NMP National Mortgage Professional May 2021

MAY 2021

nmp

Volume 13, Issue 5

TAKE ADVANTAGE

NON QM

Of DPA Programs

Roiled

By Rate Sensitivity

and the

8 OPERATING AGREEMENT TIPS for

New Brokerages Making A Deal At First Sight

Robert Senko, president of ACC Mortgage, stayed bullish on Non-QM despite Covid

TERRIBLE, HORRIBLE, NO GOOD, VERY BAD YEAR (and why it’s finally getting better)

BACK COVER

PARTNER WITH THE LEADER IN NON-QM MORTGAGE LENDING MORE EXPERTISE | MORE SERVICE | MORE TECHNOLOGY

Visit AngelOakMS.com | 877.926.3073 ©Angel Oak Mortgage Solutions LLC NMLS #1160240, Corporate office, 980 Hammond Drive, Suite 850, Atlanta, GA, 30328. This communication is sent only by Angel Oak Mortgage Solutions LLC and is not intended to imply that any of our loan products will be offered by or in conjunction with HUD, FHA, VA, the U.S. government or any federal, state or local governmental body. This is a business-tobusiness communication and is intended for licensed mortgage professionals only and is not intended to be distributed to the consumer or the general public. Each application is reviewed independently for approval and not all applicants will qualify for the program. Angel Oak Mortgage Solutions LLC is an Equal Opportunity Lender and does not discriminate against individuals on the basis of race, gender, color, religion, national origin, age, disability, other classifications protected under Fair Housing Act of 1968. MS_A252_1220

nmp

MAY 2021

FRONT COVER

Volume 13, Issue 5

TAKE ADVANTAGE

NON QM

Of DPA Programs

Roiled

By Rate Sensitivity

and the

8 OPERATING AGREEMENT TIPS for

New Brokerages Making A Deal At First Sight

Robert Senko, president of ACC Mortgage, stayed bullish on Non-QM despite Covid

TERRIBLE, HORRIBLE, NO GOOD, VERY BAD YEAR (and why it’s finally getting better)

PRESENTED BY

2

INDUSTRY PARTNER MEMBER

© 2021 All Credit Considered Mortgage, Inc. d/b/a ACC Mortgage · NMLS ID 176724 · 1801 Research Blvd., Suite 410, Rockville, MD 20850 · (877) 349-0501. Not all loan programs are available in all areas. Program restrictions may apply. All rights reserved. This is not an offer or extension of credit or a commitment to lend. Licenses are held as follows: Arkansas combination Mortgage-Banker-Broker-Servicer license #119499; Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act License #41DBO-102821; Connecticut Mortgage Lender License ML-176724; Delaware Lender License #020786; Florida Mortgage Lender Servicer #MLD953; Georgia Mortgage Lender License #46424; Idaho Mortgage Broker/Lender License #MBL-2080176724; Illinois Residential Mortgage License MB.6761111; Indiana-DFI Mortgage Lending License #40794; Maryland Mortgage Lender License #6625; Michigan 1st Mortgage Broker/Lender License #FL0022183; Minnesota Residential Mortgage Originator License # MN-MO-176724; Nevada Mortgage Lender License 4619; New Jersey Residential Mortgage License; North Carolina Mortgage Lender License L-164875; Oklahoma Mortgage Lender License #ML012740; Oregon Mortgage Lending License #ML-5825; Pennsylvania Mortgage Lender License 51566; South Carolina-BFI Mortgage Lender/Servicer License MLS-176724; Tennessee Mortgage License #181409; Texas SML Mortgage Company License; Utah-DFI Residential First Mortgage Notification; Virginia Lender Licensed by the Virginia State Corporate Commission as MC-1856; Washington Consumer Loan Company License #CL-176724; District of Columbia Mortgage Dual Authority License #MLB176724.

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

Volume 13 Number 5 MAY 2021

CONTENTS

nationalmortgageprofessional.com

4 The Meet Of The Matter As in-person mortgage events ramp up, let’s not cast safety aside too swiftly.

6 Recruiting Is Dating 101 People fall in love because of how their partner makes them feel about themselves. It’s the same technique in the LO recruitment game.

8 Can’t Wait To Make A Handshake Agreement After a year of marketing under Covid protocols, here are some good things to keep doing. And some that we will never miss.

11 People On The Move See who the movers and shakers are in the mortgage industry.

12 Build-A-Broker: The Devil Is In The Details When you start your mortgage brokerage, don’t skip out on putting together an operating agreement. With or without partners, this is the best planning document you’ll have.

14 My First Million: You Should Care If You Read This It’s not just the blahs.

Apathy at work will kill your productivity and your profitability.

16 Zoom In On Your Best Self Of course, online meetings can be a drag. But that doesn’t mean you shouldn’t take advantage of a chance to put yourself forward in

the best light. Be ready to sound strong, speak smartly and show your professionalism.

18 Get The Down Low On DPAs Down Payment Assistance programs can help more people buy houses, and more mortgage originators close loans. So why don’t LOs know about all the options available in the marketplace?

19 HEARD BY NMP 22 RATE OF RETURN Service takes a back seat to interest rates when consumers are making their choices. Be ready with your counter-arguments.

24 COVER STORY PUTTING ‘THE PAUSE’ BEHIND IT When Covid closed the nation, investors pulled the rug out from most Non-QM lenders. Now, a year later, industry leaders reflect on how they handled that situation, and what the outlook for this sector is today.

32 NMP DATABANK Find quick economic info to give you insight into what’s happening that’s affecting the market.

33 OriginatorTech Directory

>

COVER STORY PAGE 24

PUTTING ‘THE PAUSE’ BEHIND IT

35 MY BEST DEAL: A HEART-STOPPING SITUATION Dave Trabosh, Contour Mortgage, New York.

37 WFH IS CHANGING THE GAME The housing market is being remade as consumers insist on properties that fit a work-from-home lifestyle.

39 Non QM Showcase 40 Wholesale Directory

41 NMP Calendar of Events 43 UWM FACES CLASS ACTION A Florida-based broker is trying to bring a class action against United Wholesale Mortgage for its decision to cut off originators who want to work with its competitors.

44 New To Market 46 Facebook Thoughts: AKA, ‘Evil Lives In My House.”

nationalmortgageprofessional.com

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

3

MAY 2021

nmp

Volume 13, Issue 5

TAKE ADVANTAGE

MAY 2021

Roiled

By Rate Sensitivity

and the

8 OPERATING AGREEMENT TIPS for

New Brokerages Making A Deal At First Sight

LETTER FROM THE PUBLISHER

Till We Meet Again

O

ur sister organization, the Originator Connect Network, produces more than two dozen live mortgage conferences across the country every year. That lineup took a bit of a shellacking in 2020 when Covid shut the nation down. But as May rolls out, so do OCN live tradeshows and events, first in Memphis and next in San Antonio.

Naturally, we try to keep tabs on what others in the industry are doing for meetings. In April, two private lending conferences took place: one in Miami, the other in Newport Beach, Calif. We watched as pictures from these events were posted online by exhibitors and attendees, all of whom seemed thrilled to be back together in person.

Honestly, we were envious. But we were also horrified.

The rooms were packed: clearly people wanted to be at the conference, and a lot of them were. Hundreds. These didn’t look like Covid conferences. They looked like everything was back to being pre-Covid. That’s right, everything. That’s where the envy comes in. But it’s also where the horror rests.

In Miami, for example, what stood out was a large ballroom, with folks crammed at tables, and no one – really, no one – wearing a mask. Indoors. With lots of strangers.

Who just got off planes from hot spots across the nation.

TAKING IT SLOWER, SAFER We’re thrilled that vaccines are now readily available, and so many have taken them.

But we’re still concerned that so many are refusing to do so. This disease has proven across the world that it fights back. States may take away mask mandates, but they’re not repealing common sense. Even if a mask isn’t legally mandatory, it’s a good idea until we get a better handle on this virus.

Our OCN group produced six live mortgage conferences last fall, when Covid was rampant and no vaccine had yet been introduced. Every event was held to high safety standards, and the attendees and exhibitors all gave them good marks on our exit surveys.

This isn’t to pass judgment on how others convene. Everyone has to make their own determination of what they feel safe doing. We get the desire to meet again, and to do so as though everything is back to normal.

But we’re not there yet. At OCN shows, we’re still enforcing a mask requirement and trying to keep some social distancing in place. We know the rules are loosening up, and we’re cheered by that. Maybe as vaccinations hit a higher level, this slack will feel more comfortable. In the meantime, we’ll be more cheered by knowing that we put no one in danger when they come to our shows, even if they tell us they’re happy to take the chance.

VIN CE N T M. VALVO Publisher, Editor & CEO

4

NON QM

Of DPA Programs AN INSIDE LOOK:

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

Robert Senko, president of ACC Mortgage, stayed bullish on Non-QM despite Covid

TERRIBLE, HORRIBLE, NO GOOD, VERY BAD YEAR (and why it’s finally getting better)

Volume 13, Number 5

STAFF CEO, PUBLISHER & EDITOR Vincent M. Valvo ASSOCIATE PUBLISHER Beverly Bolnick SENIOR CONTRIBUTING EDITOR Keith Griffin CONTRIBUTING WRITERS Lew Sichelman, Erica LaCentra, Harvey Mackay, Pam Marron, Nick Roberson, Mary Kay Scully, James Potter Charlet STAFF WRITER Katie Jensen GRAPHIC DESIGN MANAGER Stacy Murray INTERACTIVE DESIGN DIRECTOR Alison Valvo USER EXPERIENCE DESIGNER Billy Valvo ONLINE CONTENT DIRECTOR Navindra Persaud MARKETING & EVENTS ASSOCIATE Melissa Pianin HEAD OF ENGAGEMENT AND OUTREACH Andrew Berman FOUNDING PUBLISHER Joel Berman

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

www.ambizmedia.com

© 2021 American Business Media LLC All rights reserved. National Mortgage Professional magazine is a trademark of American Business Media LLC. No part of this publication may be reproduced in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without written permission from the publisher.

Advertising, editorial and production inquiries should be directed to: American Business Media LLC 345 North Main St., Suite 313 West Hartford, CT 06117 Phone: (860) 719-1991 info@ambizmedia.com

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

5

AVE HERSHMAN

RECRUITING, TRAINING AND MENTORING CORNER

What To Say At The Recruitment Appointment Take it easy, take it slow, but be prepared and be helpful

BY DAVE HERSHMAN | CONTRIBUTING WRITER, NATIONAL MORTGAGE PROFESSIONAL

S

o you got the appointment.

You are now sitting down and having lunch. You have promised them not to recruit. Where do you go from here? For one thing, promising you are not recruiting does not mean you can’t give them a recruitment – or in this case – informational package. It takes 15 seconds to say something like: I brought you a present. This package contains some information on our company. You might enjoy looking at the marketing materials. You can just look at it and if you want, feel free to pass it on to someone else who might want to know about us.

Like our meetings with mortgage prospects, we need to make sure that our meetings with loan officer candidates uncover their real needs.

This is why cold calling prospects and hard sells do not work. If the recruitment happens that superficially, you are bound to be recruiting the wrong person because you have not really found a deep-seated match.

