alltime high.4 At the same time, the average 30-year fixed mortgage interest rate was 4.96 percent, according to the MBA.5 Those numbers combine to create a very favorable picture for current homeowners to use a cash-out refinance to consolidate their debt and realize significant interest-rate savings. Refocusing your refinance business in this direction will require a significant shift in strategy and knowledge. These

kinds of cash-out, debtconsolidation loans are typically full-doc, intricate originations. They often have more variables and take significantly longer than streamline refinances, as lenders and originators will need to consider the borrowerâ&#x20AC;&#x2122;s complete financial situation. Companies willing to do the heavy lifting to make this change will have to reeducate employees, particularly sales and underwriting staff. But by marketing to current customers and prospective clients, you may find a substantial new stream of business with cash-out refinances.

New products Another strategy to help grow your business in this changing landscape is to offer new productsâ&#x20AC;&#x201D;preferably ones that not many other lenders are offering. Obviously, not every company is in the position to do this, but there are many opportunities to partner with lenders that have committed to serving the unmet demand in the market. Some lenders are making strides working with borrowers with challenging credit, from negative credit events to low credit scores. According to Experianâ&#x20AC;&#x2122;s eighth annual State of Credit

survey, 21.2 percent of Americans have credit scores below 600.6 But this past October, less than one percent of purchase loan originations went to borrowers with scores below 600, and just over four percent of refinances did, according to Ellie Mae.7 Many of these consumers are still creditworthy, but they are too often overlooked by traditional lenders. The Urban Institute estimates that 6.3 million borrowers who would have historically qualified for a loan were unable to get one between 2009-2016 because lenders were continued on page 99

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The

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Mirror Mirror on the Wall … Who’s the Fairest of Them All? By Christine Beckwith

day-to-day rate sheet will not be the play this year. Get in, lock and Fuhgeddaboudit! In short, Mortgage Loan Originators need to take control of how they position their customer’s experience from day one, through real economic history lessons, while setting proper and appropriate expectations. 2. Home prices are predicted to rise in 2019 just under five percent. This means we will see more home improvement, more cash-out refinances, and finally, more renovation and inventory re-entering the market. This is good. We will take it. Enough said.

So, all in all, a positive prediction. Where are you right now? If you are in a race car that has stalled and are sitting on the side of the track waiting to get back in the race, what are you waiting for? You must simply put the car on the track, get it running and in rotation, ready to race, revved up and idling high. Those MLO’s sitting around as if it’s any other seasonal decline are losing market share with every moment as they remain idle. Even though the race has not been announced …the race for market share has begun. What do we know about the levers the mortgage industry has

Naysayers … step aside! This is not the year for pessimists, nor is it the year for naysayers. In fact, no one has time for any contemplation. Did I already say that those people sitting on the sidelines needed to get moving? Companies and MLO’s who understand the need to compete, also comprehend the need to educate consumers on economic changes and their impact, and grasp the need to evolve their marketing to a place that grabs followers and

influencers are already so far ahead of the game. The point is to get in line, jump in and start moving! The circuit More than ever, real estate and mortgage industry professionals need to attend conventions and circuit networking events. If MLO’s want to rise and elevate themselves within this world, they need to be seen and they need to see the evolution front and center. For that to happen, they need to get out there and visit the conventions in and around their marketplaces. Managers need to be at the big circuit conventions. They need to bring back what they believe are the golden nuggets of knowledge, and they need to get the troops they oversee marching … in a line, in sync and in rhythm! My point is that if you aren’t moving or engaging your referral partners, someone else will be. This year, you will feel the competition. This will test your professional patience, as partnerships will shift and change, so your ability to keep what you have already considered to be yours, while amassing a broader funnel of sales, will, in fact, go to those victors of hard work and steadfast engagement. So, what about mortgage technology you ask … what are your options? There are so many options to accelerate mortgage companies’ process, mobility, marketing and continued on page 99

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3. All four major reporting agencies indicate that home sales in 2019 will outpace 2018!

right now to excel? We know that it’s going to take a Millennial mindset to get a real play on marketing. So, if you’re not one, it’s time to catch up. Today, the press and public relations folks, marketing reps and account execs are being fronted by promoters and influencers, and so are real estate professionals. Millennials are putting videography companies out of business on iPhone video apps. The time has come to hone the skills! The good news is that thanks to online courses, marketing technology evolution and guys like Gary Vaynerchuk leading the cause while teaching along the way, it’s coming quite into focus the mindset of where we are headed. The 52-year-old MLO (the average age of a Mortgage Loan Originator in 2018) needs to begin to beat to a new drum if they haven’t already. This technology push has been coming for years to the naysayers, but it is evident to everyone that the time has truly come. So, get on the bandwagon … the bus is leaving the station!

