October/November 2020
HOUSINGWIRE MAGAZINE ❱ OCTOBER/NOVEMBER 2020
VANGUARDS The top
50 executives IN
HOUSING
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EDITOR IN CHIEF Sarah Wheeler
NEWSROOM EDITOR AT LARGE Kathleen Howley MORTGAGE EDITOR James Kleimann FINTECH EDITOR Mary Ann Azevedo REAL ESTATE REPORTER Julia Falcon MORTGAGE REPORTER Alex Roha DIGITAL PRODUCER Alcynna Lloyd JUNIOR DIGITAL PRODUCER Victoria Wickham INTERN Adnan Khan LEAD ANALYST Logan Mohtashami CONTRIBUTORS Frank Nothaft, Joanne Cleaver, Rohit Gupta HW+ HW+ MANAGING EDITOR Brena Nath MAGAZINE EDITOR Kelsey Ramírez COLUMNISTS Robyn Friedman, Scott Petronis CONTENT SOLUTIONS MANAGING EDITOR Maleesa Smith ASSOCIATE CONTENT EDITOR Jessica Davis DIGITAL CONTENT STRATEGIST Alyssa Stringer CREATIVE GRAPHIC DESIGNER Emily Carpenter SALES VICE PRESIDENT, SALES AND REVENUE OPERATIONS Jennifer Watson Laws NATIONAL SALES DIRECTOR, REAL ESTATE Mark Adams CALIFORNIA Christi Humphries CENTRAL Chris Anderson SOUTHEAST Tamara Wren GREAT LAKES Lorena Leggett NORTHEAST Vernesa Merdanovic BUSINESS DEVELOPMENT Lindsley Harris BUSINESS DEVELOPMENT, REAL ESTATE Amanda Luzsicza DEMAND GEN COORDINATOR Brooke Combs
❱ H O U S IN G W IR E
HW MEDIA CORPORATE CEO Clayton Collins CHIEF OPERATING OFFICER Diego Sanchez PRODUCT MANAGER Matthew Stafford CONTROLLER Andrew Key MARKETING DIRECTOR Caren Karris MARKETING COORDINATOR Katie Galbraith CLIENT SUCCESS DIRECTOR Haley Hess clientsuccess@HousingWire.com CLIENT SUCCESS COORDINATOR Talia Quigley
HOW TO REACH US LETTERS TO THE EDITOR: feedback@housingwire.com TIPS AND STORIES: editorial@housingwire.com CURRENT MEMBERSHIP / SUBSCRIPTION: hwplusmember@housingwire.com NEW MEMBERSHIP / SUBSCRIPTION: housingwire.com/membership MARKETING & ADVERTISING: jlaws@housingwire.com or (469) 893-1486 ADVERTISING CLIENT SUCCESS: clientsuccess@housingwire.com
OCTOBER/NOVEMBER 2020
I couldn’t choose WE all sat around the virtual table when I kicked
on page 36. Many of this year ’s winners rose
off the Vanguards winner selection process.
through impossible odds to become the top ex-
“I chose my 50 winners, but I wanted to say
ecutives in the housing industry today.
yes to double that number,� I said at the time.
Speaking of choosing, it’s your turn to help
“I’m just telling you right now, if you have a
choose. In the next magazine issue we are going
convincing argument for someone to be on the
to look at the future of many different sectors of
winners list, I won’t be the hold up this year.�
the housing industry. Use the QR code to help us
Typically, I’m one of the more conservative
decide which industry is the top dog and de-
voices in the group. I say yes to the fewest peo-
serves the cover spot.
ple and I am one of the most stringent about
So pull out your phone and snap the QR code.
who passes my vote. This year was nearly im-
We just have one question on this survey: which
possible. I cringed as I remembered that, by my
industry should be on the December/January
own voting system, I needed to put in a number
Magazine cover?
representing yes, no or maybe, and I slipped in a number that was between yes and maybe. I had already said yes to 50, but there were so many other Vanguards that left me beyond impressed. Coming off one of the most competitive years I am proud to present this year ’s list of 50 winners. You can read all about them starting
Kelsey RamĂrez Managing Editor @kels_ramirez
 � � �
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OCTOBER/NOVEMBER 2020
Š  �
â?ą H O U S IN G W IR E
for the program in the history of HousingWire,
DEFAULT SERVICES:
PREPARING
FOR 2O21 In today’s environment, there are many unknowns and a lot of speculation around what 2021 has in store for our industry. NTC is staying one-step ahead and is prepared to assist by continuing to expand and improve our default services. We will be ready for whatever turn the mortgage industry takes. Call us to discuss how we can help you.
- TITLE POLICY CORRECTIVE, RETRIEVAL OR REPLACEMENT - DOCUMENT RETRIEVAL/COUNTY RESEARCH - CURRENT OWNER SEARCH - ASSIGNMENT VERIFICATION REPORT (AVR) - CHAIN OF TITLE BINDER FOR NOTES AND ENDORSEMENTS - ASSIGNMENTS OF MORTGAGES
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800.346.9152 x310
Oct/Nov 2020
People Movers
14 S ag e nt na m e s T im Von K ae ne l its c hie f innov ation off ic e r, a ne w ly c re ate d ro le .
Unique Solution
26 T he top things b rok e rs ne e d to look for in a nonQ M le nd ing pa r tne r.
Startup Profile
16 S und ae pa irs s e lle rs of d is tre s s e d prope r ty w ith pote ntial b uy e rs .
Launches
28 T ill, a re ntal pay m e nt tool, rais e d $ 8 m illion in a s e e d fund ing round .
Event Calendar
18 H W A nnual tak e s on d is ruption w ith hous ing ’s top e x e c u tiv e m ind s .
Take 5
30 Jo s e p h R e s tiv o w ould hav e b e e n a ne uro surg e on in a nothe r life .
Inside Agent
20 L atha m Je nk ins has b e e n in re al e s tate ma rk e ting for m ore tha n 26 y e a rs .
Trade Desk
94 N A M M B A’s prog ra m s e e k s to c onne c t c olle g e s tud e nts to the hous ing indus tr y.
Local Intel
22 T hroug hou t the pa nd e m ic , hom e s ale s hav e b e e n at re c ord le v e ls in Hous ton.
Mortgage
100 T he F H FA c re ate d a ne w re fina nc e fe e , the n d e lay e d the s ta r t d ate to D e c . 1.
Hot Seat
24 M a nle y D e as K oc hals k i’s Te d M a nle y on suppor ting c lie nts from hom e .
Real Estate
104 F or M ille nnials w ho w a nt to buy a hom e rig ht no w, the G re at R e c e s s ion s till looms .
Fintech
108 Hous ing e m b rac e s R O N as prov id e rs g ain M IS M O R O N C om p lia nc e c e r tific ation.
Politics & Money
112 T he F e d ’s ne w inflation polic y may b oo s t w ag e s , bu t on the othe r ha nd ...
Q&A
116 E llie M ae ’s S e lim A is s i on pre v e nting ra ns omw a re attac k s w hile re m ote .
Kudos
120 T itle c om pa nie s hold the uniq ue oppor tunity to g iv e bac k to the ir c om m unitie s .
Parting Shot
122 T he num b e r of pe op le w ho w a nte d pools s pik e d this sum m e r.
â?ą OCTOBER/NOVEMBER 2020
VANGUARDS
features
f
36
66
Introducing the top 50 executives of the housing industry. By: HousingWire staff
72
84
VANGUARDS
AFFORDABLE HOUSING
50 SOLUTIONS
Investors turn their eye to affordable housing as community leaders look to elevate its case.
Six companies showcase their origination platforms and solutions. By: HW Content Solutions
By: Joanne Cleaver
78
HOUSING’S SUGAR HIGH? 2 MARKETS
Some experts predict that the housing ecosystem could get worse before it gets better.
92
COMPANY SPOTLIGHT
Dive into two very different worlds: originations and delinquencies.
DocMagic outlines its Single Implementation Solution and how it empowers lenders.
By: Rohit Gupta
By: HW Content Solutions
By: Kelsey RamĂrez
W hat could the spring 2021 homebuying market have in store?
Housing’s V-shaped recovery is complete: What had to happen to get America back by Sept. 1
32
34
PEOPLE MOVERS
Tim Von Kaenel
| Sagent Lending Technologies | Chief Inno-
vation Officer
Sagent Lending Technologies named Tim Von Kaenel its chief innovation officer, a newly created role. Prior to Sagent, Von Kaenel was the chief product officer at LoanDepot. He also worked at point-of-sale company Cloudvirga, where he helped usher in the digital mortgage era by bringing push-button, phone-based simplicity to mortgage originations.
Matt Daimler |
Zillow Group | Senior Vice President of Product
Zillow Group named Matt Daimler its senior vice president of product for Zillow's Product Group, a newly created part of the company. As part of this move, long-time StreetEasy executive Caroline Burton will step into Daimler’s former role as general manager of StreetEasy and Zillow Group NYC. Daimler joined Zillow in 2012 after it acquired Buyfolio, a co-shopping platform for real estate agents and their homebuyers, which he co-founded in 2009.
Ravi Kandikonda |
Zillow Group | Senior Vice President of Integrated Marketing
Zillow Group appointed Ravi Kandikonda its senior vice president of integrated marketing. Kandikonda has more than 20 years of experience in the housing industry, and prior to Zillow Group, served eight years as senior vice president of marketing at Comcast, where he led consumer marketing programs and operations for the company’s Xfinity branded products. Before Comcast, Kandikonda held leadership and management positions at Ogilvy, FICO and HSBC Card Services.
Lavinia Biasell |
Transnation Title Agency | Chief Legal Officer
Transnation Title Agency brought on Lavinia Biasell as its first chief legal officer. Biasell joined the team with more than 15 years of experience in the housing industry. Biasell previously worked for Fidelity National Financial as an underwriter for all of Fidelity’s Michigan title agents. She also holds experience at Maddin, Hauser, Roth & Heller, where she served as a partner at the firm, representing clients in a variety of title legal matters.
Patricia Suazo |
FundingShield | Vice President of Technology Operations and
Integrations
Patricia Suazo joined FundingShield as vice president of technology operations and integrations. With more than 15 years in the mortgage lending space, Suazo has worked with firms such as CloudVirga and Bank of America. Suazo specializes in software systems implementation, migrations and integration. At Bank of America, Suazo held roles such as IT systems product manager and business operations analyst.
Walter Allen |
Valligent Technologies | Executive Vice President of Digital
Transformation
Valuation technology company Valligent Technologies named Walter Allen its executive vice president of digital transformation. Prior to Valligent, Allen was an executive at CoreLogic Solutions for 13 years. There, Allen developed strategies for capital markets clients including Morgan Stanley and Deutsche Bank, as well as managed engagements and provided solutions for FHFA, OCC, HUD, Freddie Mac and others.
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Jim Anderson |
Guaranteed Rate Affinity | Senior Vice President of Strategic Growth
Guaranteed Rate Affinity named Jim Anderson the senior vice president of strategic growth. Anderson has more than 30 years of experience in the mortgage industry, specializing in business development, strategic sales and risk management. Prior to joining Guaranteed Rate Affinity, Anderson served in executive-level business development and sales director roles for multiple large players within the housing industry such as Stearns Lending.
OCTOBER/NOVEMBER 2020
STARTUP PROFILE
Sundae is a residential real estate marketplace that pairs sellers of distressed properties with potential buyers. The company essentially aims to aggregate demand from“fix and flippers,” who use the marketplace to bid against each other for distressed properties. Interested sellers can go to Sundae’s marketplace and request an offer. Someone fromthe company then reaches out to gather additional information and learn more about the sellers’ needs. After a “brief home visit” (or virtual walk-through if preferred by the seller in the COVID-19 era), Sundae makes an offer. If the seller accepts and an inspection is completed, the company offers a $10,000 cash advance before closing to help homeowners with moving costs or other expenses. It charges no closing costs or agent fees. Sundae then offers up the property on its marketplace, giving investors a chance to bid on it.
Things To Know Attempting to Disrupt: The sale of distressed properties to investors in the residential fix and flip industry Launch Date: January 2019 Funding: Nearly $20 million from backers such as QED Investors, PayPal cofounder Peter Thiel’s Founders Fund, Susa Ventures and a group of real estate and fintech investors and entrepreneurs. Location: Sundae operates across California with a focus on serving these areas: San Diego County, Riverside County, San Bernardino County, Los Angeles County and the greater Sacramento area. The company plans to expand up the coast through central and northern California before moving east to markets such as Texas, Atlanta and Florida.
sundae.com
Cofounded by Josh Stech, LendingHome founding partner
Cofounded by Andrew Swain, former chief financial officer of LendingHome and Airbnb
Online marketplace that pairs sellers of distressed property with potential buyers
The disruptor score, unique score and launch size were determined through interviews with and editorial research on the company.
LOW 1 6 ❱ H O U S IN G W IR E
UNIQUE SCORE: LAUNCH SIZE: FUNDING:
2
HIGH
8 8
DISRUPTOR SCORE:
$20m Pre-Seed
Seed
A
OCTOBER/NOVEMBER 2020
B
C
This is what SagentĘźs consumer-facing Account Connect suite does.
Visit our website sagentlending.com or email us at info@sagentlending.com for more information
EVENT CALENDAR
ON THE SHELF
HousingWire Annual October 8, 2020 Cost to attend: $95 Key Speakers: Doug Duncan, Robert Dietz, Laurie Goodman, Ed DeMarco LOCATION: VIRTUAL DISRUPTION is speeding through the business landscape, upending traditional strategies and agendas for those in housing. HousingWire Annual will address the rapidly evolving opportunities for our industry, bringing together the most important stakeholders in government and business for a one-day summit that will shape the conversation for this year and beyond.
“Underwater: How Our American Dream of Homeownership Became a Nightmare” BY BY RYAN DEZEMBER REVIEW BY: CLAYTON COLLINS
In today’s world, no matter how bullish you are on the housing market, all housing professionals and most homeowners are at least somewhat aware that home prices can decline. This common-sense view was not so commonly held in 2007. Ryan Dezember’s debut book, “Underwater,” navigates his experience as a real estate reporter on Alabama’s Gulf Coast and his personal battle as a homeowner in a dramatic boomto-bust market. From an extremely unique and informed vantage point, Dezember chronicles the dynamics and characters of the boom days leading up to the crash of 2008. The book is graced with characters like Bob Swallow, the RE/MAX agent that sold $186 million in real estate in 2006, and former Orange Beach Mayor Steve Russo, who was charged with multiple counts related to bribery to pave the way for beachfront developments. But Dezember’s story doesn’t stop at the local level in Alabama: His vantage point as a journalist allows him to weave in knowledge about the role Wall Street and Washington played in the crisis. In a chapter titled “System Error,” Dezember rounds the corner of detail about the boom days in Alabama and takes the narrative to Wall Street. Shortly after John Thain arrived at Merrill Lynch in 2007, Thain asked the Merrill Board of Directors “Why is it okay to own $50 billion of these assets [mortgage-related securities]?” Because they are graded AAA, of course. As the crisis unfolds, Dezember’s narrative flows into the new opportunities created by the crisis – including Wall Street’s entrance into the single-family rental market. While Wall Street came in with fresh capital and professional management, Dezember was simultaneously trying his hand as a landlord renting out his own home on Alabama’s Gulf Coast. Dezember’s experience renting his home for $650 per month is quite different from the fortunes created by SFR-behemoths Invitation Homes and American Homes 4 Rent, which he later chronicles. In the end, Dezember made it through a 10-year saga as an underwater homeowner – and the U.S. housing market returned to its pre-crisis glory. The story has a very apt ending – an anecdote of a Florida couple losing out on the purchase of their dream home due to a COVID-19 induced furlough. “Underwater” masterfully chronicles the housing crisis and connects the personalities, greed and market dynamics that powered the boom and bust. An excellent read for those impassioned by the housing market and those who like to use history as a passport to the future.
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Event TIP “You want to make sure that you get to know the other people attending these virtual conferences. If there is a way to find out who other attendees are, really make it a point to network with them and to get to know them because I think that’s the one thing that we all look forward to with conferences – getting to network and meet people. You have to be a little bit more intentional and make it a point to really get to know the other attendees.” -Raquel Borras, True Branding Group chief excitement officer
OCTOBER/NOVEMBER 2020
INSIDE AGENT
Latham Jenkins Live Water Properties latham@livewaterproperties.com Cody Creek Ranch, 1475 Creamery Lane Jackson, Wyoming 83001 $18,900,000 5 bedrooms, 7 bathrooms 65 acres, 5,651 sqft
2 0 ❱ H O U S IN G W IR E
LATHAMJENKINS is an associate broker in Jackson Hole, Wyoming, and has been a real estate marketer for more than 26 years and selling over the last six years, saying every day in this area is a new adventure. Built in 1990, Jenkins said this house offers another world of ranch living just five minutes from the town square. Described as “the ranch in the middle of everywhere that lives like a mini national park,” this home’s future owners can fly fish, canoe, paddle board and more on the property, as its 65 acres border thousands of acres of lands in conservation.
OCTOBER/NOVEMBER 2020
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LOCAL INTEL
By: Brena Nath
H o u s t o n , T e x a s (K a t y ) “Even through the pandemic, home sales have been at record levels here,” said Andi Bolin, the Texas state manager for Knight Barry Title, which just opened its office over the summer. As a new player in the Houston real estate market, Bolin added that she’s proud of how her team has handled the volume of orders on top of everything that normally goes into establishing an operation in a new area. “Like many regions of the country, there are lingering inventory concerns in our area, which may slow down our hot pace sooner than later,” Bolin said. “However, with interest rates still so low, the desire to buy – or refinance – will still be burning, so we expect to remain very busy during our first year of business. This year has already been full of so many surprises, I’d hate to predict the specifics of what is coming next, but we are expecting big things to continue.”
Commenting on what he’s witnessing in West Virginia, along with a handful of other eastern states, Bob Drummond, West Virginia Bankers Title vice president and agency manager, said, “On the ground, we hear homes are sold as soon as they hit the market. Especially in West Virginia, prospective homebuyers have gained the most purchasing power they’ve seen in years.” Drummond added that a new analysis found some of the states where they operate, including West Virginia, Maryland and Kentucky, are seeing their highest level of affordability in 25 years. “Our real estate market in the multi-state region we serve showed remarkable resiliency during the spring and was booming into the summer,” he said. “As rates hit record lows, we expect activity to remain strong, and we’re prepared to offer innovative, technology-driven solutions.”
OCTOBER/NOVEMBER 2020
Nashv ille, Tennessee
2 2 ❱ H O U S IN G W IR E
West V irginia
Vail Valley, Colorado After seeing significant drops in April and May, the luxury market has rebounded in places that are usually popular for second homes. Sara Roberts, vice president of marketing at Slifer Smith & Frampton Real Estate in Vail Valley, Colorado, said, “Summertime is usually our busiest season, but this is different. Because we’re a seasonal resort we usually have a busy summer season and we’ll pull back in the fall and then of course pick up again in the ski season.” However, she explained that dip hasn’t happened this year, and instead, they’re getting busier. One other trend Roberts said she was seeing was second homes becoming the new primary home, and even buyers moving up from smaller vacation homes.
“The pandemic has certainly changed the way real estate business gets done in and around Nashville, but as people adjusted to the new normal, the market returned to historic highs,” Homeland Title Owner Laura Perry said. July home sales were up 12% compared to July of last year, according to Nashville’s local Realtors association, and Perry said that they’re prepared for that pace to continue as more people than ever before consider moving to the area. “Just like our region is growing, Homeland Title had growth plans of its own in 2020, and even with the challenges of this year, we expect a busy fall,” Perry said.
Latham Jenkins, an associate broker at Live Water Jackson Hole, said that “COVID-19 refugees” began flocking to this vacation town in May. Jenkins said not only is the Jackson Hole purchase market flourishing, but its rental market is also off the charts. “Single-family homes with a little bit of acreage around them [are in demand],” Jenkins said. “We have seen in the $3 million plus segment, really a record-breaking pace over the last two months of pending listings.” As more people are working from home, Jenkins said that more people are retreating to bigger and more relaxed lifestyles, which is what Jackson Hole has to offer. This also leads to more bidding wars. See page 20 for one example.
OCTOBER/NOVEMBER 2020
2 3 ❱ H O U S IN G W IR E
Jac k s o n Ho le , Wyom ing
HOT SEAT
SPONSORED CONTENT
Ted Manley Partner
E
Manley Deas Kochalski
arlier this year, many businesses were required to make a quick shift to remote work. HousingWire spoke to Ted Manley, partner at Manley Deas Kochalski, about how technology has enabled the firm to continue supporting its clients while its employees work from home. HW: As health and safet y measures surrounding COVID-19 have led to an increase in remote work , what complications has that created for Manley Deas Kochalsk i and your ser vicing clients?: Ted Manley: At the onset of the pandemic, it became clear that MDK needed to adjust to working in a remote setting. The health and wellness of our employees is always a top priority, especially as we looked to stay connected to our teams and our clients during this unprecedented time. It was imperative that we maintain consistent communication with our bank and servicer contacts, and that we provide timely legal advice for managing state and local directives related to COVID-19. We focused on enhancing our existing technological infrastructure, ensuring our workforce remained as effective and secure as it is when onsite. Our compliance and human resources departments developed new workfrom-home policies that allowed our employees to provide uninterrupted support to our clients from the safety of their homes.
2 4 ❱ H O U S IN G W IR E
Q&A
HW: How has MDK 's embrace of technology enabled your firm to adapt to the current challenges while maintaining qualit y ser vice? TM: Our existing technology platform allowed for a seamless transition to remote work and client service across our six states. As soon as our teams transitioned to working remotely, we began focusing on opportunities to enhance their remote work experience by implementing additional collaboration and communication tools.
We believe the client and employee experience go hand-in-hand. Keeping our employees connected in a remote work environment has further strengthened MDK’s commitment to providing clients with continuity of services and transparency into their default portfolio. MDK’s innovative IT team has forged ahead to develop enhancements to our service offerings. We began to envision technology solutions that MDK could offer to clients in need of augmented reporting systems. As a response, our IT team developed a secure application that enables document execution, communication and ondemand reporting. We recognize that there are a number of processes that will continue to be managed remotely in a post COVID-19 world. We are working on addressing challenges that the courts, county officials and our clients are facing with a goal to provide long-term solutions. We reimagined the MDK Academy, MDK’s bespoke client training program. Our attorneys created dynamic, on-demand training sessions that our clients can access at any time, from any location. We have found that webinar Q&A sessions are a great follow-up to the online trainings, and these various format options offer clients greater flexibility when trying to organize large groups of employees working remotely. HW: Given the current uncertaint y, it ’ s possible this shif t to remote work may continue for some time. What are the best practices you recommend to your employees and anyone else work ing from home? TM: In early March, we realized that life will be described in pre- and post-COVID-19 terms from now on. We turned to leaders in organizational psychology and other progressive thinkers, including Adam Grant and Sam Harris, to gain knowledge on building stronger, more resilient teams. Recognizing that “normal” will never be the same, we strengthened our focus on strategic planning and creating a defined Innovation Hub that will encourage the development of new ideas while onboarding new lines of business that fit in our business model.
OCTOBER/NOVEMBER 2020
IT’S POS + LOS + CRM, ALL IN ONE COMPLETE PACKAGE UWM’s free online mortgage application portal, Blink, has been one of the easiest, most secure ways of letting your borrowers complete an application online since it originally launched in 2016. And now with Blink+, you can do even more: • Price out a loan inside Blink+ — no need to go between systems • Generate docs — complete a generic package quickly and easily • Preset your fees — automatically transfer over to EASE saving you time and eliminating errors • Send a quick link — collect basic borrower information with our quick application link that you can also add to your website • Create Mortgage Call Reports — export into spreadsheets so they are audit- or compliance-ready • Change the loan status of non-UWM loans — without having to leave Blink+ • Invite real estate agents into the transaction — keep them informed every step of the way Blink+ is completely customizable, so you can set it up to do as much or as little as you want. Plus, it’s synced with Brand 360’s Client Connect so all of your borrowers will transfer over in real-time. You can even opt in to have us automatically send emails on your behalf to help borrowers through the application process. It’s a nice way to nudge them along, without having to do anything manually. Work with the mortgage lender that is laser-focused on giving you every advantage from start to finish. Join our network today at UWM.com/join-uwm.
YOU + UWM = YOUNITED | 800.981.8898 | UWM.COM
UNIQUE SOLUTIONS SPONSORED CONTENT
Top things brokers and borrowers need to keep in mind when looking for a non-QM lending partner The mortgage industry never stops – consumers always desire the opportunity to own a home. Accordingly, brokers and borrowers continue to pursue purchase transactions independent of the world’s turmoil.
HITZMISTRY Marketing director at Citadel Servicing Corp.
Activity may ebb and flow and needs may change with the times, but brokers need to be ready to serve their clients inall environments. One differentiator for leading lenders, suchasCitadel Servicing, istonot onlymeet customers’ historical needs but adapt to current needs, as well as anticipate future market opportunities to ensure they are consistently enabling their broker partners to exceed customer expectations and fulfill demand. Thereis nogettingaroundthat theworldhas changed, causing a profound impact on the ever-changing landscape of mortgage lending. As aresult, not all of theorganizations inthemortgage spacewill continuetothriveandservetheir customers – Charles Darwinsaidit best in“OntheOriginof Species” – “It is not themost intellectual of thespecies that survives; it is not the strongest that survives; but the species that
2 6 ❱ H O U S IN G W IR E
“It is not the most intellectual of the species that survives; it is not the strongest that survives; but the species that survives is the one that is able to best adapt and adjust to the changing environment in which it finds itself.” survives is theonethat is abletobest adapt andadjust to the changing environment in which it finds itself.” So, what does this mean for brokers and borrowers? With the short pause in non-QMlending, many organizations decided to switch their focus to other lending areas, choosingtoconcentrateontraditional mortgages or other markets. Whilethismayhavebeenasavvytactic on the part of those lenders, it puts brokers who need a OCTOBER/NOVEMBER 2020
non-QMsolution in a difficult position. As an organization that is committedtonon-QMlending, Citadel Servicing did not try to deviate or divert its focus to other areas. Instead, the company adapted. Instead, Citadel Servicing chose to use the temporary pause to invest in its processes and technology, which would improve the customer experience. Whether abroker or borrower, eachisacustomer anda client. Thehigh-touchservice, thoughtful andinnovative programs Citadel Servicing provides do not differ. Providinga solutiontoanarea that cansometimes be seen as complicated to underwrite – but in a way that is beneficial to all parties – is something the company has done in the past and continues to do in the current environment, in which non-QMsolutions are more necessary than ever. Working with clients who may find themselves in an unusual or unexpected position is something Citadel Servicing has more experience with than anyone in the space, and the company prides itself on continuing to work with customers and drive product innovation to address the changing landscape head-on. Buildingasolidfoundationwithany partnershipis important. Abroker should be able to trust that when they have a loan to submit the lender will have not only the right programs but alsotheright peopleinplacetomake the process as simple and efficient as possible. Citadel Servicing invests in both its technological infrastructure and its employees, pushing and motivating themto become the best in the industry. Having a dedicated in-house learning and development teamto support career growthisessential tothecompany’ssuccess, as are the new systems and technologies it invested in during the recent pause in lending activity. No one knows what tomorrow will bring, but what Citadel Servicingwill continue todois make sure it stays at the forefront of the non-QMsector to provide brokers and borrowers the best service and programs in the industry.
I CAME TO ACADEMY FOR...
an opportunity to grow with a national company that provides local control.
m 10:18 a
I STAY AT ACADEMY...
because they invest in our teams through an unbeatable coaching culture.
Ryan N., Oregon
for ed up rogram. n g i s d ice an er Training P v d a r you ear I took y’s Torch B m Acade ort o supp grow t e r e h e’ll be to help you W ! c � y s a fanta he w That ’s ry step of t e you ev siness. u your b
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LAUNCHES
Till Till, a startup that aims to help renters set up customized payment schedules, raised $8 million in a seed funding round. Till says its Flexible Rent platform helps keep renters from being evicted by giving them a way to create a customized payment schedule “that aligns with their individual cash flow, helping them to become consistent, on-time payers.” The company partners with institutional landlords, who then offer it to their tenants. Till launched the analytics-driven platform in April with the goal of reducing evictions by as much as 50%. So far, the platform has been rolled out to 170 properties comprising 30,000 units in 14 states with 30% renter adoption.
Calyx’ Wholesaler Marketplace Mortgage software solutions provider Calyx announced the launch of its Wholesaler MarketPlace, a portal that connects wholesale lenders to mortgage brokers. Seven wholesale lenders are now accepting loan submissions through this wholesale network, including Caliber Home Loans, Quicken Loans, Freedom Mortgage, Stearns Lending, Plaza Home Mortgage, Sierra Pacific Mortgage and Cardinal Financial Company. Calyx said additional lenders are in the process of integrating. The portal allows brokers to connect with participating lenders directly through their LOS file. Inside the portal, they can register, lock and submit the loan they are working on, and this data will be transferred automatically without the broker manually uploading to the lender’s website.
FinLedger HW Media announced the launch of FinLedger – a fintech-focused media brand designed for financial services professionals and the first new HW Media brand expansion. Led by Managing Editor Mary Ann Azevedo and a team of journalists and contributors, FinLedger will cover technology news, perspectives and insights impacting the financial services sector from embedded finance to big data, and cybersecurity to regtech. It is taking a verticalized approach to content strategy, with specializations in banking, proptech, insurtech and payments.
Qualia’s RON Qualia announced that it extended the capabilities of its real estate closing platform with the launch of a remote online notarization product. Its goal is to enable entirely digital, contactless home closings. But rather than integrate an existing RON product into Qualia’s platform, the company decided to build its own, according to Nate Baker, cofounder and CEO of Qualia. Incorporating RON into the platform was not in the works at Qualia before the pandemic hit, Baker added. But once the company saw the increased demand, it set about building its own RON capabilities.