Deep-seated connections take time and you must be willing to go through the sales process the right way for more long-term success.

The approaches we suggested for making contact and obtaining an

appointment are actually an important part of this process.

With a connection. Instead of cold calling, you were introduced through someone you know. This gives you a connection with the prospect which you cannot achieve with a cold call.

SHOWING AN INTEREST IN THEM Your first meeting is not to hammer them over the head and gain recruiting submission, it is to find out more about them. If you find out everything about their business, you are more likely to find out how you might be able to help them. You are also more likely to find out how they can help you – again, through mutual loan referrals or even other loan officer candidates.

Your ability to ask questions, rather than talking or lecturing is a major key at this point. The person controlling the conversation is the one listening.

You can’t find out about them if you are talking. What type of questions might you ask? There are plenty of possibilities. If you are interested in a list of questions to ask at the meeting, email us at success@hershmangroup. com and we will forward them to you.

And other questions will arise from the questions you ask – as these are all about starting meaningful conversations.

For example, if you ask: What marketing system do you think you should be implementing, but you have not as of yet?

And they say: I want to keep in touch with my previous customers more frequently.

You might then ask: Do you have a newsletter you send to your clients on a regular basis?

Do not get the impression that we are recommending that you are doing the research in order to write an autobiography about this person.

Obviously, the purpose here is to find opportunities in which you can

help the candidate and they can help you. And some of these opportunities can lead to benefits you have at your company which may help them.

For example, let’s say that they are closing eight loans per month, but have a goal of moving to 15 loans per month. Perhaps they indicate they need an assistant to get to that level, but their present company will not hire an assistant for them unless they are producing 12 loans per month. If your company would provide an assistant at eight loans per month, this may be a factor which can lead to a decision.

Of course, the example is pretty much from point A to point D. For most other examples, there will be many short steps. Perhaps you can recommend a CRM system for them if their company does not provide one.

And you can mentor them in using that CRM. That mentor relationship moves the needle along and perhaps three months later, their company starts to have processing problems. Now you are in position.

CHECK AND CHECK One area we have not covered, but which is vitally important, is doing the research necessary before you even call the candidate. By accomplishing proper research, the call to get an appointment or questions to ask at the appointment will become easier.

The research can be accomplished through networking and/or online.

For example, reviewing their Linkedin profile or website to uncover where they are from, where they went to school and what companies they have worked for. This research will not only facilitate conversations, but also uncover reference sources you can use later on within the process.

Dave Hershman, senior vice-president of sales for Weichert Financial Services.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

7

RICA LACENTRA

THE XX FACTOR

Viral Marketing Lessons Learned

Covid wrenched many marketing plans. What can marketers take away – and regain – after more than a year of ducking and dodging?

BY ERICA LACENTRA | CONTRIBUTING WRITER, NATIONAL MORTGAGE PROFESSIONAL

W

ith the end (or at least control?) of COVID hopefully in sight, it’s a good time to talk about what marketers have learned over the past year. Mainly, what techniques and campaigns should be here to stay permanently as part of your marketing strategy, and what we can leave behind with COVID once and for all (I’m looking at you fully-virtual conferences).

DON’T NEGLECT THE CUSTOMERS YOU ALREADY HAVE One of the biggest things that COVID taught companies was the importance of communicating with your customers.

Particularly in the mortgage

industry, when many hard money lenders and non-QM lenders had to put a pause on origination, customers wanted answers.

Many took the approach of communicating openly and often, others stayed silent, hoping for the worst to pass without having to provide an explanation, and some even chose to sugar coat communications with their clients hoping that things would return to normal before their cover was blown.

When the dust settled, the companies that communicated clearly found they were able to bounce back quickly. Why? Because in tough times, when you look out for your customers, they are more likely to show loyalty and thank you in one way or another when they can, and that came in the form of returning business.

Do you need to provide weekly updates about the state of your business? Probably not, but you should be communicating with your customers about any program or product updates, company milestones, or other information that could affect the way they do

business with you. Never discount the power of staying in contact with your customers and rewarding them for their ongoing loyalty as being able to capture repeat business is often low-hanging fruit.

HAVE A STRONG ONLINE PRESENCE The mortgage industry has always seemed to lag behind other industries when it came to digital marketing, but COVID made it necessary for companies to pivot to a marketing plan that relied more heavily on a successful digital strategy. Over the last year there was a renewed focus on updating company websites, and developing better email marketing, social media marketing, and pay-per click campaigns.

With people staying at home more during the pandemic, they had more time to read those marketing email blasts or felt more compelled to scroll through their various social media feeds to kill time. Companies saw many of their efforts pay off because of this uptick in interaction with digital media, but having a strong digital footprint

In tough times, when you look out for your customers, they are more likely to show loyalty and thank you in one way or another when they can

is something a company should also think about going forward.

While conferences and live networking events are returning, it’s about time the mortgage industry caught up and realized the importance of multi-layered marketing campaigns. Companies should now be thinking about what digital channels they saw significant success with, whether it was certain social media ads, email marketing efforts, PPC campaigns, etc. and continue to build on those campaigns and weave them into other parts of their marketing plan to ensure future growth.

what virtual conferences taught marketers is that there is significant value in having a hybrid approach to events. Being able to network and schedule meetings ahead of time and easily capture contact information from attendees during an event via an app is something that should continue to be utilized even for in-person events.

Also, having sessions recorded and on-demand even after an event wraps up is a great way for companies to be able to further engage attendees. I can think of countless times when I’ve had to choose between two sessions

targeted with who they are presenting to if they want to have more successful webinars going forward.

State of the industry style update webinars worked very well midpandemic because customers wanted information on what was going on.

Those will no longer work as well because the industry is no longer as tumultuous. Companies should be thinking again about what webinar topics will best appeal to their customers, both new and existing, because citing industry data that is readily available and at customers’ fingertips isn’t going to cut it.

HIT THE PAUSE BUTTON ON CERTAIN EFFORTS

I’d really like to sit in on because they occurred at the same time. That should no longer be an issue going forward. I think most folks in the industry would agree though, let fully virtual conferences sputter out.

Another area to potentially consider pumping the breaks on is webinars.

Now, by no means do I think webinars should be laid to rest, quite the opposite actually. It’s just become extremely apparent with the amount of webinars that have flooded our industry that companies will have to be more thoughtful about the topics that want to discuss and more

KEEP LEARNING & ADAPTING

So, while certain marketing efforts were highly effective during the pandemic, there are some that will probably meet their demise once we start getting back to normalcy. The top one on the list is fully virtual conferences. While so many event coordinators tried to replicate the experience of in-person events through a virtual platform, there really is no substitute for the real thing.

However, while fully virtual conferences will probably die out,

COVID has taught marketers and our industry a lot over the past year, but one of the most crucial lessons has been the importance of staying on trend, learning new techniques, and being prepared to pivot. Now is not the time to sink back into old marketing habits or routines, it’s time to take everything we learned and continue to drive the industry forward.

Erica LaCentra is director of marketing for RCN Capital.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

9

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Learn more at RocketProTPO.com.

10

Quicken Loans, LLC; NMLS #3030; www.NMLSConsumerAccess.org. Equal Housing Lender. Licensed in 50 states. AL License No. MC 20979, Control No. 100152352.

AR, TX: 1050 Woodward Ave., Detroit, MI 48226-1906, (888) 474-0404; AZ: 1 N. Central Ave., Ste. 2000, Phoenix, AZ 85004, Mortgage Banker License #BK-0902939; CA: Licensed by Dept. of Business Oversight, under the CA Residential Mortgage Lending Act and Finance Lenders Law; CO: Regulated by the Division of Real Estate; GA: Residential Mortgage Licensee #11704; IL: Residential Mortgage Licensee #4127 – Dept. of Financial and Professional Regulation; KS: Licensed Mortgage Company MC.0025309; MA: Mortgage Lender License #ML 3030; ME: Supervised Lender License; MN: Not an offer for a rate lock agreement; MS: Licensed by the MS Dept. of Banking and Consumer Finance; NH: Licensed by the NH Banking Dept., #6743MB; NV: License #626; NJ: New Jersey – Quicken Loans, LLC, 1050 Woodward Ave., Detroit, MI 48226, (888) 474-0404, Licensed by the N.J. Department of Banking and Insurance.; NY: Licensed Mortgage Banker – NYS Banking Dept.; OH: MB 850076; OR: License #ML-1387; PA: Licensed by the Dept. of Banking – License #21430; RI: Licensed Lender; WA: Consumer Loan Company License CL-3030.

Conditions may apply. ©2000 - 2021 Quicken Loans, LLC. All rights reserved.

Lending services provided by Quicken Loans, LLC, a subsidiary of Rocket Companies, Inc. (NYSE: RKT) “Quicken | NATIONAL MORTGAGE PROFESSIONAL MAGAZINE Loans” is a registered service mark of Intuit Inc., used under license. Quicken Loans, 1050 Woodward Ave., Detroit, MI 48226-1906

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HOW NMP’S MONTHLY SECTION OF HANDS-ON PRACTICAL ADVICE

BUILD-A-BROKER How To Build Set Up Your Brokerage So You Avoid Legal Problems YOUR FIRST MILLION DOLLARS How To Overcome Depression And Get Your Career Back On Track How To Conduct Better Virtual Sales Meetings How To Take Advantage Of Down Payment Assistance Programs CAREER TICKER: People On The Move

PEOPLE ON THE MOVE //

> Cherry Creek

Mortgage promoted Reid Nelson to vice president of software development.

> Union Home Mortgage named David Rank as the company’s national retail business development director.

> Amerifirst

Home Mortgage appointed Thinh Nguyen to serve as the company’s chief information officer.

> Talia

Ramos joined preREO as the company›s director of Post-Closing, responsible for offering education on investment strategies to maximize returns.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

11

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

Embracing The Ties That Bind Why you need an operating agreement: 8 operating agreement tips

BY BRETT FARMILOE | SPECIAL TO NATIONAL MORTGAGE PROFESSIONAL

O

perating agreements are pivotal in outlining a business’ financial and functional decisions.

It’s the guiding document that bonds and legally protects business partners.

Nonetheless, up-and-coming mortgage pros opening a brokerage with partners often neglect it. Learn why these eight business owners and entrepreneurs stress the importance of operating agreements and tips to help you complete yours.

ESTABLISHES STRUCTURE If you are the proud owner of an LLC, then you need an LLC operating agreement! An operating agreement establishes your company’s structure, helps protect your limited liability status, and creates the governing rules of your business. The only tip I have for writing an operating agreement is not forgetting to have your co-owners and lawyer sign it to make it official and legal. After that, you are set!

-Vicky Franko, Insura

OUTLINE EVERYONE’S POWERS AND RESPONSIBILITIES If you have formed a limited liability company, otherwise known as an LLC, you must have an operating agreement.

This document can help protect you

from personal liability and save you lots of stress down the road if anything goes awry with internal affairs down the road. When crafting an operating agreement, my tip is to really spend some time outlining everyone’s powers and responsibilities. The less you leave to the imagination, the better.

