NMP National Mortgage Professional October 2021

OCTOBER 2021

Volume 13, Issue 10

FRAUD FIRES UP

Criminals can’t resist getting in on the action of an overheated market

TECH’S NEXT TWIST:

Time To Tell The Story Of You

TOGETHER

Feeling Overwhelmed

TOO MANY NEW PARTS, NOT ENOUGH WORKING

HOW TO OVERCOME

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

OCTOBER 2021

FRONT COVER

Volume 13, Issue 10

FRAUD FIRES UP

Criminals can’t resist getting in on the action of an overheated market

TECH’S NEXT TWIST:

Time To Tell The Story Of You

TOGETHER

Feeling Overwhelmed

TOO MANY NEW PARTS, NOT ENOUGH WORKING

HOW TO OVERCOME

CALL US TOLL FREE

877-349-0501

2

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VISIT US ONLINE

accmortgage.com

© 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 Mortgage License; NorthPROFESSIONAL Carolina Mortgage Lender LicenseMAGAZINE 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.

OCTOBER 2021

Volume 13 Number 10

CONTENTS

nationalmortgageprofessional.com

4 Social And Civil What is it about people asking questions on social media that brings others to rage?

6 To All Things A Season Great mortgage leaders think about the next step, and the step after that.

Change, after all, is inevitable.

8 Spread Some Of Your Good Karma Your marketing shouldn’t just be about rates and closing times. What are the essential elements that make you a great choice as a business partner? Maybe it’s time to talk yourself up a little.

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

12 Build-A-Broker: Practicalities Of Practically New When you’re outfitting your brokerage, sometimes it pays to go second-hand.

14 My First Million: Always Too Much To Do How to cope when the work seemingly never ends.

16 When It Comes To Control, Don’t Freak Realizing that you simple can’t control everything will lead you to better focus on the things you can.

17 Wholesaler Directory 18 OriginatorTech Directory 23 Racism & Renting Black and Latino renters are paying substantially more of their incomes for housing than other ethnic groups, including other minorities.

>

MY FIRST MILLION:

How to cope when the work seemingly never ends

PAGE 14

>

COVER STORY PAGE 28

NMP MAGAZINE EXCLUSIVE

24 Playing Jenga With Your Tech Stack The mortgage industry’s adoption of new tech rocketed over the past year.

But we haven’t plateaued yet. Big changes are still on their way, especially as companies look to make disparate pieces of software work more in tandem.

28 COVER STORY: The Weed Of Crime Bears Bitter Fruit. But It’s Still Growing Like A Weed.

A hot real estate market; a pulsing mortgage industry.

Too much, too fast is just too attractive to criminals. And that’s why the next year will see a fraud spinning out fast and furious.

30 Facebook Thoughts: AKA, ‘Let’s See What Freud Would Do”

nationalmortgageprofessional.com

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

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OCTOBER 2021

OCTOBER 2021

Volume 13, Issue 10

FRAUD FIRES UP

Criminals can’t resist getting in on the action of an overheated market

TECH’S NEXT TWIST:

Time To Tell The Story Of You

TOGETHER

Feeling Overwhelmed

TOO MANY NEW PARTS, NOT ENOUGH WORKING

LETTER FROM THE PUBLISHER

HOW TO OVERCOME

Volume 13, Number 10

STAFF CEO, PUBLISHER & EDITOR Vincent M. Valvo

Social Sniping

O

ne of the nice things about running this company is that in all the things we do, everything is geared toward making the mortgage industry more professional. Let’s provide great

advice on how to build a brokerage, how to ratchet up sales, how to get new opportunities. Let’s provide insight on what’s going on in the markets as a whole, and in companies in specific.

Via our sibling Originator Connect Network, we get to see people in person at nearly 30 conferences across the country. Those are terrific for the great networking we watch going on, the questions-and-answers with speakers and attendees, the chance for everyone to seek out and find new opportunities, and to spark ideas from kindred spirits.

So why then, when a fledgling originator posts a question on social media, do so many “peers” just take it as an opportunity to insult and demean?

If someone new to the business asks about trying to drum up real estate agent referrals, the correct response might be firmly guiding them to other sources of business that might not be quite so hard to break into (family, friends, etc.), not just dumping on them for being naïve. If someone starts bemoaning a shrinking pay package, maybe the response could be advice on how to shore up purchase business to offset disappearing refi work, rather than casting aspersions about lack of work ethic and commitment to origination flow.

Look at the disparate Facebook groups for loan originators – especially new ones – and you’ll quickly be overwhelmed. But when someone is reaching out for help, slapping them across the face instead doesn’t reflect well on this as a profession.

It’s not, let’s say it, professional at all.

ASSOCIATE PUBLISHER Beverly Bolnick EDITOR David Krechevsky SENIOR CONTRIBUTING EDITOR Keith Griffin CONTRIBUTING WRITERS Lew Sichelman, Erica LaCentra, Harvey Mackay, Nick Roberson, Mary Kay Scully STAFF WRITER Katie Jensen DIRECTOR OF STRATEGIC GROWTH Alison Valvo GRAPHIC DESIGN MANAGER Christopher Wallace MARKETING MANAGER Michael Castro GRAPHIC DESIGNER Stacy Murray 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

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

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© 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

By There is a place where the loan search ends And before your investment strategy begins And there are financing options that delight, And there the terms are just right And there are no hidden fees in sight Don’t delay your deals, we’re ready to lend For investors with real estate dreams to grow Contact RCN Capital and you'll know The place where the loan search ends

Visit RCNCapital.com \ Email Info@RCNCapital.com \ Call 860.432.5858 RCN Capital, LLC is licensed as a California Finance Lender under Department of Business Oversight license number 60DBO-46258.

Arizona Mortgage Banker License BK-0932325. Oregon Mortgage Lending License: ML-5571; NMLS Company ID: 1045656.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

5

AVE HERSHMAN

RECRUITING, TRAINING AND MENTORING CORNER

Leading Through Change

BY DAVE HERSHMAN | CONTRIBUTING WRITER, NATIONAL MORTGAGE PROFESSIONAL

I

t seems like the only constant in this industry is change. In my almost 40 years within this industry (yes I started when I was seven years old), I have seen plenty of change. But what strikes me is that the pace of change accelerates more quickly every day. It took sixty years for records to become obsolete. It took only twenty years for cassettes to fall by the wayside. Now we have the successor to CDs—DVDs and they are becoming obsolete as well. The power of computing doubles every eighteen months. Interest rates and the stock markets are more volatile each year.

And all of this was true before the pandemic hit. Nothing changed our business more suddenly than COVID. It accelerated technological change as we had to adjust to doing business remotely. But it also charged us into the biggest refinance market of them all and a real estate market like no other as well. Never before could we not find enough homes for sale for our borrowers and never before have prices risen so drastically—even during the real estate boom of fifteen years ago.