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n a professional world riddled with volatility, constriction, expansion, influx and obstacles, the mortgage professional of 2019 will continue this year, like so many years in the past, to find a foothold and find the path that will take them out of the conundrum of market quandaries that has lead so many in 2018 to jump ship or to swim to shore all together. This leaves all of us still in the boats that are bailing water to take a solid look in the mirror and find the truth about our ability to survive and thrive this year. The question is for you is whether you can get a good and fair read on how your organization and you yourself are positioned to grab market share. Don’t be fooled by magic mirrors … seek the truth and you shall prevail. So, let’s break it down. What are the facts as we know it? 1. Interest rates will continue to rise: All indications on economic advising, from Wall Street to the center of the U.S. housing industry, states that interest rates will continue to rise steadily. The bigger picture though clearly shows that, in hindsight, buyers today are still getting homes at a lower interest rates than their parents or their grandparents. So, perspective on interest rates needs to be educated by the Mortgage Loan Originators. What is “in scope” and “out of scope” for economic forecasting. Simply put, we need to let the consumer know that tunnel vision on a

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“Mortgage clients are looking for an Amazon-like experience, where they can interact with their Loan Officer on their terms, anytime. What Calyx has created is a platform that allows that, offering our Partner clients that experience.” —David Schroeder Senior Vice President, Quicken Loans Mortgage Services

“All the new technology that is being introduced throughout the industry will strengthen Mortgage Brokers and grow the Broker channel, and we’re excited to be part of it all.” —Mat Ishbia President and Chief Executive Officer, United Wholesale Mortgage

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a Fannie Mae 3.2 file to share with any wholesale lender. Middleman said that gives Brokers this power. “If someone comes out tomorrow with the [loan] program [the Broker] needs, they need to be able to get on that platform and deliver that loan,” Middleman said. “If the Broker is on two platforms and one is open, they have that option.” Quicken Loans, owner of the extremely successful Rocket Mortgage brand, has also agreed to work with Brokers through NAMB All-In. While this may surprise many who see Rocket as the Brokers’ chief competitor, David Schroeder, Senior Vice President of Quicken Loans Mortgage Services, said the move makes good sense for the company and the Brokers it serves. “Mortgage clients are looking for an Amazon-like experience, where they can interact with their Loan Officer on their terms, anytime,” Schroeder said. “What Calyx has created is a platform that allows that, offering our Partner clients that experience.” Schroeder said that Rocket operates independently from his division, but the guiding principles are the same.

“A Rocket Mortgage would serve a client who wanted to deal directly with Quicken Loans and our mortgage banking team,” said Schroeder. “This partnership with Calyx provides much of that convenience to a client, but allows them to deal with a professional in their local community. We are committed to an open lender marketplace because the lender that is best for any given client depends upon their situation. Ultimately, we want to provide the best experience for every client.” But Schroeder added that working with NAMB All-In also makes good sense for Mortgage Brokers, giving them another great option for their borrowers. He said that Quicken Loans was excited about what NAMB All-In will do for Brokers, saying that it would make them more cost effective and help them reach more clients. “We believe that the Broker market is a vibrant one and it continues to expand,” Schroeder said. “We think our clients, even when they don’t end up using that face to face option, love knowing that they can work with somebody in their community if they choose. That’s important to them.” Mat Ishbia, President and Chief Executive Officer of

