RENOVATION LOANS HOW TO GET A PIECE OF THIS $32 BILLION MARKET
MPAMAG.COM ISSUE 9.01
INDUSTRY ICON THE CEO WHO BROUGHT REVERSE MORTGAGES BACK MARKETING TIPS NEW WAYS TO REACH CLIENTS IN 2015
YOUNG
GUNS Meet the 50 young stars rewriting the future of the mortgage industry
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*Carrington will process any qualifying loan from the time a loan file is submitted to underwriting to the time it funds within 15 business days of appraisal receipt or the company will apply a closing cost credit of $500 to the loan once the loan closes. In order to receive the closing cost credit, any delay that causes the loan to close more than 15 days after appraisal receipt must be due to Carrington’s independent processes. If the delay is due to the broker, borrower’s or third party’s action or inaction or any other circumstances outside of Carrington’s control, the closing cost offer will be void. This offer excludes some loan programs, such as VA loans, USDA loans, 203K Loans Short Sales, New Construction loans, loans requiring property repairs, inspection, or re-inspection prior to closing, loans requiring condo approvals and flips. Offer is subject to revision or cancellation at any time. The appraisal received date is recorded in Pipeline Manager for all qualifying loans. Some loans may require additional information and be returned. Exclusions apply; contact your Account Executive for details. © Copyright 2007-2015 Carrington Mortgage Services, LLC headquartered at 1610 E. Saint Andrew Place, Suite B150, Santa Ana, CA 92705. Toll Free (800)561-4567. NMLS ID 2600. Nationwide Mortgage Licensing System (NMLS) Consumer Access Web Site: www.nmlsconsumeraccess.org. AZ: Mortgage Banker BK-0910745; 2159 McCulloch Blvd 4, Lake Havasu City, AZ 86403. CA: Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act, File No. 413 0904. CO: Check the license status of your mortgage loan originator at http://www.dora.state.co.us/real-estate/index.htm. GA: Georgia Residential Mortgage Licensee 22721. IL: Illinois Residential Mortgage Licensee. MN: This is not an offer to enter into an interest rate lock agreement under Minnesota Law. MO: Residential Mortgage Broker License 09-1746-S. NH: Licensed by the New Hampshire Banking Department. NJ: Licensed by the N.J. Department of Banking and Insurance. NY: Licensed Mortgage Banker—NYS Department of Financial Services. New York Mortgage Banker License B500980/107664. OH: Ohio Mortgage Broker Act Mortgage Banker Exemption MBMB.850208.000 (FHA DE & VA Automatic loans only) OR: Mortgage Lender License ML-4886. PA: Licensed by the Department of Banking. RI: Rhode Island Licensed Lender, Lender License 20112809LL. VA: Licensed by the Virginia State Corporation Commission MC-5382. WA: Consumer Loan License CL-2600. Also licensed in AL, AR, CT, DE, DC, FL, ID, IN, ME, MD, MI, NM, NC, OK, SC, TN, TX, WV and WI. NOTICE: All loans are subject to credit, underwriting, and property approval guidelines. Offered loan products may vary by state. There is no guarantee that all borrowers will qualify. Restrictions may apply. This is not a commitment to lend. Terms, conditions, and programs are subject to change without notice. This information is for mortgage professionals only and is not intended for distribution to consumers. Carrington Mortgage Services is not acting on behalf of or at the direction of HUD/FHA or any office of the federal government. All rights reserved.
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FEBRUARY/MARCH 2O15
UPFRONT 06 Statistics
CONTENTS 22
How can you capitalize on the lucrative home renovation market?
8 News analysis What the FHA premium cut means for the housing market
10 Opinion Why ethics matter in mortgage deals
11 Head to head Will the latest disclosure rules be good for business?
12 Technology update FEATURE
COVER STORY
YOUNG GUNS
26
THE RISE OF RENOVATION LOANS
Renovation loans are a good fit for many clients – so how do you market them?
50
Reza Jahangiri persevered against product prejudice and a sluggish economy to lead American Advisors Group to success
42
5 MARKETING TIPS FOR 2015
Marketing practices have changed with the times – here are 5 ways to keep up
52
16 Branch network update Want to reach millennials jobseekers? Joining a network might be the answer
18 Reverse mortgage update The latest Baby Boomer housing trends offer opportunity for reverse originators
PEOPLE 55 Career path Tim Peterson thought he was done with the industry – until he found his place at Academy Mortgage
56 Favorite things JJ Mack, American Pacific Mortgage
RESOURCES 46 Branch network directory MPA’s all-inclusive directory of branch networks
STRATEGY
VIDEO MARKETING
An expert shares the best ways to use video to connect with potential clients
2
Why 2015 promises to be a good year in the commercial space
The latest corporate moves and appointments in the mortgage industry STRATEGY
FLIPPING THE SCRIPT
14 Commercial lending update
20 Intelligence
These under-35 superstars are changing the face of the mortgage industry
INDUSTRY ICON
New online tools from Fannie Mae and the CFPB, how technology will handle the latest regs, and other tech news
MPAMAG.COM CHECK IT OUT ONLINE
www.mpamag.com
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4/02/2015 6/02/2015 3:54:32 10:37:14 AMPM
UPFRONT
EDITORIAL
Youthful enterprise T
he mortgage industry these days is challenging, to say the least. Regulatory challenges and plain old competition mean originators have to be tough-minded, determined and innovative. That’s why it’s heartening to see ambitious young people entering the industry. Recently, we asked you to nominate outstanding young originators – people who’ve already made their mark in the industry despite their youth. We’ve narrowed that list down to 50 “young guns” – men and women 35 or
“[These] ambitious, driven, energetic professionals [are] injecting a fresh perspective into an industry that’s seen its share of troubles in years past”
www.mpamag.com FEBRUARY/MARCH 2O15 EDITORIAL Editor Ryan Smith Writers Rachel Norvell Justin Darosa Copy Editors Clare Alexander Moira Daniels
CONTRIBUTORS Allison Landa Kim Goldstone Geoff Anderson
ART & PRODUCTION Design Manager Daniel Williams Designer Loiza Caguiat Cess Rodriguez
SALES & MARKETING Vice President Cathy Masek National Sales Managers Anne LaFlam Vanessa Williams Marketing and Communications Manager Lisa Narroway
CORPORATE Chief Executive Officer Mike Shipley Chief Operating Officer George Walmsley Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil
Traffic Manager Kay Valdez
EDITORIAL INQUIRIES ryan.smith@keymedia.com
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ADVERTISING INQUIRIES cathy.masek@keymedia.com
younger who are making a difference in the mortgage business. These young people represent a new generation of mortgage originators – ambitious, driven, energetic professionals who are injecting a fresh perspective into an industry that’s seen its share of troubles in years past. In this issue, you’ll meet top producers, idealistic young professionals with a passion for helping their customers attain homeownership, and men and women who’ve already become mentors to their colleagues despite their youth. All of these young industry pros have one thing in common – they’re changing the face of the mortgage industry.
The MPA Team
vanessa.williams@keymedia.com anne.laflam@keymedia.com
Key Media 78O7 E. Peakview Ave., Suite 115 Centennial, CO 80111, USA tel: +1 720 316 0151 www.keymedia.com Offices in Denver, Toronto, Sydney, Auckland, Manila
Mortgage Professional America is part of an international family of B2B publications and websites for the mortgage industry MORTGAGE PROFESSIONAL AUSTRALIA sam.richardson@keymedia.com.au T +61 2 8437 4787
CANADIAN MORTGAGE PROFESSIONAL vernon.jones@kmimedia.ca T +1 416 644 8740
4
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UPFRONT
STATISTICS
Home improvement There’s no other way to say it: Home renovation is a big deal. Are you positioned to capture some of this lucrative business? RENOVATION LOANS: WHAT’S COVERED
$3,597
$3,399
Denver, CO
San Francisco, CA
203K: Decks, patios, bathrooms, kitchen remodels, additions to the home (such as a second story) and other structural repairs. Luxury additions like swimming pools aren’t covered. An FHA loan, the 203K is only available for a property that will be the borrower’s primary residence. HomeStyle: A HomeStyle loan will cover most of the same repairs as a 203K. However, HomeStyle loans operate under slightly stricter Fannie Mae regulations. This loan covers borrowers looking to renovate a vacation or investment property.
$3,463
Las Vegas, NV
$3,986
Phoenix, AZ
$3,451
San Jose, CA
HomePath: This loan was for borrowers wishing to buy Fannie Mae-owned properties that had typically been acquired through disclosure. However, the program was discontinued late last year.
FREQUENT FIXES So where do most Americans spend their home improvement dollars? According to the US Census Bureau, most want to fix up the smallest room in the house – in 2010, more than 14 million households remodeled their bathrooms. Other popular projects included remodeling the kitchen and replacing or upgrading the roofing. The least common project? Adding an in-ground pool; only 560,000 households decided it was worth the effort and expense.