As the refinance boom fades, we are likely to see even more mergers and acquisitions, which points to even more change. Nothing is more daunting than working for

an independent mortgage banker for ten years and then being part of a huge bank overnight (or the opposite).

communication skills are the key to

WHAT DOES THIS MEAN?

one-on-one communications

being a great leader. When dealing with change, these skills become even more important. These include

As a manager, you will have to lead through change. With each change losses will be suffered and there will be more obstacles to overcome.

There will be a grieving process.

There will also be challenges and positive opportunities. However, we cannot ignore the losses and grief that will be suffered.

J. Shep Jeffreys, in Coping with Workplace Change, identified these example cases: • The Survivor They are gone, I have survived. Why do I feel guilty?

• Where Do I Belong?

I don’t recognize this organization.

I feel lost.

• Fear of the Unknown Being laid off was a relief after not knowing for 18 months

(counseling and listening), written

HOW CAN YOU HELP?

alter its course (inertia), satisfaction

The question is—how do you deal with these cases of change? You must recognize the stages of grief and let it run its course. Grief cannot be stopped, nor can the process be accelerated. Understand their feelings: shame, guilt, loss, aloofness, and distrust. Facilitate communication: let everyone know what you know (when this is possible and without losing their trust). Develop a trust with your employees so that they believe what you are telling them. It is here that the development of the excellent communication skills we have spoken about previously will become of major importance.

As a matter of fact, excellent

communications and public speaking skills. Ignoring change by being silent will not work—you must be proactive.

UNDERSTAND THAT EMPLOYEES WILL RESIST CHANGE In the famed show “Star Trek” there was a saying by the “Borg” – resistance is futile. Well, your employees will try to resist anyway.

The explanations for resisting change widely vary. From another work on change—Leading Change, by James O’Toole—these include: it is a natural condition of life, the force it takes to move a body of motion to with the status quo, fear of the unknown, etc. To help people deal with change, you must understand their motivations in resisting change.

In summary—change is always happening. It is always accelerating.

And the events of the past year or so have proven that change can also be very unexpected. A great leader meets the challenge of change headon. Otherwise, they will be left in the dust.

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

Nothing is more daunting than working for an independent mortgage banker for ten years and then being part of a huge bank overnight.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

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RICA LACENTRA

THE XX FACTOR

Know What Makes You, You

It’s not just what you offer, but who you are that will propel (or impair) your sales

BY ERICA LACENTRA | CONTRIBUTING WRITER, NATIONAL MORTGAGE PROFESSIONAL

L

enders in the mortgage industry may be finding it is getting harder and harder to differentiate themselves from their competitors. Touting the

highest leverages and lowest rates can often only get you so far especially when your competitors may be going toe to toe with you. So, what can a lender do to stand out in an evergrowing pool of competition? It’s time that lenders, and other businesses in the mortgage industry for that matter, stop focusing solely on marketing the specific details of their products and services and start marketing the intangible qualities of those products and services to show what sets them apart. Let’s dive into exactly what marketing the intangible means.

GOING BEYOND JUST A PRODUCT OR SERVICE While it’s obvious that all lenders have various products that they are ultimately looking to sell to customers, there is so much more to their company than just what they are selling. Companies often develop core values that are touted to both their employees and their customers to let them know what the company stands for. While many businesses may think that core values are just something to use as standards and guidelines for their business, these are also great things to be able to promote and use as focal points of their marketing.

An easier way to figure out what to focus on as you are thinking of potential intangible selling points is to think of what you as a company offer that ultimately makes for a better customer experience. It could be attention to customer service, a focus on customer satisfaction, ease of use for products or services, a fast/speedy process, knowledgeable employees that can answer all product questions, a variety of products, and having “something for every situation”, etc.

Whatever your company does better than a competitor is something you can easily highlight and promote to make your products or services stand above the rest.

It is so important to market these aspects of your business in addition to the specifics of your products as they truly are differentiators. Think of any large well-known brand. Sure, you know what their offerings are, but chances are you also have general thoughts or feelings about working with that brand or what you expect when you choose that brand over a competitor. You want to create thoughtful marketing to ensure your company and products also evoke positive connotations with current and potential customers.

THE PROOF IS IN THE PUDDING So now that you understand why it’s important to promote these aspects of your business, how exactly does a company market ideas or qualities of their business that are seemly so challenging to concretely display? It truly comes down to a case of actions speaking louder than words and being able to highlight and prove through customer experiences that what you claim is true.

Never underestimate the power of testimonials and customer reviews.

Requesting feedback and reviews from your customers is easy and it can be one of the most powerful marketing tools a company can use for future promotion. Not only does

Never underestimate the power of testimonials and customer reviews.

it give you the ability to highlight the

provide data backing up what you claim

intangible positives of working with

is indeed true. So many lenders and

your business and using your products or

companies in the mortgage industry say

services, such as great customer service,

they are “the best”, “the fastest”, “the

or knowledgeable employees, but it also

most competitive”, but what does that

gives you better insight into exactly

even mean if you have nothing to back

what your business does better than your

up those claims?

competitors.

When it comes down to it, effectively marketing your company is so much more than spouting information about your products and services. It is a careful blend of promoting the best tangible and intangible things your business

For example, if you are a lender

Often the internal view of a company

THINK OUTSIDE THE BOX

has to offer, and I cannot stress how

touting how fast you can close or how

important it is to focus both pieces of the

is very different than a customer view or

easy and quick your process is, it should

a company may think certain things are

be simple for you to access pipeline data

important to highlight when in reality

to see the average time from application

about future marketing campaigns and

they are not something a customer even

submission to closing and be able to

initiatives, think beyond the product

cares about. Use customer testimonials to

promote it. Simply put, the numbers

and learn how to effectively promote the

not only promote your business but also

don’t lie and being able to concretely say,

intangible.

learn what does matter and what you

“we closed in an average of x business

should focus future marketing on.

days over the last x number of months”

Another way to highlight these intangible benefits of your company is to

puzzle. So the next time you’re thinking

carries a lot more weight than simply

Erica LaCentra is Chief Marketing Officer for

saying we have quick closings.

RCN Capital.

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Chandler, AZ www.oaktreewholesale.com

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Non-Agency & Investor AdvantageThe 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.

Our business purpose loan products, Fix & Flip, Fix & Hold, Bridge and Long-Term Rental Investments for single-family, 14 units, Condos, Townhomes.

Our Rehab Loans & Bridge allow for the monthly Payments to be Rolled into the Loan.

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NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

9

Protect. Strengthen. Grow.

There’s one company that breaks barriers and removes obstacles, allowing you to accomplish all three.