United Wholesale Mortgage (UWM), said, “There’s a lot of people out there trying to help Mortgage Brokers, and our mission is to support Brokers in any way possible. Anything that’s good for Mortgage Brokers is good for UWM. All the new technology that is being introduced throughout the industry will strengthen Mortgage Brokers and grow the Broker channel, and we’re excited to be part of it all.” A system Brokers are ready for Rocke Andrews, NAMB President-Elect, says free software is a great benefit for NAMB’s Broker members. He should know. Andrews is a long-time member of the association and also a working Mortgage Broker who owns a company in Tucson, Ariz. He says he’ll be using the software when it hits the market next month. “You can do business with anyone you want with a free LOS,” Andrews said, adding that he expected news of the technology to lead to a bump in NAMB membership. Andrews said NAMB was the right partner for Calyx because of the organization’s reach and its proven ability to show members value. “We get them competitive with larger lenders, and now they have technology that a lot of Brokers didn’t have before.” Mark Favaloro said he will also be using the software. A Principal at Aamtrust Mortgage and President of the New York Association of Mortgage Brokers, Favaloro has been a real estate broker for 31 years and a Mortgage Broker for almost as long. “Calyx has been here as long as I have,” Favaloro said. “I think a lot of Mortgage Brokers are happy right now because Calyx Software is something we’re already familiar with. I’m excited about the partnership between Calyx and NAMB because we are getting some incredible enhancements that we have been wanting for a long time.” Favaloro praised NAMB for sticking by the Brokers through the difficult financial downturn, working at the state and federal level to ensure that Brokers did

not lose their place at the table with legislators. “NAMB spent a lot of time making sure that we would continue to be a viable source of mortgages for years to come,” Favaloro said. “Now that Mortgage Brokers make up the fastest growing segment of mortgage originators in America and our share is growing exponentially, NAMB is providing products and services like we’ve never seen before.” But Favaloro said what he found most exciting about the new platform was the single point of access it provided to all of the wholesale lenders he works with. He admitted that NAMB All-In isn’t the only wholesale broker portal on the market, but said, “This is the only one that allows me the flexibility as a Broker to continue operating with lenders using the Fannie Mae 3.2 download, as well as the fullyintegrated single point solution within the all-in-one Calyx software.” He pointed out that some competing systems are limiting the Broker’s ability to download the application. “I’m not sure that’s in the best interest of the consumers, who have the impression that Brokers have access to a large array of products,” Favaloro said. “Now Brokers have a choice that was never available before.” Parekh suggested that more Broker technology will be coming in the future. “This is not a new strategy for us,” Favaloro said. “We are focused on innovation for both the Broker and the wholesale lender.” Parekh said that stems from Calyx taking a 10,000-foot view of its business, technology and the industry. “Calyx touches many aspects of the mortgage business,” Favaloro said. “When we analyze all of the different components, whether it’s the wholesale lender, correspondent lender, the Broker or the correspondent, we ask how we can enhance our solutions to benefit all the interconnected mortgage players. Calyx will continue to drive high value for our customers and the mortgage industry as a whole.”

Rick Grant is Special Reports Editor for National Mortgage Professional Magazine and Mortgage News Network. He may be reached by phone at (570) 497-1026 or e-mail RickG@MortgageNewsNetwork.com.

taking a strong step

unusually risk-averse. With manual underwriting and experienced servicing, companies can provide responsible lending where others won’t. Lenders may look at creating proprietary lending products that serve this underserved borrower or they can use government programs such as Federal Housing Administration (FHA) and Veterans Affairs (VA) loans down to the 500-credit score threshold those agencies allow.

channel and how you operate your business. Non-delegated purchases keep underwriting inhouse, and although it can be considered a more conservative approach, this strategy allows you to focus on and ensure responsible lending. Being able to offer non-prime mortgage products to the underserved or credit-challenged market can also help with profit margins—and at the same time, a correspondent channel can help increase production on these loans. When working with wholesale and correspondent lending, it’s important to emphasize transparency and timeliness so that originators can maximize growth and profitability. Whether you want to add new lending channels or grow existing ones, it helps if you can offer a full range of mortgages, from unique products to government vehicles, and all for a wide array of credit profiles. That’s how you keep current partners—and attract new ones.

Footnotes 1—https://www.mba.org/Documents/Research/Mtg%20Fin%20Forecast%20Nov% 202018.pdf. 2—https://www.fhfa.gov/AboutUs/Reports/ReportDocuments/2018Q3_HPI.pdf. 3—https://www.cnbc.com/2018/05/21/consumer-debt-is-set-to-reach-4-trillion-by-theend-of-2018.html. 4—https://www.creditcards.com/credit-card-news/rate-report.php. 5—https://finance.yahoo.com/news/u-mortgage-activity-hits-2-172804012.html. 6—https://www.experian.com/blogs/ask-experian/state-of-credit/. 7—https://assets.contentstack.io/v3/assets/blt47a327ac368e22cd/bltf18ca0423ae70ce2/ 5bf57ab010c28a4121703148/EM_OIR_OCTOBER2018_165162.pdf.