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$3,393
Austin, TX
Remodel bathroom
14,511,000
Remodel kitchen
8,452,000
Remodel other rooms
5,862,000 Number of households
Exterior doors
5,672,000 8,224,000
Roofing 0
3 million
6 million
9 million
12 million
15 million
Source: US Census Bureau
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CITIES THAT SPEND THE MOST ON HOME IMPROVEMENT Source: Bloomberg
$3,296
Boston, MA
$3,654
Providence, RI
$3,208
New York, NY
MORE THAN HALF OF HOMEOWNERS MAKE IMPROVEMENTS
$3,589
Washington, DC
More than half of US homeowners made improvements of some sort between 2009 and 2011, according to the US Census Bureau and the Department of Housing and Urban Development. Of 76.1 million total owner-occupied housing units, 43.7 million homeowners made improvements during that period. Nearly a quarter of those made energy-efficient improvements like installing solar panels, adding insulation or improving heating and cooling – improvements that qualify for FHA energy-efficient renovation loans.
76.1 million owner-occupied housing units
BILLIONS SPENT ON HOME IMPROVEMENTS
32.4 million
According to the U.S. Census Bureau, Americans applied for more than 826,000 home improvement loans in 2009; more than $32 billion was originated. It’s no surprise – renovation loans are a ‘win-win,’ bringing originators extra business and allowing borrowers to save money by buying an older house and renovating it. Borrowers also can add instant equity to their homes by adding improvements. Applications received
Loans originated
Number
826,900
388,000
Amount
$60 billion
$32 billion Source: US Census Bureau
43.7 million
Homeowners who made improvements Homeowners who made no improvements Source: HUD and US Census Bureau
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UPFRONT
NEWS ANALYSIS
How the FHA premium cut will affect housing Mortgage originators have praised the Obama administration’s move to lower annual FHA mortgage insurance premiums, but some feel its actual impact on the housing market could be slight MANY IN the mortgage industry have called the move by the Obama administration to lower Federal Housing Administration [FHA] mortgage insurance premiums as a godsend, noting how the action could boost home buying. However, there are some who are skeptical about how much actual impact the cut will have on the housing market.
FROM THE FORUM The other point that has not been mentioned is that there will be a significant number of current FHA borrowers who were shut out of a streamline refinance due to the increase in the monthly MIP. With this reduction, there should be plenty of additional streamline clients who didn’t qualify …” –B. Richards What they need to drop is the mortgage insurance for life … 20 years from now when your mortgage-to-value is 16% and you still have to have MI is ridiculous” –Brett Government involvement isn’t a good thing. It’s not the mortgage programs, it’s the economy. The simple fact is people can’t afford homes. We need wage growth and stable … high-paying jobs” –Mya C Visit www.mpamag.com/forum
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President Obama announced in early January that he will direct the FHA to reduce premiums by 50 basis points to 0.85%. FHA fees have skyrocketed since the housing bust – the annual insurance premium paid by most FHA borrowers is currently 1.35%, up from 0.55% in 2010 — or more than $300 a month on a $300,000 mortgage. The cut, the White House said, is in an effort to help millions of families save billions of dollars in mortgage payments in the coming years, helping to support the ongoing housing market recovery.
Financial Services Committee Chairman Jeb Hensarling said in a statement. “If President Obama follows through on [this] pledge, he will be increasing the likelihood that taxpayers will have to foot the bill for yet another bailout.” Mark Calabria, director of financial regulation studies at the Cato Institute, agrees. “This sounds like a move in the wrong direction,” he told Businessweek. “FHA has a portfolio of poor quality loans. This will end up costing the taxpayer considerably.” After the financial crisis, the FHA’s finances
“It couldn’t come at a better time... I think it will have a definitive impact” David Stevens, MBA Analyst Jay McCanless of Sterne Agee says the savings will equate to a mere $25 a month per $100,000 in a 30-year mortgage, which he adds is probably not enough to significantly boost home sales or spur builders to ramp up construction. “Such a change would be marginally beneficial for the average borrower,” he said. Meanwhile, Republicans have said FHA premium cuts should be off the table because the agency’s insurance fund remains below the legally required level of 2%. Congress mandated the FHA to keep enough cash to cover all projected losses in its $1.1 trillion portfolio. “A broke FHA is a broken FHA,” House
took a hit, and in 2013, the agency was forced to draw on $1.7 billion in taxpayer funds for the first time in its history. Since then, FHA is back in the black, in part because of the higher premiums. The White House stated the new premium level is consistent with the FHA’s commitment to continue strengthening its financial health through growing reserves. However, the action will have to be approved by Congress. “The president’s decision reflects a race to the bottom between the FHA and the GSEs in which the private sector is crowded out and taxpayers are left holding the bag,” said Rep. Ed Royce,
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?
FREQUENTLY ASKED QUESTIONS ABOUT THE FHA PREMIUM REDUCTION
1) How much can borrowers save? According to the White House, typical first-time homebuyers could save up to $900 annually on their mortgage payments. 2) When will it happen? FHA’s new annual premium prices will take effect for all new FHA-insured mortgages endorsed toward the end of January. 3) Who benefits? Homebuyers who qualify for FHA-insured mortgages and existing homeowners who refinance into an FHA mortgage will see similar reductions.
“This action will make home ownership more affordable for over two million Americans in the next three years” Julian Castro, HUD R-Calif. “The financial crisis is proof positive that an increased government presence in housing distorts the market and promotes the very boomand-bust cycle we are trying to avoid.” Mortgage industry celebrates Despite skepticism, many in the mortgage industry celebrated the news, including Mortgage Bankers Association [MBA] CEO David Stevens. “It couldn’t come at a better time,” he said. “February is the beginning of the spring market. I think it will have a definitive impact, particularly in the first-time homebuyer market.” For the typical FHA applicant, the reduction in premiums means a monthly savings of about $80, according to CoreLogic chief economist Sam Khater. “It’s positive news from a consumer welfare
perspective, especially for first-time homebuyers, which account for the majority of FHA’s business,” Khater said. “However, I think the marginal impact on sales will be small because potential buyers make the decision to purchase based on trigger events, such as a new job, marriage, kids, etc. Changes in affordability only impact how much home they can buy.” HUD Secretary Julián Castro is optimistic about the impact the cut will make on the housing market. “This action will make homeownership more affordable for over two million Americans in the next three years,” Castro said. “Since 2009, the Obama administration has taken bold steps to reduce risks in the mortgage market and to protect consumers. These efforts have made it possible to take this prudent measure while also ensuring FHA remains on
4) Why now? The White House said it’s trying to help creditworthy families who can afford a home but have been shut out of the market because of tight lending requirements. It also may be because the FHA is on a better road to financial stability. 5) What about the existing FHA customer? Currently, it appears there are no benefits to current FHA customers. a positive financial trajectory.” The FHA estimates that 250,000 first-time homebuyers will enter the market after the premium reductions. The plan could steer business away from the Fannie Mae and Freddie Mac, as the recent move by the government sponsored enterprises to finance mortgages again with just 3% down may not be as enticing because of the higher private mortgage insurance premiums charged on the loans. And there are some who think the premium cut doesn’t go far enough. “HUD also needs to allow borrowers to drop the monthly insurance premium once the loan reaches 80% LTV,” said Marc Savitt, president of the National Association of Independent Housing Professionals. “Lowering the costs associated with FHA financing will allow more borrowers to qualify and afford the program.”