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Orchard Home Loans Orchard (formerly called Perch), which operates a home-buying marketplace, is the latest entrant to the mortgage market. Orchard’s goal is similar to that of many others in the space (think Zillow, Opendoor, Offerpad and Better.com) in that it wants to provide all the services a home buyer might need from beginning to end. Or in other words, it seeks to offer a fully integrated real estate platform. The company provides AI-powered home search and an all-digital mortgage and closing.
OCTOBER/NOVEMBER 2020
CONGRATULATIONS CHRIS CORDRY EVP and Senior Director of Capital Markets 2020 HousingWire Vanguard Award Winner We applaud you and your talented team of capital markets professionals for successfully navigating the unprecedented and rapidly changing conditions of 2020.
strategic vision and steady leadership to all you do. Thank you for bringing your
Primelending.com
Š2020 PrimeLending, a PlainsCapital Company. (NMLS: 13649).
TAKE 5
J o s e p h R e s t iv o
American Mortgage Network President and CEO
1. If I had picked a different career path I would be... A
neurosurgeon or orthopedic surgeon, helping people heal, especially in the military.
2. Besides my job and family, my greatest passion is.. . Traveling the world, flying my airplane and scuba diving.
Joseph Restivo is president and CEO of American Mortgage Network, a 100% employee-owned company. This new model empowers employees to think like owners and make decisions to benefit the whole team and their clients. Restivo’s philosophy was to make a 100% web-based platform so that he could work with anybody, anywhere in the world. A browser-based cloud-based system enables the company to ensure data security and manage customers’ personal information. The company is a low-cost producer, which utilizes streamlined processes and decentralized decision-making to enhance efficiency and provide fast
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turnaround to its clients. Restivo gives an inside view of his life by answering five questions:
OCTOBER/NOVEMBER 2020
3. The book I can’t stop recommending is... “The
Deming Management Method” – innovative and controversial.
4. My bucket list includes...
Skydiving over Mt. Everest and going to the Formula 1 finals in Dubai.
5. Biggest business success this year... Getting the American Mortgage Network employee stock ownership plan completed and distributing shares to all AmNet’s employee-owners. We are just so excited the company is 100% employee-owned and growing quickly.
UNMATCHED INNOVATION. CONTINUOUS TRANSFORMATION.
COMMENTARY
W
hat could the spring 2021 homebuying market have in store? The ongoing legacy of the pandemic By Frank Nothaft
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Many families were caught financially unprepared with the sudden onset of the pandemic. What seemed foreign and far away became domestic and close to home. The World Health Organization declared a global pandemic on March 11, and President Donald Trump announced a national emergency on March 13. Shelter-in-place directives proliferated across many communities and open houses cancelled. The once-promising 2020 spring home-buying season, possibly the best since before the Great Recession, was slowed to a snail’s speed. The U.S. unemployment rate spiked from a 50-year low of 3.5% in February to an 80-year high of 14.7% in April. The speed of the housing recovery from April’s trough has been impressive. The rebound was supported by accommodative fiscal and monetary policy. The sudden loss of income triggered by the pandemic was partly muted by an income tax refund for eligible taxpayers, enhanced unemployment insurance payments for laid-off workers, and small business loans to maintain employment through the Paycheck Protection Program. The Federal Reserve took immediate steps to cut short-term interest rates to near zero and accelerated their purchases of U.S. Treasury bonds and Mortgage Backed Securities to lower long-term yields. The record low interest rates on fixedrate mortgages fueled the largest refinance boom since 2012 and led a snapback in home sales. By July sales were above year-ago levels. The spring home-buying season had not been extinguished but only delayed to a
There is a heightened amount of uncertainty on the market outlook given the difficulty of forecasting how the pandemic will evolve.
summertime boom. But what does next spring’s housing market have in store? There is a heightened amount of uncertainty on the market outlook given the difficulty of forecasting how the pandemic will evolve. A reignition of COVID-19 could prompt a national shelter-in-place order and double-dip recession. At the other end of the gamut, new medical treatments and a vaccine could put the pandemic behind us and usher in a vibrant economic recovery. Something between these two extremes is the most likely outcome, with economic growth creating millions of jobs, but with the unemployment rate remaining elevated above 7% for most or all of 2021. HOUSING AND MORTGAGE OUTLOOK Interest rates on fixed-rate mortgages reached record lows in early September, hitting below 3% at 2.86% for 30-year and 2.37% for 15-year. The median contract rate on home mortgage loans outstanding at mid-2020 was 4%, according to the CoreLogic TrueStandings database, indicating that a large number of home loans remained in-the-money to refinance. Approximately $5 trillion in home mortgage debt, or nearly 25 million home loans, had a contract rate of at least 4%. Not all of these loans will refinance, as some borrowers have insufficient home equity or income (many because of unemployment), or a too-low credit score to qualify for the lowest market rates. Nonetheless, a mega refinance boom has generated the largest origination market in years. The Mortgage Bankers Association has projected more than 6 million refinance originations and 10 million first-lien originations in 2020, the largest refinance market since 2012 and highest first-lien origination totals since at least 2006. And interest rates are expected to continue to remain low throughout 2021, providing additional support for home sales and refinance. On June 10, the Federal Reserve released the latest views of the 17 officials who participate in the rate-setting meetings, which showed that all expect to hold the federal funds target at the current near-zero level through the end of 2021. With the Federal Reserve continuing to purchase MBS, interest rates on 30-year fixed-rate mortgages will likely remain near 3% throughout 2021.
OCTOBER/NOVEMBER 2020
it has a large share of employment in hard-hit sectors: Nevada’s unemployment rate in July was 14%, and the CoreLogic HPI Forecast predicts a 6% price decline in the coming year through July 2021. Borrowers who were economically impacted by the pandemic recession and eligible for forbearance under the CARES Act may have seen additional The CoreLogic Home erosion in home equity as the Price Index has forborne payments were added to registered strong the loan balance. For example, a borrower with a $200,000 loan at appreciation through 4.5% interest that had six months July 2020. of forborne payments added to their loan balance would have about a 3% (or $6,000) increase in their loan balance. As of March, 3% of Nevada homeowners with a mortgage already had negative equity, and another 3% had 10% or less home equity. Thus, if prices fall 6% and if borrowers with loanto-values over 90% opt for forbearance, as many as 6% of mortgaged homes may be at heightened risk of foreclosure or short sale if unemployment remains high. Elevated unemployment in 2021 may discourage younger Millennials from forming their own households and adding to rental demand. The CoreLogic Single-Family Rent Index has already recorded a dramatic deceleration in rent growth, from an annual increase of 3% in February to 1.4% in June 2020 with further slowing expected. Still, this may be better than the 2% rent decline predicted for apartment buildings in the latest Urban Land Institute survey, as tenants may shun high-rises for the lower density offered by a single-family rental home. This could be an ongoing legacy of the pandemic.
Frank Nothaft is the chief economist for CoreLogic, and is responsible for analysis, commentary and forecasting trends in global real estate, insurance and mortgage markets. OCTOBER/NOVEMBER 2020
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The outlook for mortgage loan performance is not as sanguine. The homeowner’s path from mortgage-payment currency to foreclosure proceeding generally involves two important trigger events. One is a sudden loss of income, often the result of unemployment. Several states had an unemployment rate in the mid- to upperteens as of July, three to four times the rate in February. Many homeowners have struggled to remain current on their mortgage loans during the pandemic, resulting in a jump in mortgage nonpayment. While federal income tax rebates and unemployment insurance supplements helped to ease the income loss, many who lost their jobs had limited savings to rely upon to remain current on their mortgage. The second trigger is loss of home equity, generally because of a fall in home prices. Places that have a larger share of employment in the travel, hospitality, retail, entertainment and restaurant sectors have been particularly hard hit and are at greater risk of price declines in the coming year. Homeowners that currently have a high loan-to-value are vulnerable to losing the equity they have when prices decline. The CoreLogic Home Price Index has registered strong appreciation through July 2020. This has reflected the shortage of inventory listed for sale – inventory in July averaged 25% below year-ago levels, according to CoreLogic Multiple Listing Service data – and rising demand by Millennials who see record-low mortgage rates as providing the opportunity to become a firsttime owner or to trade up from their starter home. But the HPI Forecast is glum: The chart shows expectation of elevated unemployment in 2021 sapping buyer demand and the prospect of distressed sales adding to for-sale inventory leads to a projection of U.S. HPI growth slowing to 0.6% in the twelve months ending July 2021 and HPI declining in eleven states. To illustrate the double-trigger scenario, Nevada has been especially hard hit because
H
COMMENTARY
ousing’s V-shaped recovery is complete: What had to happen to get America back by Sept. 1 The 5 economic and social landmarks on the recovery report card By Logan Mohtashami
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Back in April when darkness was looking us straight in our eyes, I wrote this: “ These are dark times. But even in dark times, we are preternaturally prepared to see the light at the end of the tunnel. We learned in human physiology class that the photoreceptors of the human eye can detect a single photon of light. While it may not be until nine or more photons hit the retina that we perceived dawn, we see before we can perceive. Likewise, if we are diligent, we will be able to identify the return of hope and light coming back into the American economy before it is perceived by all those poor masked souls around us.” In order to understand the economic performance of various sectors during these times, we need to abide by the dictates of the virus. For this reason, I divided 2020 into this economic-timeline in three phases: Before COVID (BC), After the onset of the Disease (AD), and America is Back (AB). In a previous article, I wrote about five economic and/or social landmarks that we would need to pass in order to determine that we had exited the AD phase and entered the AB recovery phase. This serves as a report card on that recovery with a final word about the U.S. housing market. On April 7, 2020 I wrote an article for HousingWire, which demonstrates how the housing market has recovered, as most of these five variables have been met to a degree.
If we do this right and document the cause and effect of our efforts, future generations will be able to look to this period in time for how to handle a global pandemic.
1. FLATTENED CURVE Status: Complete (with an asterisk) “It is from this data that I have based my virus turnaround thesis, which is that by May 18 or sooner, we will see a flattening of the new infection curve, and by Sept. 1, we will be at a much higher capacity to fight this virus.” By May 18 we had flattened the curve of new infections in most communities, which led to loosening or removal of stay-athome restrictions. But this was done too soon and we got sloppy resulting in a resurgence of new cases. Our government friends finally got on board with the promotion of mask-wearing and containment policies in individual states. Currently the data has gotten better, but not perfect by any means. It’s been a bumpy ride and it is not over yet. We will need to stay vigilant and united in following safety and containment measures in order to avoid another relapse into high infection rates. I’m checking this one off as complete but adding a big caution flag to indicate that we can easily undo our progress. Winter is coming, and we are attempting to reopen schools, so we do have some high-velocity events that can increase cases fast. I still fall back to my core belief on what I said on April 7. “I believe the months of April and May are going to tell an epic story of America’s start in defeating this virus. If we do this right and document the cause and effect of our efforts, future generations will be able to look to this period in time for how to handle a global pandemic. “My faith in America winning has never let me down because I always believe in my people and country. I can tell you now, this virus isn’t changing my view on that. Before that reality is more common for a lot of Americans, bond yields will have headed higher while jobless claims and the St. Louis Financial Stress Index have already gone lower. Let’s all be here to see it.” 2. END OF STAY-AT-HOME ORDERS Status: Semi-complete We never had a full-blown national stay-at-home policy with every state following it. Where restrictions were put in place, some have been lifted to a degree. One aspect that we haven’t given enough attention to is that we were confused as a country during the first few weeks of the pandemic. We were hoarding toilet paper instead of making offers on homes that had no bidding war competition. This is
OCTOBER/NOVEMBER 2020
3. 10-YEAR YIELD GOES ABOVE 1% Status: Incomplete Before the 10-year yield broke under 1%, Bankrate.com published my forecast that 10year yield during a recession would be in the range of -0.21% to 0.62%. The following Monday, March 9, bond yields dropped to a low of 0.33%. The 10-year yield was at 0.72% on the morning of Sept. 1, 2020. Since then, the 10-year yield has been above 0.62%. This tells me that the bond market believes the economy is going to get better. Having said that, yields haven’t broken above 1% yet. I expect some volatility in the markets in the next four months. When growth is slow and steady for two to three quarters, I expect yields to not only rise above 1% but stay in a range of 1.33% – 1.60% when real growth is stable.
While housing was the first sector to show a V-shaped recovery, it is no longer the only sector in recovery mode. While we can’t check off this landmark as “met,” note that the 10-year yield has been above 0.62% for most of this crisis. I know this 0.62% levels seems odd to some, but for me personally it was my biggest indicator that the bond market was telling me things are going to get better in the next few quarters. 4. A DECLINE IN CREDIT STRESS AND JOBLESS CLAIMS Status: Complete The St. Louis Financial Stress Index, possibly the most unloved metric among analysts in America, has made an impressive recovery and has stayed below my critical level of 1.21% and below zero for a while now. The index currently sits at -0.2468%. Credit stability is essential for a recovery phase so this metric is an important barometer for a functioning economy to recover. While credit stress is low, jobless claims and continuing claims remain extraordinarily
high. Continuing Claims are falling though – they just have a long way to go to get to pre-COVID level. As long as we are making progress in this area while continuing to provide fiscal and monetary disaster relief, we should not see a reversal of this positive trend. Once we have defeated this virus, I believe the government will provide a major stimulus plan, as what they have been doing these last few months is really a disaster relief package. The goal is always to get a tighter labor market so wages can increase faster. This means it might be many years from now until the Fed raises rates. 5. DATA FROM THE HARDEST-HIT SECTORS START TO TREND UPWARD Status: Complete While housing was the first sector to show a V-shaped recovery, it is no longer the only sector in recovery mode. Some data lines like retail sales and manufacturing data are showing V-shape recoveries as well. Other sectors may not be showing a dramatic V-shaped recovery yet, but the numbers are still showing improvement. We’ve been through a lot so it will take a while to get back to firing on all cylinders while this virus is still infecting and killing people every day. The U.S. housing market was hit early on during COVID. We went from weekly double-digit year-over-year growth on the MBA purchase application data to nine straight weeks of negative year-over-year data. Since that ninth week of negative data, we have recovered to become the best-performing sector in the world. New home sales, pending home sales, existing home sales, builders confidence index, mortgage purchase applications and housing starts have all shown V-shaped recoveries. The two most important factors that drive housing, demographics and mortgage rates, are both in sweet spots to support housing. If you consider Millennials as potential replacement buyers, then add in downsizing Baby Boomers and move-up homebuyers, we should see a lot of activity in the housing market in the coming months and years. Plus, we still have 15% to 20% of market sales purchasing homes with cash each year. We only need 4 million mortgage buyers a year to have a stable market and this is out of over 140 million people currently working – and the job market is still in recovery mode. It’s very rare to have any existing home sales print under 4 million in the 21st century. Typically this happens around events such as the last few months of the housing bubble crash, the aftermath of the pull forward demand from the homebuyer tax credit, and one month of COVID-19 induced sales. With mortgage rates safely under 4%, we have the cushion of low mortgage rates as well. When one puts all this into perspective, I think we can agree, the worst of times are largely behind us for the housing market. It’s time to start looking at our future with caution as long as this virus is still with us. But winter is coming. Just remember, darkness only wins if you allow it to. Love each other, fight for one another and remember, when it’s all said and done, even though we don’t agree with each other, we are all Americans. Logan Mohtashami is HousingWire’s Lead Analyst and a financial writer covering the U.S. economy with a specialization in the housing market. He also served as a senior loan manager at AMC Lending Group. Mohtashami’s work is frequently quoted in BankRate. com and Bloomberg. He has been an invited speaker at the AmeriCatalyst events, California Association of Realtors and the National Association of Women in Real Estate Business and other economic conferences. OCTOBER/NOVEMBER 2020
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totally understandable, it’s our first virus that we all had to deal with on a mass scale. The stock market was falling and we just weren’t sure how bad it was going to get. Today it’s much different. Even when restrictions were put into place in certain states, we never saw the hoarding of toilet paper again, instead we are seeing multiple bids on homes now. We are starting to live and consume goods and services with an active virus in play. As a country, our purchasing habits have shifted to even more online shopping and home delivery. And this may be the new normal until we get a vaccine.
VANGUARDS The top
50 executives
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IN
OCTOBER/NOVEMBER 2020
HOUSING
OCTOBER/NOVEMBER 2020
39
John Berkowitz, Paul Buege
40
Christy Bunce, Chris Cordry
41
Donna Corley, Thomas Cronkright
42
Sean Dobson, Robert D’Urbano
43
John Elias, Shirley Finucan
44
Katie Foster, Brian Francis
45
Josh Friend, Richard Gagliano
46
Nima Ghamsari, Sarah Gonzalez
47
Joel Gottsegen, Ernie Graham
48
Chris Heller, Neenu Kainth
49
Tawn Kelley, Aaron King
50
Karthik Kumar, Joe Langner
51
Suzy Lindblom, Gene Ludwig
52
William Lyons, Jane Mason
53
Bill Neville, Willie Newman
54
Frank Nothaft, Steve Ozonian
55
Thomas Pearce, Kurt Pfotenhauer
56
Jay Promisco, Ken Richey
57
Gretchen Rosenberg, Alex Rosenblum
58
Glenn Sanford, Brian Simons
59
Dan Sogorka, Dave Stevenson
60
Ike Suri, Tony Thompson
61
David Townsend, Rick Triola
62
Joe Welu, Leslie Winick
63
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TOC
Nick Bailey, Gary Beasley
Vanguards: The top 50 executives in housing By Kelsey Ramírez
This year’s list of HousingWire Vanguard potential candidates was more competitive than ever before. On any other given year, many would have easily won – but this was not any other year. The competition was fierce. But even more impressive was the back story behind many of our top housing executives. Just over 20% of this year’s Vanguards are women. This is not the 50% I hope we will someday see, but it is far above the 7% level of top female executives at Fortune 100 companies. Women today enjoy a much more level playing field, where hard work and determination are some of the largest factors in their success, but that wasn’t always the case. We frequently see executive women who started their career as a secretary at their financial firms because that was the only position available to women at the time – then later ran that same company. In one instance, a woman became the first female member of the executive team, and the board had to change where it met because the place that it was using for business meetings at the time did not allow women to enter. Many of this year’s winners fought through varying hardships to get to where they are today. One of this year’s Vanguards, William Lyons, appeared on season 4 of Shark Tank to ask for an investment on his real estate investing website. The judges were unimpressed and tanked his idea, saying they didn’t “understand how it’s possible to make estimations on value,” and that they didn’t “believe Bill has a real business concept.” Needless to say, Lyons did not stop there, and now runs Griffin Funding, which has
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been recognized by Inc 500 and the Fastest 100 in San Diego County. This year’s Vanguards are filled with success stories – the executives that made it to the top, and now dominate the housing industry. Flip through to read their stories.
OCTOBER/NOVEMBER 2020
Gary Beasley
C h ie f C u s t o m e r O ff ic e r
CEO and Cofounder
RE/MAX
Roofstock
AS THE chief customer officer at RE/MAX, Nick Bailey oversees all support services provided by RE/MAX to its network of franchisees and affiliates and acts as president for the global real estate brokerage franchisor. His core focus is to drive the network’s business growth, professional development and engagement on a national and global level. Upon joining the RE/MAX team in 2019, Bailey noticed that brokers weren’t actively recruiting and made it his goal to help them refocus on the importance of employing the right talent. But Bailey stepped up and set to work, creating the PlusOne initiative to help. In the fourth quarter of 2019, PlusOne challenged RE/MAX brokers to end the year with a net positive gain of one in their agent count. PlusOne came with a playbook of tools, tactics and actions to support real estate professionals with their business growth. In the U.S. and Canada, 1,445 RE/MAX offices had participated in the program and ultimately added a net 892 agents to their offices by the end of 2019. During the COVID-19 pandemic, Bailey and the RE/MAX executive team have taken a measured, thoughtful and calm approach. In a matter of weeks, measures were implemented in the network and at headquarters to solidify RE/MAX’s footing in order to exit in a position of strength. At the onset of the pandemic, Bailey launched a weekly Facebook Live broadcast, “Good Morning, RE/MAX,” to enhance communication and transparency and keep brokers and agents informed, inspired and motivated. More than 87,000 views have been recorded among 12 broadcasts.
GARY BEASLEY is the driving force behind Roofstock’s mission to power the future of real estate investing. He has more than 25 years of success in starting, growing and operating real estate businesses—two of which he led to IPO — and was one of the first to apply technology at scale to the real estate industry. In the last 12 months, Beasley has continued to expand Roofstock’s service infrastructure, product suite and has led the company to hit major new milestones that have positioned the company for long-term success. Within three years of launching in 2016, the platform had already facilitated more than $2 billion of transactions. In December 2019, Beasley led Roofstock’s effort to close on a new round of funding to the tune of $50 million. The over-subscribed funding round attracted existing and new investors alike, including Citi Ventures, the venture arm of Citibank, and Silicon Valley Bank, one of the most prominent banks serving California’s tech sector. The timing was critical to helping Roofstock weather the temporary market dislocation created by the COVID-19 pandemic just a few months later. The funding round attracted widespread attention and served as an important indicator of investor faith in Beasley’s leadership and Roofstock’s long-term prospects. In the face of the pandemic, Beasley has kept Roofstock focused on continuing to innovate, and investors have responded with growing interest in the company’s products and services. Beasley has earned a 96% approval rating on Glassdoor, a testament to his leadership and the vibrant workplace culture he’s built at Roofstock.
What has been your secret to success?
What’s the best advice you’ve ever received?
I embrace change. With 24 years in the real estate industry, I’ve seen changes in technology, the economy and business world and I’ve learned that the secret to staying in business is simply to not put yourself out of business by being resistant to the changing needs of your audience.
My father told me repeatedly as a kid, “Don’t get frustrated, get more determined.” I think about this whenever I find myself getting frustrated and immediately start thinking about what I can do to impact the situation positively. Then I start to feel better. He was teaching me grit.
OCTOBER/NOVEMBER 2020
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Nick Bailey
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John Berkowitz
Paul Buege
Cofounder and CEO
P r e s id e n t a n d C h ie f O p e r a t in g O ff ic e r
OJO Labs
Inlanta Mortgage
SINCE FOUNDING OJO Labs in 2015, John Berkowitz has provided the company with the direction, resources and autonomy to achieve its mission of empowering consumers to make better decisions. With a bold, thoughtful and strategic leadership style, Berkowitz has scaled the company to 308 employees and more than 50 markets across North America. Driven by the belief that an exceptional product comes from exceptional people, Berkowitz set out to assemble a senior team focused on sustainable growth and maximum impact. Within the past 12 months, Berkowitz has brought on Chris Heller, former CEO of Keller Williams and Mello Home; Karen Starns, who led brand and customer experience at Amazon for the portfolio of Amazon smart home devices; and Charles Myslinsky, former product executive at Jet.com and Walmart. With a powerhouse management team, Berkowitz has cultivated a culture of creativity, innovation and expertise that has driven industry impact and transformation in just one year. Even with unprecedented challenges amid the COVID-19 pandemic, in June OJO Labs secured $62.5 million in funding, which subsequently facilitated the acquisition of Movoto. Berkowitz’s ambition, grit and business-savvy were key to making a lofty aspiration become a reality. Under Berkowitz’s leadership this year, OJO Labs has seen record increases in user engagement and retention and home purchases. What’s more, the company recently announced plans to hire more than 120 employees in St. Lucia before the end of 2020, nearly doubling the team on the island. The company claims that none of this growth and transformation would have been possible without Berkowitz’s relentless energy and belief in its mission.
PAUL BUEGE leads the Inlanta Mortgage team toward achieving the firm’s strategic goals and provides direction in overall sales and recruiting strategies, human resources and corporate communications. Buege is known for fostering a positive, diverse work environment where he listens to and appreciates all perspectives. By removing walls within the company and creating an environment where everyone’s input is valued and acted upon, Buege has created an award-winning workplace. His unique leadership style and influence at Inlanta have not only led to employees’ strong performance, but to industry accolades as well. Earlier this year, Inlanta was selected by National Mortgage News as one of the industry’s 40 Best Mortgage Companies to Work For, which recognizes the industry’s best employers, based on employee feedback. That feedback was impressive, too. About 98% of the company’s employees said they were “very satisfied” working for the company while 97% said they would recommend Inlanta to a friend and 98% said Inlanta gave them the technology and resources they needed to succeed. Knowing that truly successful businesses are always improving and that great ideas can come from anywhere, Buege invites feedback from everyone at the company, directly to him, anonymously, and through the firm’s advisory board. Team members at Inlanta credit Buege’s leadership style for the positive feedback that employees give to Inlanta on overall job satisfaction. His leadership style has been described as a blend of inspiration, excitement and positivity, centered on everyone achieving a common goal. And where other companies profess to have a “team-first” culture, Buege actually helped build it.
What’s the best advice you’ve ever received?
What one habit has made a crucial difference in your success?
When starting a business, it’s easy to get tied up in a fear of failure. A mentor taught me that conquering fear is not the objective. It’s about using fear to your advantage. Now, instead of trying to eliminate fear, I harness it, and use it to propel me forward.
Always being able to recognize that there is a “best” outcome in every situation, no matter how difficult or scary. If you’re able to step back from the noise of the moment and look for it, you’ll always be able to see a better path.
OCTOBER/NOVEMBER 2020
Chris Cordry
C h ie f O p e r a t in g O ff ic e r
E V P a n d S e n io r D ir e c t o r o f C a p it a l M a r k e t s
New American Funding
PrimeLending
CHRISTY BUNCE came to New American Funding nearly 12 years ago and currently leads the day-to-day operations. Bunce’s experience and expertise in loan processing, underwriting and funding have served as a guide for the company’s growth from its beginnings as a California-based call center to a nationwide lender with a massive retail footprint. Under Bunce’s leadership, New American Funding significantly expanded its retail operations and inside sales force, launched a mortgage servicing division and has entered new lending channels including a homebuilder division and a real estate-based lending division, which Bunce has helped expand over the years. Over the last several years, under Bunce’s explicit supervision, New American Funding has increased its lending volume markedly. She maintains direct oversight of New American Funding’s lending standards, ensuring the company’s guidelines are not “one size fits all.” Instead, she works to ensure that the company does not have a rigid approach to guidelines and overlay. Bunce personally examines individual credit situations to ensure that New American Funding lends to all borrowers who are worthy, despite how their credit profiles may look to other lenders. Bunce also partners with Patty Arvielo on a career development program called “If You Want to Grow, We Want to Know.” The program, which launched in 2019, allows employees to discuss their career goals directly with New American Funding’s senior leadership. Bunce and Arvielo personally review each submission together and reach out to the employee’s manager to start the process of getting the employee moved up or on the right track.
A KEY MEMBER of PrimeLending’s strategic leadership team, Chris Cordry joined the company in 2006 and was promoted to executive vice president of capital markets in January 2019. Cordry has earned the confidence of the entire PrimeLending team, according to the company, and has consistently managed the portfolio to outperform competitors, maintaining a track record of profitability and growth. Thanks to Cordry’s strategic vision and steady leadership, PrimeLending’s capital markets team navigated the uncertain challenges during the COVID-19 pandemic and secured the company’s financial stability. As a result, PrimeLending’s profitability and opportunities for growth have never been stronger. With responsibility for optimizing revenue and profits, managing liquidity and mitigating interest rate risk, Cordry and team took several decisive actions to not only protect the company’s position, but ultimately improve it. The team adjusted to the rapid reduction in third-party servicing outlets, quickly shifting its strategy to retain rather than release servicing on mortgage loans sold. Despite falling interest rates and extreme price competitiveness, the company maintained a strong pull-through rate thanks to a proactive and balanced approach to repricing. Pipeline hedges were closely monitored to anticipate the impact of a volatile MBS market and protect the company’s position. As the pipeline grew at an accelerated pace, the team fluidly adjusted margins to not only manage capacity but maintain appropriate liquidity to ensure the company could meet the funding demand. A servant leader who has built a stellar team, Cordry sets the bar high as a champion of the company’s culture and commitment to excellence.
What has been your secret to success?
What is one thing you cannot do without?
It all boils down to hard work. In my experience, those who work the hardest have the most success. It’s not about working the most hours. It’s about applying yourself when you’re working, thinking big picture, small picture, in the weeds, out of the weeds, all at the same time.
My team! We’ve been working together for years, and the mutual trust and respect we share for each other is invaluable. We are truly one team with one purpose, and collectively we are unbeatable.
OCTOBER/NOVEMBER 2020
4 1 ❱ H O U S IN G W IR E
Christy Bunce
4 2 ❱ H O U S IN G W IR E
Donna Corley
Thomas Cronkright
E x e c u t iv e V ic e P r e s id e n t a n d H e a d o f S in g le -F a m ily
Cofounder and CEO
Freddie Mac
CertifID
DONNA CORLEY is one of the most influential women at Freddie Mac and within the housing and mortgage industry. Motivated by innovation and moving the housing industry forward, her goal as leader of the single-family business is to reshape the housing market through lasting change. In the past year during challenging times and uncharted waters, Corley successfully navigated the path forward for the single-family business, leveraging the firm’s unparalleled strengths to provide liquidity and stability in a time of crisis. Under her strong leadership, Freddie Mac has implemented policy flexibilities that have helped drive origination volumes to new heights— even at the peak of a pandemic. Corley has achieved numerous accomplishments over the past year. As the new head of single-family, Corley revamped the business’s vision and focus, empowering the organization to focus on exiting conservatorship under the guidance of FHFA and becoming the leader in housing. To better execute on her vision, Corley also developed three key strategic pillars—people, platform and performance—and the Freddie Mac team is thriving under this new structure. Corley has been a champion for helping the organization and her team understand Freddie Mac clients’ needs, and she was instrumental in helping deliver products that made them more successful. She focused on overhauling the client eligibility experience, which is enabling Freddie Mac to leverage data analytics and cutting-edge technology to better meet clients’ needs. This includes providing leadership for innovative approaches to managing risk for the company’s latest technology products and developments.