As President of Carrington Mortgage Services, Ray Brousseau is responsible for overseeing all aspects of Carrington’s lending and servicing businesses, from origination through fulfillment, as well as servicing operations, for the fast-growing enterprise. Under his leadership, both Carrington’s full-service mortgage lending business with wholesale, retail and centralized sales and operations, as well as its high-touch specialty servicing businesses have experienced unprecedented growth and operational results. Ray has nearly 35 years of experience in the mortgage banking and consumer finance industry.

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“This is not the year for pessimists, nor is it the year for naysayers. In fact, no one has time for any contemplation.” consumer experience, yet in the end, it’s going to come down to this: Are your Mortgage Loan Originators going to actually use it? Because this is more about adaptation and proper vetting because there are so many options. l Best Practice: Pilot with your pros! l Also, lock into what you are trying to do for 24 months. The truth is, in order to truly see the fruits of a technology implementation, you will need this time to vet, pilot, roll out, adapt, tweak and see real results. The tech companies will say no, that you will see the results sooner. I am certain that is possible, so this is a bet against your sales staff. What do you have? The answer to that will prove whether technology can race your car, or if it’s just nitrous in an engine you aren’t winning races with already. Keep the skilled Mortgage Loan Originators and have them pilot, champion and testify to the technology value in an internal campaign. Roll out and train in workshops in a round-robin manner and make sure your sales staff knows upfront that it’s not a test. Measure and stick with the accountability of results throughout. Go for the long game with quick returns, but implement and execute like a boss! Accountability Find the self-micro managers and exploit their successes. These are the people who check their accountability daily, are making moves and getting results. They may not be coming back with as many fish, but they are fishing

just as hard; however, the fishing hole has changed. That partner you had been aligning with who delivers not only the product, price and program needed for their consumer, but the one who elevates them, promotes them, educates them and influences others to use them the most! Keep the buoy in hand! At all costs, keep your good producers in the boat. Recognize, support, service, engage and elevate your best people. They are going to be attracted to the shiny objects being waved in their faces by your competitors. Lower volume and lower income tend to make gawkers out of loyalist, they may not jump, but failure to keep them happy and seated comfortably may end up being a company’s demise. The best leaders will win here! That is really the end of the story right there! We have no room this year for the conference room pessimists. There is no room for sitting around. There is no room for the same old, same old marketing. There is no room for the guys who didn’t get it in 2018 to figure it out in 2019. The win this year will go to the guys and companies who understand the points made above. The win of market share will go to those who can truly change the lives of their referral partners—the hustlers and game changers, go-getters and champions. It’s going to come down to who brings the most power to the table. So, my advice as an industry coach and long-time leader is to get powerful in 2019!

Christine Beckwith is a 30-year mortgage industry veteran who has broken many glass ceilings and has blazed a trail for many female professionals to come. Christine is currently President and COO of 20/20 Vision for Success Coaching and Consulting, a decorated, sought after and award-winning leader.

n National Mortgage Professional Magazine n JANUARY 2019

If you don’t want to merely survive in this shrinking market, but actually grow, you should consider creating or working with new products that fill in the gaps in traditional lending and seek out new lending channels. Determining where there’s unmet need—and figuring out a way to meet it—is critical to fostering growth and strengthening your position in any market. Mortgage Brokers and originators who want to position themselves for success will seek to partner with companies that are willing to take on this work.

the beckwith blog

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Increase lending channels Next, you should examine your lending options by adding warehouse lines to your portfolio. If a company offers lending channels beyond just retail, growing them in this market can be challenging. The critical component here is finding the right talent. You may need new leadership that’s prepared to meet the needs of the shifting market and that’s capable of recruiting the talent necessary to bolster the lending channel. Many lenders are beginning to offer correspondent lending. A Correspondent Lender originates and, unlike a Mortgage Broker, underwrites and funds mortgage loans using their own funds. The initial loan is usually made in the name of the Correspondent Lender, and then after closing, loans are either sold to a larger primary lender or on the secondary mortgage market. Although some might consider that foolhardy in this market, because correspondent profit margins tend to be lower than retail originations, it’s all about the products you offer through that

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Attention Recruiters, Business Development Managers and HR Professionals PRMG 1-855-PRMG-FAN! (855-7764-326) www.PRMG.net Built by originators for originators, PRMG was born from a vision of creating a company with a unique culture focused on the successes of the producer. We understand what it takes to be a successful originator and cultivate new business every day.