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UPFRONT
OPINION
GOT AN OPINION THAT COUNTS? Email mpa@keymedia.com
IT’S ALL ABOUT THE CONSUMER For mortgage professionals more than most, ethical business is good business, writes NAMB president John Councilman WE LIVE in a capitalist society. It only works well when people are free to operate their businesses to supply the needs of consumers with a profit incentive. We go into business with the expectation of making money. However, if making money is the main motivation, things can take a nasty turn. In the past decade, we saw what happens when the only motivation is making money. Some businesspeople had no regard for what effects their actions would have on consumers, other businesses and even their own business. Somehow, from the top to the bottom, some companies cast aside ethics. The result was a collapse of the business, huge damage to consumers and a near collapse of the economy. It was all done in the name of free-market economics. However, free markets are also only effective when both parties understand the duties of the other and the truth is being told. Many consumers were misled or simply didn’t understand. That is a recipe for disaster. Competition will only work when the parties fully comprehend what they are doing. Laws must step in where dishonesty is the order of the day. In the wake left behind, people were angry. Someone had to answer for what had happened. The mortgage industry was viewed as the culprit, and the public wanted us to pay. Congress and regulators were expected to not only fix the system, they were expected to exact punishment on the entire industry. We complain that government has gone too far. I agree that they have, but now we have to earn the public’s trust again so they are no longer demanding our punishment. I’m afraid many
are still bitter, judging by recent elections where Fannie Mae, Freddie Mac and the banks were demonized by the winning candidate. Too many homes are still underwater or barely have enough equity for the memories to fade. We should have learned some valuable lessons from this disaster. Certainly we learned that allowing people with poor credit to purchase with no money down was not a good idea. The interesting part is that many people in the
they don’t care if they get sick. You have the ethical obligation to refuse the request of someone who has bad judgment that will harm them. I realize this may go against the grain of many who want the consumer to take all of the responsibility. Some think every transaction should be ruled by caveat emptor, or “buyer beware.” Courts have ruled over and over that even if a consumer knew the gas tank on a car could explode and still wanted to buy one, you shouldn’t sell it to them. Unfortunately, many payment option ARMs were likely to explode. The government itself is confused in this area. The have willingly jumped in to solve everyone’s problems by setting many new rules. In so doing, they have harmed quite a few creditworthy borrowers. Serving someone French fries that may or may not harm them is very different than selling someone tainted food. Depending on the person’s genetics, the French fries may be perfectly healthy. There is a fine balance that makes a free-market system work. Too many restrictions
“There must be a symbiotic relationship between business and consumers where everyone wins. ... We have no business if we destroy our partner” business only realized this because it harmed their business or them personally. We should have learned and known that these practices harmed consumers. There must be a symbiotic relationship between business and consumers where everyone wins. Everything we do should be measured with this perfectly balanced relationship in mind. When we harm the consumer, it is like killing the golden goose. We have no business if we destroy our partner. I have heard people flippantly say, “If the food made the customer sick, you wouldn’t blame the waitress.” If the waitress knew the food was tainted and served it to you anyhow, yes, you should blame the waitress. The same is true of any product. No matter where you are in the chain, if you have reason to believe what you are selling is going to harm someone, you need to stop immediately. It doesn’t matter if the food looks delicious and the customer is hungry. It doesn’t matter if the consumer says
can harm consumers. Removing risk totally is not only impossible, it isn’t healthy. In reality, we shouldn’t need all of the regulation we have now. Our industry needs selfregulation that is flexible enough to meet consumers’ needs but provides a check to prevent decisions that are bad for everyone concerned. We can’t mindlessly offer products without considering whether a loan is appropriate for an individual. If we don’t do that, government is likely to do it for us in a way we won’t like. My challenge is for each of us to consider the person to whom we are selling a product. They really are the source of our livelihood. If we believe we are working for a company that doesn’t honor their customer’s best interest, perhaps we should consider finding a new company. It is true that we may be required to make some sacrifices. However, there is much evidence that businesses who operate ethically do better in the long run than the unethical.
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UPFRONT
Q:
HEAD TO HEAD
Are new disclosure rules a positive step?
The new integrated disclosure rule set to take effect in August will combine some disclosures consumers receive when applying for a mortgage. We asked mortgage pros how they think the new rules will affect business
Marc Savitt President NAIHP
Chief Compliance Officer INLANTA MORTGAGE
Jean Badciong
Don Frommeyer
“It’s going to be a little bit of both. The current disclosure forms we have are too confusing for consumers. When [the current Good Faith Estimate] came out in 2010 with the RESPA reform, we told them it was too confusing. It turns out we were right. As far as the new forms are concerned, from what I’ve seen, the forms themselves are simplified. But my concern is that the final settlement statement has to be given to consumers three days prior to closing. This is going to cause a major problem for consumers and industry alike. It’s completely unnecessary. I understand the reasoning behind it. However, we already have tolerances with the Good Faith Estimates that are carried out. The tolerances are a stop-gap, so you’re not going to see the consumer with any surprises at the closing table, other than perhaps a pleasant surprise because the cost is lower than they expected.”
“It is my opinion that the new disclosure rules … will be a positive step. The disclosure process has been confusing for customers, and made even more so when changes were made to the Truth in Lending [Act] in 2009 and the Good Faith Estimate in 2010. Key information regarding payment schedules, product information and estimated amount of funds required to close were omitted. Also, the ‘bundling’ of fees meant to simplify the shopping process only seemed to confuse it more. Now with form standardization and critical information being disclosed on the first page of the document ... the consumer is able to have a better understanding of the loan terms and costs. While there are still clarifications sought for by the industry, overall, with the help of our technology partners, we feel the new simplified Loan Estimate and Closing Disclosure will be beneficial for the consumer and for our industry.”
“The jury’s still out on the form. It’s informative; it’s not that complicated – but everybody has to learn how to look at new forms. Not only are you going to have to teach your loan originators how to look at new forms, they’re going to have to teach their customers how to look at new forms. The disclosures aren’t going to be too bad – it’s going to be the extra time in the closing process that’s going to be the problem. People don’t look at this as you having a 30-day lock, so it’s going to give you less than 10 business days to get everything done. You’re going to have to make sure you get all the documents, all the fees – you need everything right the first time you disclose. And then you’re going to have situations where you still have to re-disclose. You’re going to see companies going to a 45- or 60-day lock just to make sure they have time – and that costs the customer money.”
CEO NAMB
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11
UPFRONT
TECHNOLOGY UPDATE NEWS BRIEFS Mortgage lender aims to get rid of loan officers In an effort to eliminate origination costs, online mortgage lender Lenda said it wants to keep the entire mortgage lending process online. Lenda's plan to eliminate loan officers could work in part because it refinances loans instead of originating them. Lenda, formerly known as startup GoRefi, operates completely online – proclaiming itself “the Turbo Tax for mortgages.” The company's technology uses complex algorithms that mimic loan officers’ job responsibilities and identifies the most suitable type of loan for a borrower early in the process.
Fannie Mae launches new appraisal analysis tool Fannie Mae has launched its Collateral Underwriter [CU] tool, a proprietary appraisal analysis application that allows lenders to compare appraisals against Fannie Mae’s database of appraisal and market data. CU, which is now available to lenders, provides additional transparency and certainty by giving lenders access to the same appraisal analytics used in Fannie Mae's quality control process. The government-sponsored enterprise said the new tool is an effort to provide relief on appraisal representations and warranties in the future.
Facebook’s new feature could help generate leads Facebook’s latest tool, keyword search, allows users to search their new feeds for specific posts their friends have made. By making friends’ posts searchable, the social media site has potentially made
12
generating leads much easier for real estate professionals. The feature will help people get more use out of the increasingly overcrowded news feed and could make Facebook more useful. Queries for “mortgage” or “renovation loan” could surface recommendations from friends that compete with Google results, or surface a feed of recent mentions by friends, similar to Twitter.
Velocify’s new application highlights high-priority borrowers Velocify is now offering Velocify for Salesforce, an application that integrates high-velocity sales tools into the CRM technology. The company says the application will remove the guesswork for loan officers on the highest priority borrowers and increase the number of contacts lenders make with potential borrowers. Key features include dynamic lead distribution and redistribution, automated guided selling, activity prioritization, and top funnel insights that allow mortgage sales managers to measure, coach and optimize a loan officer’s performance.
Freddie Mac deploys new servicing technology In an effort to increase transparency and ex-pand access to credit, Freddie Mac has deployed a new servicing technology tool that allows lenders to electronically submit appeal data and supporting documentation for foreclosure timeline compensatory fees and late foreclosure sale reporting compensatory fees. Servicers must use the Default Fee Appeal System for all compensatory fee appeals now, but Freddie encouraged the group to begin using the appeal system in December 2014.
CFPB releases new mortgage shopping tool AMERICANS MAY BE spending more time shopping for clothes than a mortgage, according to a new report from the Consumer Financial Protection Bureau [CFPB], which also released a new ‘unbiased’ tool to help consumers shop for a mortgage. The regulator claims its new Owning a Home tool helps borrowers find the best rates in their area based on data the CFPB gathers from lenders. The education tool is a part of the CFPB's Know Before you Owe mortgage initiative announced in November 2013. The campaign’s loan disclosure documents were created in an effort to more efficiently lay out mortgage terms for homebuyers and include two new forms: the Loan Estimate and the Closing Disclosure. Ken Perry, president and CEO of the Knowledge Coop, says the new tool is turning the CFPB into the new Lending Tree, without
BY THE NUMBERS
70%
of consumers reported relying on their lender or broker for mortgage information
47%
of homebuyers don’t compare lenders
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For more technology news as it happens, visit www.mpamag.com
the funding. “The CFPB has created a way borrowers can get a rate quote based on their circumstances. This is insane.” He adds that the program does not quote APR. According to new data from the National Survey of Mortgage Borrowers, almost half of consumers do not shop around for a mortgage when purchasing a home. Based on the study, the CFPB's latest report found that informed consumers are more likely to shop, especially if they are familiar with available mortgage rates. “Our study found that many consumers are not shopping for a mortgage. Consumers put great thought into the choice of a home, but the mortgage process continues to be intimidating,” said CFPB director Richard Cordray. “The Know Before You Owe Owning a Home toolkit makes it easy to see how shopping for a mortgage can translate into big dollars saved in the long run. We want to enable consumers to be more savvy shoppers.” The CFPB's report also found that while half of consumers shop around to see who advertises lower rates, fewer than one out of four borrowers actually end up submitting a loan application to more than one lender or broker. The regulator said most consumers get their information from lenders or brokers, who have a stake in the outcome. The National Survey of Mortgage Borrowers asked recent borrowers whether they used different information sources, and 70% of consumers reported relying on their lender or mortgage broker a lot to get information about mortgages.