FROM FRAUD VICTIM to real estate industry catalyst, Thomas Cronkright has pioneered a nationwide campaign to combat wire fraud. His company, CertifID, has safeguarded more than $20 billion in real estate money transfers since its launch in 2018—protecting home buyers, sellers and the title and escrow professionals that conduct these transactions. In addition to leading CertifID and his title agency, Sun Title, Cronkright spends countless hours volunteering on industry committees; leading corporate training, industry panels and webinars on wire fraud; and speaking to professional organizations to raise awareness of the devastating effects of wire fraud. He has become one of the real estate industry’s leading experts on wire fraud and money-muling strategies, ways to prevent and recover wire fraud losses and business email compromise and social engineering schemes that lead to fraud. Cronkright cares not only for his customers and employees, but for everyone involved in real estate transactions. He has achieved numerous accomplishments over the last 12 months. Cronkright was appointed as a member of American Land Title Association’s Information Security Task Force. He led more than 25 national webinars on wire fraud, cybersecurity and technology to more than 3,000 real estate industry professionals. Cronkright also worked with the Secret Service to assist in eight fraud recoveries. He worked to develop “Money Transfer Insurance,” the first-ever direct-to-consumer policy to protect the safe transfer of funds. Under Cronkright’s leadership, Sun Title was awarded “101 Best and Brightest Companies to Work For.”
What has been your secret to success?
What’s the best advice you’ve ever received?
“Build strong, supportive professional networks – not just personal friendships, but professional relationships, too. And once you make it to the top of the ladder, success means more if you lean in and help those coming up the rungs.”
“Never complain, never explain.” This advice promotes a hyper-focus on the positive things that each day brings and the unmitigated discipline required to add value to your team and customers. Our team is solving the largest problem in real estate – I’m proud to be part of this journey.
OCTOBER/NOVEMBER 2020
Robert D’Urbano
C h a ir m a n a n d C E O
C h ie f In f o r m a t io n O ff ic e r
Amherst
Freedom Mortgage Corporation
SINCE ASSUMING HIS ROLE at Amherst more than 20 years ago, Sean Dobson has grown the company into one of the most innovative and fastest-growing privately held real estate investment firms. Also serving as chief investment officer, Dobson guides more than $7 billion of assets under management for Amherst and its consumer brands. Under his strategic guidance, Amherst reorganized its acquisitions team into groups focused on investment strategy, sourcing, underwriting and transaction management, and streamlined property management and construction operations at Main Street Renewal, its single-family rental platform, to complete more than 3,500 home renovations by the end of last year. Dobson has led Amherst’s CRE lending team to reach new milestones, executing its first collateralized loan obligation on a $400 million portfolio of commercial mortgage assets and growing its loan commitments to more than $1 billion across 40 CRE loans since inception. Dobson’s vision and leadership played a critical role in overseeing the team’s execution and milestone achievement, and he continues to lead Amherst’s efforts to unlock future growth opportunities. Dobson also developed and led Amherst’s ongoing internal and external COVID-19 response effort, quickly mobilizing his teams to develop and implement plans to protect the health and safety of Amherst’s employees and the broader communities in which the company operates. He guided Amherst’s nearly 1,000 employees as they transitioned to remote work virtually overnight, and continues to drive employee engagement through regular business updates, town halls and fireside chats.
ROBERT D’URBANO joined Freedom Mortgage in 2005 and guides the development of system improvements and assuring operational readiness of all corporate systems. He has more than 35 years of experience providing leadership and lasting competitive solutions in the financial services industry. D’Urbano has presided over significant growth within his organization, including an astonishing 38% increase in information technology staffing over the last 12 months. The team now consists of 397 employees. D’Urbano and his team have overseen the design, development and delivery of new technology solutions that have enabled Freedom Mortgage to double the originations volume year over year. These solutions include Freedom Mortgage’s proprietary STREAM Loan Automation Suite, which has automated much of the mortgage processing lifecycle. By using robotics and workflow technologies combined with the Lakewood loan origination system, the team created efficiencies for customers, loan originators and operation staff to streamline the loan manufacturing process. In June, Freedom Mortgage originated more than $11 billion in loans. During this phenomenal growth, the pandemic struck. In less than one week in March, as the COVID-19 stay-at-home mandates began, D’Urbano and his team enabled approximately 5,000 employees to efficiently work from home. That represented 98% of the company’s workforce. This swift move included the hard work of transitioning essential personnel to operate like a factory, with nationwide distribution of equipment to employees. As an added challenge, Freedom Mortgage has added more than 1,200 new personnel since March—all working remotely.
What has been your secret to success?
What’s the best advice you’ve ever received?
Being mission-driven is core to everything we do – Amherst is committed to giving back to the communities we build in to make them stronger, it’s what drives me to keep innovating to push the future of housing forward every day.
The best advice I received is very simple. Wake up and show up, you will be surprised sometimes but you will learn all the time and if you don’t like the outcome – work to get to where you do like it.
OCTOBER/NOVEMBER 2020
4 3 ❱ H O U S IN G W IR E
Sean Dobson
4 4 ❱ H O U S IN G W IR E
John Elias
Shirley Finucan
C h ie f R e v e n u e a n d S t r a t e g y O ff ic e r
C h ie f O p e r a t in g O ff ic e r
Guaranteed Rate
Southern Trust Mortgage
JOHN ELIAS played an instrumental role in providing Guaranteed Rate with direction and meeting the shifting needs of its borrowers, referral partners and employees—all while creating new opportunities and partnerships for the company. When the pandemic began, Elias helped Guaranteed Rate adjust by encouraging its employees to adopt the company’s technology to close transactions remotely and safely. Guaranteed Rate’s loan officers were able to utilize the company’s existing technology, such as its FlashClose platform, to meet the increase in volume. Under Elias’ leadership, Guaranteed Rate companies broke new company records almost every month this year, despite constant shifts in the marketplace and adapting to a remote workforce. In June, Guaranteed Rate locked a record-breaking $10.5 billion in loan volume and funded more than 21,000 loans for borrowers across the country. And Guaranteed Rate Affinity, a joint venture between Guaranteed Rate and Realogy Holdings Corp., which Elias helped launch in 2017, funded a record-breaking $1 billion in May and June 2020. Most recently, Elias provided executive oversight in the July launch of Proper Rate, a new independent retail mortgage lender and joint venture of Guaranteed Rate and @properties. Elias’ leadership and dedication to Guaranteed Rate not only helped the company adjust to changing landscapes due to the pandemic, but also enabled the company to continue to grow, innovate and succeed. He is constantly propelling Guaranteed Rate’s share in the industry, directing the company’s strategy as it moves into new markets, and guiding loan officers nationwide in serving as many homebuyers as possible.
SHIRLEY FINUCAN is an industry veteran who is pushing the operations side of mortgage lending forward. She has led Southern Trust Mortgage’s hundreds of operations employees while developing the company’s new priority approval and operations teams systems. These two initiatives alone have allowed Southern Trust Mortgage to nearly triple in volume in less than four years. Finucan has completely revamped the company’s operations structure into a region-based team system, giving its loan officers the peace of mind that comes with working with the same team of processors, underwriters and closers on every loan. She brought consistency to the process to keep everyone on the same page and improve workflows between team members. Southern Trust loan officers have a dedicated operations team on every one of their loans. Finucan also developed the priority approval programs, giving Southern Trust Mortgage loan officers the ability to have a fully underwritten credit approval for their buyers in less than 24 hours. Finucan explained this approval is a game-changer because it is a full credit approval and puts the ability to submit the loan directly to the underwriter in the LOs hands. LOs need minimum documentation: just the borrower’s paystubs, bank statements and W2s in order to obtain the approval, condensing a typical 30-day process to just one day. The ability to thrive in this business for decades, keeping up with all market demand and bringing about major system improvements have made Finucan an invaluable team member and a proven leader in the industry.
What’s the best advice you’ve ever received?
What one habit has made a crucial difference in your success?
In college, I was thrown out at second base trying to turn a single into a double during a close game. My furious coach told me what he thought of my poor base running. Trying to explain myself, I said, “I thought…” He cut me off: “Don’t think! React!”
Asking “why do we do it that way” has been crucial. Thinking outside of the box to find better and more efficient solutions instead of relying on comfortable ones is essential. Stepping outside of my comfort zone usually results in meaningful growth and development.
OCTOBER/NOVEMBER 2020
Brian Francis
E x e c u t iv e V ic e P r e s id e n t a n d C h ie f R is k O ff ic e r
C h ie f Te c h n o lo g y O ff ic e r
United Wholesale Mortgage
FormFree
SINCE JOINING United Wholesale Mortgage in 2013, Katie Foster has held various leadership positions within underwriting, working up to the senior vice president and head of underwriting. In this role, Foster’s leadership and guidance helped the underwriting team break records with the number of loans underwritten and closed within the last 12 months. With record-breaking volume, Foster ensured that the elite level of client service and loan quality were maintained by rapidly growing the team. In two years, the underwriting team she oversaw grew from 400 employees to more than 1,800. In her underwriting leadership role, Foster focused largely on working with the GSEs to ensure UWM’s underwriters and sales teams were up to date on all guideline changes—achieving optimal accuracy and operational efficiency that led to record-breaking turn times in the lending industry. Foster has also worked closely with UWM’s IT team to bring innovative proprietary tools to market that have been difference-makers for mortgage brokers, including One-Click AUS, which gives brokers a sideby-side comparison of DU and LP, allowing them to choose the option that has the best terms for their borrowers; Easy Valuation, which makes the appraisal process faster, easier and less expensive for brokers and their borrowers; and Waiver Pre-Check, which allows brokers to find out instantly if a property is eligible for an appraisal waiver. Recently, Foster was promoted to executive vice president and chief risk officer. She now leads a team of more than 200 and oversees all facets of risk for UWM, including quality control, legal, compliance, credit policy and more.
BRIAN FRANCIS is responsible for overseeing the design and development of FormFree’s automated asset, employment and income verification products. In this role, Francis leverages his 30-plus years’ experience leading high-performing technical teams at internationally renowned software firms to produce digital mortgage solutions that have been shown to reduce lenders’ average time-to-close by up to 20 days. Since joining the company 10 years ago, Francis has helped FormFree significantly refine its flagship AccountChek asset verification service, which disrupted the mortgage industry when it introduced automated asset verification. To date, more than 3,000 lenders nationwide have securely placed orders for nearly 4 million AccountChek asset reports, amounting to more than $1 trillion in borrower assets verified. Francis’ essential behind-the-scenes work has made it possible for FormFree to achieve numerous industry “firsts,” such as being the first designated vendor for asset verification named by Fannie Mae as part of the agency’s Day 1 Certainty initiative and the first to use artificial intelligence and over 1,000 proprietary algorithms to generate digital verification of asset and deposit reports in less than five minutes. More recently, Francis spearheaded the development of AccountChek Plus, which builds on the foundation of AccountChek’s automated asset verification system to bundle three critical underwriting pillars—borrower asset, employment and income—into one verification report. Under his leadership, the company generated a record number of AccountChek Plus reports over the last year, which was a 65% year-over-year increase. Francis’ contributions have been integral to FormFree’s continued growth and product improvement.
What has been your secret to success?
What has been your secret to success?
The secret to my success is having a yes mentality. Instead of finding excuses to why something won’t work, finding ways to make it work. Removing the option to say no makes every approach a solution-oriented one.
I remain cognizant that I develop technology to serve customers’ and partners’ business needs, and not for technology’s sake. Unless technology can solve a problem, it will just sit on the shelf, or even worse, be deployed and never used.
OCTOBER/NOVEMBER 2020
4 5 ❱ H O U S IN G W IR E
Katie Foster
4 6 ❱ H O U S IN G W IR E
Josh Friend
Richard Gagliano
Founder and CEO
P r e s id e n t , B la c k K n ig h t O r ig in a t io n Te c h n o lo g ie s
Insellerate
Black Knight
JOSH FRIEND’S IMPACT on the mortgage industry at large is unmistakable. From his early days working at a mortgage company, to rising up the ranks, to running a mortgage company, Friend has helped thousands of people realize the dream of homeownership. Over the course of his 21-year career, he has personally trained thousands of loan officers who are directly impacting hundreds of thousands of borrowers. Friend now dedicates himself solely to helping other lenders be more successful through better borrower engagement. He achieves this by transforming the borrower and loan officer experience with his technology company Insellerate. The company launched its new Engagement platform and signed up more than 50 lender clients within the first 12 months of 2019 to 2020. Through Friend’s leadership and the Insellerate platform, the company’s clients have achieved notable results. Last month, Alan Lacey and his team at Northpointe Bank closed 376 units for $125 million with only 11 loan officers, two assistants, and himself. JFQ Lending was doing $9 million a month in volume, and in less than two years is now doing more than $308 million a month in volume due to Friend’s guidance and the Insellerate platform. Insellerate was recognized as a HousingWire Tech100 company. Friend was named both a Lending Luminary and Thought Leader by PROGRESS in Lending. He was also a featured presenter at Lead Generation World, HousingWire ENGAGE Marketing, CMBA Innovators Conference, Rob Chrisman Market Updates, Fintech Hunting Podcast and Lend, Laugh and Eat podcast. Within the last 12 months, Friend has been published more than 10 times in leading mortgage industry publications.
RICHARD GAGLIANO IS A SKILLED and talented leader who is leading efforts to deliver on innovation to support Black Knight’s success and working collaboratively with the company’s lender, capital markets and GSE clients to support a more advanced mortgage industry. That success is evidenced by the number of new clients signed, cross-selling to existing clients and delivering innovative solutions that help clients grow their business, protect their business from risk and further streamline operations. Under Gagliano’s leadership, Black Knight created a unique approach for implementing the Empower loan origination system to support mid-tier lenders with origination. It enables mid-market lenders—including regional banks, credit unions and independent mortgage bankers—to gain the benefits of the Empower LOS with reduced implementation timelines, costs and complexity. The solution, which was built based on the industry’s most common lending practices for retail lending, can help clients streamline processes and support regulatory compliance. Gagliano also led Black Knight in launching new solutions outside of the core LOS platform to help originators better serve their customers, increase productivity and comply with regulatory requirements. Examples of these solutions include AIVA, Regulatory Assist, Fee Service and the Actionable Intelligence Platform. In response to the need for more virtual closings as a result of the COVID-19 pandemic, Gagliano helped lead the effort to create enhancements to Black Knight’s Expedite Close solution to enable lenders, settlement agents and consumers to securely collaborate online. After Black Knight’s acquisition of Compass Analytics in 2019, Gagliano also assumed leadership of that area of the company.
What has been your secret to success?
What’s the best advice you’ve ever received?
There’s a right financial product to sell in any market, if you understand that borrowers still need to buy homes, refinance and focus on what you can control you can have a lasting impact on the lives of others.
Stay highly focused on your customers, whether external or within your organization. Listen and engage your clients to ensure you deliver the right solutions. Remember that giving the best possible service is key, even when things are not going your way.
OCTOBER/NOVEMBER 2020
Sarah Gonzalez
Cofounder and CEO
C h ie f O p e r a t in g O ff ic e r
Blend
First Guaranty Mortgage Corp.
UNDER NIMA GHAMSARI’S LEADERSHIP and vision, Blend has launched and expanded its consumer banking platform over the last year, as well as added to and improved upon its core mortgage offerings. In September 2019, the company launched One-tap Pre-approval for Mortgage and has since rolled it out to two of its largest customers, Wells Fargo and U.S. Bank. The technology enables lenders to verify a consumer’s assets, income and employment with source data at the very beginning of the application. In October 2019, Blend also announced an auto loan product to streamline the auto purchase and refinance experiences for consumers, while helping lenders drive efficiency, increase online application completion and improve fund rates. When the COVID-19 pandemic hit, Blend pivoted to meet the immediate needs of its lender customers. In addition to spinning up a portal in 72 hours to help customers process more than $7 billion in Paycheck Protection Program applications from small businesses through the CARES Act, Blend accelerated its digital closing offering. Ghamsari has raised more than $310 million in funding for Blend and partnered with some of the largest banks in the country. Today, the company works with more than 250 lenders and enables leading financial institutions to process more than $3 billion in loans per day. Ghamsari is also committed to diversity, inclusion and belonging at Blend and across the broader financial services industry. He fosters an environment at the company that creates opportunities and avenues for employees to express themselves. Inc. Magazine named Blend one of the Best Workplaces in 2019 and 2020.
SARAH GONZALEZ oversees the strategy and operations of the fulfillment, marketing, credit risk and post-closing departments. Her authentic leadership, ability to build effective teams, strategic operational outsourcing and focus on technology initiatives are key drivers of First Guaranty Mortgage Corp.’s success. Her visionary ability to identify and mentor rising stars within the industry, teaching them to adapt to change and rise up in the face of new challenges has helped facilitate unprecedented growth for FGMC. Following a record-breaking 2019 at FGMC, Gonzalez was instrumental in creating the company’s 2020 motto to “Go Beyond,” and she has led FGMC to do just that. Under her leadership, FGMC has continued to modernize its brand, recruited top talent and implemented operational efficiencies that significantly reduce the cost per loan across all production channels. When faced with the recent unprecedented challenges of a global pandemic, Gonzalez led with transparency and poise. During a time of uncertainty, she shaped the company’s culture as it transitioned to a completely remote workforce, all while identifying opportunities to improve efficiencies and profitability. Over the last several months, Gonzalez has set the bar at FGMC for communication and morale. Under her supervision, the firm launched an internal communications strategy to make sure employees felt informed and connected in the midst of rapid change and uncertainty. She championed the creation of a COVID-19 online resource hub that focused on both informational content and lighthearted, inspirational videos to drive connection. Additionally, Gonzalez is well-known within the mortgage industry as a speaker, advocate of women and thought leader.
What’s the best advice you’ve ever received?
What is one thing you cannot do without?
Focus on substance – creating value is the only thing that matters.
I cannot do without my wonderful support system. My incredible family, mentors, leaders, teams and friends have supported me professionally and personally. My success is built on the reliance of other people and teams, and I wouldn’t be who I am without them.
OCTOBER/NOVEMBER 2020
4 7 ❱ H O U S IN G W IR E
Nima Ghamsari
4 8 ❱ H O U S IN G W IR E
Joel Gottsegen
Ernie Graham
C o f o u n d e r a n d C h ie f Te c h n o lo g y O ff ic e r
CEO
Qualia
Homebot
JOEL GOTTSEGEN has played an integral role in growing Qualia into the digital closing software that is used to process more than a million and a half real estate transactions per year. As the cofounder and chief technology officer at Qualia, Gottsegen leads product development and execution at the company. He and his team build technology that streamlines the closing process from start to finish to improve all points of contact between lenders, title companies, underwriters and other stakeholders involved in a real estate transaction. Their goal is to make home closings more transparent, efficient and affordable. Over the past five years, Gottsegen has had a hand in everything from product development, to training the company’s sales team, to answering support calls, which has given him a unique perspective on the key challenges faced by the title and escrow and mortgage industries. In the last year, Gottsegen led the development and launch of Qualia Post, making Qualia the first real estate technology company to tackle improving both the closing and post-closing process for lenders. This launch expanded Qualia’s offerings beyond the title industry to the mortgage industry. Today, Qualia Post is a rapidly growing part of the Qualia suite of products and is already gaining attention as a top product transforming mortgage lender operations, having recently won the “Best Digital Mortgage Product” 2020 FinTech Breakthrough Award. In addition to leading Qualia Post updates, Gottsegen continues to work on Qualia Connect, the company’s flagship product that is focused on the consumer closing experience.
ERNIE GRAHAM is a life-long technology entrepreneur who has been a leader at multiple startups and public companies. His real estate career led Graham to envision a mortgage industry that extends far beyond the transaction—an industry where loan officers are the trusted advisors their clients rely on to make informed home finance decisions throughout the entire homeownership lifecycle. In 2015, Graham cofounded Homebot to make this vision a reality every day by helping lenders create client-for-life relationships. Graham has fostered the company’s significant growth, with thousands of lenders and millions of homeowners now engaging through Homebot each month. Additionally, over the past six months as the COVID-19 pandemic hit, Graham pivoted the 50-person company to 100% work-from-home almost overnight, all while remaining focused on helping lenders and real estate agents maintain engagement with their clients. He introduced product enhancements that would best meet the needs of loan officers and their clients during these unprecedented times of stay-at-home orders, a ban on in-person home showings and all-time low interest rates. For loan officers to remain successful, it became more imperative than ever to stay connected with their past clients and new leads. Under Graham’s leadership, Homebot facilitated this connection by providing personalized, actionable insights that empower consumers to build wealth through homeownership. Graham has built a team of agile and growth-oriented leaders who have tackled new challenges during these unprecedented times and continue driving Homebot’s mission forward in rapidly changing market conditions.
What’s the best advice you’ve ever received?
What’s the best advice you’ve ever received?
Find work that I care about. When you’re excited about what you do, it doesn’t feel like “work.” You’re motivated to put in more time and get better at it. This makes your work more rewarding, and you inevitably inspire others to do better.
You can’t manufacture “a great place to work.” But, if you focus on creating “a place that works great,” the “great place to work” will just naturally follow.
OCTOBER/NOVEMBER 2020
Neenu Kainth
C h ie f R e a l E s t a t e O ff ic e r
C h ie f D ig it a l O ff ic e r
OJO Labs
Mr. Cooper Group
WHILE CHRIS HELLER JOINED OJO LABS just over a year ago, he had served as a trusted advisor to the company long before joining the team full time. His deep understanding of the real estate industry and passion for solving complex problems has made him a crucial member of the team as the chief real estate officer. In February, Heller guided OJO Labs in the development of Conversion Boost, an at-scale lead nurturing service. Since launch, Conversion Boost has been rolled out across Realogy brands to reduce lead drop off without adding additional work for agents. Heller played an integral role in the acquisition of Movoto, from tapping a trusted relationship to set up an initial meeting to guiding the team’s due diligence. His expertise was especially helpful in understanding the role of agents within the organization, how the business serves consumers and how OJO Labs could evolve the business to better support both agents and consumers. In addition, Heller is instrumental in helping foster key partnerships with major industry leaders including Realogy and Royal Bank of Canada. He is deeply entrenched in the industry and is a well-respected expert and advisor to OJO Labs partners and other major players in the industry. This is an ongoing effort that has helped to bring OJO Labs’ personal advisor to consumers in more than 50 markets across North America. Heller is also leading the company in an effort to bring together real estate leaders to tackle the industry’s most pressing issues, including spearheading the creation of OJO Labs’ quarterly Real Estate Industry Roundtable.
AMID THE COVID-19 PANDEMIC, Mr. Cooper Group was hit with an extraordinary spike in calls and inquiries from customers looking for options to mitigate their current financial situation. Neenu Kainth quickly realized the need for her team to develop a solution to make it easier for homeowners to request mortgage payment relief and better understand their options. This digital solution would not only relieve the strain on customer service but also provide a seamless experience for customers during an already tumultuous time. Kainth’s team worked tirelessly to develop and roll out a digital solution within 48 hours that allowed customers to sign up and eventually extend their forbearance plans. With 95% of the Mr. Cooper Group workforce working remotely, this was no small feat. In her commitment to ensure a seamless experience for customers, Kainth and her team analyzed the data in real time after the launch, collecting customer feedback and swiftly working on solutions that would further improve the customer experience. To date, more than 90% of customers who utilized the digital tool were able to self-serve online without having to call with questions or for assistance. Within 90 days of developing that solution, Kainth and her team had improved that offering and released 10 other solutions as part of the program, providing a complete end-to-end pandemic solution. Kainth never wavered in her mindset of keeping the customer top of mind. Her leadership and agility allowed her to lead her team and customers through a tough time, all the while empowering her team.
What’s the best advice you’ve ever received?
What has been your secret to success?
There’s one piece of advice that’s stuck with me throughout my career: “Show up, pay attention, tell the truth and don’t be attached to the outcome.” It’s taught me to always be prepared, present and aware, committed but never attached, and to always do the right thing.
Remain agile — by remaining agile in your approach, you have the ability to be more adaptive, creative and resilient when dealing with complexity, uncertainty and change. Your agility will ultimately guide you to the solution and allow you to never waver from what matters most.
OCTOBER/NOVEMBER 2020
4 9 ❱ H O U S IN G W IR E
Chris Heller
5 0 ❱ H O U S IN G W IR E
Tawn Kelley
Aaron King
P r e s id e n t
Founder and CEO
Taylor Morrison Home Funding
Snapdocs
TAYLOR MORRISON’S latest acquisition of William Lyon Homes also brought the integration of Closing Mark Home Loans and Closing Mark Title and Escrow. Under Tawn Kelley’s leadership, these companies were successfully integrated into Taylor Morrison Home Funding and Inspired Title Services, creating a strong infrastructure and expanding the company’s existing footprint into three new markets. With keeping the primary focus and expertise on new construction lending, Kelley coordinated the transition of the retail side of CMHL to a third party, preserving employment and active loan pipelines for many. The COVID-19 pandemic has brought about one of the toughest leadership tests, and Kelley has displayed many behaviors indicative of a true leader during these unprecedented times. She tackles the tough challenges head on, providing acknowledgement of team members’ fears, as well as credible hope that collectively the company has the resources needed to meet daily challenges. From the implementation of remote work to personally reaching out to every team member, to ensuring her leadership team is practicing empathy and compassion when it matters most, Kelley has been a true inspiration during the pandemic. Under her leadership, Taylor Morrison Home Funding has been recognized by several publications for different awards, including in the Orlando Sentinel Top 100 Workplaces for the last three years running and recognized in the Orlando Business Journal as a best place to work for 2020. Most recently, Kelley accepted a seat on the board of directors of a publicly traded company, STORE Capital.
AARON KING founded Snapdocs in 2013 and has led the company since its inception. He is a mortgage industry veteran with more than 20 years of experience. During this time, the industry has talked about the potential of digital closings, though significant progress had not been made until more recent years when lenders have been able to more easily scale digital closings. King has led his company to play a critical role in leading the industry’s progress toward digital closings and turning the benefits of digital closings into a reality for lenders. According to the company, more than 90% of hybrid closings are successfully eSigned by borrowers on Snapdocs. This is up from 80% in 2019. Snapdocs’ growth has exploded under King’s leadership as the number of lenders who use Snapdocs Digital Closing Platform has increased by more than 700% within the last 10 months. The company has also doubled headcount to support that growth. The strides the company has made under King’s leadership have been recognized across the industry. In 2020, the company was named a HousingWire Tech100 winner, and The MReport recognized Snapdocs as a Top 25 Fintech Innovator. King led Snapdocs’ strategic partnership with Ellie Mae, announced in March 2020, which brings lenders one step closer to a fully digital end-to-end mortgage process. With this partnership, lenders can easily integrate Ellie Mae’s Encompass with Snapdocs to access a single platform for managing all types of closings, including wet, hybrid and full eClosings.
What has been your secret to success?
What’s the best advice you’ve ever received?
Appreciating that every step in my journey has brought me to the success I’ve achieved. Every failure, challenge and disappointment as important as every promotion, title and win. I’ve accepted that I don’t need to know everything, I only need a talented team with shared vision.
Create clarity of thought on the number one focus of any initiative within the company. It’s easy to list multiple things to focus on, but the hard work is in boiling that down. When everything is important, nothing is important.
OCTOBER/NOVEMBER 2020
Joe Langner
M o r t g a g e P r a c t ic e H e a d
P r e s id e n t
Tata Consultancy Services
ReverseVision
KARTHIK KUMAR leads Tata Consultancy Services’ global mortgage practice, focused on solution architecture, operational delivery and entity transformation for most of the top-40 lenders and beyond and the largest vendors. With 17 years of experience in the mortgage industry and a Six Sigma black belt certification, Kumar deploys global best practices across the entire mortgage ecosystem and possesses in-depth process knowledge across dozens of individual roles and functions. Kumar is a sought-after international speaker, host and facilitator. He is best known for bringing in digital disruption and driving adoption of cognitive tech solutions in the global home lending industry. Kumar launched an entire suite of digital solutions across the mortgage value chain to support clients with POS and servicing and address secondary market needs. The suite included a robust automated document classification and data extraction solution covering 500 document and image formats. Under his leadership, the team was able to identify, address and resolve key challenges in cost, productivity, cycle time and quality for numerous clients, enabling their success and providing a competitive edge. This success stems directly from Kumar’s relentless focus on investing in multiple disruptive technologies—digital, blockchain, artificial intelligence, machine learning and more. In the past year, Kumar has been a key part of many global mortgage events, including having hosted SMARTGAGE in Prague as the chairman of the event; serving as an innovation speaker at the Mortgage Innovation Summit in Sydney, Australia; being a moderator at the Mortgage Digital Symposium in Dallas; and serving as a moderator for a HousingWire webinar on digital proximity.