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Rocket Mortgage, 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 – Rocket Mortgage, 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 Rocket Mortgage, LLC. All rights reserved. Lending services provided by Rocket Mortgage, LLC, a subsidiary of Rocket Companies, Inc. (NYSE: RKT). “Quicken Loans” is a registered service mark of Intuit Inc., used under license.

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| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE Rocket Mortgage, 1050 Woodward Ave., Detroit, MI 48226-1906

SPONSORED BY

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

BUILD A BROKER How To Save Money On Office Equipment

YOUR FIRST MILLION DOLLARS How To Handle Big Brokerage Changes How To Use The “Serenity Prayer” To Your Advantage CAREER TICKER: People On The Move

PEOPLE ON THE MOVE //

> Embrace

Home Loans named Kim Castiglioni vice president of market growth and national condominium program manager.

> CrossCountry

Mortgage LLC hired Steph Noble to join its Portland branch as a loan officer.

> South Street

Securities named Andrew Leone as managing director of its Equity Finance Team.

> CoreVest

hired Marc Heenan as senior vice president of Lender Partnerships to support the growth of the platform through thirdparty originators.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

11

BUILD-A-BROKER: HANDS ON PRACTICAL ADVICE

BUILD-A-BROKER

Should You Buy Used Office Equipment?

SPECIAL TO NATIONAL MORTGAGE PROFESSIONAL

F

or a small business owner on a budget, previously used office equipment can seem like the perfect solution.

Whether you’re looking for office furniture, lighting fixtures, computers or peripherals such as printers and copiers, used models can be found for a fraction of the cost of new equipment.

But is buying used equipment penny-wise and pound-foolish?

Here are some questions to consider when making your decision.

1. WHAT’S THE DIFFERENCE BETWEEN USED AND REFURBISHED?

Used equipment is sold as-is—it typically hasn’t been inspected and is sold without a warranty.

You may be able to look it over if you’re purchasing in person as opposed to online, but you won’t know how well the item was maintained, what its history is or what problems it may have had.

Refurbished equipment is inspected and reconditioned to ensure it’s up to the seller’s standards before it is offered for sale. It may come with some type

of limited warranty or have the option to purchase a warranty.

Depending on the item, you may even get a full report of its condition.

While purchasing refurbished items is less risky than buying used, it’s important to find out exactly what is involved in the refurbishing or reconditioning process.

you save money. However, if you’re in an industry where the latest equipment is critical, such as website design, then buying a used or refurbished computer could put you at a competitive disadvantage.

4. ARE THERE HIDDEN COSTS?

Used equipment may sound like a great deal—until you have to pay

2. WHAT TYPE OF EQUIPMENT ARE YOU BUYING?

If you buy a used conference table for your accounting business and later discover a big scratch on it, you can still use the table.

If you buy a used computer for your accounting business and it crashes right before tax filing day on April 15, you’re in trouble.

In general, the more “mission critical” a piece of equipment is to your business operations, the riskier it is to purchase it used and the more cautious you should be.

3. HOW “CUTTING EDGE” DOES YOUR EQUIPMENT NEED TO BE? If your business doesn’t need the most current computer technology, purchasing a used or refurbished computer can help

PEOPLE ON THE MOVE //

> Interfirst

Mortgage named Pete Lunetto as the company’s senior vice president of credit.

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| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

> Proper

Rate named Tom Martin as Midwest regional manager based in the Chicagoland area.

> Old Point

Financial Corporation announced that A. Eric Kauders, Jr. has been appointed as president and chief executive officer for Old Point Trust & Financial Services, N.A.

> Cenlar FSB, a

mortgage loan subservicer and federally chartered wholesale bank, announced today that Jim Scott has joined the company as vice president.

SPONSORED BY

extra for an extended warranty, or the item breaks down a month after you buy it and requires expensive repairs. Conversely, a new piece of equipment that boosts your business’s productivity and increases sales can quickly pay for itself.

5. HOW WILL YOU PAY FOR IT?

New equipment is more expensive than used equipment, so you’ll more likely need financing. However, since it’s worth more, it may also be easier to obtain financing. In addition, it’s often easier to negotiate deals or discounts for new equipment than for used, since the used items are already offered at a discount.

6. HOW LONG DO YOU PLAN TO KEEP THE EQUIPMENT?

If you only need the item as a shortterm solution, buying used could be a better choice because it won’t tie up as much of your capital as buying new. However, if you are making a long-term investment, it is probably worth the extra cost to purchase the equipment new.

7. WHAT TYPE OF WARRANTY IS AVAILABLE?

If you’re buying used equipment that’s still under warranty, make sure that the warranty is transferable to you—many warranties are only good as long as the original owner is in possession. If you’re buying refurbished equipment, find out if a warranty is included or available. If so, make sure you clearly understand what that warranty covers and how long it’s good for.

> Wells Fargo &

Co. named Ann Thorn head of the company’s Home Lending servicing operations.

SPONSORED EDITORIAL

HOW ACRA LENDING IS LEADING THE SOLUTIONS DRIVE TO A GRIDLOCKED HOUSING MARKET

C

BY AC RA L E NDING

ompetition for homebuyers is tougher than ever right now, as tightened housing stock supply continues to plague the industry.

Acra Lending is doing what it can to help free up inventory.

The company specializes in non-QM products, a sector that serves many borrowers who might not fit agency loans. By working with borrowers in unusual circumstances, Acra is helping create opportunities for inventory to open up.

3-Month Bank Statement “For example, look at Acra’s 3-month bank statement loan program,” said Keith Lind, executive chairman and president of Acra. For those who may have lost their job during the pandemic, or who are self-employed, looking at the last three months of bank statements is “more useful than looking at the last 12 or 24,” Lind said.

The 3-month bank statement program is ideal for borrowers with nontraditional income streams. Borrowers can qualify with their most recent personal or business account’s bank statements rather than going through an agency underwrite that requires more documentation. The program requirements are stringent, so no borrower is getting a loan they won’t be able to afford.

Jumbo Products In addition to low inventory, the massive competition in the market has led to an increase in home prices. According to data from the Mortgage Bankers Association, the average purchase price had risen to $384,000 as of May. While that’s still below the $548,250 minimum price tag requiring a jumbo loan, the higher average indicates big increases across the board.

“With home prices increasing, a lot more loans fall out of agency guidelines and will fall into the jumbo prime product center,” Lind said.

Acra’s jumbo prime mortgage solution is designed to provide borrowers with the larger loan amounts needed to purchase a high-value property, with loan amounts up to $3 million. Acra also offers a jumbo nonQM product, which allows borrowers to qualify with full doc or bank statements for loan amounts up to $4 million.

Fix’n’flip Fix’n’ flip loans are ideal for investors and developers looking to purchase a home and renovate it. Many fix’n’flippers look at older housing stock that isn’t immediately move-in ready, taking on needed updates and rehab to bring the home up to date with the current market’s living standards.