DENNIS BOGGS Executive vice president of business development Calyx Software
MPA: What’s the biggest challenge facing mortgage technology providers this year? Dennis Boggs: Everybody’s biggest challenge this year will be the new disclosures from the CFPB. We’ll be adding the new data and forms in [Calyx LOS] Point, and that’s what we’ll be working on between now and August. We expect to have it out to the customer in the early part of the second quarter so our customers can see it, even though it won’t be used until August. The big deal last year was QM, and QM will continue to be an issue – but the new disclosures will be the biggest challenge this year.
MPA: How so? DB: Lenders are responsible for QM on their loans, and they’re responsible for the new disclosures. But that kind of raises an issue – where are the brokers in relation to the lenders? Who’s going to manage the disclosures? We’re in the middle of that discussion with vendors and lenders. There are different interpretations to the law. I expect that though the law will probably roll [out] on August 1 and won’t be delayed, I don’t think the heavy hammer will be there at first, because there will still be a lot of questions and a lot of interpretations.
MPA: So with little clarity on the law, how do you proceed? DB: What you have to do is what the minimum is, for sure, and then you have to keep talking and working together on contingencies. You have to have the new forms in your system, and you have to have the data. Then the way the data behaves on those forms has to be checked. That’s the minimum, so you have to at least cover that – and that’s a lot.
MPA: Point is the leading origination software right now, but you’ll be introducing a new system called Pace this year. How’s that going to affect Point users, especially in light of the new disclosure rules?
55% of shoppers said they were very familiar with mortgage rates, while 30% of shoppers said they were not at all familiar
Q&A New disclosures, new challenges
42%
of respondents said having an established banking relationship with the lender is “very important”
DB: Pace will be what we think, logically, is the future of Point customers. But we will have all the new disclosures in Point so people don’t have to worry about when to switch from Point to Pace. People don’t like to change systems if they don’t have to. You don’t want them to have to do that analysis when they’re still trying to keep their originations up in a down market.
MPA: Is technology becoming more vital as new regulations make the mortgage industry more complex? DB: Without technology, you couldn’t possibly survive in a handwritten way. I remember when you could get by with a spreadsheet, but those days are done.
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UPFRONT
COMMERCIAL UPDATE
Banks loosen purse strings for commercial real estate
SINCE THE housing crisis, the focus on high-quality loans has led to a tight credit market, especially among banks. According to the Federal Reserve’s latest Senior Loan Officer Survey, banks aren’t planning to loosen their purse strings anytime soon – at least not on residential mortgages. However, they are starting to ease up on commercial lending standards. In the survey, some large banks reported having eased standards on closed-end mortgage loans, but respondents generally indicated little change in standards and terms for other types of loans to households. Reported changes in loan demand were
NEWS BRIEFS
14
mixed. Most banks reported stronger demand for auto loans and weaker demand for nontraditional closed-end mortgage loans. The pullback from banks has allowed nonbank lenders to boost their market shares. Specialized mortgage companies made 23% of all mortgage loans in the first six months of 2014, up from 17% in the first half of 2013 and 11% in the same period in 2012, according to the Mortgage Bankers Association. However, the heap of red tape on originators also has led many non-bank lenders to tighten up lending criteria. David Zugheri, co-founder of Houston-based Envoy Mortgage, says the
CRE trends to watch in 2015 According to the US Cross Sector Outlook report from commercial real estate firm Jones Lang LaSalles [JLL], strong absorption will continue in the multi-family sector, while an uptick in deliveries is expected to drive vacancy increases across varying markets. Cashed-up private equity groups will continue to invest heavily in select-service hotel portfolios with 50 or more assets. JLL also predicts hotel occupancy rates will reach near all-time highs nationally and lifestyle-brand concepts will increasingly emerge at lower price points. Office investment sale activity is expected to
rules and regulations have weighed heavily on the mortgage industry, especially small lenders. “We are going to have to work through it together as an industry, and it’s going to take a while,” he says. “If I had to single out one group that is hurt the most by the rules and regulations, it would be the small lenders.” On the business side, credit criteria for construction and land development loans has eased. The survey reported most banks have eased either standards or terms on CRE loans
Most banks have eased either standards or terms on CRE loans during the past three months, citing more aggressive competition from other banks or nonbank lenders during the past three months, citing more aggressive competition from other banks or non-bank lenders as an important reason for having done so. A smaller number of banks also attributed their easing to a more favorable or less uncertain economic outlook and increased tolerance for risk.
grow in select core suburban areas. JLL also predicts absorption and rents will gain momentum, and office construction will increase. In the industrial sector, leasing market laggards are to be considered prime for value-add buyers; JLL expects the concept of clicks-to-bricks to emerge within retail. The firm said investors should get ready for upticks related to price per square-foot values as cargo volumes at ports increase. A focus on high-end Class A malls in strong markets, as well as strategic redevelopment in the B mall segment, should continue to bode well in the retail sector, particularly in Sunbelt markets.
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Q&A A bright future for commercial lending What does 2015 hold for the commercial market? We asked Christopher Perez, CEO of Drexel Brothers, where he sees the market heading in the next year MPA: Is 2015 going to be a good year for commercial lending? Christopher Perez: From what we’re seeing, I think the market is positioned for hyper-growth. It’s going to catch up to itself very quickly. The secondary market is really catching up. People are getting warehouse lines and doing stated loans again. It’s a very exciting time. Hyper-growth is kind of the 2015-2016 mantra for everybody.
MPA: A lot of people expected 2014 to be a big year for commercial. But while it was a good year, we didn’t see stratospheric growth. Why is that? CP: Last year was kind of everybody getting their sea legs. A lot of lenders are finding their way now that they’re capitalized again. … It’s all very fluid right now. When a new lender pops up, their guidelines can change almost every single month, because they’re finding their way. There’s a lot of competition. [Last year] wasn’t really the hyper-growth we were all expecting. This year I think is the tipping point. Last year was good, just not that good.
MPA: So is 2015 a good time to get into commercial lending? CP: It’s really a perfect storm. Over the next few years, you have a trillion
TRIA legislation passes In early January, President Obama signed off on the renewal of the Terrorism Risk Insurance Act [TRIA], which authorizes the program for six years. The program had lapsed at the end of 2014 after the US Senate failed to reach agreement on the legislation. “TRIA allows the US to maintain a stable terrorism insurance market so employers can invest in properties and create jobs without assuming the risk and liabilities of a terrorist attack,” said Chris Polychron, president of the National Association of Realtors.
dollars of commercial mortgage balloons coming due. What makes this a perfect storm is not only do you have this tidal wave of trillions of dollars coming due in the next three to five years. This is business that has to be done. Storm Front Two is that many of the original lenders that had done these loans vanished in 2008. They’re gone. So the majority of these loans coming due are with servicing companies right now. Most of the time, servicing companies don’t have the ability to rewrite a loan. The third thing that makes it a real perfect storm is that banks have been all but regulated out of commercial loans. A biggie for banks is liquidity. It used to be, if you wanted to borrow a dollar from the bank, it had to have, say, 50 cents on hand to lend you the dollar. Now if you wanted to borrow that same dollar from the bank, what with the Fed changes, the bank probably has to have $2 on hand to give you that dollar. They may want to do that loan for a 610 or 580 FICO score, but they can’t. So you’re in a business where it’s hyper-growth, it’s not as regulated as residential so it’s easier to do, and the fees you can make can be astronomical. And many of the borrowers are willing to pay those higher fees because they’ve been shut out of lending for six years…You want to talk about a business that anybody should get into? The next couple of years it’s going to be raining manna.
Rental growth pace reaches 2011 levels The annual rent growth pace for US apartments accelerated to 4.7% during 2014, according to MPF Research, the market intelligence division of RealPage Inc. This performance is a return to price inflation levels not seen since 2011, after growth cooled somewhat to 3% in 2012-2013. Rents climbed 0.6% during the last quarter of 2014. “The jump was an unusually strong increase for the fourth quarter time period, as seasonally slowed leasing activity tends to result in flat to negative pricing,” reported MPF.