IN EARLY 2020, Joe Langner joined five-time HousingWire Tech 100 company ReverseVision to advance technical initiatives that allow loan originators to easily incorporate senior lending products into their existing origination workflow. Langner has accelerated technology enhancements and invested in initiatives that deliver increased value to ReverseVision customers, including increasing customer support and software engineering staff by 25%, upgrading data centers to Amazon Web Services, spearheading soon-to-be-announced partnerships with prominent CRMs, POSs, LOSs, financial planning and mortgage services software and introducing a complimentary consultation service to help customers align their technology stacks with their business goals. This year alone, Langner has led ReverseVision to achieve the following accomplishments: processing more HECM loans originated on RVX than all other systems combined; usage by all 10 of the top-10 HECM lenders; and 62 of the top 75 forward mortgage lenders brokering on the ReverseVision platform. Leading up to joining the company, Langner was already a 30-year industry veteran, having held numerous executive positions at marquee firms during critical organizational junctures. His impact on the industry includes having executed Ellie Mae’s IPO in 2011 as executive vice president and chief sales officer; preparing SaaS LOS PCLender for acquisition by Fiserv as president and chief revenue officer; and securing a 100% increase in revenue for Blue Sage as CEO and chief revenue officer. His other roles include executive vice president and general manager at Sage, and senior vice president at Dun and Bradstreet, a global provider of business decisioning data and analytics.
What has been your secret to success?
What has been your secret to success?
I knew that innovation in mortgages won’t be discouraged, but the change that follows may not be readily accepted. What was required was instilling a culture of change first and the ecosystem would automatically embrace innovation with zeal. It’s tough to sell a change, but relatively easy to execute it.
The most important thing I’ve done in my career is continually strive to understand customers’ challenges and endeavor to solve them. Professional success is about solving business problems, and that starts with asking questions and listening.
OCTOBER/NOVEMBER 2020
5 1 ❱ H O U S IN G W IR E
Karthik Kumar
5 2 ❱ H O U S IN G W IR E
Suzy Lindblom
Gene Ludwig
C h ie f O p e r a t in g O ff ic e r
Founder
Planet Home Lending
Promontory MortgagePath
SUZY LINDBLOM is a trailblazer with a passion for developing people and companies, and contributing to the mortgage industry. During the past 12 months, Lindblom has been the kind of leader every company craves during a crisis: steadfast and certain. She doubled Planet Home Lending’s origination capacity, optimized already-successful fulfillment operations, skillfully managed a 20% growth in personnel, put in place leading-edge technology to improve customer experience, grew the company’s relationship with minority industry organizations and mentored a new generation of industry leaders. To meet the ever-increasing demand for refinancing, Lindblom focused on enhancing both originations and fulfillment. She accomplished this by providing an industry-leading work-life balance, compensation, and support to help attract and develop the best talent in the industry. Those improvements brought about a 100% increase in operations productivity and a 30% reduction in origination costs over the past 12 months. As states and local jurisdictions responded to the COVID-19 pandemic by encouraging social distancing, Lindblom pushed for digital mortgage initiatives to increase safety for both customers and business partners. With eSign for loan applications and disclosures already part of the Planet toolbox, Lindblom added DocuTech’s Hybrid eClosing to help facilitate remote online notary and eSignature capabilities. Lindblom brings the same dedication to improvement to the teams she leads. She relishes identifying, empowering and mentoring future leaders by helping them assess their strengths and build around those attributes. Prior to the pandemic, Lindblom regularly visited each of the company’s regional offices, walking from cube to cube chatting with employees.
GENE LUDWIG is widely recognized as a visionary thinker on the critical issues confronting financial services. A former federal regulator and banker, Ludwig served as U.S. Comptroller of the Currency under former President Bill Clinton before becoming vice chairman and senior control officer of Bankers Trust/ Deutsche Bank. Ludwig channeled his banking regulation, risk management and fiscal policy expertise into establishing Promontory Financial Group and Promontory Interfinancial Network, making the Promontory name synonymous with excellence in compliance and risk management and resolving financial companies’ most-pressing challenges. Ludwig brought the same visionary leadership and dedication to bettering the financial services industry to the mortgage industry when founding Promontory MortgagePath in 2015. To date, Ludwig has helped PMP earn key endorsements for its technology and fulfillment services from several national and regional trade groups, most recently including Georgia Bankers Association in January 2020, Ohio Bankers League in May 2020, and Independent Bankers Association of Texas in July 2020. In addition to these endorsements, Ludwig’s leadership and direction have resulted in significant company growth and client success, which include adding more than 30 employees over the last year, with growth across all departments and locations; establishing a second fulfillment center in Denver to support PMP’s growing client base; successfully onboarding new clients during the COVID-19 pandemic; scaling mortgage operations for existing clients to manage double-digit increases in volume during the current mortgage/refinance boom, increasing PMP client pull-through rate by 30% and reducing investor delivery cycle times for PMP’s clients by 60%.
What has been your secret to success?
What one habit has made a crucial difference in your success?
I attribute my success to the strength of my teams, who have worked together to make me, themselves and Planet shine. Also to my many mentors in the industry that have not only pushed me to grow, but have collaborated with me and others to make this a great industry serving the community through homeownership.
Hard work. In my case, such success as I have had is attributable to horsepower more than brain power. I would also add the rest of the recipe: Treat others as you would be treated. Take a little less and give a little more. And no compromise on integrity.
OCTOBER/NOVEMBER 2020
Jane Mason
P r e s id e n t a n d C E O
Founder and CEO
Griffin Funding
CLARIFIRE
WILLIAM LYONS’ entire professional career has been dedicated to mortgage, real estate and U.S. veterans. Lyons started out as a loan officer, and then in 2013 he decided to start his own company, becoming the founder, president and CEO of Griffin Funding. To differentiate the company, Lyons decided that the team would become experts in VA loans so they could help veterans finance and refinance their homes. In 2015, he led the company to move from brokering loans to other lenders to becoming a direct lender. Under Lyons’ leadership, Griffin Funding has been recognized in the Inc 500 and the Fastest 100 in San Diego County. For the third consecutive year, Lyons is serving on the board of the Entrepreneurs’ Organization – San Diego Chapter. He has appeared on Shark Tank and is on the Forbes Real Estate Council. But most importantly, Lyons stands out as a leader for the industry, within his company and with his employees. He continuously shows that he cares about his people, clients, veterans and community. One such example is by ensuring that his team gives back to the community by donating a portion of all its VA loan revenue to Shelter to Soldier. This organization rescues dogs from shelters and then trains them to be service dogs for combat veterans with PTSD. Through its contributions to Shelter to Soldier, Griffin Funding has supported the adoption and training of two separate service dogs in the last 12 months who have been handed off to combat veterans who need them to live a healthy and productive life.
JANE MASON has been a mortgage industry innovator since 2007, when she first conceived and brought her groundbreaking workflow automation application, CLARIFIRE, to market. Today, CLARIFIRE is playing a critical role in helping mortgage servicers address the daunting challenges brought by a global pandemic. Large mortgage servicers are currently using CLARIFIRE to complete an average of 1,000 deferral requests per day. Over the past year, Mason and her team have also managed to stay several leaps ahead of the market by paying close attention to industry operational impediments, understanding where and how technology falls short in addressing housing industry issues, and using this knowledge to continually improve the CLARIFIRE solution. Mason has also pursued and completed a number of business alliances over the past year that have complemented and enhanced CLARIFIRE workflows. These include automated ordering of title products and credit reports, eSignatures, state-by-state recordings, doc prep services and more. By sharing business opportunities with the company’s partners, Mason has been able to provide her clients with new seamless process improvements on an ongoing basis. While accolades were never the goal for Mason or her company, they are piling up. In the past 12 months, CLARIFIRE was recognized as a HousingWire Tech100 company for the fourth consecutive year. Early in 2020, the Mortgage Bankers Association named Mason one of five MBA 2020 Tech All-Stars for her work applying technology to help servicers transform the chaos into clarity.
What’s the best advice you’ve ever received?
What is one thing you cannot do without?
“Send good out into the world.” I am a firm believer in sending out good into the world. I believe if you support your team, support your community and strive to be kind every day, the world will send good back to you.
My longstanding, loyal team. Everything we do at CLARIFIRE, we do as a team. Everyone takes part. I believe it really does take a village. Every victory, and every challenge we learn from, we experience together, and we become better at what we do.
OCTOBER/NOVEMBER 2020
5 3 ❱ H O U S IN G W IR E
William Lyons
5 4 ❱ H O U S IN G W IR E
Bill Neville
Willie Newman
CEO
P r e s id e n t a n d C E O
LoanLogics
Home Point Financial
BILL NEVILLE is responsible for defining and executing the direction of LoanLogics’ unique portfolio of technologies and services to rapidly grow sales and increase customer engagement and retention. During his tenure, the company has seen a 49% growth in its origination network and 55% growth in its servicing network over the past year alone. In fact, under Neville’s direction, 40% of all U.S. correspondent loan volume now flows through LoanLogics technology and from many of the largest correspondent lenders in the mortgage industry. Neville has worked hard over the past year to expand the industry’s awareness of AI, machine learning and digital labor, and help propel the expansion of their use. With the help of his leadership, LoanLogics has also become a leader in the adoption of machine learning to remove human capital from the routine tasks of processing loan file documents and in building purified loan file data. Neville has guided efforts that leveraged LoanLogics’ unique position with respect to its vast library of loan file documents and data—now having processed more than 600 million documents and extracted over 5.3 billion data elements—to build and train machine learning technologies and related services that achieve 99% data accuracy. With Neville at the company’s helm, the company launched in April LoanLogics IDEA OnDemand, a cloud native digital assistant for in-line, real-time document processing. And Neville is already working on new industry firsts, including the development of a new, completely rules-based digital decisioning product that can be used in loan underwriting.
WILLIE NEWMAN is an acknowledged expert and innovator in the mortgage industry with more than 25 years of experience in the field. In 2014, Newman joined forces with Stone Point Capital to form Home Point Capital and, after the acquisition of Maverick Funding in 2015, the company became operational as Home Point Financial. Under Newman’s leadership, Home Point Financial has rapidly scaled in just five years to become a top 20 nonbank originator and servicer. He developed and is the driving force behind Home Point Financial’s people-centered operating philosophy “We Care,” and is dedicated to the company’s mission to create financially healthy, happy homeowners. In the past year, Newman has driven 240% year-over-year growth to establish Home Point Financial as the second-largest wholesale lender and the13th-largest correspondent lender in the nation. Newman has built Home Point Financial to take advantage of changing markets by establishing flexibility in day-to-day operations to address volatility during a time of instability. Thanks to this business approach, Home Point Financial has been wellequipped to respond to the changing market conditions, finding new ways to work, and communicating with partners and borrowers during a period of economic disruption. The rapid growth of Home Point Financial is directly attributed to Newman’s leadership. By positioning the company as a leader, he has enabled loan volume to nearly double every year since inception. The company anticipates reaching $55 billion this year. Newman holds a BBA in finance from the University of Michigan and an MBA in finance and business economics from Wayne State University.
What has been your secret to success?
What has been your secret to success?
Today, while business is booming, costs should be tightly managed. Enabling the mortgage industry to do more with less, working with bright people making a difference and bringing to market technology that creates a positive impact has led to my success.
During my time leading a business, I’ve learned to stop trying to be good at everything. Focus on finding a competitive niche rather than spreading your chips across the table.
OCTOBER/NOVEMBER 2020
Steve Ozonian
C h ie f E c o n o m is t
CEO
CoreLogic
Williston Financial Group
FRANK NOTHAFT has the unique ability to take abstract economic concepts and apply them to practical business and policy solutions. His expertise spans not only residential and commercial property markets but also mortgage finance. During the last 37 years, he has advised executives in industry, government and think tanks. Nothaft is currently in his sixth year as chief economist at CoreLogic, where he is responsible for analysis, commentary and forecasts of trends in the global real estate, insurance and mortgage markets. He is the public face of the company and regularly speaks to key stakeholders, including government officials, media and clients regarding data-backed insights on where the housing, insurance and mortgage markets are headed. Over the last 12 months, Nothaft has worked to keep the industry and policy makers informed of housing and mortgage market performance. He is a trusted voice worldwide and has been quoted in more than 2,800 pieces of online media, including The New York Times and Forbes. Nothaft has also been featured in more than 200 pieces of broadcast coverage within the last six months, including CNBC’s Squawk Box and National Public Radio. As the housing market grapples with the impact of a global pandemic, the industry has come to depend even more on Nothaft for interpreting and disseminating analysis on the state of the housing and mortgage activity. He also brings his expertise to other business segments within CoreLogic and empowers other teams with crucial insights to make informed decisions for their business units.
STEVE OZONIAN joined Williston Financial Group as a member of the board before becoming the CEO of WFG and its family of companies in 2015. The team Ozonian has created is consistently on the cutting edge of technology and ranks “World Class” for service, with an average company-wide NPS score of more than 70 through June of this year. These impressive benchmarks have created a crucial differentiator during the COVID-19 pandemic, as businesses were forced to pivot virtually overnight to a remote-working environment. Because of Ozonian’s technology-first protocols, all aspects of WFG were able to move efficiently into a new normal when the pandemic struck, without interrupting WFG’s levels of service. In fact, the company experienced record order volumes during this time, with orders doubling compared to the year prior during the months of May, June and July. Ozonian oversees operations at WEST, the company’s digital and fintech solutions subsidiary. This year, Ozonian and his team launched DecisionPoint, which speeds up the mortgage lending process by providing lenders with an immediate title clearance decision. DecisionPoint is a 2020 HousingWire Tech100 award recipient. Ozonian also oversees WESTprotect, an enterprise security system, for clients to report any suspicious, possible cybercrime attempts. Launched to clients this year, WESTprotect was originally an in-house cybersecurity service for all WFG companies. Ozonian recognized the larger role it could play to help protect the industry from cyberattacks and made the product public in the last 12 months. WESTprotect is also a HousingWire Tech100 award winner.
What’s the best advice you’ve ever received?
What has been your secret to success?
One of your biggest responsibilities as an economist is to consider the way you present your data findings, not just with oral and written communication, but visually. The need to effectively portray your data is paramount.
My secret to success is to learn as if you’re going to live forever and live as if you’re going to die tomorrow.
OCTOBER/NOVEMBER 2020
5 5 ❱ H O U S IN G W IR E
Frank Nothaft
5 6 ❱ H O U S IN G W IR E
Thomas Pearce
Kurt Pfotenhauer
C E O a n d C h a ir m a n o f t h e B o a r d
V ic e C h a ir m a n
MAXEX
First American
THOMAS PEARCE has lived at the center of the secondary mortgage market’s buyer-seller dynamic for more than 30 years. His experiences led him to an intimate understanding of the root causes of the 2008 housing crisis, and how to solve it. With this knowledge, he became one of the original founders of MAXEX. Pearce and his team grew MAXEX to its present-day scale. To date, the company has raised more than $90 million from industry participants and has helped more than 130 buyers and sellers achieve approximately $8 billion in lock trading volume. In the past 12 months, MAXEX has achieved record volumes as trading volume more than doubled in the second half of 2019 compared to the first half of the year, executed multiple bulk transactions exceeding $1 billion for top-25 financial institutions and partnered with Ellie Mae to further expand speed of liquidity and secondary market access. Most importantly, however, MAXEX continued to provide liquidity and stability as the non-agency mortgage market rapidly deteriorated during the COVID-19 financial crisis. Under Pearce’s leadership, MAXEX ensured that buyers remained in the market, providing liquidity and honoring commitments. Outside of MAXEX, Pearce is also cofounder, president and chairman of FACT Relief, a non-profit organization dedicated to supporting families battling debilitating or terminal disease, as well as other catastrophic life events, that may impact the household’s ability to provide for their family. FACT Relief has distributed $1 million in uninsured healthcare costs and granted $100,000-plus to families with minimal financial support.
KURT PFOTENHAUER is a very connected player in the mortgage and title business, and he uses his connections to make the mortgage and title industries better. He has also used his considerable prestige to improve the lending and title process for consumers. Pfotenhauer served on the board of directors of the MBA Opens Doors Foundation, which makes mortgage or rental payments for families with critically ill or injured children so the parents may take unpaid leave from work and spend precious time with their kids. The foundation accelerated its donations during the COVID-19 pandemic with Pfotenhauer’s leadership. He served on the board of directors of the Mortgage Bankers Association and led the fight this year for liquidity when the pandemic shut down the country and dried up liquidity. Many mortgage companies that had been in a serious mark-to-market crunch survived due to Pfotenhauer’s leadership and understanding of warehouse lines of credit. Pfotenhauer also served on the board of directors of MISMO this year and is responsible for accelerating the certification process of remote online notarization closing services, which offer consumers a contactless closing experience during the pandemic. The pandemic brought about an exponential amount of interest in digital mortgage platforms like remote online notarization, and Pfotenhauer has been critical in making that technology infrastructure through his leadership at MBA, MERS and MISMO. In 2019, Pfotenhauer was awarded MBA’s Andrew D. Woodward Distinguished Service Award, presented in recognition of dedication and prominent service to MBA and the mortgage lending industry.
What’s the best advice you’ve ever received?
What’s the best advice you’ve ever received?
The limitations of our success are between our ears. Have a big vision and execute.
Bloom where you are planted.
OCTOBER/NOVEMBER 2020
Ken Richey
C h ie f P r o d u c t io n O ff ic e r
Partner and Founder
Sierra Pacific Mortgage
Richey May
JAY PROMISCO has an unerring instinct for technology growth, as evidenced in the implementation of Sierra Pacific Mortgage’s new proprietary origination system, ExpressLoan, for retail and TPO. Championed by Promisco and his hand-picked team of experts, ExpressLoan revolutionized the way Sierra originated loans by shortening the loan cycle, increasing productivity among staff and eliminating redundancies in the process. Promisco also spearheaded the company’s new fully mobile and paperless application system by launching the SPM GO! app in both Google Android and Apple iOS operating systems, which is backed by industry powerhouse SimpleNexus. Finally, attentive to the evolving global landscape and constant change in how a customer or referral partner conducts business, Promisco initiated two additional COVID-appropriate platforms that allowed the Sierra sales teams to digitally connect and respond quickly and safely in the country’s recent no-contact environment. First, Promisco initiated CRM conversations with vendor partner Total Expert and successfully launched the company-wide CRM in the spring of 2020. The introduction of this sophisticated tool allows sales to pivot quickly, communicate digitally and remain top of mind. Additionally, Promisco introduced vendor partner and video communications leader BombBomb to the field, so that teams could communicate quickly, effectively and safely via an Outlook-integrated video message. Internally, Promisco pressed the company to look at its existing brand, taking the bold steps of engaging with third-party brand consultants, introducing a new ad agency partner, and hiring integral team members well suited to successfully launch an overdue brand upgrade for the 34-year-old company.
UNDER KEN RICHEY’S leadership, Richey May has expanded to meet the needs of the mortgage banking industry and now has award-winning services in accounting, tax, technology and business advisory solutions. He is a frequent author, speaker and thought leader in the mortgage banking industry and his relationships are the foundation of the entire firm’s success. Richey was the only third party invited by the Mortgage Bankers Association in 2019 to participate with their leadership team to meet jointly with officials from the U.S. Department of the Treasury in Washington, D.C. There, he recommended modifications that clarified proposed federal income tax regulations allowing the 20% Qualified Business Income tax deduction to residential and commercial mortgage lenders and financial institutions. Richey oversaw the launch of Richey May’s new technology solutions practice, including the acquisition of AMATA Solutions to expand business intelligence services designed for mortgage lenders. In 2019, he enabled two successful M&A transactions, as well as led the efforts of multiple due diligence projects and relationship building behind the scenes. He also authorized the expansion of the Women’s Leadership Commission to become ELEVATE, Richey May’s diversity and inclusion program. Richey has encouraged the leadership team to expand their mission to include all underrepresented groups and enable people from diverse backgrounds to succeed in accounting and the mortgage services industry. Richey has hosted several online round tables to assist mortgage companies in dealing with the problems caused by COVID-19, facilitating conversation between leaders to solve problems quickly and help the industry navigate the uncertain future.
What’s the best advice you’ve ever received?
What has been your secret to success?
The only person in the way of your success is you. If you expect to hold people accountable the first person should be yourself.
Without question, the secret to the firm’s success, and therefore, my career success, is surrounding myself with quality partners and employees. Leaders of great teams are better together than they are apart and make decisions that are in the best interest of the team and not the individual.
OCTOBER/NOVEMBER 2020
5 7 ❱ H O U S IN G W IR E
Jay Promisco
5 8 ❱ H O U S IN G W IR E
Gretchen Rosenberg
Alex Rosenblum
P r e s id e n t a n d C E O
CEO
Kentwood Real Estate
Axia Home Loans
GRETCHEN ROSENBERG’S role first and foremost is to support Kentwood Real Estate brokers. Today, Rosenberg leads Kentwood’s growing team of more than 240 Realtors in Colorado’s finest luxury brokerage, which has produced more volume per agent than 99% of all real estate companies in the U.S. Rosenberg credits this to Kentwood brokers’ deep commitment to professionalism, local knowledge, expertise and customer experience. Under Rosenberg’s leadership, Kentwood agents closed more than $2 billion in total sales volume and closed more than 3,000 transactions last year. The overall average sales price notably rose year-over-year to $767,556, with four of the top 10 highest-priced home sales in metro Denver. This was more than any other brokerage in the top 10, and included the top home sale ever on record in Denver at $11,625,000, as well as the highest-priced condominium, which sold at $5,359,975, according to REColorado data. Additionally, Rosenberg has ably led Kentwood Real Estate through the COVID-19 pandemic. As other brokerages scrambled for direction, Rosenberg’s proactive leadership kept Kentwood’s real estate brokers in front of the crisis by issuing guidance with every new milestone. Rosenberg educated stakeholders on new regulations in real time, quickly launched virtual tools for the home-buying and selling process and was available 24/7 as a resource to any member of the organization for absolutely anything. Rosenberg’s leadership at Kentwood buttressed an otherwise tumultuous period in the real estate industry, maintaining the safety of her brokers and their clients and positioning Kentwood as a community and industry leader.
ALEX ROSENBLUM’S leadership philosophy focuses on developing the strategy and vision of the company, while helping his team chart a course toward individual execution of company aspirations. He works hard to ensure the entire team can see “the picture of the puzzle on the front of the box.” Rosenblum has a reputation for not micro-managing and championing a collaborative, solution-oriented environment that supports ample communication within and across teams. He has navigated Axia to a 100% employee-owned status, where problems are approached with an ownership mentality. In the past year, under Rosenblum’s leadership, Axia has established cross-functional recruiting and retention task forces that meticulously analyze the loan originator journey and develop new tools and standard operating producers to enhance the experience of the originator across the multiple touch points they have with Axia. The goal is a high level of service toward each other that translates to the best customer experience. Additionally, Rosenblum has implemented enhanced company communication and feedback mechanisms for Axia employees, including Ideas in Motion, an online portal that allows any company employee to provide feedback or contribute new ideas. Rosenblum launched Company Town Halls, State of Axia Presentations that review the Strategic Plan with the company, and re-engineered monthly company calls. Overall, Rosenblum has substantially increased transparency between the company and its employees, reorganized team and meeting structures to ensure effective cross-department communication and collaboration, restructured organizational charts to alleviate the scope of managers who were spread too thin, and identified areas within the company where more senior leadership was needed.
What’s the best advice you’ve ever received?
What’s the best advice you’ve ever received?
“Girls don’t stand on the sidelines cheering for boys. They go in and play the game, too.” We require new voices – leaders with empathy and vision and leaders who aren’t afraid of being both strong and vulnerable.
Three things: There’s more I don’t know than I do: continuously improve; collaborate to solve problems – diversity in background and skills helps solve complex problems; take an exhaustive approach to due diligence, but don’t fear failure.
OCTOBER/NOVEMBER 2020
Brian Simons
CEO
P r e s id e n t
eXp World Holdings
Maxwell
IN THE PAST YEAR, eXp World Holdings has reached milestones in every measure because of Glenn Sanford’s leadership. Most notably, the company experienced record profitability and results and continues to see agents join eXp Realty at one of the highest rates in the industry, according to the company. Because of Sanford’s evangelism and commitment to eXp World Holdings’ cloud-based model, agents around the world are joining eXp at a rapid clip. Sanford has also helped scale eXp Realty internationally. Over the past 12 months, the company has expanded to Australia and the United Kingdom, with additional provinces and territories in Canada. Additionally, Sanford made several key hires to propel international growth in the coming year. He was also a champion for creating ONE eXp, which is eXp’s initiative to promote diversity and inclusion across the company. Sanford is proud to support ONE eXp, which facilitates agent and staff career development, promotes fair housing principles, and provides networking opportunities that encourage cultural awareness. Through Sanford’s leadership, eXp is committed to building the most diverse and inclusive real estate brokerage in the world, where all views are respected and encouraged. Lastly, Sanford is proud to have joined the Board of Directors at VirBELA this year, driving the strategic direction for the company. VirBELA’s immersive software enables next-generation remote collaboration and is used for teams, learning and more. Sanford’s vision for VirBELA is to empower employees and companies across the world with access to an immersive platform for collaboration.
BRIAN SIMONS, an industry veteran of more than 25 years, is passionate about reimagining how lenders manufacture loans enabled by the power of modern technology. Simons joined Maxwell as president back in January 2020 and has already had an exponential impact in both the organization and the industry. Since joining the company, he has focused on the successful launch of Maxwell’s Fulfillment Platform, an outsourced fulfillment solution built for the 200 small to midsize community banks, credit unions and IMBs that use Maxwell’s point-of-sale platform. Simons’ leadership of the fulfillment platform culminated in a launch in May 2020. His skillset has been exemplified through the platform’s tremendous success and reception in the market. Simons has already driven a more than 100% increase in employee headcount, with a projected additional 100% growth again by mid-Q3 2020. Growth is expected to continue to increase rapidly as small and midsize lenders seek solutions to manage costs, enhance productivity and improve quality. Along with growing the team to meet the market demands for processing, underwriting and closing services, Simons is critical in managing the operation and quality of the work done by the team in a way that reflects Maxwell’s technology foundation. The Maxwell Fulfillment Platform provides the highest-quality experience for on-shore, outsourced services, and the quality, speed, communication and partnership with the company’s lenders is where his expertise truly shines. The speed and quality of the work is noted by a 190% increase in volume processed through the team in their first quarter of operation.
What’s the best advice you’ve ever received?
What’s the best advice you’ve ever received?
“You can get anything that you want in life if you just help enough other people get what they want,” motivational speaker Zig Ziglar
My first boss told me that your reputation is all that you have in this industry. My career would only flourish by protecting my reputation, which meant being honest, doing what you say, treating people with respect and living a values-oriented life. It’s basic advice, but it’s true.
OCTOBER/NOVEMBER 2020
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Glenn Sanford
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Dan Sogorka
Dave Stevenson
P r e s id e n t a n d C E O
C h ie f Te c h n o lo g y O ff ic e r
Sagent Lending Technologies
SimpleNexus
DAN SOGORKA has led digital transformation in housing for two decades. Before joining Sagent in March 2020, he served as CEO of digital mortgage point of sale provider Cloudvirga, president of EXOS Technologies, executive vice president of Servicelink, a $1 billion revenue subsidiary of Fidelity National Financial, and division president at Black Knight. Since joining Sagent, Sogorka has played an integral role in helping reinvent and modernize how banks and lenders power the homeownership and consumer lending experience for more than 12 million borrowers. Within the first few months of his leadership role at Sagent, Sogorka has racked up numerous accomplishments. He scaled product development to deploy new features, functionality, and configurability that keeps up with the real-time changes the pandemic has brought to markets, borrower situations and regulations. Sogorka identified key opportunities for acquiring core technologies to modernize the loan servicing workflow, including customer service, payments, escrow, investor, collections, loss mitigation, bankruptcy, foreclosure, REO and claims. He leveraged existing and emerging partnerships across the servicing and mortgage lending landscape to modernize systems for loan origination, point of sale, products and pricing, eSign, digital closing and marketing across Sagent’s full loan servicing suite. He also added six prolific housing leaders to the executive leadership team. And, finally, Sogorka built out world-class security, compliance, and regulatory/agency affairs teams that enable Sagent’s mortgage servicing customers to react and adapt in realtime to seismic shifts in mortgage servicing policy, particularly in light of the COVID-19 pandemic.
DAVE STEVENSON joined SimpleNexus in 2015 and has since had a hand in practically every line of code the firm has released. Impressively, Stevenson is just as capable a leader as he is a coder. He oversees SimpleNexus’ team of 50 developers, and under his guidance, the SimpleNexus development team has honed its ability to listen and respond to the needs of customers. As the chief technology officer at SimpleNexus, he has also been instrumental to the company’s ability to scale system resources to meet the unprecedented demand generated by this year’s refinance boom. Stevenson has directly contributed to the following recent SimpleNexus accomplishments: attained 1,280% revenue growth over the three-year period from 2015 to 2018, expanded the development team from four engineers to 30 in a single summer (and continued to grow headcount to the team’s current size of 50). In addition to that, he also achieved 99.7% year-over-year customer retention, graduated more than two dozen college interns from SimpleNexus’ development program and scaled system capacity 500% with zero downtime to keep up with demand brought on by 2020’s refi boom. Without Stevenson’s technical chops, SimpleNexus could not deliver on its mission to enable lenders and borrowers to easily complete mortgage loans from anywhere. It is also thanks to the work of Stevenson and his team that the company was named one of Utah’s fastest-growing firms by three different publications in 2019 alone. For the second year in a row, SimpleNexus cracked the top 500 of the Inc 5000, and it ranked No. 102 on the 2019 Deloitte Fast 500.
What has been your secret to success?
What one habit has made a crucial difference in your success?
Bringing together engineering, creativity and relationships. My background helps make complex technical matters simple for decision makers, which builds relationships. In my creative pursuits, I write and produce music which is just like building housing technology: bringing different specialists together to collaborate.
Keeping the customer front and center in everything I do has made a crucial difference in my career. I have the amazing opportunity to develop exciting software, but if what I create doesn’t deliver value for the customer, it’s just wasted time and energy.