-Blake Murphey, American Pipeline Solutions

BECAUSE LAWYERS SAY SO Whenever an attorney or CPA gets on my case for something, I listen and do it. I respect their expertise and experiences. If they’ve seen business owners like me get burnt for things like not having an operating agreement in place or posting labor law posters, I make sure that our posters are displayed, and an agreement is in place. Even if you are the sole owner of a business, avoid future lawyer freak out moments by getting an operating agreement in place.

-Brett Farmiloe, Markitors

PLAN FOR AN UNEXPECTED EXIT You and your business partner are most likely in the honeymoon phase and don’t think it is a good use of your limited funds to invest in legal counsel to document how one or both of you can make your exit. However,

you would be wrong. It is much easier to set up a win-win exit strategy in advance than after emotions are high and people feel burned by their former best friend and business partner. Until business partners fully understand the importance and have the tools to negotiate expectations, business divorces will continue to occur at high rates. Worse, the business’s value diminishes significantly because of the distractions caused by these unproductive transitions and transactions.

-Katharine Halpin, The Halpin Companies Inc.

HIRE A PROFESSIONAL An operating agreement defines what duties members are responsible for as it pertains to the business and is also a blueprint of what happens to the company in the event of divorce, death, and dissolution. I believe it is vital to hire an attorney to prepare an operating agreement when a business gets started. A professional will ask the questions you may not think about, and it is best to hammer out the details with all involved before any issues arise, so decisions are made with a clear head and without emotion.

-Kimberly Bogues, Flourish Business Services, LLC

PEOPLE ON THE MOVE //

Nations Lending hired Randy Koerner as the company’s divisional sales manager.

12

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

Sprout Mortgage hired Henry Santos as the company’s executive vice president and chief information officer.

American Homeowner Preservation Inc., promoted Tim Gillis as the company’s chief revenue officer.

Bhavesh Patel was named director of client management for Chase Correspondent Lending located in Houston, Texas.

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DON’T LEAVE IT TO YOUR STATE’S DEFAULT CLAUSES The law may use jargon such as that the operating agreement can be printed, oral, or inferred. The implicit agreement essentially implies that although there is no formal or oral agreement, it is understood that the participants wish to be ruled by the default clauses.

However, even though a state does not need an operating agreement, it is a wise business decision to have one and even smarter to have one in writing. The agreement may protect the status of your business, ensure that each member abides by the rules, and help alleviate any problems or misunderstandings that may arise— including for single-member LLCs. If the deal has been sealed, retain copies of all your private business documents.

So don’t forget about that!

-Sylvia Kang, Mira

Walker & Dunlop, Inc. hired Suzanne Jones as a senior director in its Agency financing group focusing on the origination of Fannie Mae and Freddie Mac multifamily loans.

CLARIFY THE GREY Having an operating agreement with a business partner is a great way to avoid conflict and ensure you are operating within the original vision and charter of the organization. My tip for writing an operating agreement or any other similar document is to be exhaustive with brainstorming areas of the business that may need to be addressed.

While some situations at the onset may seem mundane, addressing these proactively will only maintain sanity in the business relationship, which will contribute to the organization’s overall health.

-Steven Brown, DP Electric Inc.

AVOID GETTING SUED EASILY If you want to get sued easily or risk facing bankruptcy over one mistake in your business, don’t have an operating agreement in place. Operating

Fast Mobile Home Loans hired Charles Arnell as the company’s executive director.

agreements are basically your way of saying, “Hey, you can’t sue me on this because I already outlined my practices on this contract.” Operating agreements are important in protecting you from losing everything you worked hard for. My greatest tip for writing an operating agreement is to consult with a professional first. You don’t want to miss any clauses that may jeopardize you in the long run. If you can’t find someone to help you, make sure whatever rules you write are as specific as possible. That includes names, addresses, who you’re addressing, under what provisions, etc.

-Manny Vetti, Back Taxes Help, LLC

Brett Farmiloe is the founder & CEO of Markitors, a digital marketing company that connects small businesses to customers through organic search.

Mr. Cooper Group Inc. appointed Kurt Johnson, to lead risk and compliance as executive vice president and chief risk and compliance officer.

Mortgage Connect LP named Ian Morgan as the company’s chief information security officer.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

13

HOW: HANDS ON PRACTICAL ADVICE LEADERSHIP LESSONS

Start Caring About Apathy You can get worked up again about getting up for work

BY HARVEY MACKAY | SPECIAL TO NATIONAL MORTGAGE PROFESSIONAL

A

newspaper reporter secured an exclusive interview with the devil and was especially interested in the deceptive techniques the devil used to build his reputation.

He asked, “What is the most useful tool you use on people? Is it dishonesty? Lust? Jealousy?”

“No, no, no,” chuckled the devil.

“The most useful weapon I possess is apathy.”

How true! An “I don’t care” attitude will strip life from the loftiest dreams.

Apathetic phrases like “Never mind,” “That’s not my problem,” “I’m not concerned about that,” or “I don’t want to hear that” don’t accomplish peace of mind or solve anything.

Helen Keller, the famous blind author, said: “Science may have found a cure for most evils; but it has found no remedy for the worst of them all – the apathy of human beings.”

Apathy has been around forever, but the Covid pandemic and resulting isolation has left many more people feeling bored, empty and lacking motivation. No energy. No enthusiasm. And then, no results.

Apathy isn’t sadness or anger.

It’s more like feeling not much of anything.

TRANSIENT TROUBLE The good news is that apathy is temporary.

It’s only a glimpse of how you feel now. In other words, you can change. But first it’s helpful to figure out what caused your apathy. Then you can make some adjustments to help you break out of your doldrums.

Are you bored with your job? Have you stared at the same wall too long?

Does it seem like too much work to look for ways to improve your situation? Are you willing to settle?

If “I don’t know and I don’t care” are the common answers to questions, it’s time to change things up.

Maybe you need to adjust your daily routine. Get up early and exercise. Go outside and walk and get some fresh air. Take a bike ride or go on a day trip in your car. Become more active. Do something that will help you perk up.

Maybe it’s reading a book, listening to music or taking up a new hobby. Plan your dream vacation for the day when life gets back to “normal.”

What did you previously do that brought you joy? Make a list. And then

commit to doing some of the things daily that brought you happiness.

Do something that you’ve wanted to do for a long time. Start a challenging project that you’ve been thinking about tackling to get your mind going.

WORKED UP The antidote to apathy is enthusiasm.

Enthusiasm is about passion, gusto, excitement and infectious energy.

Major League Baseball star Pete Rose once was asked which goes first on a baseball player – his eyes, legs or arm.

He said: “None of these things. It’s when his enthusiasm goes that he’s through as a player.”

What can you do to boost your enthusiasm? It all depends on how much you want to succeed. Take control of your own destiny. Success comes from knowing what you want, not wanting what you know.

A landscape gardener ran a business that had been in the family for three generations. The staff was happy, and customers loved to visit the store, or to have employees work on their gardens or make deliveries.

For as long as anyone could remember, the current owner and previous generations of owners were extremely positive happy people. Most folk assumed it was because they ran a

PEOPLE ON THE MOVE //

Embrace Home Loans hired Jason Will as the company’s senior vice president of market growth, a newly created role at the company.

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The Masiello Group, Ltd. revealed that Timothy C. Coughlin joined the company as general counsel.

Steve Strother will lead Waterstone Mortgage Corporation’s new branch in Jacksonville.

BSI Financial Services hired Michael Bugbee as vice president of client success.

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What can you do to boost your enthusiasm?

It all depends on how much you

want to succeed. successful business.

In fact it was the other way around.

A tradition in the business was that the owner always wore a big lapel badge, saying Business Is Great! The business was indeed generally great, although it went through tough times like any other. What never changed, however, was the owner’s attitude, and the badge saying Business Is Great!

Everyone who saw the badge for the

first time invariably asked, “What’s so great about business?” Sometimes people would also comment that their own business was miserable, or even that they personally were miserable or stressed.

The badge always tended to start a conversation, which typically involved the owner talking about lots of positive aspects of business and work.

No matter how miserable a person was, they’d usually end up feeling

a lot happier after just a couple of minutes listening to all this infectious enthusiasm and positivity.

When asked about the badge in a quiet moment, the business owner would confide: “The badge came first.

The great business followed.”

Mackay’s Moral: Apathy is the glove in which evil slips its hand.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

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HOW: HANDS ON PRACTICAL ADVICE

MARY KAY SCULLY

BENCHMARKS & BEST PRACTICES

Strike The Right Tone The three S’s for effectively presenting yourself in a virtual environment

BY MARY KAY SCULLY | CONTRIBUTING WRITER, NATIONAL MORTGAGE PROFESSIONAL

W

e’ve been firmly planted in a virtual environment for more than a year now and it can be hard to present well.

According to a study on the relative importance of verbal and nonverbal messages in personal communication

by Professor Albert Mehrabian of UCLA, when people are processing a conversation, between 38% and 83% of the interaction is defined by your tone – how you sounded. As much as 55% of what they take away from the conversation comes from what they saw in your environment, in your message or in your body language. That leaves as little as 7% of their takeaway that comes from the words you actually said.

Whether it’s in a video meeting, phone conversation or even in an email, it’s important to consider how you sounded, what you said, and what they saw.

THE FIRST ‘S”: “SOUND”

THE SECOND “S”: “SAID”

The tone of your conversation sets the tone for your relationship, so it’s important to keep a few things in mind. While it’s more difficult to read the room in a virtual setting, I like to think of it as being a parrot.

Align with, or match, other people’s energy levels and patterns of speech.

Share excitement if they’re excited or take your time and slow your speech pattern if they’re calmer or more subdued.

Some other key elements of perfecting your tone are as simple as using the customer’s name to show them that you care and value their unique situation.

Similarly, try what I call “putting a smile in your voice.” Especially on phone calls, the sound of your voice can say so much about you as a person. A customer can detect your mood or interest level just by the sound of your voice, so ensure you sound engaged and happy to work with them. Additionally, elevation in your volume to compensate for technical quality issues or background noise distractions may be perceived as anger or intolerance.

Another huge factor in keeping people engaged is what you said.

Aside from accuracy, the biggest challenge with what you say will come from how people understand you or receive the information you’re presenting. Make sure you’re being clear so that your message is received how you intended.

Check for understanding by asking, “Does that make sense?,” or “Do you need me to explain this differently?”

Make sure whoever you’re engaging with has a very clear idea of the points you’re making and that they have ample opportunity to ask questions as well.

THE THIRD “S”: “SAW” Last, but not least, let’s dive into what others see. After a year of Zoom calls, everyone should know that what they choose to show in that small box on the screen speaks volumes about them. Does your background or your desk say that you are trustworthy and organized, or does it say you are scattered and lack attention to detail? Remember that in many cases what they see is

The biggest challenge with what you say will come from how people understand you or receive the information you’re presenting.

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almost more important than what you say.

Next, think about how you’re carrying yourself. Don’t try to multitask, as this can take away from the meeting, and unintentionally signal to the other person that you’re disinterested in the conversation.

Even the information included in your email signature and how it looks can say a lot about you. You may want to consider using multiple email signatures categorized by what is relevant to the recipient. As a bonus this may reduce the amount of inquires that you receive based on information that could have been proactively shared.