Trepp CMBS delinquency rate declines During the course of 2014, the Trepp CMBS delinquency rate improved every month but two, ending the year down 168 basis points. The delinquency rate for US commercial real estate loans in CMBS is now 5.75%, the lowest rate since November 2009. Among the major property types, the lodging sector saw the biggest year-over-year improvement, falling 314 basis points during 2014. The retail sector saw the smallest improvement, dropping 40 basis points over the course of the year.
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UPFRONT
BRANCH NETWORK UPDATE NEWS BRIEFS Carrington now licensed to do business in Nevada California-based Carrington Mortgage Services, which focuses on underserved home buyers with subpar credit, is now licensed to do business in Nevada. The wholesale lender will enter a housing market that has shown steady improvement during the last year – according to Zillow, Nevada home values have gone up 14% in 2014, and it predicts they will rise 5.7% within the next year. The median home value in Nevada was $189,800 as of Sept. 30, 2014.
Nadlan Valuation expands in Mid-Atlantic and Southeast Nadlan Valuation is aggressively expanding into new areas of the country. The appraisal management company is growing its presence in the Mid-Atlantic and the Southeast regions and has added new appraisers to its staff in those states, and is looking to hire more. Nadlan works with certified and insured appraisers to deliver accurate and timely appraisals to mortgage lenders. “With so many regulatory pressures, lenders really appreciate our thorough appraisal review process,” said Sam Heskel, president of Nadlan.
Freedom Mortgage recognized for its title process Freedom Mortgage Corp., a privately held, full-service residential mortgage lender licensed in all 50 states, was named
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winner of the 2014 Global Award for Excellence in BPM & Workflow for its business process management technology. Freedom Mortgage was specifically recognized for its automated workflow surrounding the title insurance process, which increased in speed by 51%, with a 52% reduction of employees needed to complete the process.
Fidelity Bank’s wholesale division eyes Southeast region Fidelity Bank is expanding its wholesale and correspondent lending division within the Southeast region. “We are now looking for AEs for both wholesale and correspondent lending in Texas, Louisiana, Arkansas, Florida, Georgia, Alabama, North and South Carolina, Virginia, Maryland, Tennessee and Kentucky,” said industry veteran Craig Dodds, who was hired this year to manage the division and grow the channel. Atlanta-based Fidelity Bank is a direct seller servicer to the agencies and provides AEs with access to wholesale and correspondent programs.
Industry’s first billion-dollar originator looking for branch partners The mortgage industry’s first billion-dollar loan originator, Greg Frost, is looking for a few more branch partners. Frost Mortgage, affiliated with Primary Residential Mortgage, currently has branch partners in New Mexico, Arizona, California, Colorado, Texas, South Dakota, Illinois, Iowa and Mississippi. The FHA-licensed mortgage lender was established by Greg Frost in 1991, with corporate offices in Albuquerque, New Mexico.
Are mortgage originators too old? MILLENNIALS ARE slated to assume a greater share of the housing market during the next few years. According to a recent report by The Demand Institute, millennials will spend $1.6 trillion on home purchases in the next five years – more on a per-person basis than any other generation. So, will the aging mortgage professional be able to attract the newest consumer power group with the largest buying capacity? “The average age of a loan officer is 54, and 59 for a Realtor, so there’s a huge disconnect with the future customer,” says Chuck Cowan, president of recruiting firm Cowan & Associates. “The world is changing, and the best way to get good ideas is to get new minds. There are young people in the business, but that number isn’t where it should be.” However, millennials appear uninterested in joining the mortgage industry. When it comes to the companies the group trusts the least, a recent Accenture survey found that financial institutions ranked high on the untrustworthy list. “These are heavily commission-driven jobs and are not attractive to a 28-year-old,” Cowan says. “How can we attract people with no mortgage experience and get them away from their $50,000-a-year jobs?” It also doesn’t help that the mortgage industry received a bad rep during the global financial crisis. “In 2008, I remember I told people I recruited mortgage bankers, and people looked at me like I was in a crime syndicate,” Cowan says. One solution to attracting a younger workforce is offering an extensive training program. In July 2014, Churchill Mortgage launched Churchill Mortgage Aca demy to develop the next generation of mortgage
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professionals. Coordinated out of the company’s headquarters in Brentwood, Tenn., the program is aimed at strengthening its relationships with customers by supporting millennials’ unique needs. “To engage this group, we must understand their lifestyles, attitudes and the unique challenges that they face,” said Mike Hardwick, president of Churchill Mortgage. “The CMC Academy positions us to do that by developing the next wave of mortgage professionals who will help a new generation of borrowers realize the real American dream of debt-free homeownership.”
THE 10 BEST-PAYING AREAS FOR LOAN OFFICERS (based on median annual salary in 2013)
1
New York- White Plains-Wayne, NY and NJ $116,590
2
Lawrence-Methuen-Salem, MA and NH $109,260
3 4 5 6 7
Midland, TX $99,830 San Francisco-San Mateo-Redwood City, CA $98,840 Ocala, FL $98,170 Vallejo-Fairfield, CA $96,890 Haverhill-North Andover-Amesbury, MA and NH $93,980
8 $93,920 City, NJ 9 Ocean $93,740 MA $93,490 10 Peabody,
Wilmington, NC
Q&A Is a branch network right for you? PETER SALAMONE National Director of business development Inlanta Mortgage
MPA: What are some of the advantages of being a member of a branch network, as opposed to being an independent originator? Peter Salamone: One thing we really embrace is “Originate more, worry less.” It’s really to focus on what’s the highest and best use of your time. If that’s selling, you need to partner with someone can help you do that, as well as provide programs, products and turn times that are acceptable. There’s also the compliance aspect. Three years ago, we didn’t have a CCO – chief compliance officer – within our management team, and now we do. That’s a full-time gig these days, and I can’t imagine having to run your own operation, worrying about that as well as the selling aspect.
MPA: What should an originator look for in a branch network? PS: Longevity. How long has the branch operation been in this space? From my perspective, we always encourage them to listen not only to recruiters and talking heads from corporate, but get on the phone and call some existing branch managers on the platform. How is it working for them? We also take great pride in investing in our employees’ success. What does that piece look like? Are they investing in their employees with training and education? And you can’t really quantify culture, but you need to get a handle on that, too. You can’t take a move to a branch platform lightly. You need to do your due diligence.
MPA: What does a branch network look for in an originator? PS: In our situation, first and foremost is quality – a quality originator who has quality relationships and embraces that street-fighter mentality. It’s a relationship business, and that’s what we’re looking for.
MPA: So how does an originator make himself a more attractive prospect for a branch network? PS: Ultimately, the question I ask is, what does your book of business look like today? How do you generate business? Not that there’s a right or wrong answer, but there are two different ways. There’s the old-school feet-on-the-street path, and there’s the path where you sit in a branch that has foot traffic, or a branch that provides Internet leads. I’m not saying that one path is right or wrong, but they’re clearly distinctly different paths. If you’re looking to join someone who wants you to get self-generated business, make sure that’s who you are. Strong relationships and partnering with the right platform can assist you in building new business while strengthening the relationships you already have.
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UPFRONT
REVERSE MORTGAGE UPDATE
Baby Boomers plan to upsize, not downsize, if they move at all CONTRARY TO common belief, the postWorld War II generation will not be trading homeownership for renting, suburbs for cities or yards and gardens for more maintenance-free living. Rather, most Boomers will age in place, according to a new report by The Demand Institute, a nonprofit think tank. The generation will account for nearly one in every four dollars spent on housing in the next five years. The report surveyed more than 4,000 Boomer households (ages 50-69), and reveals that few Baby Boomers have intentions of downsizing or moving away from their families. “During the financial crisis, Baby Boomers saw their wealth drop dramatically. While many have been forced to adapt their retirement and housing plans to new financial realities, they haven’t abandoned those plans entirely,” said Louise Keely, president of The Demand Institute. “For the most part, they are still retiring in their mid-sixties and staying in their homes. They value strong family relationships; they want to be near their children and grandchildren. Additionally, many Boomers maintain plans to upsize homes.” The next decade will see many Boomers taking on home remodeling projects as they
NEWS BRIEFS
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seek to update their homes. Nearly 40% surveyed plan for major home improvements in the next three years and could be taking out financing, such as 203k loans, to do so. Yet, according to the report, most continue to prioritize style over the amenities necessary for aging, such as lower maintenance and accessibility features. Those who do plan to move are not interested in exclusive elder communities and prefer to stay close to their current homes. “Financially, this generation is not necessarily ready for retirement, and half of their assets are tied up in their homes,” said Jeremy Burbank, vice president at The Demand Institute. Despite all of this, many Boomers will look to finance their housing aspirations. Their choices will have real impact on the housing sector in the next several years.” Yet according to NRMLA, the reverse mortgage industry is penetrating just 2% of the current market. “The aging population is growing with need, so why are we not penetrating better?” said NRMLA vice chairman Reza Jahangiri. “Or better, why aren’t we maintaining our penetration levels? Despite the sheer number of number of Baby Boomers, it is not growing.”