OCTOBER/NOVEMBER 2020
Tony Thompson
C h a ir m a n a n d C E O
Founder and CEO
FundingShield
National Association of Minority Mortgage Bankers of America
IKE SURI is a successful global entrepreneur with a track record as a hands-on owner, operator, mentor and executive with the ability to set the vision and execute to deliver success. His experience as a senior executive and principal in technology and numerous technology-related industries—such as fintech, human capital management and media—gives him the ability to envision and build enterprise value. Suri identified the unique opportunity to fill a void in the mortgage industry, where a lack of visibility in managing fraud and risk existed. He created a disruptive fintech solution to provide the industry with real-time, intelligent, actionable data to prevent title and wire fraud risk to deter from first-party fraud and cyber-based, third-party threats. Under Suri’s leadership, FundingShield has been able to onboard strategic partners and clients to participate and deliver industry-specific, client-centric solutions that are scaleable, malleable, cloud-based and available at the transaction level with loss coverage. He has invested, cultivated and built a team to deliver a sustainable and relevant solution. Suri’s expertise and dedication to FundingShield have resulted in company revenue and client growth and profitability of more than 400% year over year. As one of the companies with the most impactful technology in the housing industry, FundingShield was a HousingWire Tech100 winner in both 2019 and 2020. HousingWire’s inaugural 2019 Tech Trendsetters award recognized Suri as one of the industry’s top 50 professionals behind the most innovative technology driving the housing and mortgage industries.
TONY THOMPSON founded the National Association of Minority Mortgage Bankers of America in 2016 with a vision to positively grow, develop and improve the industry by introducing women and minorities to the industry and investing in America’s youth to make them the leaders of tomorrow. Every year since inception, Thompson has grown NAMMBA not only in presence and branding, but in chapters and members across the U.S. and in recognition and corporate sponsorship by some of the industry’s largest organizations. He created a formal strategic partnership with the Mortgage Bankers Association to collaborate on certain conferences and meetings and to produce industry advocacy and research designed to further a diverse workforce, including recruitment and professional development scholarships. He also signed a memorandum of understanding with the National Association of Women in Real Estate Business to create a new collaborative initiative aimed at making the industry more diverse and inclusive. Under Thompson’s leadership, NAMMBA launched an initiative called “Mission 2025” in which the company will connect with 50,000 students to bring them into the mortgage profession. It will seek more Millennials, minorities, and women. Thompson is also working to develop relationships with more than 500 colleges nationwide. He plans to establish NAMMBA chapters on college campuses and bring in industry speakers, partners and stakeholders to talk with students. Thompson has served as vice president of growth and strategy at Silverton Mortgage Specialists, where he ensures the company focuses on finding the right people to take the business to the next level. Over the course of the year, the company has grown from 150 to 300 employees.
What one habit has made a crucial difference in your success?
What’s the best advice you’ve ever received?
To always show up to play, contribute, coordinate, collaborate and deliver.
Show me who you associate with and I will tell you who you are. Associate and surround yourself with the people you wish to emulate and before you know it, it will be your turn to pass on the character and wisdom.
OCTOBER/NOVEMBER 2020
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Ike Suri
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David Townsend
Rick Triola
P r e s id e n t a n d C E O
CEO
Agents National Title Insurance
NotaryCam
DAVID TOWNSEND founded Agents National Title Insurance Company in 2005 to meet the needs of independent title agents. His leadership has grown the organization to a national title insurance underwriter. Incenter, a Blackstone Group portfolio company, acquired ANTIC and completed the deal in 2018. Townsend anticipated that being backed by Incenter would allow the company to grow. This year, ANTIC introduced an innovative title insurance decision engine that instantly delivers a clear-to-close title decision for more than 57% of residential refinance transactions and greatly reduces the time to close. Townsend has guided ANTIC during a time of unprecedented growth, as premiums have more than tripled in the last two years. He has led the company in growth, adding 25 state licenses in the past year alone. He has also grown premiums from $12 million in 2018, to $17 million in 2019 and now to an estimated $40 million in 2020. Under Townsend’s leadership, ANTIC utilizes some of the most stringent vetting procedures in the industry for prospective agents. Before an agent is allowed to represent the company, seven detailed steps must be taken. The company prides itself on upholding high standards of excellence. Townsend is a member of the board of the American Land Title Association and has been an adjunct professor of law at the University of Missouri Law School since January 2015, where his Title Insurance Practice course teaches students how to examine residential and commercial land titles and what it takes to insure properties.
RICK TRIOLA founded NotaryCam in 2012. Its industry-pioneering efforts made NotaryCam the first platform to execute a remote online notarization transaction in November 2012. In 2014, the company completed the mortgage industry’s first remote online closing. Triola continues to play a pivotal role in the advancement of RON through his tireless efforts as a grassroots advocate for RON legislation nationwide. Triola predicted that Florida would be a ripe market for RON due to its high concentration of international/remote buyers and sellers, vacation/second homes, and senior population. Thanks to his early anticipation of demand and preparations leading up to Florida’s Jan. 1, 2020, RON start date, NotaryCam was able to increase its monthover-month RON transactions in Florida by 100% during Q1 2020 without a hitch. This would prove to be excellent training for Triola and his team to manage the 300% increase in demand triggered by the COVID-19 pandemic. Nearly all states without RON legislation passed temporary measures allowing for RON at the start of the pandemic, and currently, 48 states and Washington D.C. authorize remote eNotarization either through an existing law, or emergency action. These emergency actions were able to be put in place so quickly due to the recommended uniform language Triola helped draft alongside the Uniform Law Commission. Furthermore, under Triola’s leadership, NotaryCam was able to offer the answer to completing real estate closing ceremonies amidst social distancing concerns, all while increasing the firm’s revenue more than 100% in the first two quarters of 2020.
What has been your secret to success?
What one habit has made a crucial difference in your success?
I have always believed in surrounding myself with the right people and giving them room to grow. My leadership style is based on collaboration and personal responsibility. I work with my staff to develop their ideas which help drive the company forward.
Focusing exclusively on each and every transaction – every NotaryCam customer receives a personal thank you message from me with direct contact information, asking “What else can we do better?”
OCTOBER/NOVEMBER 2020
Leslie Winick
CEO
C h ie f S t r a t e g y O ff ic e r
Total Expert
Mortgage Capital Trading
JOE WELU has dedicated nearly 20 years to improving customer engagement in the real estate and financial services industries, with an intense focus on attracting and delighting customers, using technology as a foundation for business growth. Welu founded Total Expert with the mission of helping top banks, lenders and financial services companies humanize customer engagement. Early on, he recognized a disturbing trend. When financial institutions leverage non-specific, non-targeted communications with their customers, they sacrifice the long-term relationship for short-term convenience. To restore the focus on customer experience, Welu turned his company toward bank, credit union and mortgage lending CMOs and loan officers—those who foster customer relationships that ultimately lead to a sale—to understand their needs and give them the necessary solutions to serve their customers, build better relationships, and ultimately grow their business. Under Welu’s lead, Total Expert has achieved numerous favorable outcomes within the last 12 months. The company experienced an increase of more than 24% in employee growth, surpassing 200 employees in 2019, with a current headcount of 241. It also more than tripled revenues with a total revenue growth of 3,206% over the last three years. Total Expert added a $52 million Series C round in October 2019, bringing the company to $86 million raised since its founding in 2012. The round, led by Georgian Partners with participation from Emergence and Rally Ventures, was one of the largest raises for a Minnesota company in 2019 and one of the largest in the state in recent history.
SINCE 2016, Leslie Winick has been a guiding force at Mortgage Capital Trading, codifying the firm’s vision, purpose and capability development in the secondary mortgage space, thereby fueling the success of nearly 300 mortgage lenders. She is a fervent champion of the mortgage lender. Her strong leadership and tenacious focus on client experience and outcomes have been instrumental in ensuring MCT advances relationships with key industry players, like GSEs, broker/dealers, aggregators and other secondary hedge firms. While Winick is responsible for detailing, communicating and reassessing the blueprint MCT uses for supporting its clients, she also ensures that MCT has the internal capability and capacity to drive change across the mortgage landscape. From new, cutting-edge technology innovations to industry-leading support, Winick helps define and prioritize what is needed most at a given point in time. She then actively participates in engaging, educating and mobilizing the MCT team to over-deliver on client expectations and set a high standard. Above all, Winick helped define and actively embodies MCT’s core values of drive to transform, community, trust, and humility. Winick’s lasting impact on the mortgage industry was of particular importance from March to April 2020, when the markets were under great duress. Winick offered daily, action-oriented advice including one-on-one calls, developed a rapid on-boarding process for non-clients to use MCT technology tools and more. All of MCT’s mortgage lending clients, non-clients and industry participants benefited from these stabilizing daily communications and actions.
What one habit has made a crucial difference in your success?
What has been your secret to success?
I make customers the hero of the story. We must constantly articulate how we help customers survive and thrive, which is everyone’s goal. Telling people how you’ll help them survive and thrive forces you to clarify, empathize and humanize your message.
Communication and active listening are the keys of success manifesting insights, leadership, and solutions. Communication produces strategic alignment for companies to be poised to fulfill their purpose. Furthermore, transparency engenders shared trust, collaboration, and success amongst professionals in the secondary market.
OCTOBER/NOVEMBER 2020
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Joe Welu
HousingWire’s top stories delivered to your inbox every day. Find the right fit for you: www.housingwire.com/newsletter
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Is the housing industry on a sugar high?
OCTOBER/NOVEMBER 2020
BY KELSEY RAMÍREZ
OCTOBER/NOVEMBER 2020
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Housing ecosystem could get worse before it gets better
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- no, I’m not beeping something out. These days, it seems those symbols are all the economic recovery scenarios that are possible as the U.S. looks to recover from the pandemic that has gripped our nation in 2020. For the housing market, that recovery could look different from the larger economy. In the Spring of of 2020, as stay-at-home orders spread across the U.S. and many businesses began to close, the housing market proved to be incredibly resilient, thriving amid record low interest rates and high consumer demand. Experts pointed out that while the housing market created the Great Recession of 2008, this time, housing was in the unique position to pull the economy through the pandemic-induced recession. TransUnion , the M or tgage B anker s Association, Black Knight and many other companies released data at the end of the summer showing that mortgage delinquency rates were slowing down. After jobless claims skyrocketed to more than 30 million at the start of COVID-19, many Americans took advantage of forbearance opportunities to survive the economic hardships brought on by the pandemic and the stay-athome orders that followed. By the end of March, mortgages in forbearance had jumped 1,396% in just one month. But the data at the end of the summer was encouraging, showing fewer Americans with a mortgage in forbearance and a decline in delinquencies. Economists such as White House Economic Advisor Larry Kudlow continue to argue we will see a V-shaped recovery in the U.S. and the worst is already behind us. But some housing experts warn there is a possible foreclosure crisis on the horizon, and have doubled down in their business lines as they prepare for this rise.
ATTOM Data Solutions’ RealtyTrac, a foreclosure listings and search portal, added industry veteran Rick Sharga back into its ranks in early August in a move that foreshadows what the company sees for its future. Sharga will oversee RealtyTrac’s marketing and public relations initiatives and implement new marketing strategies to increase brand awareness. Foreclosures declined to record lows in recent years, but RealtyTrac sees the potential for increased foreclosure activity due to the pandemic. Sharga isn’t new to the company, having laid the foundation for its internal and external communications program for eight years in the early 2000s. But the announcement of his return is a true sign of the times. “[Sharga] now returns at a pivotal moment, as RealtyTrac once again positions itself as the premier foreclosure listings and search portal,” the company said in its release. “In this role, Sharga will be responsible for developing and executing a strategic marketing plan to optimize growth and drive business development.” In the release, RealtyTrac General Manager Ohan Antebian also talked about ATTOM’s vote of confidence and strategic decision to re-invest in the foreclosure site, saying it will solidify awareness of the organization and its near-term modernization. “While currently the majority of banks are providing deferments for homeowners, many forecast that we will see a rise in the number of foreclosures when these provisions expire,” the company’s website states. “As a result, now is the right time to keep an eye on the foreclosure and real estate market trends.” In August, Sharga wrote a piece for HousingWire titled “The case against a foreclosure tsunami,” saying COVID-19 has disrupted the normal progression of a recession. In an
OCTOBER/NOVEMBER 2020
“Our foreclosure forecast model does predict a rise in foreclosure volume over the next few years, but not exceeding even 2019 levels until 2022 and peaking at 39% below the Great Recession peak in 2010.” –Rick Sharga OCTOBER/NOVEMBER 2020
we get a vaccine for COVID-19, which is looking more like it could be as early as the first half of 2021,” Blomquist said. “When prospective buyers regain some certainty and confidence in the world around them, the frenzied, almost panicked, buying we’ve been seeing over the past few months should start to subside. “Corresponding somewhat to the drop-off in demand will be a ramping up of supply: single family housing units started by homebuilders back in late 2019 and early 2020 — some may forget single-family housing starts increased to a more than 12-year high in December 2019 and nearly reached that same level again in February 2020 — and distressed sales starting to flow into the market, assuming the foreclosure moratoria are lifted and the forbearance programs end on schedule,” he continued. In March, Fannie Mae, Freddie Mac and the U.S. Department of Housing and Urban Development suspended all foreclosures and evictions for 60 days to ensure that people didn’t lose their homes as the coronavirus was shutting down the U.S. economy. That date has since been pushed back several times as the effects of the economic shutdown continue to linger. But because the date continues to move back, it is unclear at what point foreclosures might begin to increase, possibly creating a marginal spread. Sharga pointed out that factors such as individual states’ moratoriums and judicial proceedings could keep foreclosures from hitting the market all at once. Each state differs in foreclosure requirements, but they generally fit into two categories: judicial and non-judicial foreclosures. The timelines for foreclosure filings in judicial states are much more lengthy than their non-judicial counterparts. For example, as of the third quarter of 2019, timelines for homes foreclosed in the judicial states of Indiana, Hawaii and Nevada were all more than 1,500 days, or more than five years. Comparatively, foreclosure timelines in judicial states can be completed in a matter of months, such as 201 days in Virginia, 217 days in Montana or 229 days in Mississippi. Because of these vast differences, Sharga said that the timeline for foreclosures as a result of the pandemic is difficult to predict. “It may not feel as bad as the last crisis nationally, because it could happen in stages,” Sharga said.
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interview with HousingWire, Sharga doubled down on this position, saying an increase in foreclosures is highly likely, but that it won’t look anything like the crisis that unfolded in 2008 during the Great Recession. On any given year, an average number of foreclosures is about 1% of all mortgages, Sharga said. Just before the pandemic hit, the number of foreclosures had dropped to just 0.5%. As the foreclosure moratorium comes to an end (it has been extended to the end of 2020 for most mortgages), Sharga expects that number to rise to about 1.5% to 2% at the peak. For comparison, during the Great Recession, about 4% of all homes with a mortgage were in foreclosure. Another economist, Auction.com Vice President of Market Economics Daren Blomquist, says the housing market is on a “sugar high,” and that high will eventually have to come down. “The sugar high the housing market is riding will likely begin to wear off after the presidential election in November and even more so when
“I definitely think there’s going to be a dip. I think it’s going to happen in the later part of the year and it’s going to continue for a few years…”
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–Jarred Kessler Blomquist agreed there will be an uptick in foreclosures, but it will not look the same as what the market saw at its peak in 2010. “Our foreclosure forecast model does predict a rise in foreclosure volume over the next few years, but not exceeding even 2019 levels until 2022 and peaking at 39% below the Great Recession peak in 2010,” he said. “We define foreclosure volume as properties that complete the foreclosure process by either selling to a third-party buyer or reverting to the foreclosing lender at foreclosure auction.” On a HousingWire podcast, EasyKnock Cofounder and CEO Jarred Kessler said the housing market is strong for now as homebuyer demand is going up, however, he said the damage to the economy will cause that demand to trickle off. “I think [homebuyer demand] can continue to go up in the short term, but I just don’t think it’s sustainable,” Kessler said. “There’s too much damage in the economy in the underbelly right now, to where I believe it will eventually trickle into the real estate market. “I definitely think there’s going to be a dip,” Kessler continued. “I think it’s going to happen in the later part of the year and it’s going to continue for a few years…You can’t have an economy this damaged right now without having an effect to the housing market. Eventually it’s going to make its way through and you’re going to see a little bit of a panic in the market and you’re going to see inventory open up.”
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Sharga, however, said he is cautiously optimistic about the rest of this year, but said he is still waiting to see if the strong housing demand is simply pent-up demand that was not spent during the spring homebuying season, or if it will be sustainable for the rest of 2020. “March was actually off to a great start before the shelter-in-place orders,” Sharga recalled. “And then we saw April, May and June numbers fall pretty significantly. I’m wondering if July August and September are going to be this year’s April, May and June…the answer to that question will go a long way to your question about the economy. If we continue to see that type of sustained buying demand, I think I think it bodes well for the overall economy.” Sharga expects the growth to continue, saying strong demographic factors outside of the pandemic will also help the increasing homebuyer demand. “The biggest cohort of Millennials right now is between 31 and 32,” he said. “So, they are rapidly approaching that prime home-buying age. That’s millions and millions of prospective homebuyers and that will have a material effect. Anecdotally, we’re also seeing an acceleration of Millennials transforming from urban renters to suburban homeowners. And I think the pandemic has certainly accelerated that trend.” At the heart of the matter is the COVID-19 pandemic, which has brought unprecedented changes to the housing market and the economy overall. And if there’s one thing economists agree on, it is that the pandemic makes any kind of economic forecasting difficult. “The real variable here, as any economist will tell you, is what happens with the virus,” Sharga said. “Are we able to push out a vaccine at scale in the next few months? Will there be other medical treatments that come out that can mitigate the threat? Because until we know that, it’s hard to predict when businesses will not only be able to reopen but when people will feel safe enough to go participate.” In a separate interview, Ralph McLaughlin, chief economist and senior vice president of analytics at Haus, agreed, saying: “No housing analyst alive has seen the housing market perform during a pandemic.” McLaughlin noted that in this economic downturn, policy plays a much larger role in what’s going to happen with the health of the housing market than fundamental economics.
And the latest discussions about new benefits And even websites like RealtyTrac aren’t putting all their eggs in one basket: The company in Congress have not been promising. Unable is not just looking at the foreclosure market as to come to an agreement and unwilling to forgo it plans its expansion. With Sharga at the helm, their summer vacation plans, Congress allowed it is also exploring other areas where it could the CARES Act, and therefore eviction moratobranch out, even other areas of real estate in- riums, to expire in July. This also ended extra vestment, including some small multifamily unemployment benefits and other economic boosts to help Americans during the governproperties. “There are other types of properties besides ment-imposed shutdown in many states. In August, President Donald Trump signed foreclosures that represent good investments, whether those are properties that are currently an executive order and three memorandums listed on the MLS or digging into public record aimed at providing relief to Americans sufferdata to take a look at properties that might rep- ing from the economic fallout of the COVID-19 resent an untapped investment opportunity,” pandemic. One memorandum deSharga said. ferred through the end of “Maybe even including the year, for employees sort of the low-dollar commaking less than about mercial assets that most of $100,000 a year, the paythe commercial websites roll taxes that are used to kind of ignored because fund Social Security and everybody wants the $20 Medicare – but it doesn’t million office building, but cancel the taxes. He also not necessarily that gas provided an extra $400 a station in Akron, Ohio. week for people receiving “We’re still formulating unemployment benefits and those plans,” Sharga coninstructed federal departtinued. “But the reality is ments to consider and rethat the majority of investview ways to keep renters in ments that people make in their homes through existreal estate are not forecloing government programs. sures. And I think we have “Although the foundation an opportunity because of of the U.S. housing market the wealth of data that our is strong, grounded in solid parent company, ATTOM long-term fundamentals, Data has, to be able to put some of the gauzy houstogether a really compre–Ralph McLaughlin ing numbers of the last few hensive web platform that months are more flimsily lets investors find those built on shorter-term debigger deals.” mand stimulants — fear For now, the latest data from Black Knight is already beginning to show caused by the virus and the allure of falling mortincreased delinquency rates. The number of gage rates — along with shorter-term restriction seriously delinquent mortgages, meaning pay- of supply — homeowners gun-shy about listing ments overdue by 90 days or more, soared to in a volatile economy, and distressed supply a 10-year high during July in a tally that counts held back by foreclosure moratoria and forbearance programs,” Blomquist said. forbearances. The COVID-19 pandemic is bringing unprecThere were 2.25 million home loans that were seriously delinquent that month as borrowers edented changes to U.S. homeowners, renters, took advantage of a provision of the CARES Act small business owners and even some large that allows people impacted by COVID-19 to businesses are struggling with no clear vision suspend payments for up to a year, according as to what turn the economy will take next due to, as McLaughlin stated, the role policy plays to a Black Knight report. “Serious delinquencies were up 20% from in the overall health of the economy. Experts continue to look at the economy with a June and are now the highest they’ve been since early 2010,” Black Knight said. “In total, trained eye and analyze the trends, but predictserious delinquencies are now 1.8 million over ing the direction of the market during an unprecedented pandemic could prove impossible. pre-pandemic levels.”
“No housing analyst alive has seen the housing market perform during a pandemic.”
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Investors turn their eyes to affordable opportunities Community leaders look to elevate its case
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BY JOANNE CLEAVER
OCTOBER/NOVEMBER 2020
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About the Author: Joanne Cleaver has been producing stories since 1981. Cleaver began her career as a freelance business journalist by writing for Crain’s Chicago Business. In 2004, Cleaver joined the Milwaukee Journal Sentinel as a deputy business editor. Today, she manage projects to advance women in the accounting, transportation and other industries.
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he COVID-19 pandemic redefined “home” for many Americans and underscored the bedrock necessity of affordable housing for seniors, families and essential workers. As the pandemic shifts from crisis to chronic, investors, community leaders and housing advocates say they intend to make the most of the chance to permanently elevate the case for affordable housing even as economic metrics are starting to shift. The public and policymakers appear to be unflagging in their understanding and support for workforce housing, especially for essential workers, recognizing its pivotal role in community operations, said Brian Coffee, senior director for community investment capital for Synovus Bank, in Birmingham, Alabama. “We’re seeing statistics from our developers across the country that their portfolios are holding up well,” he said. “There’s a growing sense that affordable housing is a stable investment class for banks and insurance companies; even in the 2008 – 2009 recession, it held up well.” A recession precipitated by a pandemic is new territory and traditional patterns likely will face unanticipated factors, especially as states and municipalities enter an excruciating budget cycle said Coffee. For instance, it’s possible that housing tax credits and other supports for affordable housing could be sacrificed or functionally negated by property tax increases. State and local officials concur: the unusual confluence of public health, faltering businesses of all sizes and dramatically different use of public services, such as transportation, will almost surely force creative strategies for expanding affordable housing. Entering the fourth quarter of a chaotic year, consumers appeared to be managing their finances with common sense, as much as they could. The influx of cash to consumers early in the pandemic kept rent payments flowing, all agree. Overall consumer debt edged down by 1% in the second quarter, according to the Experian Consumer Sentiment Index. A poll conducted in August by the Associated Press/NORC Center for Public Affairs Research found that two-thirds of Americans are spending “less than usual;” 45% are saving “more than usual;” and 26% have been paying down debt faster than they usually do. For many, sheltering in place meant staying put, which dampened demand-driven rent increases. CoreLogic reported in mid-August that rent prices for single-family houses increased
only 1.4% in June, compared to a 2.9% rise in June 2019 over the prior 12 months. Single-family rentals account for half of the rental housing stock, according to CoreLogic. Builders of multifamily housing, including affordable housing, remained glum in the middle of 2020, according to a survey by the National Association of Home Builders, based in Washington, D.C., based on both flaccid production and slightly rising vacancies. EVOLVING RISK, EMERGING RESPONSE Affordable housing developments are a long-term play, usually affected little by short-term economic travails. But as pandemic economic stress fractures start to crack, investors, developers and governmental officials will adjust accordingly, say affordable housing finance experts. Even as pandemic realities heighten the urgency for workforce housing, developers, investors and finance companies are puzzling through the resources to respond as rapidly as possible, said Beth Mullen, who heads the affordable housing industry practice for New York-based CPA firm CohnReznick. “The good thing is that the folks who build this housing, they always have a large pipeline of deals they want to do, but it takes time to ramp up,” she said. “The real bottleneck is that federal resources are limited. The low-income tax credit program can only build so many units. States and cities are repurposing dollars to housing, but the challenge is that many of those dollars are going to emergency shelter.” As the economic toll of the pandemic-induced recession continues to mount, the effects of unemployment and the collapse of small businesses will start to ripple through developments’ cash flow, Mullen predicted. Though renters typically try as hard as they can to stay put, say advocates and experts, paying rent above other bills, the widespread economic pain could undermine even the most determined families. If family income declines, investors and operators will have to reconsider the benchmarks for what families are expected to pay, potentially entertaining the concept of dollar thresholds rather than percentages of income, Mullen said. Investors examining deals through August were “more diligent about stress-testing,” said Mullen. “What happens if vacancies are 10%? What happens if operating expenses go up by X percent? What happens if we can’t raise rents for several years?” Bearing in mind returns reliably in the range of 4.75% to 5.25%, investors are both more interested and more skeptical of projects framed by tax credits, said Bill Shanahan, co-president of Evernorth, a nonprofit fund that serves Vermont, New Hampshire and Maine. Investors are fine-tuning their must-have lists, seeking greater liquidity and “cleaner” deals, he explained. “If they can get a 9% tax credit deal on new construction, that’s what they want,” Shanahan said. “They don’t want an acquisition
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As the pandemic shifts from crisis to chronic, investors, community leaders and housing advocates say they intend to make the most of the chance to permanently elevate the case for affordable housing.
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with tenants in place and worrying about COVID affecting tenants and construction delays...We’re seeing a much deeper dive into the stresses that deals are put through, as we bring those to market.” As long-term implications of short-term shocks start to emerge, investors will, of course, align budgets accordingly, said Thomas Stagg, a partner with Novogradac & Co., a San Francisco-based CPA firm with a large affordable housing practice. “Now that we’re looking forward to a few years of potentially decreasing or flat income limits, how will that impact projects’ abilities to remain solvent?” he asked. While projects are continuing, the industry has its fingers crossed that Congress will lock in a 4% floor for credits, “which hard-wires a minimum credit percentage that would result in more tax credits per project, which would be a tremendous benefit to projects facing increased construction pricing and longer construction cycles, due to worker social distancing,” Stagg said.
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NEW USES, NEW DESIGNS Mandated telecommuting, homeschooling and curtailed activities add up to different demands for developments. Developers and officials are plotting ways development design can support objectives for providing safe, functional housing for working households. “We have to pay attention to how tenants are supported. We have to help them transition through the pandemic so they can be or remain valued tenants,” said Flynann Janisse, executive director of Rainbow Housing Assistance Corp., and president of the Equality Community Housing Corp, based in Phoenix. “The preservation of affordable housing depends on investors creating viable environments that foster growth, and that includes a livable wage. The returns to owners come from stabilization of the tenant base. Certainly, the financial impact is a factor impacting own-
Bearing in mind returns reliably in the range of 4.75% to 5.25%, investors are both more interested and more skeptical of projects framed by tax credits.
ers and investors. These are long-term investments that require stabilization.” Janisse already sees closer collaboration of operators and work skills training and job placement programs, as swaths of displaced workers gravitate to rapidly growing sectors of the economy. Some Rainbow-affiliated programs took training virtual to help clients find a new way forward in the midst of layoffs and economic turmoil. Tenants’ focus on staying employed must be matched by operators’ delivery of reliable broadband, precisely to support clients’ access to training and employers. “Any excess funds that a low-income person had is generally invested in cell phones, transportation, food and emergency needs, and wants versus needs in some cases.” Janisse said. “Much of the tax-credit-related housing being built these days has a service component to it,” Mullen said. “If it’s for seniors, there’s a service coordinator who helps keep the residents healthy. In developments for families, it’s after-school programs, or, depending on the tenant population, it might be classes for English as a second language.” The amount of space allotted to families might have to change as a matter of public health, according to analysis by the Harvard Joint Center on Housing. Workers whose jobs entail sustained close contact with others – such as health care and retail – are more likely to be minorities, often living in moderate-income, multi-generational families. That means, the analysis indicated, that allowing space for self-isolation (as required when exposed to COVID-19) directly frames workers’ ability to quell the spread of disease to both the public and to vulnerable family members. Classic assumptions about where to best locate affordable housing might change, too, as commuting habits reset. Academics at Rensselaer Polytechnic Institute studied consumers’ daily habits during the height of the pandemic lockdown and documented a 60% drop in monthly trips related to work and, that consumers anticipate that their work-related travel will permanently drop by 8.2%. Similarly, the academics found that consumers predict that grocery delivery will permanently rise by 63.8%. In Maine, the pandemic sharpened the state’s escalating goal of collaborating with municipalities to carve affordable housing from an aged and, often, obsolete housing stock. Persuading independent municipalities to get on board is much more carrot than stick. “We’ve always had a great relationship with housing developers, but we haven’t much explored relationships with municipal leaders,” said Daniel Brennan, director of MaineHousing, the Pine Tree state’s housing finance agency and administrator of several federal housing programs. The agency has had some success incentivizing private, single family developers to include a few modestly priced ($200,000 to $250,000) houses in each subdivision. MaineHousing expanded the concept to offer grants of up to $500,000 to municipalities to craft their own incentive programs, reflecting local redevelopment and economic development priorities – an approach that dovetails with the state’s acute need for workforce housing. “We don’t tell people what to do,” said Brennan, referencing
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Aff ordable housing advocates take issue with President Donald Trump’s tweet on July 29 that suburban residents would no longer have to worry about being “ bothered or financially hurt by having low income housing built in your neighborhood.” The tweet was occasioned by the president ’s directive to the U.S. Department of Housing and Urban Development that the agency revoke the 2015 Aff irmatively Furthering Fair Housing rule, which required community leaders to proactively address housing discrimination. The truth is quite the opposite, Janisse said, because low and moderate income workers provide exactly the service-intensive amenities that suburbanites crave. A Harvard Joint Center on Housing study found that aff ordable housing distributed in middle income neighborhoods permanently helps working families and also has a positive impact on longtime residents. “ You can’ t negate the ability of people to live and work in their community, where service workers are a necessity,” Janisse said.