Once the newly updated home is ready, it can then go back onto the market, much more appealing for standard home buyers than it might have previously been. Through these loans, developers and investors are able to bring new stock to the market that may have been previously overlooked or passed up.

“The fix’n’flip market should absolutely be beneficial to bring on more inventory,” Lind said. “We’re very excited to enter the fix’n’flip space. Our goal is to provide two loans there – we provide the fix’n’flip loan and then the permanent financing for the next person that’s going to get into that home and want to live there for a long time.”

For more information, visit www.acralending.com.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

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HOW: HANDS ON PRACTICAL ADVICE LEADERSHIP LESSONS

Don’t Get Worked Up About Being Overworked Attitude will change burden to bearable

BY HARVEY MACKAY | SPECIAL TO NATIONAL MORTGAGE PROFESSIONAL

B

ecause of a big project deadline, the employees had been asked to work double shifts for the next few days.

“That’s it, I’m going home,” one employee said to his colleague.

“But there are three more hours left in our shift,” the co-worker replied.

“Well, I’m exhausted now. Come to think of it, I’ll take tomorrow off, too. Watch this,” the worker said as he grabbed a lampshade and covered his head with it and stood atop a ladder in the center of the room.

The manager walked in, gasped, and said, “What on earth are you doing up there?”

“Isn’t it obvious? I’m a lightbulb,” the worker replied.

“Good grief,” the manager said.

“You’ve worked so long you’ve gone mad. Come down from there, and then take the rest of the day off. While you’re at it, take tomorrow off, too.”

The worker descended the ladder and began to walk away with the lampshade still on his head. His colleague decided to follow him out.

“Just where do you think you’re going?” asked the manager.

“I’m taking the rest of the day off, too,” the co-worker replied. “I can’t work in the dark.”

We’ve all felt overworked at some point in our lives.

The 40-hour work week certainly isn’t standard in the United States. In fact, a U.S. Bureau of Labor Statistics chart indicates the average American works 44 hours a week. A Gallup poll I found listed it as 47 hours a week.

Extra hours don’t necessarily translate to more productivity. In fact, you might even feel overworked if you work less than 40 hours a week. Feeling overworked can lead to exhaustion, stress, anxiety, irritability, burnout, lack of sleep, poor health, absenteeism, turnover, workplace conflicts … and psychiatric problems like thinking you’re a light bulb.

ALL HANDS ON DECK

I remember one time when I was making a speech, and I asked the audience for a show of hands if they felt overworked? Just about everyone raised their hand. WOW! I wasn’t expecting that.

Employers are finding that productivity is up among staff who are working remotely these days. That trend looks like it will continue into the foreseeable future, especially if it means that employees are more satisfied with their jobs and work schedules.

Regardless of location, all of us have occasionally felt overworked and overwhelmed. Busy times at work, big projects with short deadlines, unfilled positions that leave the company short-staffed – these are common reasons for extra pressure.

Getting more organized, adopting better time management practices and delegating small tasks to others are helpful strategies to combat burnout.

Maybe a lot of bad habits have crept into your daily routine, such as visiting too much with co-workers, spending too much time on the Internet or doing personal tasks.

Stop procrastinating. Do the things you don’t want to do first thing in the

All of us have occasionally felt overworked and overwhelmed.

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"I'm in a paperwork mood, let 'er rip."

morning. Plan ahead and have a set daily, weekly and monthly schedule of the projects you need to tackle. Don’t be afraid to say no. Saying no is not the same as saying never. It’s an acknowledgement that you respect yourself as well as the person doing the asking. Believe me, it won’t stop them from asking again!

Is everything you do necessary or is some of it just busy work?

Strive to become more productive.

Set boundaries. Be respectful of others’ time, and they should be respectful of yours.

I realize not everyone can do all of these things all the time, and there will always be hectic days or weeks. But you can prepare for them and minimize their negative effects with the right attitude.

But let’s not ignore the possibility that you are in a position where your job truly is too much for any one

person. Wearing many hats or juggling a ridiculous number of responsibilities with little or no support is beyond being overworked. If your situation demands that you produce the work of two or more people – unless you actually own the business – you need to get your resume updated. Being taken advantage of can take a serious toll on your mental and physical health.

Otherwise, you will be repeating this choice anonymous bit of sarcasm: “We the willing, led by the unknowing, are doing the impossible for the ungrateful. We have done so much with so little for so long, we are now qualified to do anything with nothing.”

Mackay’s Moral: The problem

with work is that it is so daily.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

15

HOW: HANDS ON PRACTICAL ADVICE

SPONSORED BY

MARY KAY SCULLY

BENCHMARKS & BEST PRACTICES

Keep The Plan On Track Process, Practicality and Priorities: How does your company stack up?

BY MARY KAY SCULLY | CONTRIBUTING WRITER, NATIONAL MORTGAGE PROFESSIONAL

W

e’ve talked about how to manage your time and your to-do lists, so now it’s time to get into the weeds.

With the end of the year quickly approaching, there is no better time to assess your business – specifically how your processes are contributing, or not contributing, to your bottom line.

It will be difficult to grow your business if you don’t know what makes money and what wastes it. To get a better idea of how work is working for you, take a look at the processes, practicality, and priorities at your organization.

PROCESS To assess how your business is doing, you must first take inventory of your processes and sourcing. The business you are doing likely falls into one of four categories: high effort, high return; low effort, high return; high effort, low return; low effort, low return.

With this in mind, identify the processes and relationships that have high returns.

How can you protect those sources of your business? Are there ways you could grow in those areas? Especially for those that do not

take an excessive amount of effort, look for new opportunities to promote them in order to boost your overall success.

In the same way, examine your transactions and relationships with low return. These are the ones you will want to improve or strategize around. Ask yourself why it’s not moving the needle.

Is the process inefficient? Do you need more resources to make it a success? Is it mutually beneficial?

Just because something is low return does not mean it needs to be written off entirely.

Uncover why it’s low return and brainstorm ways you can turn it around. Maybe it’s something as simple as finding an activity that can be automated or delegated. Other areas of your business, or even other industries, may have examples of how they have solved similar problems. Use your resources and explore your options.

While the first reaction may be to cut out everything that is inefficient, the goal should be to look for opportunities to improve efficiency and boost ROI in the long run.

PRACTICALITY Once you’ve assessed your processes, you’ll have a better understanding of how to best use your time to create meaningful results for your business.

The right processes also generate the most revenue, especially with regard to how much work was put in. Look at information like the percentage of loans that are withdrawn, rejected, and closed or what percentage of loans require a counter offer or have numerous items needed in order to be clear to close.

Are the majority of rejections the same loan type or from the same referral source? Understanding the reason for the loan denial is critical. You may need to improve your product and guideline knowledge. Why are some applications suspended?