HUD budget shows HECM program back on track U.S. President Barack Obama’s proposed budget for the Federal Housing Administration in 2016 revealed that the administration is starting to see reverse mortgages as a viable again. The administration is projecting the HECM portion of FHA’s Mutual Mortgage Insurance Fund will generate positive cash flow in the coming fiscal year; up slightly from a negative subsidy rate of -0.4% projected for fiscal year 2015. The FY2016 budget proposal also includes a bump in HUD’s current funding levels.
TOP 10 MARKETS FOR BABY BOOMERS % of movers to the city who are Baby Boomers
19.33%
North Port-Bradenton-Sarasota, Florida
16.84%
Cape Coral-Fort Myers, Florida
13.10%
Tucson, Arizona
10.38%
Phoenix-Mesa-Glendale, Arizona
8.19%
Orlando-Kissimmee-Sanford, Florida
7.85%
Boise City-Nampa, Idaho
6.49%
Albuquerque, New Mexico
6.23%
Greenville-Mauldin-Easley, South Carolina
5.92%
Raleigh-Cary, North Carolina
5.65%
Denver-Aurora-Broomfield, Colorado
Senior home equity reaches highest level in eight years Senior citizens have more equity in their homes than at any period since the financial crisis, giving rise to reverse mortgage potential, according to the NRMLA/RiskSpan Reverse Mortgage Market Index. A $94.6 billion increase in senior home equity in the third quarter of 2014 was driven by an estimated $97.8 billion increase in the aggregate value of senior housing, offset by a $3.2 billion increase in mortgage debt held by seniors.
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Q&A Both sides of the fence Open Mortgage CEO Scott Gordon talks about his company’s decision to work in both forward and reverse mortgages – and plans to expand its reverse footprint even more MPA: A lot of companies focus on forward or reverse, but comparatively few do both. How did you decide to expand into reverse? Scott Gordon: We just celebrated the work anniversary of an employee named Linda Litt. Four or five years ago, she introduced me to reverse. She thought it was a good area to get into. … It looked like a product that was a good service for people.
MPA: Is there a different approach to selling reverse, or is it similar to doing business in the forward space? SG: I think they’re very different. For us, I hired [senior vice president of reverse] Joe Morris. He’s a lifetime member of [the National Reverse Mortgage Lenders Association], so he really knows the space. Our reverse headquarters is in Atlanta; it’s completely separate from our main headquarters in Austin.
MPA: Does Open Mortgage have any plans to expand in the reverse space? SG: I actually have a letter written and a video taped that I’m going to send out to about 25 CEOs … to offer to acquire their reverse divisions. Back in December, we acquired the reverse division of 360 Mortgage Group, and it really went well, so I decided I ought to check with other lenders who are focused on forward to see if I can acquire their reverse divisions.
Reverse mortgage volume increases 30% in fourth quarter Reverse mortgage volume grew nearly 30% in the fourth quarter of 2014, with brokers leading the rise, according to the latest Reverse Market Insight report. Total home equity conversion mortgage endorsement growth increased 28.9% to 4,851 loans in October. The wholesale channel grew 37.3%, compared to 23.4% for the retail/direct channel On the wholesale side, Urban Financial of America led the wholesale lender group, followed by Liberty Home Equity Solutions and American Advisors Group.
MPA: Is succeeding in the reverse space more challenging? SG: We are super excited about the reverse industry, so I’m not feeling like there are any big challenges. People are talking about financial assessments, but since we do forward, we’re used to underwriting credit. So I don’t feel the financial assessment is going to be a big deal, really.
MPA: There’s still a bit of a stigma about reverse mortgages. Do you think that’s getting better? SG: I do think, slowly, the stigma keeps getting better. Our experience is, when we meet people who have a negative impression of reverse, we discover that they believe things that aren’t true. When they realize what the reverse mortgage is really like, they’re okay with it. It’s an information campaign that has to keep happening over time.
MPA: So how can reverse loan officers get that information out to prospective customers? SG: I think a strategy for a lot of loan officers should be education, which they can aim at consumers by having seminars or coffees or whatever you want to call it – a chance for seniors to get together. But we also need to educate financial advisors. That’s a group that might have a negative impression of the reverse mortgage. But once they understand how it can be used as a tool, they’ll be on board with it.
Industry leader urges Fannie, Freddie to return to reverse market The National Reverse Mortgage Lenders Association is urging Fannie Mae and Freddie Mac to enter the reverse mortgage market. NRMLA sent its request to the Federal Housing Finance Agency, noting the benefits of the reintroduction of a Home Keeper-like program similar to that of Fannie Mae’s proprietary reverse mortgage, and the importance of Fannie and Freddie being able to purchase proprietary reverse mortgages in the market.
More seniors moving in with children According to a study by The American Institute of Architects, 39% of the group’s more than 500 residential architects said they were seeing a surge of demand for in-law suites this year. That’s a significant jump compared to 2012, when the percentage stood at only 10%. Respondents said the suites may include a second master bedroom with a bathroom or an attached apartment-like structure. Six percent of US-born seniors and 25% of foreign-born seniors live with relatives, according to a survey by real estate site Trulia.
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UPFRONT
INTELLIGENCE CORPORATE MOVES Acquirer
Target
Comments
Impac Mortgage Holdings
CashCall Inc.
Acquisition will position Impac to continue the roll out of new ALT QM loan programs directly to consumers
Open Mortgage
360 Mortgage Group
Acquisition will allow 360 Mortgage to increase its focus on wholesale, correspondent and the servicing of both forward and reverse mortgages
loanDepot
Mortgage Master
Combined company will position loanDepot to accelerate its expansion in the Northeast
DocMagic
Doc-Tech Corp.
Acquisition adds to DocMagic’s suite of electronic products and services with the addition of the Doc-Tech’s Elite Docs Series
Academy Mortgage
Republic Mortgage
Partnership will benefit Republic team members by providing them with additional resources and volume to enhance their capabilities moving forward
Matt Martin Real Estate Management
RealtyBid. com
Purchase would provide Matt Martin Real Estate Management with a web-based platform for real estate asset sales
NorthMarq Capital
Quest Commercial Capital Corp.
Acquisition will allow NorthMarq to expand its Midwest footprint into the greater Cincinnati market
Valuation Partners
Lending QB
Integration will allow lenders to order appraisals from Valuation Partners from within LendingQB, reducing appraisal order time and duplicate entries
Freedom Mortgage
Continental Home Loans
Acquisition will allow Freedom Mortgage to expand its presence in the Long Island metro area
Impac sets the stage to become a market leader Five-star lender Impac Mortgage Hold ings has signed an agreement to acquire the mortgage origination business of CashCall Inc., revealing the name of originator in a deal first announced in early December. Terms of the deal were undisclosed. Impac said it believes the acquisition will complement its current origination business model and position the company to continue the roll out its new ALT QM loan programs directly to consumers. During the fourth quarter of 2014, CashCall’s mortgage division volume was approximately $800 million and is expected to add “significant retail direct origination volume” to the Impac Mortgage platform beginning in 2015.
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PRODUCT NEWS
>> FIRST CALIFORNIA MORTGAGE said it is meeting the demand for non-QM loans with the launch of its first renaissance products for its retail and wholesale channels. Qualifications include non-owneroccupied properties for purchase or refinance, credit score to 680, max LTV of 75%, and max cash out of $350,000. Interest-only loans are available for a fixed period. >> 360 MORTGAGE, DITECH MORTGAGE CORP.,
UNITED WHOLESALE MORTGAGE, PREMIER NATIONWIDE LENDING MAVERICK FUNDING
are among the latest lenders to offer Fannie Mae and Freddie Mac 97% loan-to-value [LTV] products. The new product offerings came only weeks after the government-sponsored entities announced their 3% down payment options for homebuyers. Fannie’s 97% LTV loans will meet the GSE’s usual eligibility requirements, while Freddie’s Home Possible Advantage program is offered to qualified low- and moderateincome borrowers. >> ANGEL OAK WHOLESALE has launched its mini-correspondent program. The platform provides affiliated lenders with the opportunity to offer Angel Oak’s non-agency products in their respective lenders’ name and was created in response to requests from its mortgage broker clients that have warehouse lines of their own. Angel Oak Mortgage Solutions specializes in non-agency lending, with a focus on non-prime loans.