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“We have to pay attention to how tenants are supported. We have to help them transition through the pandemic so they can be or remain valued tenants.”
independent-minded local officials. “But we say, ‘we have significant resources and expertise...if you have a vision, we’d like to help you get there.’” One early success story is playing out in Biddeford, in the Portland metro. Traditionally one of the few cities with affordable, if unattractive, housing, the city zeroed in on a program that helps new homeowners buy small multifamily units and improve them, both building family equity and the affordable housing stock in the process. And last year, the Maine legislature approved a new funding structure for the agency, a new state tax credit for low-income housing. “Investors look to Maine and see that there’s lots of demand,” Brennan said. “We’re oversubscribed on the tax credit program.” Even small municipalities like Oxford, Mississippi, population 25,000, are realizing they must quickly ramp up workforce housing in some way. Mayor Robyn Tannehill said that the city is too small to afford direct assistance, such as rent subsidies for households hit hard by layoffs in two of the sectors most important to Oxford’s economy – academia and tourism. But every downturn has an upside, said Tannehill: “Perhaps our biggest potential for the next few years is an overabundance of purpose-built student rental housing. How do we translate that into some type of rental at prices that are lower, and putting those units into a workforce housing pool? “As a city leader, I feel it’s our duty to provide a healthy and safe place to live for everyone in our community,” Tannehill said. “The ROI metric I would use is, have we enacted sustainable policies that create a healthy and safe place to live?”
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A fa r fro m n o r m a l d o w n tu rn: O rig in a tio n s versus delinquencies OCTOBER/NOVEMBER 2020
A tale of m ark ets
two
About the author: Rohit Gupta is President and CEO of Genworth’s U.S. Mortgage Insurance Business. Along with his advocacy, Gupta served as chairman and remains a board member of the U.S. Mortgage Insurers trade association. He also serves on the boards of the Mortgage Bankers Association Residential Board of Governors and Housing Policy Executive Council.
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By Rohit Gupta
C
OVID-19 is a
historically unique event
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for the mortgage industry. Typically, during a crisis or catastrophic event that impacts the housing industry, you’d see a significant downtick in mortgage originations and an uptick in delinquencies, ultimately leading to f o re c l o sure s . H oweve r, t h e
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C O V I D -19 p a n demic has been a unique crisis to not only live in and learn to work through, but also to follow as it relates to the mor tgage b u s i n e s s . M a ny factors have contributed to the type of downturn we’re seeing – one that’s far from normal.
PANDEMIC REALITIES (SO FAR, ANYWAY) Lenders are experiencing higher delinquencies due to the number of borrowers
in forbearance as a result of the tens of millions of Americans that have filed for unemployment over the past few months
Ultimately, the effect of the pandemic on the housing market could very well end up playing out exactly how we expected.
and the availability of federal forbearance programs. Black Knight reported that in August, 7.5% of all active mortgages are in forbearance. That part we expected. What we did not expect was, with historically low interest rates, new mortgage originations remain high as many existing homeowners were driven to refinance their mortgages and renters were considering making the jump to homeownership. It’s a tale of two markets. On one hand you have employed borrowers who are
able to take advantage of purchasing a home or refinancing an existing mortgage. And on the other hand, in a very different market, unemployed borrowers have access to programs that can assist them in keeping their homes, such as forbearance and payment deferral. While one market is seeing signs of health, the other is seeing signs of distress. Typically, the front- and back-end of the mortgage industry are not busy at the same time, which makes this particular event incredibly unique. While housing inventory remains tight across the country, COVID-19 has not deterred the purchase mortgage market. WHAT’S DRIVING THIS DICHOTOMY? There’s a clear dichotomy between the strength of the origination market and mortgage delinquencies, but what’s driving it? Low interest rates, the difference in unemployment between geographies and industries and even stay-at-home orders all have contributed to this contrast we’re living and working through. Low interest rates: Lower interest rates helped make housing more affordable, especially for borrowers who had been sitting on the sidelines, waiting for an event to help push them into the mortgage market. The decline in interest rates gave potential homebuyers more reason to buy. Over the first half of 2020, mort-
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PANDEMIC EXPECTATIONS In trying to wrap our arms around the COVID-19 pandemic, we expected to experience a decline in mortgage originations. Mortgage industry participants ran scenarios reflecting a decline in originations, a decline in overall revenue and generally-speaking, an overall decline in housing activity, along with an increase in loans in forbearance and ultimately in delinquencies. That’s generally how a crisis impacting the housing industry works. As jobs are lost and incomes diminish, people stop buying homes and the rate of requests for forbearance or some type of homeowner assistance goes up. The mortgage industry flips the switch from helping people get into homes to preparing to work closely with homeowners to help them remain in their homes. Ultimately, the effect of the pandemic on housing could end up playing out exactly how we expected. We’re keeping a close watch on how the pandemic is impacting customers, employees and the overall business of doing business. Interestingly, though, what we are seeing so far is not in line with those expectations.
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gage rates were down 80 basis points from the year before, saving borrowers over $1200 a year on a $250,000 loan. The lowest mortgage interest rates on record enabled a large number of borrowers to refinance. Weekly refinance applications ranged from two to six times last year’s number. Interestingly enough, apartment rental growth turned slightly negative in the first quarter (down 0.2% annually), as it became a less attractive option when compared to homeownership. According to Freddie Mac’s Quarterly Refinance Statistics report, on average, borrowers who refinanced their first lien mortgage in the first quarter of 2020 lowered their rate by about 0.75 percentage points. A year earlier, refinance borrowers only lowered their rate by 0.15 percentage points on average. The report also states that during the first quarter of 2020, borrowers saved on average close to $2,000 in annual interest payments by refinancing, though the amount saved differed significantly by refinance purpose; borrowers who refinanced in order to lower their rate or extend the term of their loan saved on average about $2,300 in annual interest payments while cash-out borrowers saved on average less than $1,000 in annual interest payments. Unemployment by region and industry: Most borrowers that experienced unemployment had the option of entering into a forbearance plan, thereby stabilizing the for-sale market, at least for now. At the end of the forbearance period, some borrowers will be able to transition into a modified loan and avoid foreclosure. However, anecdotally, we’re hearing that once borrowers realized that forbearance didn’t mean forgiveness, they were less interested in entering into forbearance. While the labor market remains fragile with an unemployment rate at close to 10%, how that percentage impacts homeowners and forbearance activity is very uneven. Higher hit areas for COVID-19 forbearance and delinquencies include the states and metros that have higher numbers of COVID-19 cases or where efforts to contain the virus through lockdowns were more severe. For example, states such as such as New York and New Jersey had high numbers of cases and states like California acted early to impose restric-
tions to contain the virus’ spread. Selfemployed borrowers and certain industries such as travel, tourism, hospitality, and personal services (think hair and nail salons) have also been harder hit. According to the June data from the Bureau of Labor Statistics, states frequently visited for their hospitality, entertainment and gaming appeal, like Nevada and Florida, are experiencing some of the highest levels of unemployment in the U.S.: upwards of 15%. Whereas most midwestern states, while still impacted by the effects of COVID-19 though less populated than California, Florida and Texas, are reporting significantly lower unemployment rates, between 4.3% and 7.4%. If you look at unemployment through the lens of income level, 40% of households earning below $40,000 in annual income reported a job loss in March. To take it a step further in terms of education level, households that have earned bachelor degrees and above saw an unemployment rate of 6%, versus those households that have obtained high school degrees or less who experienced upward of 25% unemployment. COVID-19-related job losses also have disproportionately affected Black and Hispanic communities. The Wall Street Journal’s Real Time Economics Special Report reported that Black and Hispanic populations were experiencing unemployment levels between 13% and 15% in July. You see the same unevenness reflected in the broader commercial market, as companies like Amazon, Microsoft and Netflix are experiencing record market value and stock increases as their services are being used even more frequently. On the other side of the industry coin, popular retailers like J. Crew and JCPenney, who you wouldn’t have thought would be struggling during a normal downturn, have had to declare bankruptcy. There are various indicators during this cycle that show the impact of this particular downturn is significantly more targeted, concentrated or selective than we’ve seen in the previous downturns. Stay-at-home orders: Nationwide stay-at-home orders also affected the housing market, especially between March 15 and April 12 where the number of purchase applications were down 33%.
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Most borrowers that experienced unemployment had the option of entering into a forbearance plan, thereby stabilizing the for-sale market, at least for now.
However, since April 12, the purchase market increased by 59% and was up 16% compared to mid-July of 2019. Stay-at-home orders implemented across the U.S., school closings and a rapid transition to work from home have made our homes an even more functional part of our day-to-day routines. If the work-from-home environment remains for a significant period of time, many families are even rethinking their current space and what they may need that they don’t currently have, such as office and educational space. For those who are able, this may serve as a reason to purchase a new home or refinance in order to gain the ability to remodel or make at-home adjustments. HOW THE MARKET IS DEALING WITH THE DICHOTOMY The number of COVID-19 cases has been rising since the middle of June, which has resulted in pauses and reversals in re-openings and more voluntary social distancing efforts across consumers and businesses. As of June, Black Knight reported an increase of 1.2 million homeowners in serious delinquencies as the initial wave of borrowers impacted by COVID-19 missed their third mortgage payment. This could eventually result in higher foreclosures and more foreclosure sales in the housing market.
WHAT’S NEXT? With so many questions swirling throughout the mortgage and housing industry, industry leaders are wondering how lenders will treat borrowers who come out of forbearance and apply for a new mortgage, and most Americans are wondering what the rest of 2020 looks like for them from an unemployment and economic stimulus perspective. As an industry, there are a few ways we can make the most of what we have to ensure success as we take steps to recover and prepare ourselves for 2021. First, we need to make sure that we tailor our actions to the respective markets. On the front-end of the market, even though it’s a large market and many are currently working in a virtual environment, that doesn’t mean that we change our credit or underwriting standards. Underwriting rigor, holding the right amount of capital, and making sure we have strong counterparties should all still be processes and activities in place on the front-end to ensure that we are still putting qualified borrowers in homes they can afford. Even if we’re doing virtual ap-
praisals in this environment there are still ways to make sure we’re taking the right precautions to ensure we’re originating good loans. That same rigor can help all of us navigate through the cycle and hopefully give us optimism that as an industry we can come out of this cycle relatively quickly. Second, we need to make sure that we use the playbook from the last downturn to help guide the path forward. For people who are financially distressed, have lost their income and are going through the forbearance program, it’s imperative that mortgage professionals and com-
we simply cannot allow all the action we took coming out of the last crisis to help homeowners on the backend be in vain.
panies are providing the right help to those homeowners to help them stay in their homes. As recorded by Genworth Mortgage Insurance’s Chief Economist Tian Liu, the last recovery showed the industry’s ability to adapt and innovate during a downturn. For example, some investors realized that people who lost homes to foreclosure or those who could
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not buy because of tight credit standards still needed a place to live. This gave rise to investor-owned, single-family rental businesses. Nonbank lenders also seized their opportunity when bank lenders reduced their participation in the mortgage market, and these nonbank entities represent a major segment of the mortgage industry today. Because housing is such a fundamental part of people’s lives, disruptions within the housing industry will give rise to alternatives to meet those same needs. Third, we must embrace the innovation that tends to accompany market disruptions like this one. The biggest lesson we learned from the past recession is that we should remain agile and recognize that a severe disruption to the economy and the housing market calls for change. For example, there were new policies and services, and enhancements to existing policies, born out of the 2008 financial crisis, including automated income and employment verification, Private Mortgage Insurer Eligibility Requirements that strengthened the mortgage insurance industry’s risk and capital standards, and credit risk transfers from the GSEs to private investors. Disruption naturally creates a path to innovation. Given what we’re experiencing in the market, we need to have the right discipline on the front-end and we simply cannot allow all the action we took coming out of the last crisis to help homeowners on the back-end be in vain. We can’t ignore the part of the population that’s struggling just because there’s a lot of volume on the front end. We also can’t be tempted to fall back to the practices known for producing shortterm success, but instead we must work to put the industry in a position to manage another round of challenges down the road. Now, more than ever, it’ll be critically important that we’re taking our lessons from the past, coupled with our current programs and an innovative mindset, to help order our next steps. The statements provided are the opinions of Rohit Gupta and do not reflect the views of Genworth or its management.
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According to data from the Mortgage Bankers Association, home purchase applications rose 54% from early April to mid-summer. To address both these phenomena, we’re seeing credit availability tighten as lenders raise minimum credit scores, lower maximum debt to income ratios, and exit certain products not backed by the U.S. government in an effort to manage both the influx of business and their long-tail risk. Additionally, verifying borrowers’ income and employment prior to loan closing has become increasingly challenging with some borrowers’ incomes or income histories being affected as well as many offices being closed where all or most of the employees are working from home. Determining an appropriate qualifying income is becoming more subjective as underwriters have to make judgments on whether pay reductions, furloughs and other events are temporary or long-term events to be considered.
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Origination Platforms and Solutions Special Reports
With this year’s record-low interest rates and spikes in mortgage applications, it’s more important than ever for lenders to be able to work efficiently to handle increased volume while maintaining compliance. Several tech companies offer loan origination solutions that help lenders improve their process speed, efficiency and quality while meeting borrower expectations for a digital experience. In this section, we feature six companies providing platforms and solutions to streamline the front end of the home buying process for everyone involved.
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Altisource.....................................................86 Black Knight..................................................87 CoreLogic......................................................88 Mor tgage Cadence..................................................89 Origence..................................................90 Tavant..................................................91
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- SPECIAL REPORT -
- SPECIAL REPORT -
Sponsored Content
ALTISOURCE altisource.com
THE EXECUTIVES:
BEN HALL, VICE PRESIDENT OF PRODUCT BenHall has17yearsof experienceinthereal estate and mortgage industries and leads multiple subsidiaries for Altisource.
BRIAN SIMON, PRESIDENT OF TRELIX AND CASTLELINE In addition to his work at Altisource, Brian Simon also leads Lenders One Cooperative, anational allianceof independent mortgage bankers.
Get the edge you need in today’s world with innovative origination solutions fromAltisource
S
ince the pandemic hit, lenders have been shifting operational processes to meet the changing loan needs of their customers. Altisource is here to help. The company has evolved its full suite of services and products to help originators and correspondents adapt to a world that must now connect remotely to succeed. Altisource believes in helping clients stay ahead of changing industry demands and challenges with innovative solutions and technology. That’s especially true now. Its solutions are customizable to help give clients an edge in today’s uncertain market. Whether you need eClose options, automation or increased capacity capabilities, Altisource’s deep industry knowledge, proven experience and customer-centric strategic approach can help. Here are a few of the solutions Altisource offers: INCREASED CAPACITY MANAGEMENT Trelix helps increase mortgage fulfillment productivity and customer satisfaction by helping companies adjust to constantly fluctuating business demands with a global supplemental team of skilled mortgage associates. Quickly scale your operations by integrating onshore, offshore or blended capacity personnel seamlessly with your customer, client and employee workstreams.
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CONVENIENT ECLOSE SOLUTIONS Despite social distancing, there is still a significant need for new and refi closings. Since 2018, Premium Title has helped clients electronically close nearly 10,000 transactions. The company recently expanded its suite of convenient remote capabilities to include hybrid eClose, total eClose and remote online notarization (RON) in approved states. STREAMLINED CONSTRUCTION PROCESSES
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Construction Title Pro (CTPro) is a nationwide title platform built to streamline highly fragmented processes while reducing costs. Powered by Premium Title and Granite Risk Management, it provides a single destination for all construction title and settlement work. CTPro helps standardize order placement, expedite delivery and simplify status tracking. INTEGRATED VALUATION SERVICES HomeVal, a Premium Title and Springhouse Valuations HELOC Hybrid solution, provides a full suite of customizable, low cost products delivering precise title search and valuation data with greater speed and ease. Delivered in one consolidated report, HomeVal can significantly mitigate risk for HELOC lenders and standardize the investment property closing process. “Now more than ever, lenders need origination services that do more than save time, lower costs and drive operational efficiency,” Altisource Vice President of Product Ben Hall said. “They also need a trusted source who can help deliver exceptional experiences for every customer. We are your one source for every solution you need.” “Altisource is deeply committed to solving the unique business challenges clients face today so they can keep moving forward and get results fast,” added Brian Simon, Trelix and Castleline president. CUSTOMIZED ORIGINATION SOLUTIONS • Trelix Mortgage Fulfillment Services • Premium T itle and Settlement Services • Springhouse Valuations • Vendorly Third-Party Oversight • CastleLine Insurance Services • Lenders One Cooperative Visit Altisource.com now to discover how its solutions can help you.
- SPECIAL REPORT -
Sponsored Content
T
ech can significantly ease many pain points in the origination process, but lenders may find that the time, cost and complexity of implementation make adoption difficult. Black Knight solves this challenge with the Empower loan origination system (LOS) and its implementation model – Empower Now! The Empower Now! model offers reduced implementation timelines, costs and complexity, which means lenders can gain the benefits of Black Knight’s powerful, best-in-class LOS more quickly and easily. This unique deployment strategy can help regional banks, credit unions and independent mortgage bankers start using new technology in just a few months. The Empower LOS offers lenders advanced features such as configurable workflows, intelligent automation, exception-based processing, embedded compliance testing and web APIs. Its integrated capabilities include digital point of sale, loan officer workspace, a modern pricing engine, comprehensive closing-fee service and actionable intelligence. These features enhance the user experience for both borrowers and loan officers. Empower’s point of sale solution guides homebuyers through the prequalification and application process, and loan officers can follow the borrower through these steps using the intuitive dashboard. The solution also provides loan officers with a single access point for products, pricing, pipeline information, rate-locking capability and more, which simplifies their work. Empower uses advanced process automation to perform numerous tasks that do not require the need for human intervention, creating process efficiencies that reduce the overall cost per loan. Service
integrations such as flood, appraisal and title can be handled lights-out, as well as the monitoring of closing-fee changes and generation of re-disclosures. The solution’s task- and exception-based workf lows help lenders significantly streamline processes for their employees. Its intelligent, end-to-end automation stretches across the entire origination lifecycle to reduce manual tasks and errors, decrease cycle times and enhance data consistency. The LOS systematically evaluates changes in loan data and alerts staff when a loan review is needed, helping decrease manual intervention and accelerate turn times. The Empower LOS integrates with several of Black Knight’s innovative data and analytics solutions and its industry-leading MSP servicing system for straight-through processing. Lender-configurable loan-level state and federal compliance testing can be embedded directly into the LOS workflow, assisting lenders with addressing their compliance requirements. And, as lenders look for ways to effectively scale their business, Empower can support monthly originations ranging from 100 to more than 10,000, which gives lenders the ability to continue to grow their business while avoiding the need to constantly increase staffing levels to keep up with growth. “Empower offers everything that a lender needs on one comprehensive, integrated LOS to help dramatically increase efficiency, reduce origination costs and enhance the consumer experience,” said Richard Gagliano, president of Black Knight Origination Technologies. “And because Black Knight continually invests in Empower, our LOS supports lenders’ needs today and in the future.”
BLACK KNIGHT, INC. BlackKnightInc.com
THE EXECUTIVES:
ANTHONY JABBOUR, CHIEF EXECUTIVE OFFICER As CEO, Anthony Jabbour is responsible for thecompany’soverall visionanddirection, as well as management of Black Knight’s offerings for many of the nation’s largest lenders and servicers.
JOE NACKASHI, PRESIDENT, BLACK KNIGHT JoeNackashi is responsiblefor overall strategic direction and ensuring that Black Knight maintains a laser focus on clients and delivers the solutions that help themachieve greater levels of success.
RICHARD GAGLIANO, PRESIDENT, BLACK KNIGHT ORIGINATION TECHNOLOGIES RichardGaglianois responsible for the overall strategy and product direction of Black Knight’s origination technologies.
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Black Knight’s Empower LOSis able to support monthly originations ranging from100 to more than 10,000
- SPECIAL REPORT -
Sponsored Content
CORELOGIC CoreLogic.com
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SAGE NICHOLS, EXECUTIVE OF CLIENT AND BUSINESS DEVELOPMENT, CORELOGIC COLLATERAL TECHNOLOGY
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SageNicholsisresponsiblefor drivingorganicrevenuegrowthandthought leadershipfor thecollateral platformtechnologysalesteam at CoreLogic.
CoreLogic AutomatIQCollateral provides lenders a single point of access for property underwriting data
D
espite significant technology investments, it actually takes longer and costs lenders more to originate a loan today than it did 10 years ago. AutomatIQ Collateral from CoreLogic helps lenders reverse these trends by delivering the data and analytics they need to validate property ownership, value, condition and hazards on one platform. AutomatIQ C ollatera l, pa r t of CoreLogic’s AutomatIQ Suite of Digital Mortgage Solutions, serves as a single point of access for crucial property underwriting data. The solution provides lenders with powerful collateral review tools and comprehensive property profiles that deliver critical decisioning information for underwriters, yielding faster decisions and greater confidence in outcomes. I N T E G R AT E D A N D I N T E L L I G E N T COLLATERAL UNDERWRITING AutomatIQ Collateral is a single underwriting system built on automation and analytics and powered by the industry’s most reliable and current collateral data and insights. The solution contains everything needed to make a collateral underwriting decision, with property profiles that turn complex valuation reviews into more focused tasks, powering more efficient underwriting reviews. By applying intelligent automated workflow rules, AutomatIQ Collateral brings structure to what has traditionally been an unstructured process. The system helps underwriters identify and fast-track their verifications of low-risk properties, enabling them to focus their resources more efficiently, leading to accelerated workflows and reduced costs. At the same time, it alerts lenders to higher-risk properties and potential red flags earlier in the process. AutomatIQ Collateral helps lenders simplify their origination workflows, reduce their costs to close and improve their overall loan quality.
OCTOBER/NOVEMBER 2020
Users benefit from earlier indications and analysis of potential “red flags,” a variety of value analytics and real-time natural hazard information that impacts closings and their broader loan portfolios. The platform’s workflows can be configured to GSE requirements or any investor’s guidelines. POWERFUL SYSTEM ENHANCEMENTS: TITLE AND PAYMENT SERVICES Recently, the CoreLogic Team implemented two significant solution enhancements to AutomatIQ Collateral: Title Services and Payment Services. AutomatIQ Collateral’s new Title functionality integrates a lender’s title workflow on the same platform that they currently manage their collateral and valuation workflows. This seamless integration allows clients to merge what has traditionally been two separate processes requiring multiple portals and vendors into a single comprehensive collateral underwriting management workflow – accelerating the review process and simplifying their reporting needs. The AutomatIQ Collateral payment functionality represents an elegant new solution at a critical relationship touchpoint. By allowing lenders and borrowers to make order-level, exception-based payments directly on the platform, the new functionality accommodates all transactional payment needs, including accepting digital borrower payments, generating invoices and disbursing appraisal fees via direct deposit. This comprehensive payment solution automates manual tasks and helps simplify accounting workflows, improving the overall user experience for all parties involved. Implementation of AutomatIQ Collateral is simple. The solution is built on a platform that is integrated with all the major third-party loan origination systems, including direct integration with some of the nation’s largest LOS options.
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Sponsored Content
Lenders can scale and innovate at speed with cloudbased Mortgage Cadence Platform vice, anywhere, with specific role-based workflow automation and design. MCP makes it easy to prioritize borrower communication and move loans quickly through the origination cycle. The platform’s built-in automation and real-time concurrent teamwork on each loan ensure efficiency and speed. Its dynamic workflow, based on each loan’s individual characteristics, focuses on the information and screens users need to close the loan quickly, efficiently and accurately. Mortgage Cadence’s open API architecture gives lenders the flexibility and agility to access their data and scale to best fit the needs of their business. Its digital eClosing capabilities and Collaboration Center tool bring lenders, title partners and other third parties together to partner in real-time on the closing experience. In addition to flexibility, configurability and efficiency gains, users of the Mortgage Cadence Platform also benefit from the company’s reimagined implementation process. “Over the past 3 years, Mor tgage Cadence has successfully redesigned our implementation process and developed a Core Configuration to significantly lower cost and duration and ensure that all implementations are completed on time and on budget,” CEO Pete Espinosa said. W i t h M o r t g a ge C a de nc e ’s C o r e Configuration, lenders have “out-of-thebox” access to its preconfigured workflow and feature functions. For lenders with more specific needs, a Solution Architect works with them on a Solution Plan to leverage the flexibility and open architecture of the Enterprise-grade Platform. “Through significant recent investment and a focus on innovation, Mortgage Cadence is delivering on our road-map and vision to be the last lending solution our clients will ever need,” Espinosa said.
THE EXECUTIVES:
PETE ESPINOSA, CHIEF EXECUTIVE OFFICER A career-long software and technology executive, each company Pete Espinosa works with achieves unique, special results that benefit customers andemployees alike.
JOE CAMERIERI, EXECUTIVE VICE PRESIDENT Amortgage industry veteran, Joe Camerieri has over 33 years of experience inmortgage banking, delivering a consultative approach for his prospects and clients.
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he effects of the COVID-19 pandemic, including the subsequent increase in loan volumes, has accelerated the need for digital tools and automation that give lenders and their borrowers a more intuitive, efficient user experience in order to expedite loans to the closing table. In recent months, Mortgage Cadence clients have been able to quickly pivot to a remote-work model without missing a beat using its end-to-end digital lending solution, the Mortgage Cadence Platform (MCP). The Mortgage Cadence Platform is a modern, comprehensive, cloud-based digital lending solution that was designed with the user in mind, delivering an exceptional experience throughout the entire lending lifecycle, for all channels and products. The system is hosted in the Microsoft Azure Cloud, providing lenders with data integrity, security and the ability to innovate at speed while driving productivity with leading analytics tools. Lenders are able to scale and leverage new features and capabilities quickly. All users of MCP, including the borrower, access a single system from point-of-sale through post-closing. The best-in-class borrower experience is an extension of the system, which inherently drives improved data and document integrity, efficiencies, communication and transparency. Borrowers can shop, compare and apply for a loan, send documents and view conditions all in one portal. Credit, asset and employment verification are embedded, making application fast and simple so loans can move into production quickly. Document-driven automation increases velocity and improves the borrower experience throughout the loan process. The Platform is available from any de-
MORTGAGE CADENCE mortgagecadence.com
OCTOBER/NOVEMBER 2020
- SPECIAL REPORT -
Sponsored Content
ORIGENCE origence.com
THE EXECUTIVES:
ROGER HULL, CHIEF PRODUCT OFFICER Roger Hull oversees strategic planning and product development at Origence and has over 30 years of strategic leadership experience in the mortgage and technology industries.
ANDREW WEISS, VICE PRESIDENT OF PLATFORM STRATEGY AndrewWeiss has more than 30 years of experienceinmortgageandconsumer lending business.
MICHAEL FARRIS, VICE PRESIDENT OF STRATEGIC SOLUTIONS
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echnology has made many aspects of day-to-day life more seamless than ever, with instant, easy and personalized consumer experiences; however, lending is still difficult. Lenders who want to move away from a frustrating, onesize-fits-all approach to origination need a modern solution that helps streamline processes while maintaining compliance. The Origence Mortgage Platform is an end-to-end lending platform that puts the power of modern technology in lenders’ hands, enabling them to close more loans, faster. In return, borrowers have a lending experience that is streamlined and more personalized. Origence designed its platform with the ability to continually transform and stand the test of time. The Origence Mortgage Platform is not bolted onto existing technology; as a result, it works as an extensible platform that lenders can configure to their organization’s lending practices, automating the steps that make sense for their teams. The platform automates the mortgage process, providing lending teams with simple configurations that align with their business goals and improve origination speed, efficiency and quality. Origence’s breakthroughs in automation of workplans, document processing, compliance and other time-consuming tasks help eliminate manual processes and streamline workloads. The flexible, scalable technology of the Origence Mortgage Platform allows lenders to expand, customize and adapt their lending experience to their borrowers’ needs. Loan officers can access high-priority information via its Sales Portal interface, which includes pipeline views and outstanding conditions. Origence built its POS to provide borrowers with a modern mortgage experi-
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Michael Farrisisaseasonedindustryveteran with experience in digital lending and process-driven sales solutions.
With the Origence Mortgage Platform, lenders can adapt their lending experience to meet borrowers’ needs
OCTOBER/NOVEMBER 2020
ence from application to closing, with the goal of making the process of obtaining a loan as seamless, pain-free and simple as possible. Borrowers submitting a mortgage application through their existing lending institution benefit from data prefill features to accelerate the submission process. For prospective and current customers, conditional questioning and third-party integrations allow borrowers to easily compare products and apply for a mortgage on the device of their choosing. If bor rowers have questions, the Origence platform includes real-time lender collaboration tools with quick answers to keep the process moving. And after the application is submitted, the secure portal streamlines communication with automatic task alerts, real-time status updates and document upload. Origence’s goal is to keep borrowers connected at every stage of the origination process. Implementation struggles can often be a sticking point for LOS adoption – Origence works to avoid that with a process that is collaborative, efficient and thorough. Account managers and a specialized implementation team provide a personalized experience for each client and simple configurations optimize the process as well. Once the client has gone live with the Origence Mortgage Platform, they’re seamlessly transitioned to the customer support team – all the while, the implementation group stays in contact to ensure things go smoothly. The goal is to minimize the traditional problems of LOS implementation. “We believe modern lending starts with modern technology,” said Roger Hull, chief product officer at Origence. “From origination through delivery, Origence helps our customers close more loans, more efficiently than any other origination platform today.”