When you share your screen in a meeting, keep in mind the tabs you have open as well as what your computer background is, as that image can also say a lot about you. A best practice is to close out all of your other windows prior to sharing your screen. You don’t want your emails popping up and it’s critical that none of your other clients’ personal information is visible.

Finally, what does your followup look like? After a meeting, make sure your follow-up message is thoughtful, organized and includes information that is pertinent to the conversation you had. Again, there is no “one size fits all” approach here.

Tailor your message to the unique individual to show them that you’re invested in the relationship. Be sure to put some thought and effort into how you present yourself in order to keep colleagues and customers engaged and ultimately build trusting relationships.

Mary Kay Scully is the director of customer education at Genworth Mortgage Insurance. The statements in this article are solely the opinions of Mary Kay Scully and do not necessarily reflect the views of Genworth or its management.

PEOPLE ON THE MOVE // Shanon Schinkel will serve as the branch manager for Hometown Lenders’ 92nd location in Colorado Springs.

Plaza Home Mortgage named Michael Fontaine as the company’s copresident.

Plaza Home Deephaven Mortgage Mortgage named hired Shelly Michelle Griffin as the Richardson company’s as senior vice senior vice president, president chief financial of client NATIONAL MORTGAGE PROFESSIONAL MAGAZINE | 17 officer. development.

HOW: HANDS ON PRACTICAL ADVICE

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CLIENT SOLUTIONS

DPA Options Have Never Been More Plentiful For Originators

BY PAMELA M. MARRON | CONTRIBUTING WRITER, NATIONAL MORTGAGE PROFESSIONAL

AM MARRON

O

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ne of the most needed resources for clients who wish to purchase a home is down payment assistance.

But in 2020 when some federal and state funds were diverted to assist homeowners and renters to stay in homes during the height of the pandemic, the emergence of wholesaler and some proprietary DPA programs came to the forefront.

This not only expanded the availability of needed DPA funds, but also provided awareness of the variety of programs with a slight advantage to mortgage brokers who can utilize wholesale DPA in addition to city, county SHIP and most state programs.

And with the mammoth rollout of the new URLA, be aware of differences of dropdown information in 4b. for second mortgages and 4d. for grants.

In today’s competitive housing market, homebuyers who need closing costs assistance from the seller often compete with cash buyers and flippers who don’t. Any advantage for the homebuyer is sought and down payment assistance can provide that advantage by providing funds needed through a DPA source rather than the seller.

BIG JUMP Down payment assistance has been available to consumers for a long time, but the variety of programs currently available has not. For loan originators who wish to use as many of these sources as possible, Downpaymentresource.com offers this variety state by state.

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Loan originators can generate leads from this source as well (for a fee) on the Down Payment Connect side with a personal landing page and website link promoting that the loan originator can provide selected DPA programs for interested clients. Customized selection of specific programs a loan originator can provide that will show up for qualified clients is included.

The biggest problem loan originators have with down payment assistance is matching the DPA guidelines with the 1st mortgage product. Many originators have had the experience where a client fits all of the criteria for the first mortgage, but the loan is denied for criteria not met with the down payment program. The best benefit of all (to me!) with Down Payment Connect is the detail for each down payment program outlined on its own page, including who to contact and an updated status on funds availability at the top of each program description.

that the company offers.

PROGRAM HELP

entries. 4b. and 4d. entries work for

Some DPA programs provide a blended 1st and 2nd mortgage program so that client qualification criteria is easily matched. Land Home Financial Services, a national wholesaler that provides a blend of the 1st and 2nd mortgage, has a link in their description to an easy to follow DPA Program Comparison Matrix linked to the FHA and two additional conventional programs

And, even if the DPA program that is offered is only a second mortgage that needs to be matched with a first mortgage, the Down Payment Connect DPA Directory often provides a link to get information on approved lenders and how to become an approved lender. This is done with Chenoa Fund, a nationwide down payment assistance program that can provide two different second mortgages that can subordinate to an FHA loan and a conventional DPA second mortgage for eligible conventional first mortgages.

NEW URLA DPA ENTRY The most important detail to know upfront about DPA is if it is a grant (forgivable, sometimes after a period of time and not normally counted as a debt) or a 2nd mortgage (with interest rate and term and counted as a debt). In the new URLA, 4b. is where a DPA 2nd mortgage type and source is inputted and 4d. is where a gift or grant type and source is inputted. To ensure correct input, check with your DPA provider for the exact type and source that they require from the dropdown both Fannie Mae and Freddie Mac automated underwriting systems.

There are also additional fields to complete if the DPA is a Community Second.

Stay tuned!

Pamela M. Marron is a senior loan originator with Innovative Mortgage Services Inc.

heard by In our daily email newsletter, our weekly NMPTV showcases, or our monthly publication, NMP magazine brings you the strategies and observations of the top executives in the mortgage world. The industry’s best share their views. Here are some of their observations from the past few weeks, as heard by NMP.

“What made me a good executive is my knowledge and background as a mortgage broker. I use what I know from the front end and tie it into the back end. What a ton of mortgage executives miss is the front piece of the process, origination.”

—Robert Pieklo, CEO Equity Home Mortgage

“People are getting into homes, they’re trying to save money and the broker is the one advising them on that. We need to treat the broker with empathy because they’re in the hot seat … working with the consumer and kind of being in the middle between us and the consumer.”

—Michael Brenning President, Wholesale Lending AmeriSave Wholesale Mortgage Solutions

“What loan officers need to do for the decade, not just for today’s market, but literally for this decade, if you want to make this decade better than last decade and you’re a referral-based professional, you need to embrace technology and media.”

—Dave Savage, CEO, Mortgage Coach

“I think to provide a good experience to everyone today, it’s really about, in my opinion, having consistent communication and providing the education as the consumer wants it, information in a way that’s digestible.”

—Kristin Messerli, VP of Sales, Experience.com

“Loading up a servicing portfolio with loans having FICO scores of 620 and below, 97% LTV, or FHA servicing that may be 10-15% in forbearance by the end of the year may not turn out to be a successful long-term strategy,” —Seth Sprague, Principal, Stratmor

Seth Sprague

Michael Brenning

Robert Pieklo Kristin Messerli

Dave Savage NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

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At Mortgage Educators & Compliance, we help businesses and associations like CAMP thrive by making compliance painless, and fun. Connect with us, and we’ll show you how we can make YOUR business better.

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THE MORTGAGE SCENE

Rates Talk. Otherwise, Borrowers Walk

LEW SICHELMAN

Lenders need to get more creative to keep price-sensitive mortgage shoppers

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BY LEW SICHELMAN | CONTRIBUTING WRITER, NATIONAL MORTGAGE PROFESSIONAL

I

t’s all about the Benjamins.

Relationships matter, “but price matters more,” according to a recent consumer lending survey from Nomis Solutions, a fintech focused on value creation for lending institutions of all sizes.

In other words, to most borrowers, it’s about dollars and cents and little else. Especially nowadays when shopping for a home loan is as easy as hunting on-line for the best deal on a new refrigerator. “Consumers can easily see and shop for rates,” the report says. “They have gotten savvier overnight and shop for mortgages like they are shopping for clothes.”

Hell, some retailers even have programs that search their competitors web sites for lower prices. And if such a price exists, the retailer will match it.

It’s doubtful whether mortgage makers will ever go

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that far. But if they don’t grab for the brass ring right away, wouldbe borrowers are likely to go on to the next one and the next one after that, on down the line, until they find the lowest rate, or at least one that’s fits their needs.

WHAT’S THE COST In its survey of 500 consumers who applied and were approved for a home loan within the previous 12 months, Nomis found price was the top driver, with 36 percent saying low rates was the primary reason for selecting the loan they did. On the other hand, their relationships with their primary banking institutions mattered hardly as at all.

Ease of application and quick access to funds also were important factors, cited by 27 percent and 23 percent respectively. But mostly it was all about money.

“In today’s competitive lending environment, where interest rates are continually in the news cycle, consumers are focused on securing the lowest possible rate as they select a loan product,” the Nomis report said.

Cost even trumps – Lord, I hate using that word – relationships.

Oh, relationships matter. But asked if they would ditch their primary bank if they could find

less expensive financing elsewhere, most – a whopping 78 percent – would jump ship in a New York minute. Asked another way – would they be willing to pay more for a mortgage – 70 percent said no, they wouldn’t, thank you very much.

This, despite the fact that most respondents said they have been with their primary banks for years, at least five in most cases. And most said they trust their banks far more than on-line lenders and search engines such as Google or Amazon.

That’s some serious stuff, says Nomis. “Banks should not be complacent about their hold over customers,” the report warns.

SAVVY SHOPPERS The study also found that mortgage borrowers are comparison shoppers. Just 31 percent of the loan applicants queried said they considered a loan solely with their primary banks. The rest looked around, to at least two different lenders, including lender comparison websites and those lenders who exist only on the Internet.

Here, Nomis, whose platform is an end-to-end, customercentric pricing engine, offers the commercial you’d expect from the outfit which paid for the survey.

TECH ROI LAGGING

Even after they’ve been approved, 31 percent of pending borrowers said they continued to shop for a better rate.

A

s a follow up to previous columns, the Stratmor Group says that while lenders have been buying and installing the latest technology “at a record pace,” they are not yet getting the biggest bang for their bucks.

In 2016, retail lenders spent less than $400 per loan on technology, the Greenwood Village, Col.-based advisory firm says. But that figure just about doubled in the first half of 2020.

“Lenders ramped up with more people and pushed harder on technology, buying and installing at a maddening pace,” says Senior Partner Garth Graham in the company’s latest Insight Report.

Nevertheless, its suggestion rings true. To capture customers and deter them from shopping around, engage in a form of “couponing.” Not the buy one, get one free variety, because they only want one loan. Rather, promotional pricing, say an offer that expires at the end of the month or one that appeals to their particular age group or sex.

Gimmicks don’t seem to cut it, though. Special non-price incentives offered by the lenders were important to only 8 percent of the survey respondents. “You have only one shot, so make it your best,” said Joe Zeibert, the company’s managing director of global lending solutions.

NON-STOP COMPARISONS

mentioning from the Nomis report: * People don’t seem to have as much faith in newcomers to the mortgage business. Asked to rank a wide range of loan providers, conventional lenders – national and regional banks, community banks and credit unions – scored higher on the trustworthiness meter than online lenders. * Access to live human “experts” is still important to a minority of borrowers. Most applicants prefer a mix of digital and in-person applications. But 20 percent want a head-to-head meeting. Digital, however, is the preferred means by which people want to submit such key documents as pay stubs and tax returns.

But even after you’ve made your best offer, even after a borrower decides to apply with you, it doesn’t necessarily mean he has stopped looking around for another. Even after they’ve been approved, 31 percent said they continued to shop for a better rate.

And 41 percent said they’d actually change horses in midstream if something better came along.

“Why not?” the study remarks.

Why not, indeed!

A couple of other takeaways worth

Lew Sichelman is a contributing writer to National Mortgage Professional magazine. He has been covering the housing and mortgage sectors for 52 years.

His syndicated column appears in major newspapers throughout the country. He also has been the real estate editor at two major Washington, D.C., dailies and spent 30 years on the staff of National Mortgage News, formerly National Thrift News.