REMN Wholesale 732-738-7100 www.remnwholesale.com Although REMN Wholesale is part of a large corporation, it feels like a “Mom and Pop”-style company. We encourage our team members to grow and we train and promote each individual to their full potential. As a national company, REMN provides many opportunities for employment from coast to coast.

United Wholesale Mortgage 800-981-8898 www.uwm.com/careers Voted the #1 place to work in Metro Detroit, UWM is looking for A players to join our talented team. Our business is driven by our culture, and our people are our greatest asset. If you’re looking for the opportunity of a lifetime, apply to UWM today!

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NATIONAL MORTGAGE PROFESSIONAL MAGAZINE’S

calendar of events FEBRUARY 2019 Wednesday-Saturday, February 6-9 2019 NAMB Focus: Technology Conference & Trade Show Innisbrook Golf & Spa Resort 36750 U.S. Highway 19 N Tampa, Fla. For more information, visit NAMB.org. Thursday-Friday, February 7-8 2019 Tri-State Mortgage Conference Marriott Residence Inn/Portsmouth Harbor Events Center 100 Deer Street • Portsmouth, N.H. For more information, visit MBBA-NH.org. Sunday-Wednesday, February 10-13 MBA’s CREF/Multifamily Housing Convention & Expo 2019 Manchester Grand Hyatt San Diego 1 Market Place • San Diego, Calif. For more information, visit MBA.org.

Monday-Thursday, February 25-28 MBA’s National Mortgage Servicing Conference & Expo 2019 Hyatt Regency Orlando 9801 International Drive Orlando, Fla. For more information, visit MBA.org.

Sunday-Wednesday, March 10-13 MBA’s Mid-Winter Housing Finance Conference 2019 Ritz-Carlton, Bachelor Gulch 0130 Daybreak Ridge • Avon, Colo. For more information, visit MBA.org. Tuesday-Wednesday, March 12-13 MBA of KY 2019 Gala & Education Conference Holiday Inn Louisville East 1325 South Hurstbourne Parkway Louisville, Ky. For more information, visit MBAKY.org/2019-education-conference.

Monday-Tuesday, March 25-26 NRMLA 2019 Western Regional Meeting Paséa Hotel & Spa 21080 Pacific Coast Highway Huntington Beach, Calif. For more information, visit NRMLAOnline.org/event/2019-westernregional-meeting. APRIL 2019 Monday-Tuesday, April 1-2 MBA’s State & Local Workshop 2019 Capital Hilton 1001 16th Street, NW Washington, D.C. For more information, visit MBA.org. Tuesday-Wednesday, April 2-3 MBA’s National Advocacy Conference 2019 Capital Hilton 1001 16th Street, NW Washington, D.C. For more information, visit MBA.org. Wednesday, April 3 2019 IMA Spring Conference Quad City Waterfront Convention Center 2021 State Street Bettendorf, Iowa For more information, visit IowaMA.org. Sunday-Thursday, April 7-11 2019 Regional Conference of MBAs Harrah’s Resort & Convention Center 777 Harrah’s Boulevard Atlantic City, N.J. For more information, visit MBANJ.com. Tuesday-Thursday, April 16-18 2019 Great River MBA Conference The Peabody Hotel 149 Union Avenue Memphis, Tenn. For more information, visit GreatRiverMBA.com.