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For more industry news as it happens, visit www.mpamag.com
MOVERS & SHAKERS Name
>> MOUNTAIN WEST FINANCIAL has announced a change the identity of the interest section of its conventional guidelines. Loans for a one-unit second home or investment property that includes non-arm’s length, at-interest or identity of interest characteristics are no longer required to be priced through the direct program. Mountain West also has made enhancements to its FHA & VA Streamline products, including guidelines applicable to FHA credit qualifying and non-credit qualifying streamline transactions. >> SOCIAL FINANCE [SOFI] continues to expand its non-QM offerings. At least half of all SoFi’s mortgages are considered nonqualified mortgages because the debt-to-income ratio exceeds the CFPB’s 43% threshold. Loans to borrowers with low debt ratios carry rates as low as 2.75%, and borrowers with higher ratios pay as much as 4%. SoFi mortgages average around $1 million, and half of them are nonconforming. Loan applications typically close in 14 days. >> STONEGATE MORTGAGE CORP. has rolled out its Prior Approved Affinity Program, which gives qualified correspondent clients the opportunity to deliver significant savings for their customers or enhance earnings when they place loans through Stonegate. Participants of the quarterly program are all approved correspondents who submit previously approved loans that reach final disposition during each evaluation period.
Leaving
Joining
New Position
Jonathan Corr
N/A
Ellie Mae
CEO
Rudy Orman
Residential Credit Solutions
Carrington Mortgage Holdings
Managing director of business development
Linda Bomar
AllRegs
Indecomm Global Services
Vice president of sales
Len Tortorice
ClearVision Funding
Midwest Equity Mortgage
Director of business development
Brian Vieaux
Flagstar Bank Home Lending Division
Flagstar Bank Wholesale Division
National sales director of wholesale lending
Candice Merriweather
StreetLinks Lender Solutions
LRES
Vice president and national sales manager
Tim Pearce
Wells Fargo Home Mortgage
Urban Financial
Head of West Coast retail team
Jay Sherwood
N/A
NMI Holdings
President
Patricia Hamilton
HomeBridge Funding
The StoneHill Group
Business development manager
Larry Gunnin
PennyMac Loan Services
Mortgage Network Inc.
Southeast regional manager
CARRINGTON HIRES NEW DIRECTOR OF BUSINESS DEVELOPMENT Carrington Holding Co. has named Rudy Orman managing director of business development for Carrington Mortgage Holdings. Orman will serve as the new intuitional business liaison for Carrington’s real estate and mortgage divisions. With more than 29 years of industry experience, Orman possesses a rich history of managing business growth and developing key relationships within the housing sector.
ELLIE MAE NAMES JONATHAN CORR AS NEW CEO Ellie Mae has appointed Jonathan Corr as chief executive officer, effective Feb. 1. Corr, a 12-year company veteran, currently serves as its president and chief operating officer. Sig Anderman, who served as Ellie Mae’s CEO since founding the residential mortgage software company in 1997, will continue to serve on the board of directors as executive chairman.
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FEATURES
RENOVATION LOANS
THE RISE OF RENOVATION LOANS
Renovation loans can open up a whole new cache of properties to potential homebuyers. Here’s how to tap into the market
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ARE YOU looking for a new market to enter? If so, you might want to consider the renovation-loan realm. Developed in the 1970s by the Department of Housing and Urban Development in conjunction with the Federal Housing Administration, the FHA 203(k) loan program offers borrowers an option to bundle financing for a home purchase or refinance, plus with the costs of home improvements, into a single loan. The program was originally created as a way to assist people in preserving and maintaining older homes in urban neighborhoods. It is also a means for borrowers to buy a property that may not be in alignment with standard FHA requirements due to needed repairs. There are two types of FHA 203(k) loans: Full and Streamline. Buyers who opt for the Full loan are likely planning larger projects that will require more than $35,000 in improvement costs or projects that are in need of structural repairs. The extent of the amount that can be borrowed depends on the FHA county limit. Full loans allow for the home to be demolished and rebuilt as long as the existing foundation remains. These loan programs require the assistance of a HUD consultant. The Streamline loan was introduced in December 2005 and is meant for less pricey repairs and improvements such as siding, tiling, painting, new flooring, roofing and appliances. This loan maxes out at $35,000 – none of which can be used for structural costs or landscaping – and does not require the services of a HUD consultant. Fannie Mae also offers a renovation loan product. The HomeStyle loan allows borrowers to include financing for home improvements in the purchase or refinance transaction of an existing home. It is billed as a convenient method for borrowers to make renovations, repairs or improvements totaling up to 50% of an as-completed appraised value of the property without having to rely on a second mortgage, home equity line of credit or other more costly financing method. Those who are eligible to borrow under this program include homebuyers as well as investors, nonprofit organizations and local government agencies. These loans will typically run a buyer approximately a percentage point higher than
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more conventional options and are available in both 15- and 30-year terms with fixed or adjustable rates. Homebuyers must put down at least 5% of the property’s current value and have a minimum credit score of 600. Add in paperwork for costs like appraisal and inspection, and you’re looking at closing costs that exceed $1,000 or higher on average – so it is incumbent upon a broker to make a compelling case for procuring the loan. The time is now So why should you consider this particular niche? Carl Markman, director of national sales at Iselin, N.J.-based wholesale lender Real Estate Mortgage Network, believes that now is the moment to take advantage of what promises to be a potentially lucrative market. “This is the perfect time for loan officers to educate themselves on renovation products – 203(k) and HomeStyle –and begin now to market to their Realtors and other referral sources,” Markman says. Because today’s market includes more inventory in need of repair, he says, renovation loan experts are needed to in order to serve a growing demand. “There are many potential homebuyers that cannot look past the ‘old’ inventory that’s out there – those 1960s and 1970s outdated ranch and colonial-style houses that have outdated floor plans,” he says. With plenty of homebuyers willing to put in the work to improve these properties, savvy brokers with industry knowledge will be able to tap into a whole new network of potential clients. “If the loan officer’s referral base was educated on renovation loans and knew what to look for, they would absolutely sell more homes in 2015,” Markman says. “Our job as loan officers is to help our referral partners sell more loans, and this is the perfect way to do it.” Mortgage brokers can not only make an impact on their bottom line by entering the renovation market, Markman says, but also build long-lasting relationships and earn more money year after year. Today’s renovation loan market offers alternatives to both potential and existing homebuyers. If a current homeowner doesn’t have the funds for upgrades, a 203(k) loan
WHICH RENOVATION LOAN IS BEST FOR YOUR CUSTOMER?
FHA 203K: One of the biggest benefits of the FHA’s 203K loan is that borrowers can obtain a single loan at a long-term fixed or adjustable rate. The 203K loan program can help borrowers with simple improvements that don't require plans, consultants, engineers and/or architects. The program is also a better fit for borrowers with credit issues. Keep in mind, however, that luxury improvements aren’t covered – so your borrower won’t be putting in that swimming pool with this loan. • 203K refinance loans: May finance up to 97.75% of the 'to be improved' value, or the 'as is' appraised value plus the total cost of all renovations (whichever is less) • 203K purchase mortgage: May finance up to 96.5% of the 'to be improved' value of the appraisal, or 96.5% of the sale price plus the total cost of all renovations (whichever is less)
HomeStyle: This program covers most of the same repairs as a 203K, but gives borrowers more flexibility to make exterior changes. It also allows luxury items like pools and spas. This may be the perfect loan for customers looking to improve vacation homes or investment properties. • HomeStyle refinance loans: May finance 85% to 95% of the 'as-completed' value, plus the total renovation cost. Financing terms depend on whether the home is a primary residence, second home or investment property. • HomeStyle purchase mortgage: May finance 75% to 95% of the 'as-completed' value, plus the total renovation cost. Financing terms depend on whether the home is a primary residence, second home or investment property.