Is the cause an incomplete application? You may need to conduct a thorough review of the borrower data to avoid

process delays. Missing data and documents with inaccurate information can cause a process bottleneck and negatively impact all transactions. The data will be clear as to which processes are working and which need improvement. Remember the experience of the borrower dictates the likelihood of a referral or repeat customer.

Assessing your practical processes is just as important as assessing your impractical processes. What types of transactions have the fastest pipeline clearance and/ or approval rate? Are there transaction types that you know will be profitable, but you are not going after? If this is the case, you are letting business walk out the door. Ask yourself what is holding you back from spending your time on improving or changing a processes that will result in referrals and returns down the road. It may be that you need to go back to assessing your processes to find out why you are not capitalizing on a certain transaction type.

PRIORITIES Now that you know what works and what works well, it’s time to prioritize. Of course, it’s important to prioritize what truly moves the needle for your business and positively impacts your bottom line, but it’s equally important to prioritize yourself.

Your business won’t be profitable if you are burnt out. High production is great, but it’s not the only way to see success. Make sure your workload is sustainable and you are not overwhelming yourself with tasks and responsibilities.

Additionally, prioritize activities outside of work that make you happy. This could be time with friends and family, time alone, exercise, rest, or travel. The list goes on and will depend on what recharges you, and makes you feel energized and ready for work.

Mary Kay Scully is the Director of Customer Education at Enact, leading the development of the company’s customer education curriculum. The statements in this article are solely her opinions and do not necessarily reflect the views of Enact or its management.

Wholesaler Directory

Acra Lending Specialty/ Niche: Non-QM / Jumbo 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.

ACC Mortgage Specialty/ Niche: Non-QM

Princeton Wholesale Specialty/Niche: The Effortless Mortgage

ACC Mortgage is the oldest Non-QM lender that has never stopped lending in 22 years.

We specialize in Bank Statement, ITIN, P&L, Foreign National and DSCR lending. Price, Product and Process are what make for NonQM success.

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

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

Bio: Princeton Wholesale is headquartered in Pittsburgh, PA driven by the mission to show up every day and improve our mortgage process for our broker partners and their customers. We believe that customer loyalty is earned by providing a consistent, effortless experience and by doing the right thing, every time.

http://ACCMortgage.com

https://acralending.com/

States Licensed in: Alabama, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Idaho, Illinois, Iowa, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, Washington, Wisconsin http://princetonwholesale.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.

First National bank of America Specialty/ Niche: Non- QM Bio: 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 http://www.fnba.com/mortgage-brokers

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 www.angeloakms.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 bi-lingual staff and resources supporting complete Wholesale and Correspondent Partner relationships.

Freedom Mortgage Specialty/ niche: VA and FHA

States: CA. CO, DC, FL, GA, IL, MD, OR, PR, TN, TX

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

http://www.moneyhouseus.com

*Inside Mortgage Finance, Jan-Jun 2020

States: all 50 states, the District of Columbia, Puerto Rico and the Virgin Islands. www.freedomwholesale.com NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

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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 a Mastercard company

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 userfriendly navigation possible, a userrole based workflow, the easiest to use reporting engine, as well as the only true cascading decision tool.

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 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

ReadyPrice 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.

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

SPONSORED EDITORIAL SPECIAL TO NMP

GOING WHERE THE BORROWERS ARE

BY JOHN G. STEVENS

A

s a former president of NAMB, I know the power mortgage brokers have to meet the housing needs of American home buyers.

No one has traditionally been better positioned to interact with, educate, inform and otherwise guide consumers through the home buying process.

originators all across the United States. Consumers can create search terms for property type and mortgage loan expertise, such as condo, second home, investment property, single family, or any other mortgage type. Search results connect them with mortgage professionals who have been reviewed by past borrowers.

The National Association of Mortgage Brokers is the voice of the mortgage industry representing the interests of mortgage professionals and homebuyers since 1973.

For as long as I’ve been a part of this industry, loan originators have struggled to find good new business leads and to forge strong partnerships with their partners in real estate sales. It’s going to get harder in the future, but this new online destination will change all of that, at least for the brokers who create profiles on the new platform.

A few decades ago, mortgage brokers were on the front lines, meeting with consumers in coffee shops and at kitchen tables as they began their search for a new home. But today, searching for a new home, getting a prequalification letter and even applying for a mortgage have all moved online.

Under the terms of the new agreement NAMB and SRE will cooperate to build a new online marketplace that will connect consumers with the mortgage loan originators of their choice.

That work has already begun!

“This new online destination will be the industry’s first true borrowerfacing portal, where consumers can choose the professionals they want to serve them based on the Borrowers don’t go into the branch actual experience of their peers,” Kimber told NAMB members in as often and they don’t expect the release. “At the same time, to wait for a loan officer to meet them in person. Today, they expect NAMB members can collect consumer ratings and reviews and to transact online. If mortgage brokers want to stay relevant in the add the human component in human-assisted eCommerce. It is future, that’s where they have to like Amazon meets the real estate meet their prospective borrowers. transaction!”

A NEW PARTNERSHIP TO BENEFIT MORTGAGE BROKERS Recently, NAMB President Kimber White and I announced a partnership that will provide a new member benefit for NAMB members aimed at preparing loan originators to compete more effectively, both today and in the coming purchase money mortgage market.

He was exactly right and it’s the mortgage broker’s best chance of making new business easier to find when the refinance business falls off next year.

GETTING INVOLVED NOW AND NOT LEFT BEHIND

The SRE marketplace will include profiles for mortgage loan

SRE.com will be the world’s first online destination for home buyers, sellers and investors that gives consumers everything they want, including trust support for their real estate buying and financing transactions.

It’s about human-assisted eCommerce and it’s what’s coming to our industry next. SRE. com is spending millions on this new online destination and we want you to be part of it.

Get your profile on SRE.com today ... for Free!

Any licensed originator completing their free profile between now and October can win one of FIVE trips to two to Hawaii. Ensure the future success of your business today at SRE.com.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

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S Y M P O S I U M (GET PSYCHED)

Come experience APM for our first in-person event of 2021 WHERE: WHEN: Arizona Grand Resort & Spa November 3-4 We'll be talking about what's NEXT with:

• The Industry • Customer Experience • Technology • • Sales Strategies and Much More!

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Visit JoinAPM.com or contact Dustin Block at 303.378.3166. ©2021 American Pacific Mortgage Corporation | NMLS #1850. All information contained herein is intended for mortgage professionals only and not for public distribution.

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Where The Rent Burden Is Most Unequal Across Racial Communities

T

he typical U.S. renter household spent 30.3% of its income on rent in August, just over the 30% threshold at which a household is considered rent burdened with limited income left to pay for other household costs, according to a Zillow research report.