But while they are spending big money, they’re not yet achieving max dinero in return, according to Graham, who noted that only about half the eligible users are adopting the tech tools pushed their way. “Lenders are rushing to deploy the tools,” he says. “They are spending money on technology but are struggling in terms of adoption.”

One of the top technologies added by lenders last year was to support electronic closings. But eClosings failed to advance in the way many expected. “Instead, we saw hybrid eClosings experience the highest gains,” Graham reports. Hybrids, which the Stratmor exec claims “is a safer process and offers a substantially improved experience for the consumer,” increased by 25 percent.

Part of the slow implementation rate has to do with getting the new tools installed, configured and ready to go.

But the biggest roadblock is people.

“Good technology implemented well is the goal,” Graham says. “But lenders must focus on the humans in the equation because they will account for 90 percent of the cost.”

– Lew Sichelman

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nmp

COVER STORY

LESSONS LEARNED

Non-QM’s Year Living Dangero A little over a year ago, Covid slammed the window down on Non-QM lending. Here’s how lenders in that space coped, and how they’ve thrown the window open again.

BY KEITH GRIFFIN | NATIONAL MORTGAGE PROFESSIONAL CONTRIBUTING EDITOR t’s just past a year since the bottom fell out of the Non-QM mortgage space, creating what industry insider call “The Pause,” as investors dropped out of that category and lending ground down for months.

The biggest takeaway from what started in March 2020? It’s kind of twisted, but follow along: People need to be more important than profits.

Yet … the reason profits plummeted and the NonQM market almost collapsed was the overwhelming necessity to protect people.

With a year of hindsight, folks in the market space now know what they would do differently – from being less quick to cut to not being aggressive enough to grab even more market share. Granted, they’re primed with reasons they spout quickly for the actions they took, but many Non-QM insiders are candid and willing to admit missteps were made.

Tom Hutchens is executive vice president of production for Angel Oak Mortgage Solutions. With over 18 years in the mortgage industry, he has seen all the economy can do to the business. He’s frank about how Angel Oak reacted initially when commerce came to a terrifying halt in midMarch 2020.

In a phone interview not long before the first anniversary, he recalled the chaos everyone was facing. Who knew what the effects of a pandemic were going to be? But the economy was put on hold, and investors were scaling back sharply.

“We had to make tough decisions quickly. We didn’t know the scale of what was happening.”

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“Business came back so quickly,” he acknowledges. “But we didn’t know” it would when everything went on pause.

“We should have just kept entire company together,” Hutchens says in hindsight. “But we didn’t know that rates would drop to the lowest in history and the mortgage industry would do more volume. From an operations standpoint, we got pretty lean. We let go 80% of our ops team and 50% of the sales team. A lot came back but a lot of ops people were snapped up by agencies.”

Then he adds, “Maybe we should have made different decisions.”

A DIFFERENT REACTION Robert Senko, president of ACC Mortgage, didn’t have to make those decisions. His claim to fame is that his company never stopped making Non-QM loans. His decision wasn’t made recklessly. He wasn’t a rebel questioning the scientists.

“I was the guy during COVID in Costco with a full flatbed of toilet paper, cleaning supplies and dry goods. I stocked up.”

He didn’t need to stock up at ACC because the coffers were already full, metaphorically speaking. “My philosophy has always been to be nimble enough to adjust.” Senko said he saw companies when he first started 30 years ago fly high and then plummet when a rate increase put them out of business.

His desire when he started ACC in 1999 was to always be able to adjust. He saw the crash coming in 2007 and pivoted.

With a right balance of assets, he was able to pivot when the pandemic struck.

CONTINUED ON PAGE 26

r Of ously

Angel Oak’s Tom Hutchens says Non-QM lending has rebounded from last year’s “Pause.”

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NON-QM SPRINTS AFTER ITS COVID PAUSE CONTINUED FROM PAGE 24

‘HOGS GET SLAUGHTERED’ Senko uses a porcine analogy to explain why the nimble survive. “It’s an age-old discussion – pigs get fat and hogs get slaughtered. Everyone thinks every day is going to be great.

You don’t need a rainy day fund or the spigot will not close. It’s a mistake not recognizing the reality and fickleness of the capital markets that can turn on a dime.”

Employees were furloughed at ACC, Senko admits, but the lights kept burning and the doors stayed open.

About 12 people out of 50 had their lives put on pause, but most quickly returned. When the market flowed back, ACC wasn’t starting from a standstill.

Still, the company needed to make adjustments, some of which it has retained. Critically, ACC changed the compensation structure for its account executives.

Commissions became the income stream, not salaries plus commission. It’s one COVID takeaway the company is going to keep.

Senko recalled a story a consultant had told him. The consultant was working for the United States Postal Service during the anthrax scare.

“Everybody was in a panic,” Senko recalled. Years later he and the consultant still talk about that scare and this stuck with him: “It’s easy to shut down a business. It’s harder to restart. A lot of business struggled to regain their footing.”

Arc Home tried to hold onto staff when Non-QM paused, and that made it easier to ramp back up, says Katherine Gardner.

and safer for our customers.

“Given everything that was happening with increases in volume in other products, lenders needed to take a step back, review capital and make internal decisions on whether they wanted to sell loans or retain them. Once everyone realized this didn’t trickle down to the banks and credit markets, the Non-QM segments opened back up and Non-QM went on to outperform the modeling.”

The gravest mistake during the early stages of the pandemic were made by the major liquidity providers exiting the market immediately and not honoring their commitments.

LESSONS LEARNED BUT …

Jim Anderson, Chief Marketing Officer, Finance of America Mortgage, says his company would do nothing different in hindsight. “We stopped and took inventory of where the market was, and liquidated assets as appropriate based on the available information and thought about how we do this better

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Anderson argues “we are coming out of this even better, the product has been stress-tested, and serves a valid segment of the market. Innovation is back and we are in the race to zero. The pandemic basically allowed us to restart in a safer way for the consumer.”

Katherine Gardner, Chief Production

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“My philosophy has always been to be nimble enough to adjust,” says Robert Senko of ACC Mortgage.

Officer at Arc Home, said leaving the lights on during a period when no one understood the scope of the pandemic meant a great deal to Arc Home employees. “We were able, and had the foresight, to retain staff and the sales force had a significant advantage in re-launching Non-QM products.

This also had a very positive impact on culture and the trust employees have in the stability of their employer.

THE F WORD: FORBEARANCE Even though it had nothing directly to do with the Non-QM market, forbearance was an F word of sorts for lenders in the segment. The government wasn’t backing their loans to begin with. “Forbearance was never in anyone’s vocabulary before the pandemic,” Hutchens said.

Suddenly customers were inquiring about it. “Part of the challenge was the government was saying if you need forbearance, you’ll get one.” But of course only for government backed mortgages. That forced companies like Angel Oak to extend the olive branch of financial assistance to those who needed it. “Most borrowers once educated about it wouldn’t take it. But

if people were in a hardship, they were given it,” Hutchens said.

INVESTORS DID WRONG John R. Lynch, CEO and founder of PCMA Private Client, said long-term errors were made by investors with short-term focuses. “The gravest mistake during the early stages of the pandemic were made by the major liquidity providers exiting the market immediately and not honoring their commitments to purchase loans from their seller partners and warehouse banks. This not only hurt the firms originating these loans, but strained warehouse line relationships, but irreparably damaged the reputation of the Non-QM market.

“Now as the non-QM market is regaining its footing and market appeal and the liquidity providers re-enter the market, you have major push back by the warehouse lenders who will no longer accept these firms as counterparties and the seller partners have moved their origination capabilities to more acceptable and consistent agency originations and will most likely never come back to NQM. Lynch lamented that “the street firms and hedge funds that looked to profit from this amazing market opportunity should have been good stewards and taken the approach of long term investors. Instead, they were in it for the trade and not for the good of the market. The moment the market traded away from their position, they were out.”

“If they thought like investors of a great opportunity and not like typical vulture traders, they would have recognized this was temporary, honor their covenants, protect their partnerships and invest long term in the health and well being of the category,” he charges. “This was the biggest and most unforgiveable mistakes that were made.”

John R. Lynch of PCMA Private Client said long-term errors were made by investors with short-term focuses.

ONE YEAR LATER Hutchens said there continues to be a bigger demand from borrowers for Non-QM products. S&P Global shares his optimism. It says that Non-QM issuance volumes will return to 2019 CONTINUED ON PAGE 28

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HOW TO KEEP THE NON-QM LENDING LIGHTS ON

S

o, if somehow a catastrophic event strikes again, what can the Non-QM segment do to avoid another business shattering pause? What needs to be done?

John R. Lynch, CEO and founder of PCMA Private Client, says changes have to be made to bring more stability to the Non-QM market. “I am in the business of following cycles and patterns, and it seems to be very consistent that we have a systemic shock to our financial system approximately every 10 years. The methods of which liquidity is brought to the market for origination of Non-Agency Residential Mortgages over the past three decades is one that needs to be rethought. The providers of NQM liquidity need to evolve to meet their obligation of stable capital for investment.

“I personally am on a crusade to move away from this outdated securitization model of financing RMBS, to a more modern way of financing risk without excess leverage and outdated risk assurance models that expose our markets to crippling margin calls and ‘Too Big To Fail’ institutions.”

EDUCATED CONSUMERS NEEDED

Katherine Gardner from Arc Home says there should be no hesitance from consumers in this segment if companies know what they’re doing. “We do not see consumer hesitancy, but we still see a large need for consumer education.

It is critical for more brokers to engage

in non-QM originations so potential borrowers can tap their buying power.

“There is likely a trillion dollars in borrowing ability untapped due to lack of product awareness. Brokers have the opportunity to gain significant market share in Non-QM originations.

With rising interest rates in the future, we expect originators to invest their time in learning and marketing a more diverse product set. This will significantly contribute to the growth of non-QM.” “We have found that any hesitation towards non-QM adoption is more of a lack of time rather than a lack of confidence. As rates rise, nonQM and non-Agency adoption will be key to remaining relevant in the marketplace. We anticipate that loan officers will use these offerings to differentiate themselves and reach more borrowers,” said Tom Davis, executive vice president of correspondent lending at First Guaranty Mortgage Corp.

ODDLY RIGHT TIMING

All of the experts interviewed said a pandemic is never desirable but the fact that it happened in 2020 made a difference.

Angel Oak’s Tom Hutchens said if this had happened back in 2014 when Non-QMs were first ramping up in force, things would have been drastically different. “I don’t know if it would have come back then. But now we had a record and history. Performance was

strong. Loans didn’t implode.”

Robert Senko of ACC Mortgage agreed. “These loans performed which is why you’re seeing so much demand.

There is a lot of capital chasing yield, which I think drives the interest in NonQM.” Adds David Adamo, CEO and founder of Luxury Mortgage, “The Non-QM market has proven to be quite resilient and this can be attributed to the obvious intrinsic value that this liquidity unlocks and affords to a growing b o r r o w e r segment that would otherwise have very limited sources of financing.

DAVID ADAMO “Non-QM credit and pricing methodologies in general have responsibly and smartly evolved these past several years and this is proven in the relative performance of these loans to date,” he opined. “This is also further demonstrated in that Non-QM credit and pricing have largely returned to prepandemic levels today and in some cases are even superior to where they were one year ago. The prevailing expectation is that non-QM will resume its growth trajectory in 2021.”