MAY 2019 Saturday-Wednesday, May 4-8 NAMB 2019 Legislative & Conference Liaison Capitol Hill Hotel 415 New Jersey Avenue NW Washington, D.C. For more information, visit NAMB.org. Sunday-Wednesday, May 5-8 MBA’s Legal Issues and Regulatory Compliance Conference 2019 Hyatt Regency New Orleans 601 Loyola Avenue New Orleans For more information, visit MBA.org. Tuesday-Friday, May 14-17 MBA’s Commercial/Multifamily Servicing & Technology Conference 2019 JW Marriott Los Angeles L.A. LIVE 900 West Olympic Boulevard Los Angeles For more information, visit MBA.org. Wednesday-Saturday, May 15-18 NAPMW 2019 Annual Education Conference “Jazzin’ Up Mortgage in the Big Easy” Hotel Monteleone 214 Royal Street New Orleans For more information, visit NAPMW.org. Sunday-Wednesday, May 19-22 MBA’s National Secondary Market Conference & Expo 2019 New York Marriott Marquis 1535 Broadway New York, N.Y. For more information, visit MBA.org. Monday-Tuesday, May 20-21 NRMLA 2019 Eastern Regional Meeting InterContinental New York Times Square 300 West 44th Street New York, N.Y. For more information, visit NRMLAOnline.org/event/2019-easternregional-meeting.

JUNE 2019 Sunday-Wednesday, June 2-5 MBA’s Chairman’s Conference 2019 Silverado Resort 1600 Atlas Peak Road Napa, Calif. For more information, visit MBA.org. Thursday, June 20 MBA’s Document Custody Workshop Ritz-Carlton, Tysons Corner Tysons Galleria 1700 Tysons Boulevard McLean, Va. For more information, visit MBA.org. JULY 2019 Wednesday-Saturday, July 31-August 3 FAMP 60th Annual Convention & Trade Show Walt Disney World Swan and Dolphin 1500 Epcot Resorts Boulevard Lake Buena Vista, Fla. For more information, visit OurFAMP.org. SEPTEMBER 2019 Saturday-Monday, September 14-16 NAMB National 2019 Conference & Trade Show Caesar’s Palace 3570 South Las Vegas Boulevard Las Vegas For more information, visit NAMB.org. Sunday-Tuesday, September 15-17 MBA’s Risk Management, QA & Fraud Prevention Forum 2019 Sheraton Grand Chicago 301 East North Water Street Chicago For more information, visit MBA.org. OCTOBER 2019 Sunday-Wednesday, October 27-30 MBA’s 2019 Annual Convention & Expo Austin Convention Center 500 East Cesar Chavez Street Austin, Texas For more information, visit MBA.org. NOVEMBER 2019 Monday-Wednesday, November 18-20 2019 Annual Meeting & Expo Nashville Omni 250 5th Avenue South Nashville, Tenn. For more information, visit NRMLAOnline.org/event/2019-annualmeeting-expo.

To submit your entry for inclusion in the National Mortgage Professional Calendar of Events, please e-mail the details of your event, along with contact information, to newsroom@mortgagenewsnetwork.com. *Looking for additional exposure at key industry events? Call 516.409.5555, ext. 4 to discover how to maximize your event coverage.

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MARCH 2019 Thursday, March 7 FAMP Gold Coast Chapter 2019 Annual Trade Show Bonaventure Hotel & Conference Center 250 Racquet Club Road • Weston, Fla. For more information, visit FAMPGoldCoast.org.

Sunday-Wednesday, March 24-27 MBA’s Technology Solutions Conference & Expo 2019 Hyatt Regency Dallas 300 Reunion Blvd E Dallas For more information, visit MBA.org.

Wednesday-Saturday, April 24-April 27 NAMMBA Connect 2019 The Westin Buckhead Atlanta 3391 Peachtree Road NE Atlanta For more information, visit NAMBA.org.

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Tuesday, February 12 CMLA Mortgage Expo 2019 Denver Marriott Tech Center 4900 South Syracuse Street • Denver For more information, visit CMLA.com/expo/2019/home.

Thursday, March 14 IMBA 2019 Mortgage Lending Conference Doubletree Hilton Hotel 1909 Spring Road Oak Brook, Ill. For more information, visit IMBA.org.

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Selected Mortgage Loan Originators may be entitled to receive: l Recognition in National Mortgage Professional Magazine l Participation in award ceremony at NAMMBA Connect Conference l Video interview on Mortgage News Network Nominees must represent minorities or be women who originate loans with an active NMLS number. Production by units or total loan volume (dollar amount) must be verified by letter by a sales manager or other responsible party. Submission will be reviewed and due diligence will be conducted on a percentage of all submissions. Inaccurate data provided will result in a company ban.

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