The nation’s white and Asian households spent notably less of their incomes on rent (28.6% and 26.0%, respectively) than Black and Latinx households (34.0% and 32.1% respectively).

Across all races and markets analyzed, Black renters in San Diego are the most rent burdened, spending more than half (almost 53%) of their income on rent.

Households that spend 30% or more of their income on rent are considered “housing cost burdened,” left with little leftover income after paying for housing and taxes to cover other costs like food, transportation, household bills and clothing. In August, the typical rent burden nationwide for all households was 30.3% — just over the cusp of being a burden. ​​But rent

burdens are unequal across races, and while the nation’s white and Asian households typically spend below the 30% threshold (28.6% and 26.0%, respectively), Black and Latinx communities spend more – 34.0% and 32.1%, respectively.

Put another way: The typical black household only has 66% of its income left after rent, or $920 less per month (before taxes) than white households.

As is often the case, the national figures mask wide variation across the nation’s largest metro areas, with some groups typically spending much more and others spending much less, according to a Zillow analysis of race, rent and income.

RENTERS OF COLOR SPEND THE HIGHEST

Across all races and markets analyzed, Black renters in San Diego are the most rent burdened, spending more than half (52.6%) of their income on rent. The most unaffordable rental market for Latinx renters is Orlando, where Latinx households should expect to spend 42.0% of their income

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on rent. Even so, that 42.0% is still less than the Black household rent burden in three other metros – San Diego (as noted), Sacramento, and San Francisco.

Miami is the least-affordable metro for both Asian and white households, requiring these renters to dig into their pockets to the tune of 39.8% and 35.1% of their incomes, respectively. It is important to keep in mind that these numbers represent the typical rent burden — many households will and do spend less. But many will and do spend much, much more.

MANY RENTERS STRUGGLE

Even in the nation’s most-affordable metros, where rent burdens overall are generally low, Black renters are still paying the most, relatively speaking. In St. Louis, for example, the typical rent burden for all renting households is 24.1%, well below the national figure.

But while white households in St. Louis spent just 22.0% percent of their income on rent in August, respectively, Black renters should have expected to spend 27.5%.

“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 |

23

TECHNOLOGY

BUILD A BETTER

TECH STACK

Re-Inventing the mortgage lending business

BY NICOLE VALENTIN-SMITH | SPECIAL TO NATIONAL MORTGAGE PROFESSIONAL

R

einvention is part of living a creative life. It allows us to take what we have learned and apply those lessons to our lives by changing the way we operate. In business, it involves developing new processes and often employing new technologies. It’s an important part of the process of becoming better at what we do and more effective for our customers.

In many industries, reinvention, like its cousin reengineering, is viewed with suspicion and even fear. The idea of changing what has worked in the past, even if it’s not working as well today as it was yesterday, can be a scary thing. The memory of past implementation problems does nothing to diminish this fear.

And yet, mortgage lenders have bravely faced this concept.

Mortgage lenders have been hard at work reinventing their businesses for some time now. The financial crash was a wake-up call and the new laws passed afterward transformed the way the industry operates. Lenders have led that change, out of necessity perhaps, but with a marked positive impact on the borrowers they serve.

For many borrowers, satisfaction comes down to knowing what is happening with their loan, as soon as they ask for that information. This has traditionally been difficult for lenders

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because they depend technology platforms, upon so many third was in reality much parties to complete the more elaborate. It loan origination process. required not just new It has traditionally technology, but new been very challenging ways of thinking to keep track of where about the process of everything is as it originating a mortgage relates to the borrower’s loan. It also required transaction. full acceptance by state But things are regulators, consumers changing and the result and even those lenders will be a better process who were still clinging NICOLE VALENTIN-SMITH and more information to traditional methods. for lenders as they Over the years, the complete the work of originating the industry developed its paperless mortgage loan. lending infrastructure in fits and starts, system by system. As each new tool was developed, whether it THE INFRASTRUCTURE THAT be for appraisal management, faster BUILT AN INDUSTRY flood certifications, electronic asset Mortgage lending was not always such verification or something else, it was a complex business, but over the years cobbled onto the lender’s LOS. the changing needs of consumers and Lenders debated the merits of bestensuring the safety and soundness of of-breed, where each piece of the the system itself complicated things so much that paper forms became very puzzle was chosen from among all the available options, versus all-in-one, difficult to manage.

With the passage of the US Electronic where the lender’s LOS provider made Signature Act (ESIGN) and the Uniform a more limited set of options available and took responsibility for integrating Electronic Transaction Act (UETA), the financial services industry was granted them into the LOS. In either case, each time a new permission to conduct business technology was added to the lender’s electronically. Now, 20 years later, the industry is still making that transition. technology stack it complicated the process and provided the opportunity What may appear to be a simple for increased friction. Correcting change, giving up paper in favor of problems was expensive and time electronic data exchanged between

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consuming because there was often no single party responsible. Even when the LOS provider took responsibility, the integrations were not trivial.

Much of the technology that has been developed over the past 20 years was created specifically to work around these issues. But better technology is only part of the solution.

To be effective, the tools must be wired together in a manner that provides a complete solution.

In effect, we need to reinvent our concept of a mortgage lending infrastructure for modern digital lending.

WHAT A BETTER MODEL WOULD LOOK LIKE Today, it is possible to construct a mortgage loan origination system that can interact automatically with third party data providers using a robust API layer. This reduces the friction and eliminates the problems the industry has experienced in the past. It makes it possible to do more with fewer people and do it faster and at a much lower cost.

However, this only works if the LOS is situated at the center of a welldesigned ecosystem of technology systems, all feeding the required information into the central LOS. This is the infrastructure that will support the future of mortgage lending and it goes well beyond the thirdparty integrations required for loan origination.

In the future, successful lenders will not only choose the best loan origination technology they can find, but also factor into their decision the ecosystem it resides within. Without seamless access to the other systems that provide data required to close the mortgage, friction will remain, and efficiency will be impossible to attain.

The components of the ecosystem that the lender chooses to use in its specific process will depend upon its needs and will constitute its “secret sauce.” Typical elements will include:

We need to reinvent our concept of a mortgage lending infrastructure for modern digital lending. seamless connections between components, partners, and systems.

By gaining access to electronic data the institution already has on its borrowers, the process will go faster and the consumer will need to respond to fewer requests for information.

WEB-BASED AND MOBILE BORROWER EXPERIENCES Today’s borrowers are demanding a fully digital experience that follows them across mobile devices. This is a critical component that must be built into the ecosystem.

OCR & ICR Even in the digital lending world, there will remain paper documents and borrowers who prefer them, at least for the foreseeable future. This means lenders will need easy access to services that can digitize those forms intelligently and efficiently.