NON-QM MANAGEMENT CHALLENGES CONTINUED FROM PAGE 27

levels this year, reaching an estimated $25 billion, due to a strong purchase loan market and slowing agency refinancing activity. It also thinks that older Non-QM securitization cleanup calls could contribute to additional new securitization collateral in the low-interest rate environment.

“The gig economy and the gig worker are growing exponentially,” Hutchens points out. “It’s a gig economy with remote working.

Employers don’t give out W2s as much

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any more. We see more 1099s and the self-employed and credit challenges that signify growth.”

And that, he asserts, means there’s money to be made. “There’s so much opportunity for originators. When refinancing goes down, everybody starts working harder on purchase loans.”

That’s a sentiment shared by others in the industry. “We anticipate that the upcoming market will attract more brokers and lenders to Non-QM

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

business,” says Aaron Samples, CEO of First Guaranty Mortgage Corporation.

“As

rates

fatigue

increase

around

hold, we

and

borrower

refinance

believe

that

takes

purchase

business will climb and it will be necessary to reach these borrowers who fall outside of agency guidelines.

The increase in home prices, building costs, and self-employed borrowers is likely to drive exponential growth in the Non-QM space.”

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Qualify with Full Doc, Bank Statements, or DSCR

Individual Taxpayer Identification Number – Valid U.S.Government issued ID

ATR-in-Full

DSCR

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Debt Service Coverage Ratio No income verification – N/O/O only

Letter of good standing with current financial institution or international credit report

The Leader in Today’s Non-QM Programs – (888) 800-7661 sales@acralending.com | www.acralending.com 25531 Commercentre Drive, Suite 160, Lake Forest CA 92630 Acra Lending is a dba of Citadel Servicing Corporation NMLS ID# 144549, Licensed under Department of Financial Protection and Innovation under the California Residential Mortgage Lending Act license #41DBO-74196, Finance Lenders License # 60DB094450, and CA-DRE #01799059. For mortgage professionals only. This information is intended for the exclusive use of licensed real estate and mortgage lending professionals in accordance with local laws and regulations. Distribution to the general public is prohibited. Acra Lending is an equal opportunity lender. Rates, terms, and programs subject to change without notice. Offer of credit subject to credit approval per applicable underwriting and program guidelines, applicant eligibility, and market conditions. Not all applicants may qualify. Not valid in the following states: AK, HI, IA, MA, MS, MO, NM, NY, ND, OH, RI, SD, and WV.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

29

GREAT EVENTS START AT AMBIZ MEDIA LIVE, IN PERSON 2021 SHOWS

MAY 5

Mid South Mortgage Expo Memphis, TN

30

MAY 11

Motor City Mortgage Expo Detroit, MI

MAY 18

JUNE

Texas 10-11 Mortgage New England Roundup / SA Mortgage San Antonio, Expo TX Mohegan Sun, CT

JUNE 15

Great Northwest Mortgage Expo Portland, OR

30 ORIGINATOR CONNECT MAGAZINE | SUMMER 2019

JUNE 22 Chicago Mortgage Originators Expo Chicago, IL

JULY 6

Ultimate Mortgage Expo New Orleans, LA

JULY 13

Carolinas Connect Mortgage Expo Charlotte, NC

www.mortgageconferences.com

| 30 NATIONAL MORTGAGE MORTGAGE BANKER | PROFESSIONAL JANUARY 2021 MAGAZINE

JULY 22

Arizona Mortgage Expo Phoenix, AZ

AUG 3

NY Mortgage Expo Suffern, NY

AUG 12

CA Mortgage Expo San Diego, CA

The Originator Connect Network is the nation’s largest coalition of mortgage conferences, reaching more mortgage originators in person than any other organization. Coast to coast, we offer many opportunities for companies to reach the front-line sales and origination professionals critical to you success.

There’s nothing quite like standing faceto-face with potential new clients. At American Business Media, we produce some of the most successful and largest business-to-business conferences and trade shows in the nation.

Visit www.mortgageconferences.com for a full listing of our shows and links to register your company as a sponsor, exhibitor or attendee.

SUN O OAST M O R TG AG E E X P O

AUG 20-22

Originator Connect Las Vegas, NV

SEPT 2

Texas Mortgage Roundup Dallas, TX

SEPT 9 CA Mortgage Expo North Glendale, CA

SEPT 14 Great Northwest Mortgage Expo Seattle, WA

OCT 7

Colorado Mortgage Summit Denver, CO

OCT 12

CA Mortgage Expo San Francisco, CA

OCT 19

Suncoast Mortgage Expo Tampa, FL

NOV 4

Utah Mortgage Expo Park City, UT

NOV 18

Texas Mortgage Roundup Houston, TX

DEC 8

OCN California Mortgage Holiday Party Irvine, CA

DEC 9

CA Mortgage Expo Irvine, CA

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE www.mortgageconferences.com

|

31

DATABANK

U.S. Homeowners Equity Over Time

Bank and Nonbank Servicing ($000)

32

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

Overall Mortgage Debt Since 2010

Mortgage Originations Actual & Projected | ($B)

DIRECTORY

Calyx

Global DMS

www.calyxsoftware.com Dallas, TX & San Jose, CA

http://www.globaldms.com Lansdale, PA

We offer mortgage origination technology for small to enterprise level organizations.

Finicity

ReadyPrice

Global DMS offers the most advanced appraisal technology on the market called EVO™, engineered and designed for both commercial and residential appraisal business. With a purposeful departure from outdated processes of older platforms, EVO combines 100% configurability, boasts the most user-friendly navigation possible, a user-role based workflow, the easiest to use reporting engine, as well as the only true cascading decision tool.

http://www.readyprice.com San Jose, CA

ReadyPrice, powered by SitusAMC, is a leading mortgage technology connecting mortgage loan originators and lenders to support more efficient loan origination.

Their technology enables MLOs to manage and choose pricing, run automated underwriting, and deliver approved loans to lenders at no cost to the MLO. For lenders, ReadyPrice provides an efficient way to scale their businesses, ensuring wholesale lending rates are included in every pricing engine search while providing brokers with the easiest path to directly transfer DU approved loans.

a Mastercard company http://Finicity.com Salt Lake City, Utah

Finicity's Mortgage Verification Service is the one-touch, GSE-accepted digital verification of assets, income and employment. MVS leverages Finicity's open banking platform so lenders can use the best data from the best sources in the best way to deliver a winning lending experience for their customers and business stakeholders. Finicity also provides account validation services to mitigate payment risk, as well as the use of transactions, account history and statements direct from FIs that can be used for loan servicing or other needs.

Mortech

ReadyPrice technologies support FNMA, FRE, FHA, VA, USDA, VA, and non-agency (non-QM, jumbo, etc.) loan originations.

a Zillow Group business https://www.mortech.com/ Lincoln, NE

As a pioneer in the digital mortgage era, Mortech provides mortgage professionals with a number of services and tools including Product Pricing, Online Rate Quoting, and Secondary Marketing solutions to help automate their workflow, giving them more time to focus on business growth.

Product offerings: • Instant pricing from multiple investors at the touch of a button.

• Streamlined secondary desk with tools such as historical pricing, centralized lock desk, and more.

• Quote live mortgage offers to a broader audience with access to the largest portfolio of mortgage marketplaces.

• Ability to re-capture current customers and gain new purchase leads with predictive analytics

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

33

Hey, San Diego!

The California Mortgage Expo is one of California’s largest mortgage events for loan origination professionals, bringing together hundreds of mortgage brokers, loan originators and bank and credit union lending officers from throughout the region for an event full of education, networking and fun. You’ll be growing your business and your contacts in a setting packed with passion, professionalism and fun.

Thursday, August 12th, 2021

San Diego, CA

+ Free NMLS Renewal Class August 13th

www.camortgageexpo.com Enjoy free registration using our code OCNFREE .

PRESENTING SPONSOR

NONNQM SPONSOR

REVERSE MTG SPONSOR

SHOW PRODUCER

Safety top priority.MORTGAGE Learn about the safety precautions we take at each of our events to earn us 100% safety satisfaction from our attendees at originatorconnectnetwork.com/covid19.

34 is|our NATIONAL PROFESSIONAL MAGAZINE Complimentary registration available to NMLS-licensed active LOs and their support staff. Show producers resereve the right to determine final eligibility.

MY BEST DEAL

Writing This Mortgage Made His Heart Skip A Little Name: Dave Trabosh

|

Job Title: Senior Loan Officer

How much was your best deal for?

Business: Contour Mortgage, NY

first time at the attorney’s office for the mortgage application.

Priceless.

What made it your best deal?

I have been a mortgage originator for the past 25 years in New York. In 2005, I received a phone call from a young woman looking to be pre-approved to purchase a home. She was a single, hard working woman who worked two jobs to save up money to purchase her first home. As we spoke on the phone, I felt something go through my body that I have never experienced in my life (hard to explain it). I gave her all the information needed to be pre-approved and within a few days she sent me the paperwork, I reviewed and sent her the pre-approval letter.

Within a week, she found a home and got an accepted offer. We were on the phone many times explaining the steps since she was very nervous, and I referred her to one of my attorneys to represent her for the contract. When it was time for her to sign the contract, I met her for the

WIN a $100 Amazon gift card

|

During the process, I explained to my processor that I will be personally handling her file with the conditions. She thought that was very weird since I have never asked her to do that.

About a few weeks into the process, I asked the client out for dinner and she accepted. This was highly unusual, since I have never mixed business with my personal life -- these are my clients. But we went out for a dinner and, fast forward 15 years later, we have two girls who are 11 and 10.

Today, I explain to my clients that they will never be my best client because that is my wife.

What else?

With all the hundreds of loans that I have done in my career. I met my soul mate through writing her mortgage.

Have a great story about your best deal? We’re not talking about your biggest deal. We want to hear about your best deal – the one that resonates with you personally, the one that became the story you’ve told again and again about why you’re in this business. Head over to bit.ly/MyBestDeal and tell us the details. You can win a $100 Amazon gift card if your story is selected for publication.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

35

Greg Gadson

I AM A VETERAN AND THIS IS MY VICTORY.

“My victory is proving that nothing can hold me back.” While serving in Iraq, an explosion took both of Greg’s legs. But it didn’t touch his spirit. Today, Greg is an entrepreneur, photographer and public speaker. DAV helps veterans of every generation get the benefits they’ve earned—helping more than a million veterans each year. Support more victories for veterans®. Go to DAV.org.

36

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

EXPERTS: WORK FROM HOME IS HERE TO STAY More inventory is on the way

A

n overwhelming majority (95%) of more than 100 economists and real estate experts surveyed by Zillow as part of the Q1 2021 Zillow Home Price Expectations (ZHPE) survey said an increased preference to work remotely at least part-time is a permanent shift. The quarterly survey, sponsored by Zillow and administered by Pulsenomics, also asked experts for their views on the rental market, housing inventory and their expectations for home value growth this year and over the next five years.