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he use of tech in the current mortgage application process is disjointed and siloed. Borrowers, loan officers and the corresponding processors and underwriters are often working on entirely different systems. Meanwhile, borrower’s real estate agents, brokers and financial advisers may not even have access to those systems, preventing them from supporting their clients through what is typically the largest financial transaction of their lifetime. With FinXperience, Tavant aims to bring all parties together on one collaboration platform and provide hyper-personalized digital journeys to borrowers, loan officers, brokers, real estate agents, financial advisers and other participants in the lending ecosystem. FinXperience provides one universal platform that seamlessly allows all parties and stakeholders in the application intake, processing, underwriting and decisioning of a loan to actively participate and collaborate in the transaction. The platform is loan origination system-agnostic and is able to “surround and extend” loan origination systems to provide a more efficient lending experience. A s a w h i t e - la b el s olu t i o n, t he FinXperience platform is highly customizable and configurable, with the ability to align with a lender’s specific branding and marketing differentiators and customer segmentation. The platform’s features, functionality and volume-handling capabilities are scalable with the lender’s growth in the market. “Most of our competitors have offerings that coerce the lender to follow a pre-determined and inflexible customer journey since their architectures provide for limited flexibility on the user experience front,” Chief Revenue Officer Hassan Rashid said. “The flexibility of FinXperience allows lenders to create an extremely differentiated experience from other lenders, as
well as a hyper-personalized experience across their customer segments. There are no cookie cutters here.” FinXperience integrates through a bi-directional framework with its surrounding systems, including CRM platforms, pricing engines, document management systems and LOS. This integration allows all participants in the process to interact with and access loan data in a true, real-time manner. “Tavant’s user journey and persona mapping for every party within the mortgage transaction leads to an optimal workspace for each user,” said Mohammad Rashid, head of Fintech Practice. “The UX is friendly and intuitive, providing the most productive and efficient interaction coupled with bi-directional real-time data directly from the LOS based on security and data access rights.” F in Xper ience leverage s Tava nt ’s FinConnect product, a leading mortgage services and data integration platform. FinConnect includes one-hop integrations to all third parties required to manufacture a loan as well as coordinate among multiple enterprise systems, including pricing engines, LOS and document management systems. FinConnect provides more than 130 connectors, including Day 1 Certainty vendors, verification of asset, verification of income, verification of employment, credit report, agency automated underwriting systems, mortgage insurance and fees services. This allows FinXperience to dynamically bring together a true end-toend digital experience for each actor in the mortgage process. “Our alignment with digital transformation strategies across the home loan journey and our injection of AI/ML techniques along the way reduces the cost of originating mortgages through scaled automation opportunities at every junction,” Rashid said.
OCTOBER/NOVEMBER 2020
TAVANT tavant.com
THE EXECUTIVES:
HASSAN RASHID, CHIEF REVENUE OFFICER Hassan Rashid steers Tavant’s strategy for continued profitable revenue growth, supported by a fully aligned business development engine.
MOHAMMAD RASHID, HEAD OF FINTECH PRACTICE MohammadRashidis responsiblefor driving innovation, strategy, offerings and revenue of Tavant’s market-leadingfintechbusiness.
ABHINAV ASTHANA, HEAD OF PRODUCTS AND INNOVATION Abhinav Asthana is responsible for the overall innovation, go-to-market and product management strategies for Tavant VELOX. 9 1 ❱ H O U S IN G W IR E
Tavant’s FinXperience brings all parties in the lending process onto one collaboration platform
C O M PA N Y S P O T L I G H T :
DOC M AG IC | SP ON S OR E D C ON T E N T
DocMagic’s Single Implementation Solution Digital technology empowering lenders to work where and how they want
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or the mortgage industry, like many others, conducting business as usual is no longer possible or plausible. As DocMagic works with clients and partners every day, the company knows there is no ordinary roadmap ahead. Remote workforce adaptation and fundamental changes in consumer behavior are shifting mortgage industry focus. While some shifts may be temporary, many changes to the mortgage loan process will be more permanent. A BUSINESS-CRITICAL APPROACH At a time when social distancing concerns play a large role in business decisions, many lenders are focused on digital technology to update paper-based lending processes. It’s critical for lenders to think strategically, invest thoughtfully and embrace solutions that enhance key business processes and ensure the ability to rapidly scale their remote capabilities. Maybe you’ve been originating loans for many years, working with legacy technology, outdated workflows, multiple vendors, and you’re tasked with getting your process to an eClosing. That’s the arms race every lender is facing right now. DocMagic provides clients with an agile and technology-forward lending platform that ensures that they can sustain and scale critical business processes. “There are a significant number of moving parts to an eClosing, and as a single-source solution, we have intri-
cate knowledge of every one of them. We have eliminated all of the issues that plague other providers—not only immediately after the implementation, but over the long haul as well,” said Dominic Iannitti, president and CEO. “DocMagic provides powerful endto-end technology, perfectly executed and seamlessly implemented, with an intuitive interface that everyone— staff, settlement service providers and borrowers—can use immediately, without a steep learning curve. Our hands-on approach to implementation, from developing the project roadmap to synchronized testing of each facet of the eClosing process, is what ensures our clients’ success.” ONE SOLUTION, INFINITE OPTIONS By leveraging browser-based technology that is accessible anywhere, anytime via any device with an internet connection, lenders empower their employees to work where they want, when they want and how they want. DocMagic delivers that technology in one seamless process provided by a single-solution suite designed to make the client experience as simple, quick and easy as possible. By switching the majority of loan documents from paper to digital, lenders can reduce a loan closing from hundreds of pages to just a few. Prior to closing, borrowers can access the platform to preview and electronically sign documents that don’t require notarization, and at closing time, if the
OCTOBER/NOVEMBER 2020
eNotary functionality is utilized, any remaining documents can be electronically signed and notarized in a single, short session. “We believe the utilization of dynamic, intelligent, data-driven loan documents is paramount,” said Chris Lewis, director of Enterprise Solutions. “By onboarding DocMagic as your document generation and compliance provider, you are essentially eliminating the entire vendor food chain downstream and giving yourself access to all eClosing options.” DocMagic’s document generation process is fully e-enabled and is integrated into a solution set that is provided as a service lenders can consume transactionally. No software installation is required—users simply access the service via the web. What users experience is the ability to eSign, eDeliver, generate eNotes, perform remote online notarization (where available) eClosings and secure eVault storage… everything right out of the box. Once setup is complete, any lender can generate disclosure and/or closing packages instantly. Now they can check every box. Once lenders begin to see all the options available inside the solution, they realize they can solve a whole host of problems. Can I eDeliver everything? Yes. Can I eClose? Yes. Will DocMagic generate an eNote? Absolutely. Will you vault it for me? Will you register it with MERS? Yes, and yes.
“Integrate with DocMagic for document generation and you can close with us however you want,” Chief eServices Executive Brian D. Pannell said. “Instead of the complication and ‘risk’ associated with adding another vendor, or introducing another solution in the value chain, with another integration point, and another piece to break, etc. The simplicity of the DocMagic solution is the power of it.” For very little investment, lenders can have an eVault set up. DocMagic generates an eNote seamlessly as part of your closing package. It’s all fully integrated, including automatic eRegistry with MERS and all the functionality is built into your document management solution. That’s a single implementation that hinges on document generation. By integrating the company’s document generation solution, you can access all of it as a service transactionally. “All the functionality is inside one online marketplace. By creating one ecosystem, users can approach the digital lending solution as a single transaction,” Pannell said. “It’s like going to a fast food window and ordering an eClose. You don’t order the bun, lettuce and meat separately. You just order a hamburger.” END-TO-END EXPERTISE Lenders with the ability to adopt tech-
DOC M AG IC | SP ON S OR E D C ON T E N T
nology that drives efficiency and client satisfaction have a competitive advantage in today’s landscape. DocMagic works with lenders who want the right balance between technology and service to change the way consumers think about the mortgage process. With more than 34 years of technology innovation, DocMagic’s 100% paperless solution dramatically speeds up the closing process, ensuring accuracy and delivering remote capabilities and efficiencies for lenders, borrowers, notaries and settlement service providers. • LOS Integration - Bi-directional integrations with each lender’s loan origination system, to complete transactions. • Document Generation DocMagic’s 100% digital e-enabled documents work seamlessly with its eClosing interface. • LoanMagic for Borrowers – Connecting borrowers in real time to the loan process and providing constant loan status updates. • An extensive dynamic eDocument Library of well over 250,000 e-enabled documents, including MISMO SMARTDocs. • With over 400 million eSign transactions, DocMagic’s eSign technology provides secure electronic delivery and execution of documents. SmartCLOSE, a se-
OCTOBER/NOVEMBER 2020
cure portal between the settlement agent and lender that facilitates collaborative creation of the LE and CD with the ability to review, edit and add loan fees and costs in real time. • AutoPrep dynamically e-enables any third-party documents. Lenders with loan documents that are not e-enabled can immediately eSign, eDeliver, eNotarize and eClose. • Total eClose is a comprehensive, end-to-end eClosing platform that provides all technology necessary for a 100% paperless eClosing. Seamless digital workflow facilitates all hybrid, as well as totally paperless, eClosings, is comprised of DocMagic’s comprehensive suite of eSolutions: SMARTDoc eNote generation, embedded eNotary technology and Certified eVault functionality, and provides Investor eDelivery. To help organizations develop a strategy for agility, resiliency and growth, DocMagic brings a consultative approach to digital workflow implementation. DocMagic partners closely with its clients to help them manage uncertainty and outperform those less prepared. DocMagic believes the right actions today can position an organization to adapt and succeed in the future.
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C O M PA N Y S P O T L I G H T :
TRADE DESK
Trade associations from across the housing industry are on the front lines of issues that lenders, real estate agents and everyone in between face every day. In these letters, they give their members an inside look at what they are working on, and the most important issues facing each industry today.
AIME......................................95 ALTA......................................95 MBA......................................96 NAHB ....................................96 NAMB ....................................97 NAMMBA...............................97
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NAR.......................................98
OCTOBER/NOVEMBER 2020
TRADE DESK
President Association of Independent Mortgage Experts
navigate the market changes caused by COVID-19 in order to be stewards to their communities. Our members don’t want “no” to be an answer to anyone pursuing the dream of homeownership. Through strategic partnerships, AIME is equipping our members with credit repair services, loan escalation resolutions and other tools to get borrowers to the closing table faster and remotely wherever possible. And on the heels of the holidays, getting more people into homes at low rates and great service is fuel to the broker community’s fire.
Association of Independent Mortgage Experts
ALTA members, October is National Cybersecurity Awareness Month, so it’s a perfect time to ensure your business and customers have the resources they need to stay safe online. According to a March 2020 report from The Pew Charitable Trusts, cybercriminals have been capitalizing on the COVID-19 pandemic, taking advantage of the millions of Americans working remotely during this health crisis. Because COVID-19 is new, attackers are using phishing emails to create panic and urgency, luring normally suspicious people into clicking malicious links. The Federal Bureau of Investigation has published alerts regarding COVID-19 scams. The FBI’s Internet Crime Complaint Center has seen a significant increase in reports of online scams during “stay-at-home” orders. According to the FBI, “it is important to remember that scammers adapt their schemes to capitalize on current events such as the COVID-19 pandemic … in an attempt to make their scams seem more authentic.” The American Land Title Association takes cybersecurity seriously; in fact, our Board of Governors has
identified information security and real estate wire fraud as an ALTA strategic priority. Phishing attacks are often a precursor to real estate wire fraud. ALTA has created a wealth of resources for title professionals in this area, the majority of which can be found at www. alta.org/business-tools/cybersecurity. In May 2020, ALTA created a video showing that whether title professionals are utilizing digital closings during the COVID-19 pandemic or ensuring homebuyers are remaining vigilant against real estate wire fraud, we have been protecting American homebuyers for more than 100 years. As real estate professionals and homebuyers increasingly conduct business online, it is more important than ever to be proactive and alert. ALTA endeavors to provide crucial, timely information members need to stay safe and grow their businesses.
American Land Title Association
OCTOBER/NOVEMBER 2020
Diane Tomb
CEO American Land Title Association
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Marc Summers
AIME members, This year the broker community has seen unprecedented business growth. Low rates and innovative loan products have put independent mortgage brokers on the forefront of what was already an incredibly busy purchase season, now coupled with a refinance boom. As we enter the fourth quarter, the mortgage broker community will continue to move forward and not slow the momentum we have had throughout all of 2020. Without a clear end to the pandemic, brokers are continuing to adapt and
Robert Broeksmit President and CEO Mortgage Bankers Association
Mortgage Bankers Association
TRADE DESK
MBA members, The mortgage industry continues to press forward as the pandemic has made a significant impact on our industry’s customers and the broader economy. And as it persists, we continue to closely monitor how this year will shake out – especially with the upcoming presidential election. One of the significant contributions MBA makes to the industry has always been our widely attended conferences and networking opportunities. Unfortunately, given our new reality, we have had to re-examine their structure. Thankfully, we have landed on a new virtual format, which allows us to continue to engage with participants and deliver the business-centric content and expertise people have come to expect.
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NAHB members, This year, as the COVID-19 pandemic disrupts our lives and threatens our economic well-being, it is more important than ever that housing industry professionals support pro-housing, pro-business candidates for elected office. We need lawmakers who understand the challenges we face that make it increasingly difficult to build homes that are affordable for hard-working families. The legislative affairs staff at the National Association of Home Builders works hard to educate policymakers about the importance of housing to all American families, and the importance of residential construction to the economy at the national, state and local levels. We’re looking for lawmakers who will listen to our concerns and work with us to craft legislation that will improve housing affordability and strengthen our industry. Some politicians better understand how excessively burdensome regulations affect housing affordability. They understand that an aging workforce and an insufficient supply of skilled labor make it harder, and costlier, to build new homes. They see the effectiveness of the Low-Income Housing Tax Credit, and recog-
The apex of this new virtual experience will be MBA’s Annual Convention and Expo on October 19-21. This year’s Annual Convention will stream our keynote and industry expert presentations, allow attendees to participate in virtual breakouts, and provide a venue for discovering the latest products and solutions in THE HUB. The convention will feature insights from MBA leaders, industry experts and regulators, members of Congress, and presidential historian and Pulitzer Prize-winning author Jon Meacham. The future may be clouded with uncertainty and change, but the one constant during these times is MBA’s commitment to our members and the industry.
nize that if that credit is not available, then countless hard-working households will suffer. Electing pro-housing, pro-business candidates to Congress gives us the opportunity to work with policymakers who value the housing sector and are more likely to create an environment where our members’ businesses can thrive; candidates who will craft and pass legislation that reduces excessive regulatory burdens, invests in training for skilled labor, and promotes fair trade practices, among many other goals. I encourage all housing industry professionals to seek out and support candidates with a strong pro-housing track record – those who have demonstrated a commitment to policies that promote homeownership, rental housing opportunity, and small business. Let’s support those who will fight for our industry and for the communities we serve. Find a list of non-partisan endorsements at nahb.org/ endorsements.
National Association of Home Builders
OCTOBER/NOVEMBER 2020
Chuck Fowke
Chairman National Association of Home Builders
President National Association of Mortgage Brokers
NAMB members, One of the goals of a professional organization is to give voice to the individual where their voice is not being heardlike Washington, DC. Another benefit is to negotiate for the individual with the power of many. In this manner, NAMB negotiates discounts for the many that might not be available to a small one person shop. A great illustration of this is the NAMB Technology Toolbox. NAMB has a toolbox that you can find under member benefits. There is a free multi-lender pricing tool from Lender Price that pulls up the top 10 lenders for each rate on the program you input. There is also a digital lending platform that allows you take an online application. This can be added to your website. Lending Pad is a full service, robust LOS that is cloud-based. It is integrated with DO/DU and LPA. It allows you to customize your own documents and packages and send out through Docusign. The Lending Pad team is
NAMMBA members, NAMMBA has launched a Visionary campaign to enlist CEOs and top executives in the real estate finance industry to support NAMMBA’s Mission 2025 Program of connecting college students to the industry. This campaign will support the effort of connecting students to our new digital platform, the Talent Hub, providing students with skills, tools and resources through webinars, while directly connecting students to both internships and jobs with corporations in the real estate finance industry. We have a goal of enlisting 250 Visionaries by the end of this year and to reach that goal we are asking 50 industry veterans to join as Visionary Ambassadors, helping to reach out to their networks to create aware-
constantly adding on and is very responsive to tech support tickets. There is a one-touch Mortgage Call Report that is very satisfying to those of us that have created by hand online over the years. EC Purchasing is a phenomenal discount program offering deep discounts on printing and copying from FedEx stores as well as substantial shipping discounts. There are also discounts on car rentals, cell phone plans and others. Optimal Blue is a recent addition to the toolbox. It is a pricing engine fully integrated with Encompass and Calyx Los’. Mortgage Hippo is getting added as a Point of Sale application for borrowers to apply online. It will be mobile optimized and integrate with your LOS. It is a “smart”1003 and guides the borrower through the process. Take advantage of these discounts that pay for your membership in a very short time.
ness about this campaign. Laura Bra ndao, CE O of A mer ica n Financial Resources, is the chair of this campaign and Eddy Perez, CEO of EPM, is our vice chair helping to encourage and enlist college students. Together with industry CEOs and top executives, NAMMBA will be able to connect 50,000 college students to the industry this year. Join us today!
National Association of Minority Mortgage Bankers of America
OCTOBER/NOVEMBER 2020
Tony Thompson
Founder and CEO National Association of Minority Mortgage Bankers of America
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Rocke Andrews
National Association of Mortgage Brokers
TRADE DESK
NAR members, Our most recent data at the National Association of Realtors shows that metro home prices achieved major growth in the second quarter of 2020. In fact, 96% of the nation’s metro areas saw prices increase. While there are still more questions than answers as to exactly how America will reemerge and rebuild once this pandemic is behind us, these latest statistics are promising. Higher home prices aren’t necessarily ideal, but this climb in costs is confirmation that there is great demand for housing and America’s residential real estate market is, in fact, helping to stabilize and strengthen our economy despite unprecedented external circumstances. With 15 metro areas experiencing price growth in the double-digits, the desire of homeownership persists, even in the midst of this worldwide pandemic. One detail I found of particular interest was in regard to home affordability. With record-low mortgage rates, buying a home in the second quarter of 2020 was more affordable than 2019’s second quarter. This is great news
for those buyers contemplating a move to the suburbs, seeking housing that offers more space inside and more physical distance from other homeowners. As I have been saying for months, the housing industry will help lead the way to America’s economic recovery. To that end, Realtors – with real estate services now declared essential in all states – have continued to work. Agents almost seamlessly pivoted, moving to conducting virtual tours for potential homebuyers and relying on electronic signatures for closing. This is the beginning steps toward an economic resurgence and the real estate industry – I believe – can be a model for other American business sectors looking to rebound.
National Association of Realtors
Vince Malta
President National Association of Realtors
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MORTGAGE
OCTOBER/NOVEMBER 2020
MORTGAGE
FHFA creates, then delays refinance fee start date to Dec. 1 E X C LU DE S LOA N S U N DE R $125,0 0 0 B Y K ELSE Y R A M ÍR E Z
Dec. 1. The FHFA directed Fannie Mae and Freddie Mac to delay the implementation date of their adverse market refinance fee after it was previously scheduled to take effect Sept. 1, 2020. FHFA is also announcing that the enterprises will exempt refinance loans with loan balances below $125,000, nearly half of which are comprised of lower-income borrowers at or below 80% of area median income. Affordable refinance products Home Ready and Home Possible, are also exempt.
“As a result of risk management and loss forecasting precipitated by COVID19 related economic and market uncertainty, we are introducing a new Market Condition Credit Fee in Price.” -Freddie Mac
OCTOBER/NOVEMBER 2020
A
After Fannie Mae and Freddie Mac announced an added 50 basis point fee to all refinances, the housing industry was quick to react. In fact, the industry quickly turned against Fannie and Freddie’s added fee. “As a result of risk management and loss forecasting precipitated by COVID-19 related economic and market uncer taint y, we are introducing a new Market Condition Credit Fee in Price,” Freddie Mac said in a bulletin.
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The Federal Housing Finance Agency announced Tu e s d a y i t i s postponing the date it will begin implementing its adverse market ref inance fee to
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MORTGAGE
The Mortgage Bankers Association was one of the strongest voices in opposition to the new fee, saying, in part, “The additional 0.5% fee on Fannie Mae and Freddie Mac refinance mortgages will raise costs for families trying to make ends meet in these challenging times. In addition, the September 1 effective date means that thousands of borrowers who did not lock in their rates could face unanticipated cost increases just days from closing.” It also criticized the increase, saying that it would be particularly harmful to low- and moderate-income homeowners. The fee assessed by the government sponsored enterprises adds a 50 basis point increase to the refinance mortgages it purchases, but the mortgage giants don’t charge borrowers directly since they don’t originate loans. This fee is placed on the lender, which then has the option of passing on the charge to the borrower or eating the cost. If the refinance fee is ultimately passed on to the borrower, and extended through the life of the loan, it would add about 10 basis points, or 0.1%, to the interest rate of the loan. One broker pointed this out in HousingWire’s slack community: “ [ There’s] some shor t term pain, especially for borrowers already in the pipeline,” Mortgage Broker Jason Barlow said. “We’ll adjust (to the new ‘tax’) – at the end of the day, rates are still extraordinarily low, so [there are] lots of homeowner benefits to be had.” While the housing market is seeing strong profit margins and high demand for purchase and refinance originations, in today ’s unique economic chaos brought on by COVID-19, it is also seeing a spike in delinquencies. The percentage of accounts with mortgage loans in “financial hardship” was 6.79% in June, according to a consumer credit snapshot by TransUnion. The report defines accounts with deferred payments and forbearance programs as those in financial hardship.
“The new 0.5% fee being implemented by the Federal Housing Finance Agency – Fannie Mae and Freddie Mac’s regulator – on mortgage refinancing transactions delivered to the agencies beginning September 1 doesn’t pass the smell test.” -Greg McBride
OCTOBER/NOVEMBER 2020
Back in April, 6.1% of mortgages were delinquent by at least 30 days or more, marking the nation’s highest overall delinquency rate since January 2016, according to a report by CoreLogic. Meanwhile, some people in the industry are calling the new fee a money grab by the GSEs. “The new 0.5% fee being implemented by the Federal Housing Finance Agency – Fannie Mae and Freddie Mac’s regulator – on mortgage refinancing transactions delivered to the agencies beginning September 1 doesn’t pass the smell test,” Bankrate.com Chief Financial Analyst Greg McBride said. “The irony is striking – the Federal Reserve is effectively printing money to buy government guaranteed mortgage backed securities in order to keep markets functioning, drive down mortgage rates, facilitate refinancing, and put monthly savings into consumers’ pockets. And now FHFA wants to grab that savings from the consumer and put it into Fannie and Freddie’s coffers.” In the second quarter, Fannie Mae reported an earnings decrease of 26% year-over-year due to a loss in fee revenue while Freddie Mac saw its earnings rise by 18%. But despite Fannie Mae’s decrease,
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Then, talk surfaced just before the fee was set to begin, that the FHFA was considering delaying the fee. When it announced the delay, the FHFA also gave a breakdown of the need to implement the fee, saying pandemicrelated losses could total at least $6 billion for the GSEs. “The actions taken by the enterprises during the pandemic to protect renters and borrowers are conser vatively projected to cost the enterprises at least $6 billion and could be higher depending on the path of the economic recovery,” the FHFA said in a statement. Those expenses are expected to at least include: • $4 billion in loan losses due to projected forbearance defaults • $1 billion in foreclosure moratorium losses • $1 billion in servicer compensation and other forbearance expenses
“FHFA has a statutory responsibility to ensure safety and soundness at the Enterprises through prudential regulation,” the FHFA continued. “The enterprises’ congressional charters require expenses to be recovered via income, allowing the enterprises to continue helping those most in need during the pandemic.” Many in the housing industry voiced their support for the delay of the fee. The MBA released this statement: “ We welcome today’s announcement
from the FHFA amending the recently announced adverse market refinance fee from Fannie Mae and Freddie Mac,” MBA CEO Bob Broeksmit said. “Extending the effective date will permit lenders to close refinance loans that are in their pipelines and honor the rate lock commitments they made to their borrowers, ensuring that economic relief in the form of record low interest rates will continue to flow to consumers. “ We understand that the pandemic and the associated borrower assistance measures the GSEs have instituted impose significant costs on the GSEs and on mortgage servicers, and we are gratified that the revised guidelines also reflect the need to lessen the impact on borrowers with modest incomes or low loan amounts,” Broeksmit continued. “Likewise, we support the previously
“ The Communit y Home Lenders Association strongly commends FHFA Director Calabria for his announcement today that Fannie Mae and Freddie Mac will be moving back to December 1st the effective date on their new half point adverse market fee on refinance mortgage loans – as well as exempting certain affordable loans from the fee,” CHLA Executive Director Scott Olson said. “CHL A fully appreciates Director Calabria’s comments that COVID-19 is creating billions of dollars of GSE losses that necessitates repricing of risk on certain GSE products and loans,” he added. The National Association of Federally Insured Credit Unions said it was grateful for the delay, but still stood against the fee as a form of loss mitigation.
“The actions taken by the enterprises during the pandemic to protect renters and borrowers are conservatively projected to cost the enterprises at least $6 billion and could be higher depending on the path of the economic recovery.” -FHFA announced exemption of all home purchase loans.” The National Association of Mortgage Brokers, which urged people to contact their local congressman through its petition form when the fee was announced — and got almost 17,000 supporters — applauded the change. Roy DeLoach, NAMB’s lobbyist said, “All mortgage broker owners and loan originators deserve a thank you for joining our sister real estate organizations in Washington D.C. to push back this tax on homeowners. All organizations are on high alert to work together in the future to collectively engage on any future similar actions.” The Communit y Home Lenders Association supported the changes.
OCTOBER/NOVEMBER 2020
“ NAFCU appreciates the FHFA’s delay of the GSEs’ new policy charging higher mortgage refinance fees and exemption of certain loans,” NAFCU President and CEO Dan Berger said. “While this delay will temporarily limit unnecessary financial strains placed on credit unions and their members, the policy, once implemented, will still force credit unions to absorb new financial costs amid a recession and global pandemic. We understand the GSEs are facing financial concerns of their own, but these concerns would be better mitigated through wholesale housing finance reform as opposed to preventing credit unions from helping more members.”
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both companies still reported a positive net income at $2.55 billion for Fannie Mae and $1.78 billion for Freddie Mac in Q2. Pushing back on the announcement, the housing industry called on Fannie Mae and Freddie Mac to retract the fee.
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REAL ESTATE
OCTOBER/NOVEMBER 2020
REAL ESTATE
For Millennials who want to buy a home right now, the Great Recession still looms large B U T T H IS R E C E S S IO N IS A W H O LE D IF F E R E N T B E A S T
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f the Great Recession never happened, how would potential homebuyers be looking at today’s housing market? After all, the giant cohort of potential homebuyers now in their late 20s and early 30s was also the generation fresh out of college trying to find a job as the market was crashing in 2008. They remember the struggles of trying to find a job, and they remember the large swath of inventory on the market that made home prices drop lower and lower. So when it comes to deciding whether or not to buy a home in the middle of a recession, it’s difficult not to pull in past memories from the Great Recession. But this is a very different kind of recession, and, as Ralph McLaughlin, chief economist and senior vice president of analytics at Haus, said: “No housing analyst alive has seen the housing market perform during a pandemic.”
“No housing analyst alive has seen the housing market perform during a pandemic.”
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McLaughlin noted that in this economic downturn, policy plays a much larger role in what’s going to happen with the health of the housing market than fundamental economics. Back in April – during what should’ve been the year’s busiest home-buying season – McLaughlin talked about whether or not it was a good time to buy a home. At the time, he noted that the largest group of first-time homebuyers, Millennials, are going to be the most susceptible to recency bias when it comes to recessions. “They basically only went through one, the Great Recession, and that sample size of one just happens to be the worst economy for the housing market since the Great Depression,” McLaughlin said. Since that interview six months ago, the housing economy has proved to be extremely resilient to the current crisis, thanks to some significant actions by the government. For starters, eight months ago, the Federal Reserve started a bond-buying program again, something it did during the financial crisis.
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B Y B R E NA NATH
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“The major reason why we are forecasting price declines isn’t necessarily because the course of the pandemic has worsened from where we initially thought it was going to go, but really because of policy questions.”
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Since launching the program, the reserve has purchased about $892 billion of agency mortgage-backed securities, pushing mortgage rates to an all-time low. These low rates continue to fuel refinance demand, as the Mortgage Bankers Association’s refinance index continues to increase year over year, with last week marking the thirteenth-straight week of year-over-year gains. Then, there’s the CARES Act, which Congress passed in March to of fer economic relief to those affected by the shut-downs, expanding unemployment b e ne f i t s and of f e r ing mor tgag e forbearance to homeowners with mortgages backed or insured by the federal government, including Freddie Mac, Fannie Mae, VA and FHA. Under the CARES Act, homeowners can ask for forbearance from their mortgage servicer and suspend payments for up to 12 months.