AUTOMATED DATA GATHERING & ANALYSIS Business analytics must be hard-wired into the ecosystem, for compliance and loan quality but also for harvesting business insights that will allow the institution to improve every aspect of its lending business.

E-LENDING

DIGITAL COMPLIANCE ANALYSIS

The future of mortgage lending is digital and the ecosystem should be built around this concept, with

Business intelligence has matured to the point that financial institutions can now pull important insights out

of their data for many purposes. Chief among these is compliance due to the high cost of non-compliance.

AI & RULES-BASED WORKFLOW The days of a job waiting for a human to move it on to the next task in the workflow are over. Today, smart systems move the loan file through the origination process without the need for human intervention. The efficiencies gained in this way are massive.

Some lenders may require additional systems to be part of their ecosystem.

In any event, both the ecosystem and the LOS are required. Together, they form the new infrastructure required for modern digital lending.

To be most effective, the lender will require a very strong processing hub sitting at the center of the mortgage ecosystem. This job has typically fallen to the lender’s LOS and we believe it will continue to do so for many years.

The modern LOS is still the ideal technology to marshal the mortgage through the process to the closing table.

This is the answer we expect more lenders to arrive at as they take on the work of reinventing their firms for success in the years ahead.

Nicole Valentin-Smith is Director, Client Management, Digital Lending and Origination at Fiserv, Inc.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

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27

THE MORTGAGE SCENE

CRIME STORIES From the Trenches

Bad brokers, renegade Realtors, treacherous title agents.

It’s getting tough out there.

BY LEW SICHELMAN | CONTRIBUTING WRITER, NATIONAL MORTGAGE PROFESSIONAL

C

ue the theme from Dragnet, the classic 1950s TV drama: “Dum de dum dum.”

Cue Joe Friday, played by series creator Jack Webb: “Ladies and gentlemen: The story you are about to hear is true.

Only the names have been changed to protect the innocent.”

Cue the music once again: “Dum be dum dum, dum.”

This month, I’m gonna tell you several stories. They are true-crime tales from the trenches, stories that show just how dangerous the housing business can be. And where I can, I’m not gonna change the names. If you peddle your wares in any facet of the sector – mortgages, sales, even

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property management he allegedly falsified -- you best be careful. business records to Otherwise you could be reap millions. “No had. Or even dead. one is beyond the law Remember Paul in New York,” former Manafort. Yes, that Paul DA Cyrus Vance said Manafort, the one-time when the indictment campaign manager for was handed down. one DJT – I still can’t say The case was that name, let alone type eventually dismissed; it – who was pardoned the court ruling that LEW SICHELMAN by you-know-who. The it violated the state’s pardon absolved him double jeopardy law of his federal crimes, to which he because it too closely mirrored the pleaded guilty. But he was indicted in federal case against him. So DJT’s New York on state charges related to buddy was able to skate again. mortgage fraud, among other things.

Nevertheless, it is worth noting here, The Empire State said huckster largely because this kind of thing Manafort faced 16 charges stemming happens too often in the mortgage from a year-long scheme in which business.

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

FRAUD FINDS ITS WAY This is one of the more famous cases, the end to which was under-reported.

But if CoreLogic is on the money, there were – and will be – many more. The company said shifting lending volumes and borrower misinformation in the second quarter drove fraud risk to its highest level since the beginning of 2019. The probability of application fraud – that’s what Manafort was accused of – rose 10.5 percent quarterly and 37.2 percent year-over-year.

The recent case in Connecticut, where a former attorney pleaded guilty in late August to fraud – after already being convicted twice before on fraud charges – is a, no pun intended, case in point. According

to court documents, this swindler conned an investor out of more $1 million in a scam that centered around buying mortgages. But he never did, instead keeping the money for himself and a co-conspirator.

Sometimes, though, the crime comes from within. Consider the case of Shirene Hernandez, who worked as a sale rep for Fannie Mae in its Irvine, Calif., office. She was convicted of partaking in a multimillion-dollar scheme involving kickbacks from real estate brokers.

According to the U.S. Attorney’s Office, Hernandez, using intermediaries and alter egos, bought at least one Fannie Mae-owned property in Sonoma for herself at a below-market price. She ensured that

multiple offers higher than her own below-market price were rejected.

She then paid for the property using a duffel bag filled with $286,450 in cash, which she gave to her sister-inlaw to bring to the closing.

That, alone, is suspicious. But Hernandez also helped family members become Fannie Maeapproved brokers, and then steered nearly $80 million in Fannie Mae listings to them, resulting in nearly $2 million in commissions in less than three years.

“In total, Hernandez received more than $1 million in benefits, including the cash kickbacks and rent that she collected and equity that she built in the Fannie-Mae property she bought for herself,” the DA’s office said.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

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A LITTLE LEEWAY Her conviction – and 76-month prison sentence plus an order to pay Fannie Mae $982,516 in restitution – was upheld on appeal. A Minnesota couple running a market and asset management real estate firm got off more lightly for their part in another long-lasting kickback scam.

Jeffrey Detloff was sentenced to 16 months in the pen plus two years of supervised release for his part in an illegal bidding and kickback dodge in connection with foreclosed properties, while his wife and business partner, Lori, received seven months in jail plus a year or supervised release for aiding and abetting the crime. Their firm also was ordered to pay a $593,000 fine as well as restitution to the Detloff’s victims.

According to court documents, the pair conspired to defraud lenders and guarantors who hired him to oversee maintenance and repairs on foreclosed homes. He was charged with steering maintenance and repairs contracts to companies that would kickback part of their fees to his company. He also included kickbacks within his bids and invoices sent to lenders, and she was responsible for ensuring the kickbacks were paid.

STATES OF ERROR In Louisiana, meanwhile, a 47-yearold woman has been arrested on forgery charges after a real estate agent notified police of what appeared to be falsified documents. Pamela Chandler, aka Pamela Goldwyn, was charged with two counts of forgery after attempting to buy a milliondollar home in Benton. The sharp-eyed agent noticed something was amiss and informed

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local authorities.

Through the course of the investigation, the Bossier Parish Financial Crimes Task Force found that Chandler altered a letter from an attorney in an attempt convince the agent she had access to sufficient funds to purchase the home. As it turned out, she also was wanted in warrants in Texas on assorted charges, including fraud.

And in West Chester County, N.Y., a man was arrested after allegedly posing as a real estate agent to collect rental fees from unsuspecting tenants. On four separate occasions – at least the four the authorities know about – he supposedly charged his marks substantial real estate broker and application fees after posting fraudulent listings on popular websites.

Let’s not forget about organized crime, either. The New York City District Council of Carpenters hasn’t.

In a bold step, it has expanded its authority to bring charges against members suspected of mob membership or ties to the mob. Or, as a court order filed on behalf of the union stated, “knowingly associating with any member or associate of any La Cosa Nostra crime family or any other criminal group.”