The experts said they believe the pandemic has permanently altered consumer preferences regarding where office work gets done. Nearly all respondents said the consumer preference for working from home at least parttime will be an enduring legacy of the pandemic. Roughly a third of them (36%) said the recent shift to full-time work

from home in favor of full-time in-office work will prove permanent.

Panelists were more evenly split regarding the permanence of other pandemic-driven shifts in attitudes towards where we live and the ideal size of our homes.

When asked about Americans’ preference for living in the suburbs over urban areas, the same share of ZHPE panelists said the shift was permanent as said the shift was temporary (46%).

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24/7 access through our online portal

Joseph Noviello (718) 240-4780 jnoviello@ridgewoodbank.com NMLS ID# 625762

*On primary residences. (LTVs apply). | **1–2 family and condo purchases and rate and term refinances – primary residences. | Terms and conditions subject to change without notice. Loans subject to credit approval. © 2021 Ridgewood Savings Bank. All rights reserved.

CONTINUED ON PAGE 38

“I cannot express how grateful I am to have a broker relationship with Ridgewood. Time and time again, you’re the lender I count on for personal attention and unparalleled service.”

Mary Ann Scaggs Sr. Mortgage Loan Originator Purchase, NY

www.ridgewoodbank.com

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

37

We Have Mortgage Jobs.

NEARLY 15% OF RENTERS EXPECTED TO BE EVICTED CONTINUED FROM PAGE 37

The results were similar when asked whether consumer preference has changed in favor of proximity to smaller cities over larger cities, or larger homes in favor of smaller homes.

• Branch Manager • Business Development Manager • Client Relationship Manager • Client Relationship Specialist • Collateral Asset Manager • Commercial Loan Officer • Credit Analyst • Licensing Assistant • Loan Officer • Loan Mitigation • Post Closing QC Expert • Loan Administration Manager • Processor • Regional Vice President • REO Closer • Retail Branch Manager • Reverse Mortgage Specialist • Sales Manager • Underwriter • Wholesale Account Exec • And MORE! Resposes are from highly-qualified candidates. Your ad can also be [osted on Indeed and SimplyHired as a FEATURED JOB, on Craigslist in most cities, Googlebase, Oodle, Juju, CareerMetaSearch, TopUSAJobs, Jobalot and MORE! Pay-per-use RESUME BANK.

findmortgagejobs.com

Give your customers assurance of your professionalism and integrity.

Become a Certified Reverse Mortgage Professional The National Reverse Mortgage Lenders Association developed this rigorous certification for industry professionals who want to give customers the confidence to know they are working with thoroughly knowledgeable and devoted individuals.

Earning the CRMP* designation requires validating your experience, continuing your education annually, participating in our ethics workshop and passing an exam.

For for more information, visit nrmlaonline.org *The CRMP designation is available to members and non-members of NRMLA.

38

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

SUPPLY & DEMAND The pandemic changed many expectations of what we want and need from our homes, and ushered in a surge of demand from homebuyers in search of a different space in which to work, play and educate. This red-hot demand means that in the current market, buyers are often plucking homes off the market just days after they are listed, thanks in part to technology that’s making home buying and selling faster and easier. The speed with which homes are selling is one factor contributing to low inventory, which has steadily declined during the pandemic and now sits about 30% less than a year ago.

This high demand, coupled with limited inventory, is pushing home values up at a pace not seen since before the Great Recession. ZHPE panelists, on average, said they expect home values to grow 6.2% in 2021 — a full two percentage points higher than when they were surveyed in Q4 2020 — and several panelists called for double-digit price growth this year.

But the experts also see a shift coming that could upend this longstanding inventory drought and coinciding rapid runup in home value appreciation. More than two-thirds (69%) of panelists said they expect inventory will begin to grow in the second half of this year or the first half of 2022. An increase in existing homes being listed for sale is expected to be the biggest factor in the reversal, with 38% of panelists saying that is the most likely catalyst for inventory growth.

Inventory growth should cool down home value appreciation. While panelists expect home value growth this year to be almost double its pre-bubble, historically “normal” annual pace of 3.6%, they expect a slowdown through the middle of the decade. On average, panelists said they expect annual home value growth to slow to 4.5% in 2022, slowing further to 3.7%, 3.5%, and 3.6% in 2023, 2024, and 2025, respectively. Even with an anticipated slowdown to levels more in line with historic norms, the recent stretch of rapid home value growth is extraordinary.

“This is the most bullish near-term outlook for home prices we’ve seen from our experts since the early stages of the post-bust recovery, and the panel’s five-year average annual home price forecast has never been more optimistic,” said Terry Loebs, founder of Pulsenomics. “In the wake of last year’s heady home equity gains, these new projections indicate that the aggregate value of homes across the country will increase by another $2 trillion in 2021. This is great news for existing homeowners, but even with a robust economic rebound in the coming months affordability will likely remain a challenge for

NON QM Showcase Angel Oak Mortgage Solutions Atlanta, GA www.angeloakms.com

Angel Oak Mortgage Solutions is the leader in the non-QM mortgage space. We offer alternative specialized mortgage solutions for brokers throughout the country helping borrowers who don’t fit conventional guidelines. Our innovative non-QM products include: Bank Statement, Platinum Jumbo, No Income Investor Cash Flow, "Just Missed" Portfolio Select and Asset Qualifier. We are pioneering a fresh approach to today’s mortgage lending challenges helping partners to grow their business.

LoanStream Mortgage Irvine, CA

www.LoanStreamWholesale.com Programs Include: Full Doc / Alt Doc, ITIN, DSCR, Bank Statement, Fixed, ARM, and Interest Only Programs, High LTVs and Lower FICOs, Business Owners, Investors, Licensing - LoanStream (lsmortgage.com)

Visit https://angeloakms.com/ programs/ for details on our products that can help you grow your business.

Luxury Mortgage Corp Stamford, CT

www.luxurymortgagewholesale.com The Simple Access® NonQM suite of products was built around the idea that it doesn’t have to be complicated to finance a home. We have created a diverse selection of borrower friendly programs that are simple, innovative and flexible.

For information on our Correspondent division, visit www. luxurymortgagecorrespondent. com.

AL | AR | AZ | CA | CO | CT | DC | DE | FL | GA | IL (no IO loans) | MA | MD | ME | MI | NH | NC | NJ | NM | NY (no subprime) | OH | OR | PA | RI | SC | TN, TX | UT | VA | WA | WI Properties

NATIONWIDE except: AK | HI | ID | MA | MO | NY | VT

Oaktree Funding Corp.

Chandler, AZ

www.oaktreewholesale.com Non-Agency & Investor Advantage

The Non-QM experts Oaktree Funding are proud to offer innovative solutions for diverse borrowers. We offer products and services through our three channels of operation: Wholesale, Correspondent and Retail Lending. Oaktree is not tied to any one investor securitization, which allows us to consistently offer flexible and expanding guidelines to adapt with borrower’s needs.

Full product line at: www. oaktreewholesale.com AZ | CA | CO | CT | DC | FL | GA | ID | IL | IN | MD | MA | MI | MN | MO | NJ | NM | NV | NC | OH | OR | PA | SC | TN | TX | UT | VA | WA | WI

many aspirational renters looking to move into homeownership this year.”

LOOMING EVICTION CLIFF Although the for-sale market has soared over the past year, the rental market has stagnated as renters have borne a disproportionate amount of the job losses and broader economic burden brought on by the pandemic.

A federal eviction moratorium that has been extended several times has succeeded in keeping a roof over many renters’ heads, but at some point this and other moratoria will end.

It’s important to note that not all struggling renters currently at risk of eviction will be evicted, and panelists on average believe a large majority (85%) of these renters will either find ways to remain in their current home or will avoid eviction by moving to a less-expensive home. Still, panelists said they expect some 15% of currently distressed renters will ultimately be evicted, representing millions of households.

And even for those distressed renters that do remain in their homes, they may find it somewhat more difficult to make ends meet depending on how their landlords react to changing market conditions and/or how they work out owed back rent — if any — depending on their

circumstances. Panelists said they expect that 39% of these renters will experience a modest or substantial decrease in rent affordability after eviction moratoria expire, larger than the shares for which affordability would not change (37%) or for which affordability would improve (24%).

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

39

Wholesaler Directory

Acra Lending Specialty/ Niche: Non-QM / Jumbo Bio: Acra Lending is the leader in Non-QM Wholesale and Correspondent lending programs. Offering a range of programs and services geared toward helping mortgage professionals and borrowers achieve their purchase and investment goals. We are committed to providing simplicity, consistency and an optimal customer experience.

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

Website: https://acralending.com/

Angel Oak Mortgage Solutions Specialty/ Niche: Non-QM, Non-Agency “Angel Oak Mortgage Solutions is the leader in the non-QM mortgage space. We offer alternative specialized mortgage solutions for brokers throughout the country helping borrowers who don’t fit conventional guidelines. We are pioneering a fresh approach to today’s mortgage lending challenges helping partners to grow their business.”

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

Freedom Mortgage Specialty/ niche: VA and FHA As the #1 VA and FHA lender*, Freedom Mortgage Wholesale is dedicated to serving the needs of brokers, wholesale correspondents, banks and credit unions with a wide variety of products. Our local Account Executives, three Regional Operation Centers, and seasoned underwriters are committed to providing an unparalleled experience *Inside Mortgage Finance, Jan-Jun 2020 States: all 50 states, the District of Columbia, Puerto Rico and the Virgin Islands.

www.freedomwholesale.com

The Money House, INC. Specialty/ niche: DIRECT HECM LENDER - GNMA ISSUER Money House On Demand is the US Division of The Money House, Inc., a Ginnie Mae Forward and Reverse Mortgage Issuer/ Servicer. The US Division combines a complete range of mortgage products with a unique seasoned and professional team of bilingual staff and resources supporting complete Wholesale and Correspondent Partner relationships.

States: CA. CO, DC, FL, GA, IL, MD, OR, PR, TN, TX Website: http://WWW.MONEYHOUSEUS.COM

www.angeloakms.com

Towne Mortgage Company Specialty/ niche:Manufactured Homes, Renovation Loans

First National bank of America Specialty/ Niche: Non- QM FNBA is a portfolio lender with over 65 years of experience. We understand that in the Non-QM business, service makes all the difference. That’s why we are committed to providing you with the fastest turn times, exceptional service and loan programs that make growing your business easy!

States Licensed in: All 50 States

www.fnba.com/mortgage-brokers

40

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

Towne has nearly 40 years of experience in the industry. When you choose to partner with Towne, you join a team of seasoned industry experts and an unmatched client support team. We offer competitive pricing in a rapidly changing marketplace. Visit our website tpo.townemortgage.com or call us at (925) 727-2516 States: AL AR AZ CA CO CT DE DC FL GA IL IN IA KS KY LA MA MD ME MI MN MO MS MT NE NV NH NJ NC ND OH OK OR PA RI SC SD TN TX UT VA VT WA WV WI WY

tpo.townemortgage.com

NATIONAL MORTGAGE PROFESSIONAL

Calendar of Events

APRIL 2021

JUNE 2021

JULY 2021

Tuesday-Thursday, April 27-29 2021 Mid-Atlantic Regional Conference MBA/MW + MMBBA MGM National Harbor 101 MGM National Ave. Oxon Hill, Maryland MARCMBA.org

Thursday-Friday, June. 10-11 2021 New England Mortgage Expo Mohegan Sun Resort & Casino 1 Mohegan Sun Blvd.