OCTOBER/NOVEMBER 2020
Over the past eight months, McLaughlin said his forecast has shifted considerably. Back in early April, he wasn’t forecasting any impact from COVID on home prices, and predicted a growth in home prices, although at a slower rate. “Now, we do show a decent likelihood of price declines in early 2021,” he said. “The major reason why we are forecasting price declines isn’t necessarily because the course of the pandemic has worsened from where we initially thought it was going to go, but really because of policy questions.” With the introduction of the CARES Act, homeowners were given protection not only from forbearance and eviction, but also households were given extra unemployment insurance. McLaughlin said now the big question is going to be: “For all those households
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If there are no new forbearance programs put in place to protect households who were impacted by the coronavirus, McLaughlin said there is a non-trivial likelihood that there will be an increase in foreclosure proceedings and an increase in distressed inventory in March, April and May of 2021. According to data from Black Knight, there were 2.25 million home loans that were seriously delinquent in July, reaching the highest level since early 2010. This lack of certainty around a new forbearance program caused McLaughlin to adjust his forecast to add in the probability of an increase in foreclosures and distressed inventory, leading to a period of home price declines. But home shoppers waiting around for Great-Recession level price drops are going to be severely disappointed. The Great Recession produced 10% to 20% price declines on a year-over-year basis. Now, McLaughlin’s latest forecast from Haus states that home prices are expected to grow between 0.9% and 1.7% in August but are expected to fall early
next year by -0.5% to -2.5% on a yearover-year basis. Haus’s regional forecasts for each of its 400 forecast markets, with some markets,
that we have from the demographic structure, that could lead to potentially another shift towards a buyer’s market, maybe not to the extent that we saw
“The number of new listings is increasing, but they are quickly taken out of the market from heavy buyer competition. More homes need to be built.” like Colorado Springs, bucking the trend and still expecting to experience an increase year over year. One of the biggest dif ferences between the Great Recessions and today is inventory levels. “ Homeowners weren’ t impacted as broadly as say during the Great Recession, so there wasn’t this flood of inventory,” he said. “In fact, exactly the opposite happened. Over the course of this pandemic, we’ve gone from what was historically low inventory pre-pandemic to low inventory that I don’t think anyone ever could have foreseen even six months ago.” Unsold inventory sits at a 3.1-month supply at the current sales pace, according numbers from the National Association of Realtors. Lawrence Yun, NAR’s chief economist, said, “The number of new listings is increasing, but they are quickly taken out of the market from heavy buyer competition. More homes need to be built.” There is a possible silver lining for would-be buyers though, as McLaughlin added that there are a few factors that could change early next year, creating the possibility of a buyer’s market. The two main drivers behind this shift – distressed inventory coming to the market and would-be sellers that chose to hold off until 2021. “If that leads to a big increase in supply that far outpaces the growing demand
OCTOBER/NOVEMBER 2020
back in 2009, 2010 and 2011, but certainly maybe a shift to a buyer’s market that we haven’t seen this cycle,” he said. Then, there’s the uncertainty around the issue that we’re all hyper-focused on: the virus. As everyone watches and waits for clarity on housing policy, the potential for a large amount of distressed inventory and a cure for the virus, the word uncertainty in a housing forecast is starting to be the most certain thing the industry can rely on.
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that took forbearance, what’s going to happen when the 12-month period runs out?” “Ideally, in a perfect policy world, you’d be able to extend the forbearance program long enough so that the rising tide of the U.S. economy would take over and would basically re-employ those homeowners who have lost their jobs,” he said. But with no extended forbearance policy on the horizon, McLaughlin shared his new updates on the future of the housing market.
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FINTECH
OCTOBER/NOVEMBER 2020
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Housing industry embraces Remote Online Notarization T H E R E A R E N OW 4 P R OV IDE R S W IT H M IS M O R O N C O M P LIA N C E
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C l o s i n g platform Pavaso announced it has been awarded the Remote Online Notarization Compliance Certification through the Mortgage Industry Standard Maintenance Organization – making it the fourth company to receive the specialized certification. Originally introduced in April, the MISMO RON compliance certification was designed to assure RON tech providers meet a universal set of standards including credential analysis, borrower identification, capturing and maintaining a recording of the notary process electronically, audio and video requirements, record storage and audit trails. The Mortgage Bankers Association explained that The MISMO RON Software Compliance Certification Program is designed to increase adoption of RONenabled digital mortgage closings and support the
“Digital mortgage closings – especially during this time of social distancing and state stay-at-home orders – provide a safe, fast and convenient experience for all parties involved in a real estate transaction,”
OCTOBER/NOVEMBER 2020
integrity and scalability of eMortgages. “Digital mortgage closings – especially during this time of social distancing and state stay-athome orders – provide a safe, fast and convenient experience for all parties involved in a real estate transaction,” said Mike Fratantoni, MISMO president and MBA chief economist and senior vice president of research and industry technology. “Expanding the availability of RON is a priority for MBA and MISMO, and this new certification program is intended to provide comfort to lenders and others that certified vendors are complying with MISMO's RON standards.” Now, Pavaso joins the ranks of companies with the RON certification. “Pavaso has always worked closely with Secretary of State offices to obtain eNotary vendor approvals, where required,” said Nancy Pratt, vice president of partner relations and government affairs for Pavaso. “The MISMO certification program is designed to enhance the vetting process by assuring states that certified RON vendors are conducting business in
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B Y JULIA FA LCON
FINTECH
a more secure and consistent manner. We are very excited to be granted this certification.” The MBA says MISMO’s success up to this point has been notable, and credits it to investments by key stakeholders, saying it has created tangible benefits for both lenders and consumers, including: • RON standards • A RON Product Cer tification to assist lenders in identifying produc t vendors that meet MISMO standards • A digital mortgage resource center to assist organizations with the transition to digital loan processes • Standardized Closing Instructions templates to enable lenders to communicate more effectively with settlement agents • The creation of an Industry Loan Applic ation Datas et , which provides a standard way of exchanging information included in the new Uniform Residential Loan Application as well as the GSE automated underwriting systems • The creation of standardized terms and definitions that enable consistency in the exchange of information with the GSE Uniform Mortgage Data Program, FHA, VA, Ginnie Mae and CFPB HMDA requirements
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The SECURE notarization act was introduced in a bipartisan movement in Congress as COVID-19 began to make social distancing a reality. Senators Mark Warner D-Virg., and Kevin Cramer R-N.D., introduced a bill that would allow remote online notarizations nationwide,
“The MISMO certification program is designed to enhance the vetting process by assuring states that certified RON vendors are conducting business in a more secure and consistent manner. We are very excited to be granted this certification.” -Nancy Pratt
which would enable many people to close on a home or conduct other legal activities without compromising their social distancing practices. The bill, which is entitled the “Securing and Enabling Commerce Using Remote and Electronic Notarization Act of 2020,” would authorize every notary in the U.S. to perform remote online notarizations. At the time, nearly half (23, to be exact) of the states in the U.S. allow for the use of RON technology, in which a notary and signer are in different locations and use two-way audio-visual communication to securely execute electronic documents. But the senators noted that 55% of the country is unable to access this technology now, necessitating a bill that would allow for it nationwide. The bill also requires tamper-evident technology to be used in electronic notarizations, and encourages fraud prevention through use of multifactor authentication.
OCTOBER/NOVEMBER 2020
“Americans shouldn’t have to risk their health or safety to execute important financial or legal documents, especially when they could do so from the safety of their own home,” Cramer said in a statement. “The SECURE Notarization Act brings the notary process into the 21st century, allowing people to securely complete documents while still following recommended health and social practices amid the coronavirus pandemic.” However, after making no headway in congress since its introduction in March, states took it upon themselves to procure their own policies for RON with the assistance of RON providers. In an effort to combat the economic toll of COVID-19, a wave of varying permanent and temporary legislation for remote online notarizations continues to sweep across the country. States like Louisiana quickly pushed new RON orders in a reactionary method to COVID-19. In March, Louisiana’s governor amended his emergency executive order to allow the use of RON – by June he called for implementation of it no later than August 1, 2020. For four years , the L and T itle Association of Colorado pushed for RON legislation in Colorado, however, it would take less than four months from March, 2020 to June for the state to pass a bill allowing the use of temporary RON. In June, Colorado Governor Jared Polis declared the bill will effectively turn into law December 31, 2020. Alaska also expedited RON legislation after an April bill backed the validity of electronic documents and signatures for notarizations, however, it will not be effective until January 2021. Other states like Indiana, Iowa and Maryland were in the process of enacting RON when COVID-19 hit, advancing the process along in a bid to protect employees and homebuyers. One state in particular, Washington, passed RON
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Prior to Pavaso’s announcement , eNotaryLog received RON compliance certification on May 27, followed by Notarize on July 2. The third company granted the compliance designation was digital signature servicer Signix. “Real estate transactions continue to close during the COVID-19 pandemic because of advancements in digital mortgage technology, including the increased adoption of remote online notarization as a safe and convenient option,” said Mike Fratantoni, president of MISMO and Mor tgage Bankers Association chief economist and senior vice president of research and industry technology. “ MISMO encourages all product providers to expand the integrity and availability of eMortgages by obtaining their MISMO certification.” All certified RON providers will receive a “MISMO Compliant for RON Standards” seal which may be displayed on the RON provider’s website and marketing materials, MISMO said. According to MISMO, Docutech, Heracles Holding and Nexsys are currently in process of receiving the certification. Other companies are venturing into the RON space with new product launches of their own. In August, Qualia announced that it has extended the capabilities of its real estate closing platform with the
launch of a remote online notarization product. “We started on this project in April, and are getting out the door now,” he said.
“Americans shouldn’t have to risk their health or safety to execute important financial or legal documents, especially when they could do so from the safety of their own home.” -Kevin Cramer
“I’m proud of our engineering team, as it was a pretty quick turnaround for them.” Incorporating RON into the platform was not in the works at Qualia before the pandemic hit, Baker added. But once the company saw the increased demand, it set about building its own RON capabilities. In the era of the COVID-19 pandemic, the demand for RON has skyrocketed. And thanks to people like Notarize founder and CEO Pat Kinsel, who are lobbying across the U.S., more states are allowing for it to take place.
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legislation in April last year and was slated to go into effect Oct. 1, 2020. With stay-at-home orders being implemented across the country the governor issued a proclamation for immediate use of RON. According to Pavaso, in addition to following the MISMO standards and corresponding practices, Pavaso’s platform adheres to individual state RON legislation.
OCTOBER/NOVEMBER 2020
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POLITICS & MONEY
OCTOBER/NOVEMBER 2020
POLITICS & MONEY
Fed’s new inflation policy may boost wages, but on the other hand… “ IN F L AT IO N -AV E R AG IN G ” C O U LD LE A D TO H IG H E R M O R T G AG E R AT E S
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resident Harr y Truman famously asked for a onearmed economist after being fed up with economic advisors telling him, “On the other hand...” The Federal Reserve’s new inflation policy is kind of like that. It may lead to higher wages for Americans, but those same families might be paying more for their mortgages. Af ter two decades of stagnant growth in household wages, the Fed has decided to take a different approach to its mandate from Congress to “promote effectively the goals of maximum employment, stable prices, and moderate long term interest rates.” Until a year ago, central bank policymakers used to consider a jobless rate of 5% to 5.2% to be “full
“We will seek to achieve inflation that averages 2% over time.” -Jerome Powell
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employment.” In Fed-speak, it’s called the “NonAccelerating Inflation Rate of Unemployment,” or NAIRU. The thought was: There will always be a certain percentage of the population that can’t work. For example, people with physical or mental ailments, or homeless people who want a job but are constrained by the lack of an address and other barriers. If the unemployment rate dropped below 5%, it would spark inflation by overheating the economy, the old-model thinking went, because workers would have more bargaining power to ask for higher wages. They would then have more money for the consumer spending that accounts for about 70% of the U.S. economy. That would give businesses the power to increase prices, which would boost inflation. The central bank raised rates nine times between 2015 to 2018 as the unemployment rate fell, trying to prevent inflation before it materialized.
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B Y K ATHLE E N HOW LE Y
POLITICS & MONEY
“I know no one wants to pay higher mortgage rates, but if their wages are rising faster as a result of today’s change in Fed policy, it ends up being a wash.” -Dean Baker
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But then the jobless rate dropped to an almost six-decade low of 3.5% four times in the last year and... no inflation. In fact, the inflation rate remained below the Fed’s 2% target rate, which gives the central bank another potential scenario to worry about – disinflation, in which falling prices sap economic growth. When asked during Congressional testimony last year what happened to the old formula – the jobless rate had fallen to historic lows without sparking inflation – Fed Chairman Jerome Powell responded simply: “We were wrong.” Af ter a year-long review, the Fed announced at the end of August it was tossing out the “inflation targeting” method it has used to great success for decades and was replacing it with “inflation averaging.” In other words, the central bank will allow inflation to run above 2% if it comes after a sustained period of growth below 2%.
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“We will seek to achieve inflation that averages 2% over time,” Powell said, speaking at a video-only version of the Federal Reserve Bank of Kansas City’s annual Jackson Hole conference. “ Therefore, following periods when inflation has been running below 2%, appropriate monetary policy will likely aim to achieve inflation moderately above 2% for some time.” The new model will help workers get pay raises by giving them more negotiating power because the central bank won’t try to slow the economy when the jobless rate gets too low, said Dean Baker, senior economist at the Center for Economic and Policy Research. The downside is: Higher inflation would put upward pressure on mortgage rates. “I know no one wants to pay higher mortgage rates, but if their wages are rising faster as a result of today’s change in Fed policy, it ends up being a wash,” Baker said in an interview.
POLITICS & MONEY
enough to crash housing markets in key regions of the nation. That 1970s inflationary cycle was sparked by several factors including President Richard Nixon pressuring Federal Reserve Chairman Arthur Burns to provide him with easy monetary policy to boost his reelection prospects. It worked. Nixon was reelected in 1972 in a landslide, riding the wave of a strong economy. By the time he resigned amid the Watergate scandal in 1974, inflation had spiked to 12.3%. It kept rearing its ugly head for years afterwards, peaking
sectors of the economy that had been left behind, Powell said. “As the long expansion continued, the gains began to be shared more widely across society,” he said. “The Black and Hispanic unemployment rates reached record lows, and the dif ferentials between these rates and the white unemployment rate narrowed to their lowest levels on record.” While the worst pandemic in more than a century wiped out many of those gains and boosted unemployment to a record 14.7% in April, the Fed’s new policy will
“The robust job market was delivering life-changing gains for many individuals, families, and communities, particularly at the lower end of the income spectrum.” -Jerome Powell in 1979 at 13.3% as businesses confused by the Fed’s contradictory moves kept prices high. So, no one wants a return to a hyperinflationary cycle. The Fed believes its new policies will, on one hand, benefit workers and, on the other hand, keep inflation rising at a tame pace. The record lows in the jobless rate in the months preceding the pandemic were pulling more Americans into the job market and helping those already employed get pay raises, Powell said in the August speech that announced the new inflation-averaging policy. “The robust job market was delivering life-changing gains for many individuals, families, and communities, particularly at the lower end of the income spectrum,” Powell said. “In addition, many who had been left behind for too long were finding jobs, benefiting their families and communities, and increasing the productive capacity of our economy.” The low jobless rate was lifting up
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help Americans regain ground when the health crisis is over, Powell said. “Before the pandemic, there was every reason to expect that these gains would continue,” he said.
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Wage growth has been anemic for two decades. In the last year, there was a pickup as a shortage of workers forced employers to compete with higher salaries, according to U.S. Census Bureau data. “The single most important thing that we can do is support a strong labor market,” Powell said when he announced the new policy. “Getting wage gains only in the eighth or ninth year of a recovery is not the best outcome.” If the new policy succeeds in goosing up the inflation rate, it would lead to higher prices for consumer goods and more expensive interest rates for loans such as mortgages. Mortgage-bond investors use inflation as the mainstay of their calculation that determines the yield, or return, they are willing to accept. Because higher inflation eats into bond yields, investors demand a higher return for the mortgage-backed securities and other bonds they buy when inflation is rising. Inflation fears also boost yields on Treasuries, which are used as a benchmark for MBS investors. The Fed’s new policy likely will keep its overnight lending rate at its current near-zero level for years as the economy recovers from the recession caused by the COVID-19 pandemic. That keeps rates low for home equity lines of credit, which often are linked to prime rates that are benchmarked to the Fed’s rate, even if higher inflation pushes up long-term home-loan rates. No one wants inflation to rise too high. If higher inflation pushes up mortgage rates too much, it will chill demand for home sales which help to drive the consumer spending as new owners buy drapes, couches, appliances and other household needs. Remember mortgage rates topping 18%? It happened in the not too distant past. Interest rates first broke into double digits in 1978 and peaked in 1980 at 18.6%, as measured by Freddie Mac. It was
w it h Selim Aissi Ellie Mae Senior Vice President and Chief Security Officer
How to prevent phishing and ransomware attacks while remote With more people working remotely these days, here’s his advice Now that more people are working remotely – as many states have issued shelter-in-place or closed all non-essential businesses – the likelihood of being the victimof a ransomware or phishing attack has risen. HousingWire spoke to Ellie Mae Senior Vice President and Chief Security Officer Selim Aissi about how an attack could happen, what it might look like, and what to do if it does happen. Aissi has an extensive background in information security, serving as the vice president of global information security at Visa and as a security strategist and architect at Intel before his current role at Ellie Mae. Ellie Mae has been running exercises that simulate the challenges of having employees work from home, which has helped prepare the company for the current situation. This interview has been lightly edited for length and clarity.
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HousingWire: Do you think people within the industry take cybersecurity seriously enough in the current pandemic? Selim Aissi: I think our industry is taking it very seriously. There’s a lot of information being shared and I think there’s a lot of escalation of monitoring. I can see that across the industry, so there’s definitely a high alert. There’s a lot of custom malware that’s being distributed. We know people are sitting at home, just spinning up websites and infecting malware. We have seen some ransomware out there as well. HW: How is the disruption to not only the market, but peoples’ home and work lives increasing the risk of phishing and ransomware? SA: I think there are probably four different areas where the risk is increasing. First, where companies have not ensured that the endpoints and laptops that people are taking home are secure — with data loss prevention, malware protection and all of the necessary protection at the endpoint. That could be a huge gap, because people are not connected to the network within the corporate environment now, they’re somewhere else. But those endpoints definitely need higher security. Second, I think there’s definitely some behavior where people are working remotely, but also searching for information: where they can buy toilet paper, which stores show up. And this thing about [COVID-10] infection maps,
people are looking for where the infections are, and that’s where the bad guys are spinning up websites and phishing these people. I think the third area where risk is increasing happens because people are busy at home with the kids running around having to do their work, and they’re probably not paying enough attention to phishing attacks, and we’re seeing a huge peak right now with COVID-19 phishing. That’s the biggest threat we see from an enterprise perspective. And I think the fourth thing is, [we] are working from home, while some people might be working from coffee shops, they could be working from unsecure WiFi or hacked WiFi connections. HW: A lot of people have been forced to start working remotely – how does using a home connection as opposed to a professionally secured network affect cybersecurity risks? Should all remote workers be using Virtual Private Networks? SA: Email usually doesn’t require VPN. A VPN is great when you’re a programmer and you’re accessing sensitive information on the corporate network. For normal tasks, like this video session or Zoom, that doesn’t need to be over a VPN. What we try to achieve is securing the endpoint. So, when I send an email from my laptop, it’s secured over whatever connection, whether I’m using Ellie Mae internet in the building or I’m using my WiFi connection. The traffic is secure because we’re securing people’s laptops, from data leakage, from anti-malware and also a lot of these applications. They’re encrypted end to end, so it doesn’t matter what WiFi connection I’m using, or what network I’m using. HW: What extra measures should people take to protect themselves and their clients’ data when working remotely or from home? SA: The extra precautions people should be aware of are, first they shouldn’t be clicking on anything that looks suspicious. They need to pay attention to all of the flood of information about the pandemic. People offering to help, companies who are offering help, they need to be really careful with their official sources for pandemic information
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HW: Does social distancing have an effect on phishing and ransomware risks, considering a notable percentage of the workforce has gone remote? SA: I think people are now starting to feel lonely, they’re starting to feel like they’re not having their teammates to talk to close by, and they don’t have the water cooler conversation over lunchtime. They’re reacting to a lot of the social media interactions and we’re observing a huge spike of malicious information and malicious messages going to people because there is a need for people to interact with their friends, their colleagues, family members. The adversaries are taking advantage of this social inconvenience, this situation. Now, they take advantage of a sense of urgency when you need to file taxes. They could send you a phishing email saying ‘hey, your filing didn’t go through.’ It’s the same thing here — they know people are in need of information they need to hand out to their friends, they can send them urgent messages, offering either services or connections or other types of things that would fill this need for social interaction. [They are] definitely, definitely taking advantage of that. HW: Is Ellie Mae seeing or capturing any data or insight into cyberattacks in the lending process? How are they advising lenders to be more safe and secure? SA: We’re definitely monitoring our own environment and our threat landscape. We are definitely tightening up our threat intelligence regarding Ellie Mae. And by doing that, obviously we’re protecting our customer data and our services that we offer to our customers. HW: What is the biggest technology challenge Ellie Mae clients are seeing in the shift to remote? SA: I think the technology challenge which we took on from the get-go, was the potential saturation of our VPN communication, which was not the case. We revamped our VPN capability before sending everybody home. I think the other challenge was the potential of reaching capacity on some of the services such as Zoom and things like that and, knock on wood, it’s still going fine, I think we have enough bandwidth.
From an operations perspective, things are normal. We’re monitoring hour by hour, we have all of these standup meetings every day. I’m probably attending about a dozen stand-ups every day with just monitoring and watching. Things are normal… I think we’ve been over-prepared for a lot of this… even from a pandemic management perspective. Within our anti-phishing program, about four years ago we started running phishing simulations on a very regular basis. We change this theme all the time. Sometimes it’s personal themes, sometimes it’s work-related themes and we monitor the numbers. We send the notifications to the people who click on our phishing simulations. Also from a technical perspective, we’ve deployed some intelligent tools to detect behavior of these types of attacks. And, also from an email gauge perspective, we built a bunch of rules to reduce the number of these spray-and-pray types of attacks, and also targeted attacks. So we have different techniques for different types of attacks from a phishing perspective. And then, from an awareness perspective, Erica [Bigley, Ellie Mae chief marketing officer] has been a great partner with me on this, we publish articles on a regular basis for employee awareness. In fact, this week we published an article on how people can protect themselves against pandemic-specific phishing attacks, providing a lot of guidance, a lot of details, some infographics and visuals for people to look at. HW: What should you do if and when you are attacked? SA: The best way to deal with it is to be able to detect it and block it. Typically what we really worry about as a SaaS company is the phishing attack that has been infected, or sometimes what we call a weaponized attachment. That’s how the ransomware was tagged, moving around the company and infecting all of the servers. So those are the things that we always do our best to detect and block. The rest of the phishing attacks, either where they asked for money, or this other category called business email compromise where the attacker sounds like a CEO asking the CFO to wire money. There’s a lot of those also, of course. But as a SaaS, our biggest priority is to make sure that we don’t get infected, and phishing attacks have been a huge conduit of those types of infections and distribution of ransomware. We want to block those as much as we can. And also, we want to make sure that we have the right controls in place, and educate people in case some of those phishing emails go through that the end-user doesn’t click. It’s a kind of dual approach: there’s the technology process but also a huge aspect of awareness across our employees. They should pay attention to these because technologies and tools are never perfect. And these attackers are innovating every single day. They’re getting really good at it and they invest a lot of money and effort in these efforts. So, technology is important, as is detection monitoring, but the human aspect is a hugely important business well. That’s how we get prepared for this.
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such as the [Center for Disease Control], they only need to go to trusted sources, that’s a big one. There’s definitely an increased volume of those types of phishing attacks. Second, they need to make sure that if they need to work outside of their home, they need to use a WiFi connection that is a trusted connection. I think the third one is definitely if they are going to use any critical application, or they need to access code repositories, development environments, anything that could potentially be touching production environments, or any critical business applications, or data customer data, they need to use VPN. Or, they need to use another secure channel, such as VDI. So, there are some secure mechanisms of accessing critical applications, critical systems that must be utilized in these types of remote working situations.
CONGRATULATIONS 2020 HousingWire Vanguard Award Winners
JAY PROMISCO Sierra Pacific Mortgage Chief Production Officer and 2020 Vanguard Award Recipient
Dynamic doesn’t even begin to describe our fearless leader Jay Promisco. With over 20 years in the mortgage lending industry, Jay’s vision, leadership, dedication and driving energy make this a well-deserved recognition. Sierra Pacific Mortgage would like to extend sincere congratulations to Jay and all this year’s distinguished winners.
©2020 Sierra Pacific Mortgage Company, Inc. NMLS# 1788. (www.nmlsconsumeraccess.org) Equal Housing Lender. 1180 Iron Point Road, Suite 200, Folsom, CA 95630 (Tel. 800-447-3386). FOR INDUSTRY USE ONLY. NOT FOR CONSUMER USE. DO NOT DISTRIBUTE TO CONSUMERS.
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Gathering around the table: How one title company pledges to support local community By Brena Nath
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Tucked right into the end of the home-buying process is the unique opportunity for title companies to connect with borrowers on how they can give back to the community together.
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Title companies and agents are often the last people to see borrowers before their highlyanticipated move into their new home, and they’re also invested in the well-being of the community. After all, the cornerstone of the housing industry is the local community. This level of commitment to their hometown is why Security Title Insurance Agency continues to dedicate its time and resources to the St. Louis metropolitan area, where it has a handful of offices spread across the region. “One of the things we’re really proud of is that we’re locally owned, and we’re support-
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ing our community by hiring people who live in the community to work for us,” said Wendy Cromer, Security Title Insurance Agency vice president of compliance, sales and marketing. “We just feel it’s important to give back and to not just be a corporation in the community.” Every year, Security Title tries to support at least one charitable initiative. Given how each year brings a new set of challenges or needs, like the COVID-19 pandemic for example, the charity they choose to support varies depending on the year. The title company also uses the various initiatives as a way to work together with their customers to give back to local causes. “Naturally, around the holidays, we typically adopt families and buy presents for them. We also would adapt ornaments at senior citizen homes, where they would put three things that they wanted on an ornament on a tree, and then, we would fulfill those ornament wishes,” Cromer said. But this year brought a new set of challenges when it comes to giving back. Tightened safety restrictions made it tough to physically go inperson to volunteer, host charitable events, run marathons together for a cause and more. But even with stricter guidelines in place, it didn’t stop companies, like Security Title, from finding new, creative ways to give back. Cromer explained that Security Title chose the St. Louis Area Foodbank as its initiative this year since food banks were really struggling due to the pandemic. The food banks were also faced with an influx in demand since schools were closed. “During the month of May, our company donated $5 for every buyer side, seller side or refi closing that we did,” she said. And while the pandemic forced everyone to shift how they typically operate, the St. Louis Area Foodbank was able to adapt to the new virtual world caused by the virus and created an online food bank for Security Title since they
couldn’t go in person and bring canned goods. Instead, people could go online to Security Title’s virtual food bank and purchase things like a case of green beans or a case of macaroni and cheese and pay whatever the wholesale price is. That item would then be added to Security Title’s cart that went toward the food bank. “It was really a huge effort, and we did some internal challenges between our offices to encourage the employees to participate,” Cromer said, touching on how the group effort not only rallied employees but also got some of their clients involved in the donation process. In total, Security Title was able to donate $4,578.40 and provide 18,314 meals to the food bank. Another big initiative that Security
Title championed with the help of their employees and customers was donating to Habitat for Humanity. Similar to the food bank initiative, Cromer said that they donated a flat amount to Habitat for Humanity for every closing they conducted, but with this one, they also took it a step further. Since they continuously deal with people selling their homes who have to pack up all their belongings, they encouraged sellers to donate any unwanted items to the habitat ReStore. “It was kind of a double way of helping to support their mission,” she said. “That was a great way to just be involved, and I think that the customers really appreciated knowing that they’re supporting the community.”
Cromer added that they would give their customers in both drives, whether it was Habitat for Humanity or the food drives, the opportunity to donate personally over and above what the title company was doing if they wanted to. Whether it was customers calling in to say that they’re working with the habitat ReStore to donate their unwanted items as they move or coming together as an office to adopt a senior during the holiday season, Cromer explained that these initiatives gave them a way to support their community together. “All of our employees
have their own causes as well, and as a company, we definitely want to support them, and their individual causes,” Cromer said. “But I always think it’s good to have a greater cause for everyone to come together and be part of. It’s fun to see what we can do as a company, how we can make change, how we can lend support and the difference we can make when we as a company and our employees come together and do something.” “It’s truly important for any company to find some way to give back, and for every company, that’s going to look different, and that’s okay. But you have to find some way to truly engage with your community,” she said.
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An aerial shot of an L.A. neighborhood supports recent data that the number of people who wanted pools in the summer spiked alongside those looking for patios, remodels and home offices. With July builder confidence reaching its highest level since 1998, renovations, maintenance activity and existing housing activity began to tick back up towards pre-pandemic levels in support of increased demand. With reports showing more and more people fleeing urban neighborhoods for the suburbs, spending the summer in a pool of their own may be the future.
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When we named him President in early 2020, ReverseVision already knew Joe Langner was no ordinary Joe. More like DiMaggio, Frazier, Namath and Montana, in our opinion. ReverseVision’s game-winning team, peerless technology and business-tested strategies allow mortgage lenders to seize their share of a home equity lending solution custom fit for senior home owners where they are in life. Joe’s mission was to advance technical initiatives allowing loan originators to easily integrate senior lending programs into their existing origination workflow. Joe came out swinging while ReverseVision’s platform continues to be the #1 choice for lenders, brokers, and technology partners alike. Now, that’s no ordinary Joe!! “Similar to my experiences both at Ellie Mae and Blue Sage, where solving for the success of our customers was our sole purpose, ReverseVision has built technology and developed a playbook that equips lenders to execute new winning game plans around the growing demand for senior home equity solutions,” said ReverseVision President Joe Langner.
Congratulations, JJoe LLangner V NGUARDS Visit www.reversevision.com for more information about the ReverseVision platform.
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