According to press reports, the union has been under court supervision since 1994 and, in the last few years, has fallen under renewed pressure to fight against any association with organized crime after a member made headlines for renting out a Queens apartment to a mafia social club run by mobster “Bobby Glasses.” You can’t make this stuff up, even in the movies.

HARD TIME

| NATIONAL MORTGAGE PROFESSIONAL MAGAZINE

These cases all involved fiscal losses.

Sometimes the crimes result in physical losses, as many real estate agents can attest. Indeed, of all the professions involved in housing, being a realty agent is the most dangerous, at least on a personal level. The peril bound up in selling houses doesn’t stack up to that faced by taxi drivers, which the Bureau of Labor Statistics says is the most dangerous job going.

But as many agents can attest, it is nonetheless fraught with risk.

Surely we all have heard or read of the headline cases where an agent or some other professional involved in the sale of a property has lost his or her life. Just a few months ago, for example, a home inspector on assignment in Huntington Beach, Calif., was shot and killed. Police have charged a man who was involved in a family dispute over whether to sell the house left to four siblings by their father.

Or maybe you are familiar with the recent murder of a West Omaha agent, who was found dead inside a house that was for sale. But did you hear – or read – about the Nebraska man who was arrested last December in connection with the suspected homicide of a real estate agent? The agent had recently purchased the property and was showing it to the alleged killer as a possible tenant.

Or the North Ridgefield, Ohio, agent who was attacked outside a house for sale? Though traumatized, she fared much better than those mentioned above when she was attacked by two men with knives who tried to pull her inside the house. She managed to escape and locked herself in her car.

How about the Utah agent who found herself at the business end of a rifle by a man who told her and her client to leave his property? The guy locked himself in the house before being taken into

custody. Similarly, a Tennessee agent was opening a lockbox to show a place when he was approached by a gun-wielding 18-year-old man who demanded that he run. The agent threw his car keys, fled the scene and the gunman subsequently stole his car.

And who can forget the poor, befuddled Black real estate agent in Wyoming, Mich., who was showing a home to a client when police arrived on the scene and placed both of them in handcuffs – in front of the client’s 15-year-old son. Police were responding to a neighbor’s 911 call.

“The level of the response and the aggressiveness of the response was definitely a take back, it really threw me back,” Brown told local media.

“Am I just automatically the criminal?

Because that’s pretty much how we were treated in that situation.”

That incident made the national nightly news. But you probably never heard about the Black realty agent – a former U.S. Capital Police officer -- who was waiting in his car to photograph a client’s house in Arlington, Va,, when several police cars showed up and asked him for identification. “They have three cop cars out here for me,” said the agent, who called the incident demeaning. “I am an agent and a photographer and this is what we get in this climate. It’s ridiculous.”

AGENTS PROVOCATEUR Sometimes, though, as in the financing sector, agents are the perpetrators, not the victims. And sometimes they are their own worst enemies. In Los Angeles, a Beverly Hills real estate agent has been charged with serving as an accomplice for a thief who posed as an agent and stole more than

2,000 items from houses the rich and famous had listed for sale.

And who can forget Jenna Ryan, the Texas real estate agent who stormed the Capitol in January and stopped to pose for pictures she later posted on social media to plug her real estate business. In case you missed it, she has pleaded guilty to demonstrating inside the building, a misdemeanor that comes with a $500 fine and up to six months in the hoosgow. She was one of two agents – the other was former Olympic medalist Klete Keller – charged with knowingly entering a restricted building to impede an official government function, disorderly conduct and obstructing law officers.

Then there is a whole category of realty agents who commit deeds that, while not necessarily crimes, are no less reprehensible. Surely you’ve heard of the Arizona agent who shouted racial slurs at two people outside his home, for example? A video of his rant went viral.

But do you know about the Brooklyn agent who went on a racist screed when a gym manager asked him to wear a mask? Or the California agent who was caught on video hurling insults at an Asian-American woman in Brentwood? Or the New York City agent whose insensitive behavior toward homeless people – he was tossing empty beer bottles at them -- also was captured on video. Or the agent who, too, was seen on a video flipping off a neighbor and destroying the “Biden For President” signs she had placed in her yard.

To their employers’ credit, these agents were all

summarily dismissed by their respective brokerages. “The way in which our agents represent their communities is of utmost importance to us,” said one firm. Another, a major chain, said it “does not condone or tolerate racism or discrimination.

The immediate manner in which this matter was addressed by our franchise office represents that our core values have been upheld.”

All-in-all, the housing business can be a dangerous one. The flimflam men – and sometimes women – are out there, ready to take your money or someone else’s in an instant. Or perhaps your life. And so, too, are the racists and bigots among us who come out from under the rocks to show their true colors when they think nobody is looking. Or when they hope everyone IS watching.

So I leave you with one Sgt. Phil Esterhaus, who kicked off every episode of Hills Street Blues, the long running 1980s TV cop drama, with these immortal words: “Let’s be careful out there.”

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.

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE |

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FACEBOOK THOUGHTS

A Little Light Therapy….

NICK ROBERSON

Nick Roberson

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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:

Anyone down to take couples counseling, and see at what point the therapist realizes we don’t even know each other?

Note, if you are being chased by a pack of taxidermist, do not play dead!

In case anyone was curious a pizza pan in a 425 degree oven gets really hot! Also, I do not recommend removing it from the oven with your bare hands. I have first “hand” knowledge of this. I am proud to say I did not drop the pizza. I also realized I know far more swear words than I thought. A few weren’t even in English.

My neighbor, Jim, and I are going to a Halloween costume party together. We are going dressed as a horse. I am going to be the front and he is going to be himself.

I was getting a drink at Starbucks this morning. On my way back to my car a guy approached me. I thought he was going to ask me for money, but that was not the case. Instead, he offered me a career opportunity. He was trying to convince me I could make a fortune by investing in a new bitcoin he had created. He was telling me about how successful he was, and how much money I could make. This sales pitch might have been a whole lot more convincing if it weren’t for the fact he smelled like a frat house the night after a big party, he looked like he hadn’t combed his hair in ... well ever, and he only had 5 teeth and 3 of those were in his pocket. I think I will stick with my current career path.

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

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Sometimes to annoy my therapist, I ask her, “How does my lack of progress make you feel?”

If you die and get cremated, you can be into an hourglass and still be included in family game night.

Everyone is dancing around the house in their underwear this morning while listening to their Rat Pack, Van Halen, and Aerosmith playlist, right??? No? Maybe I should call my therapist. Probably should close my blinds first though ... Nahhhhh ... Sorry, Jim. Hmmmm ... it just occurred to me that a Prius and a suppository appear to have been designed by the same person. Coincidence? I don’t know, but I don’t want to get rear-ended by one.

The first five days after the weekend are the hardest.

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