Uncasville, Connecticut NEMortgageExpo.com

Tuesday, July 13 2020 Carolinas Connect Mortgage Expo Embassy Suites Hilton Charlotte 4800 South Tryon St. Charlotte, North Carolina CarolinasConnectMortgage.com

Tuesday, June 15, 2021 Great North West Mortgage Expo — Portland Holiday Inn Portland South 25425 SW 95th Ave., Wilsonville, OR 97070 www.greatnorthwestexpo.com

Thursday, July 22 2021 Arizona Mortgage Expo Wild Horse Pass Resort & Casino 5040 Wild Horse Pass Boulevard Chandler, AZ 85226 2021 Arizona Mortgage Expo www.azmortgageexpo.com

Tuesday, June 22 2021 Chicago Mortgage Originators Expo Holiday Inn Chicago SW 6201 Jollet Road Countryside, Illinois ChicagoOriginators.com

AUGUST 2021

Sunday-Thursday, April 11-15 2021 Regional Conference of Mortgage Banker Associations Hard Rock Hotel Casino 1000 Boardwalk Atlantic City, New Jersey mbanj.com

MAY 2021

Tuesday-Thursday, May 4-6 Mortgage Star Conference for Women Sheraton Memphis Downtown 250 N Main St, Memphis, TN 38103 www.mortgage-star.net Wednesday, May 5 Mid-South Mortgage Expo Sheraton Memphis Downtown 250 N Main St, Memphis, TN 38103 www.midsouthmortgageexpo.com

Thursday, June 3 2021 California Mortgage Expo— Irvine Hilton Irvine/Orange County Airport 18800 MacArthur Blvd.

Irvine, California CAMortgageExpo.com

Tuesday, July 6 2021 Ultimate Mortgage Expo Hotel Monteleone 214 Royal St New Orleans, LA 70130 www.ultimatemortgageexpo.com

Thursday, August 12 2021 California Mortgage Expo— San Diego Hyatt Regency La Jolla 3777 La Jolla Village Dr. San Diego, California CAMortgageExpo.com

Tuesday, May 11 2021 Motor City Mortgage Expo DoubleTree by Hilton Detroit— Dearborn 5801 Southfield Expressway Dearborn, Michigan MotorCityMortgageExpo.com Tuesday, May 18 Texas Mortgage Roundup – San Antonio Wyndham San Antonio Riverwalk, 111 E Pecan St San Antonio, TX txmortgageroundup.com

See www.mortgageconferences.com for more events.

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 editorial@ambizmedia.com.

All events are as of May 1, 2021 and are subject to change.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

41

Attend for FREE, use code: OCNFREE

The Originator Connect Network presents the

Renew your NMLS for free!* Enjoy our complimentary complete 8-hour NMLS renewal course, taking place on June 16th, when you attend the event.

Great Northwest Mortgage Expo — Portland Edition. Join us for a lineup of engaging events centered around networking, skill-building and having a great time with your peers. There will also be a wide variety of exhibitors and workshops on topics to educate and enhance the opportunities for mortgage pros throughout Oregon.

Attend for FREE with code OCNFREE

June 15, 2021 Portland, OR www.greatnorthwestexpo.com TITLE SPONSOR

NON-QM SPONSOR

SHOW PRODUCER

Attend for FREE, use code: OCNFREE

Find an event near you at originatorconnectnetwork.com Conditions apply for eligibility to attend the free NMLS renewal course. Complimentary registration available to NMLS-licensed active LOs and their support staff. Show producers reserve the right to determine finalMAGAZINE eligibility. To find out how we’re keeping attendees safe, visit originatorconnectnetwork.com/covid19 | NATIONAL MORTGAGE PROFESSIONAL

42

UWM FACES CLASS ACTION SUIT OVER BROKER ULTIMATUM

BY NAVINDRA PERSAUD, NATIONAL MORTGAGE PROFESSIONAL STAFF WRITER

U

nited Wholesale Mortgage is facing a Class Action lawsuit that was filed by The Parrish & Goodman Law Firm, on behalf of independent mortgage brokers from Florida.

The group is looking to earn back their freedom to choose which lender is best for their clients, following an “anticompetitive ultimatum” that was issued by UWM CEO Mat Ishbia in early March, according to a press release from the firm.

“UWM’s leveraged ultimatum is clearly unlawful, unfair and is designed to use UWM’s dominant market share (nearly 35% according to company claims) to limit the consumers’ choice and steer business for their own gain,” according to the release. “This position also runs counter to the actual value provided by mortgage brokers - the ability to shop all lenders and select the company and loan program that provides their clients the best possible rate, experience and process. In some cases, this ultimatum could create conditions by which consumers will lose access to financing altogether, depending on which lender is offering programs that match their credit profile.”

“We do not comment on legal matters that are currently pending, especially those that have no merit or substance,” said a UWM spokesperson, in an email statement to NMP. The lawsuit alleges that UWM willfully violated a number of Federal and Florida laws and regulations including The Sherman Antitrust Act, The Florida Antitrust Act, Tortious Interference with Business Relationship and Florida’s Deceptive and Unfair Trade Practices Act. It also alleges that it forced brokers into an unenforceable Contract of Adhesion.

In today’s mortgage banking industry, you have a choice: you can play “follow the leader” or you can be a leader ...

Lykken on Lending

With a 43-year career in mortgage lending, David Lykken is one of the most respected business leaders in the industry. He created Lykken on Lending in 2009 to offer his mortgage industry professionals an insider’s view of the trends, issues and personalities that impact mortgage banking and the wider economy.

Created by a mortgage professional for mortgage professionals, Lykken on veteran Lending is a weekly 60-minute radio program hosted by mortgage veteran, David Lykken. Joining the program each week is Joe Farr with a MARKET UPDATE, Alice Alvey providing a LEGISLATIVE UPDATE and Andy Schell (a/k/a "The Profit Doctor") providing tips on FINANCIAL MANAGEMENT along with other regulars and featured guests.

Lykken on Lending brings forth the major players in mortgage banking for provocative and insightful conversation. This is the only mortgage banking indust leaders speak directly without being edited or media outlet where industry filtered by agenda-driven third parties.

Covering Topics from Main Street to Wall Street and Capitol Hill

Listen LIVE Coast to Coast Mondays at 1:00pm Eastern/10:00am Pacific, or dial in and listen at (646) 716-4972 or (877) 666-9318 Download the Podcasts of Previous episodes any time at David Lykken

Your One-Stop Shop For Mortgage Training and Superior Marketing Content Download FREE The 2019 Book of Home Finance at www.originationpro.com 200+ pages packed with the information needed to succeed in this industry.

www.OriginationPro.com l success@hershmangroup.com

1-800-581-5678 NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

43

New To Market column: E-mail: | editorial@ambizmedia.com

NEW TO MARKET MAY 2021

LoanLogics released LoanLogics IDEA for MSR Transfer, a new solution that automates document processing and data extraction for mortgage servicers and banks when acquiring mortgage servicing rights.

The LANIS Group, LLC Mortgage Software released its LANIS TIER ONE Import and Export feature, a Cloud-based software solution created for loan officers and mortgage lenders of all types.

Black Knight, Inc. launched a new application programming interface (API) to help investors automate bulk transaction pricing and committing in the correspondent lending process.

Ncontracts, a provider of risk management and compliance solutions, announced that the company’s Questsoft lending solutions team has collaborated with Discover Financial Services to create a new prequalification review.

At its annual shareholders meeting on April 1, Merchants & Marine Bank announced the launch of Canvas Mortgage, a new residential mortgage banking division.

A&D Mortgage released its Prime Jumbo loan product available through an automatic underwriting system-only loan.

Sprout Mortgage launched a new program on April 1 called BROKE AdvantEDGE. The program features several operational improvements and will continue to evolve over the balance of 2021 and beyond. The first phase of the program will feature streamlined fee management.

Black Knight, Inc. launched its new Early Warning Suite designed to help lenders identify and avoid closing on loans affected by natural disasters.

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| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

WE’LL BE THERE. YOU CAN BET ON IT. The wait is almost over. Originator Connect, the nation’s premier mortgage event, returns to Las Vegas this August with a lineup of events sure to prepare you better than ever before for an ever-evolving industry. You won’t want to miss these exclusive programs:

Free NMLS Renewal* Build-A-Broker Your First Million Dollars Most Loved Employers Awards Gala & so much more!

See the full lineup of events and reserve your spot for free using our code NMPOCN at www.originatorconnect.com.

AUGUST 20

22, 2021 LAS VEGAS, NV

Join us at Planet Hollywood, located at the heart of the Las Vegas Strip!

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*Complimentary registration available to NMLS-licensed active LOs and their support staff. Show producers resereve the right to determine final eligibility.

45

FACEBOOK THOUGHTS

NICK ROBERSON

I Think My Daughter Has It In For Me

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Nick Roberson

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

I got up early this morning to watch the sunrise, fill up my car with go-go juice, and get it washed. I made the mistake of sending my daughter Savannah a video from the carwash. When I got home, she said, “Dad, why was the background on your gauges glowing red instead of blue? Did you have your car in Sport mode again?

Oops, Busted!

Please don’t wear skinny jeans if you don’t have any skinny genes.

When I got back home from running an errand this evening. I noticed my neighbor sitting in her car. I walked to the end of my drive and gave her a wave. What I saw next was straight out of a vampire movie. You know the one where the main character is driving down the road and catches the Vampire in his headlights mid-feeding, I had caught my vegan fitness guru neighbor sitting in her car with a face full of In-N-Out Burger, devouring it like a wild animal with sauce all over her face. She gave me a look just like that vampire in the movie, then went back to her task. It’s okay Stacy, your secret is safe with me.

Go ahead and eat that big, beautiful burger!

Savannah just took me for a ride in her car to the carwash and the store. On the way, I told her how proud I was of her, how much I appreciated what a great child she has been, and I loved her very much. I told her the car looked good on her and that I felt she truly deserved it. As we

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

pulled up to the stoplight, Savannah looked over at me and said something that truly hit me in the heart. “Dad, I am not buying you a Taco cart.”

Dang it!

Today is one of those days where I would really like to know what the human body’s maximum capacity for caffeine is. I will keep you posted on my findings.

At precisely 8:30 AM, every morning, an elderly neighbor from a block over walks his two cocker spaniels past our house. The two dogs crack me up. One dog barks nonstop from the time they leave his house until they return.

The other dog never makes a sound but keeps looking at the other one like he is crazy, and takes a nip at it every few steps as if trying to tell it to shut up. This is probably how my friends feel when we are at a conference and I am wide awake and chatty in the morning.

I was finishing up my work for the day, and got up for a moment to see what Savannah was making in the kitchen. She was making pasta and I caught her midsauce creation. She turned her back on the stove for a moment and I dipped a spoon into the sauce to taste it.

She snatched the spoon out of my hand before I could taste it. Then she chicken-necked me and told me to get out of her kitchen before I got some sauce to the face!

What the heck, did she attend some “Mom” convention I am not aware of?

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

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