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FEATURES
RENOVATION LOANS
"Savvy brokers with industry knowledge will be able to tap into a whole new network of potential clients"
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can give them that flexibility. Markman says these loans also provide opportunities for buyers to purchase a ‘fixer-upper’ that’s less appealing as-is to potential homebuyers. Additionally, he says, the costs to upgrade the property will be included in the repair costs, with no out-of-pocket funds necessary other than the initial down payment. Renovation loans can be found with most lenders, but according to Markman, not all have the expertise to fund and follow up after the loan closes. “REMN Wholesale has educated account executives, a renovation lending specialist to help train our broker/banker partners and a renovation concierge desk,” he says. “We are truly specialists when it comes to renovation lending.” What types of renovation mortgages are available? These permanent financing options can help to rehabilitate, repair or renovate existing site-built homes. Here are the available choices as described by Freddie Mac. Eligible property types are existing oneto four-unit site-built homes, primary residences, investment properties and second homes. Manufactured homes are not eligible for renovation loans. Eligible mortgage products include 15-, 20- and 30-year fixed rate mortgages, with most adjustable-rate mortgages eligible for sale to Freddie Mac. Freddie Mac Home Possible mortgages and super-conforming mortgages are also eligible. Transaction types are purchases, no-cashout refinances and cash-out refinances. If the mortgage proceeds are used to replace an Interim Construction Financing, the transaction must meet the requirements of Chapter K33 of the Single-Family Seller/ Servicer Guide. Execution options are servicing-released cash, servicing-retained cash, fixed-rate guarantor and WAC ARM Guarantor. Renovation mortgages with a settlement date of more than 12 months after the effective date of permanent financing are not eligible for sale under MultiLender Swap. Underwritten products are Loan Prospector Mortgages and Non-Loan Prospector
Mortgages. All mortgages must meet risk class and/or minimum Indicator Score requirements. According to Freddie Mac, lender benefits of renovation mortgages include options to drive more loan volume, as well as enhanced niche marketing opportunities to meet borrower needs when processing many lowdown-payment mortgages as renovation loans. Borrowers get the benefit of mortgage options that meet their needs, offering financing flexibility when combining renovation mortgages with many other Freddie Mac products, as well as flexibility when securing permanent financing. As for the latter, Freddie Mac requirements for eligible renovation loan borrowers allow the removal of a co-borrower or the addition of a related person to the permanent financing under specific circumstances.
WHY IS NOW A GOOD TIME FOR RENOVATION LOANS? Home values continue to rise A recent study by Zillow indicates that average home values may exceed their pre-recession peaks by February 2018. In 2014, national average home values rose by 6.4%. A home purchased for $200,000 at the beginning of last year would go for around $212,000 now. Lots of fixer-uppers in the marketplace About 60% of real estate sales in recent years have been through foreclosure and short sales. A lot of those homes are in less than mint condition – meaning there are a lot of less expensive homes out there for the selling. Stronger housing market Home sales continued to rise across the nation last year – and as home sales increase, so does buyer confidence.
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Time for a Change?
Academy Mortgage is growing with the acquisition of Republic Mortgage Home Loans. With Academy Mortgage’s acquisition of Republic Mortgage Home Loans, we now offer mortgage originators an even greater number of opportunities and resources to grow your business and enhance your capabilities. • • • •
Additional marketing solutions to assist you in becoming 1st CHOICE. Additional products to an already robust product portfolio. Additional talent and support. Additional tools to enhance the home buying process.
“By joining forces with Republic Mortgage, we will be able to accelerate our opportunities for growth and, most importantly, our opportunities for each individual to push forward our vision to inspire hope, deliver dreams, and build prosperity.” —Adam Kessler, Academy President
Are you ready to grow with Academy? Contact the National Recruiting Team at (801) 568-4716 or visit www.academymortgage.com. Corp NMLS #3113 | Corp State Lic #5491140 | MAC1214-1258956899
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FEATURES
COVER STORY: YOUNG GUNS
YOUNG
GUNS 26
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YOUNG GUNS 2015
Meet the young stars who are making waves in the mortgage industry WELCOME TO MPA’s second annual Young Guns report. We asked you to nominate mortgage professionals aged 35 and younger who had already made a splash in the industry, and your suggestions came flooding in. We’ve whittled the list down to 50 young people who we think merit a mention.
From the already-seasoned pro who started her own mortgage shop at the age of 18 to the young originators whose success has already made them mentors to their peers, all of the men and women on this list have proven themselves exceptional. Despite their youth, they’re some of the top producers in their companies, racking up tens of millions of dollars per year in sales volume. In time when rapid regulatory change demands fresh ideas and new perspectives, these are the hot young originators who hold the future of the industry in their hands.
INDEX BY NAME Name
page Company
Name
page Company
Arocho, Edwin
28
Maverick Funding
Krabbe, Jake
39
Academy Mortgage
Banosian, Shant
30
Guaranteed Rate
Krohmer, Greg
39
Advisors Mortgage Group
Betesh, Shaul
35
Guaranteed Rate
Levesque, Zachary
28
Maverick Funding
Boffy, Jenny
30
W.J. Bradley
Lewandowski, Tina
28
REMN Wholesale
Boruchov, Justin
40
Massey Knakal Capital Services
Bowman, Austin
39
Caliber Home Loans
Lund, Lisa
34
Lund Mortgage Team
Brannon, Ian
36
NOVA Home Loans
Mack, JJ
36
American Pacific Mortgage
Broukhim, Pouyan
36
PB Financial Group
Mazowski, David
33
Gateway Funding
Craig, Ryan
37
4Trust Mortgage
McDermott, Michael
36
NOVA Home Loans
Cresta, Phil
38
Residential Home Mortgage
McKinnies, Jonathan
39
Hallmark Home Mortgage
Academy Mortgage
Merati, Marco
36
Village Mortgage
Marcus & Millichap Capital Corporation
Muscarella, Anthony
29
Advisors Mortgage Group
36
Guaranteed Rate
Curran, Whittney Dansker, Andrew
40 39
Dupuis, Gene
30
Open Mortgage
Nielsen, Mike
Feinman, Seth
28
Silver Fin Capital Group
Page, Jeremy
34
Inlanta Mortgage
Finkle, Charadie
30
Academy Mortgage
Scarimbolo, Michael
34
Advisors Mortgage Group
Fisher, Mark
34
United Northern Mortgage Bankers
Scuotto, John
34
Advisors Mortgage Group
Gomes, Manny
30
Norcom Mortgage
Shannon, Scott
30
W.J. Bradley
Gonzales, Michael
32
Open Mortgage
Gore, Tara
33
Gateway Funding
Shotnik, Michael
28
Colorado Mortgage
Haines, Justin
41
NOVA Home Loans
Sigman, Joshua
35
Legacy Mutual Mortgage
Hernandez, Henry
33
Academy Mortgage
Tanga, Jodie
40
Pacific Rim Mortgage
Hunter, Jason
28
Guaranteed Rate
Tyson, Cody
30
W.J. Bradley
Eastern Union Funding
Walker, Rich
34
HighTechLending
34
Inlanta Mortgage
Hyman, Nate
39
Jones, Mark
28
Academy Mortgage
Warzon, Kip
Kapahi, Ayush
39
HKS Capital Partners
Wielgot, Luke
35
Academy Mortgage
Katz, Eric
36
The Federal Savings Bank
Young, Amber
30
W.J. Bradley
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FEATURES
COVER STORY: YOUNG GUNS EDWIN AROCHO
TINA LEWANDOWSKI
33, mortgage loan originator, Maverick Funding
35, regional sales manager, REMN Wholesale
One of Maverick Funding’s top originators, Edwin Arocho has been recognized with the company’s President’s Club award for top originators all three years since the award’s inception. In 2014, Arocho closed more than $9.2 million in loan revenue. Already a mentor to other loan officers, Arocho is also very active in his community, participating in numerous fundraisers and collection drives for charity. “His dedication and commitment to bettering the financial lives of others is truly inspiring,” says colleague Erica Adams.
Tina Lewandowski grew up in the mortgage industry and has spent the last 16 years living and breathing the business. Lewandowski manages a team that hit nearly $200 million in volume for 2014, and Lewandowski herself hit more than $60 million. “If you are a customer of Tina’s, a co-worker, a peer or a friend, you know that she understands that self-motivation and being the best she can be is what drives her on a daily basis,” says colleague Erin O’Dell. “We need more young people in our industry like Tina!”
SETH FEINMAN 31, vice president Silver Fin Capital Group
MARK JONES
MICHAEL SHOTNIK
28, loan officer, Academy Mortgage
31, branch manager, Colorado Mortgage
Mark Jones closed his first loan for a welldeserving family who had been turned down by another lender. After that, there was no looking back. Jones developed a passion for helping others achieve homeownership. That passion has translated into sales; Jones joined Academy Mortgage in 2012 and has been a consistent qualifier for the company’s Top Producers Club. In 2014, Jones closed $18.4 million in sales volume.
As a branch manager for Colorado Mortgage, Michael Shotnik knows how to bring his company business, racking up tens of millions of dollars in sales. “In a short amount of time, Michael Shotnik has become a well-known and respected lender in the real estate industry,” says Colorado Mortgage marketing director Nielle McCammon. “Realtors that have in-house lenders switch to Colorado Mortgage because of Michael’s responsiveness, honesty, communication and efficiency.”
ZACHARY LEVESQUE 35, vice president of sales, Maverick Funding Zachary Levesque immersed himself in the mortgage industry straight out of college. At the age of 35, Levesque already has 10 years of sales force management. In the last three years, he’s led his team to 1,650 originations and $460 million in sales. “Zach attributes his success to a few simple principles: treating clients with the utmost respect, always valuing their business and having a strict regard for stellar customer service,” says colleague Erica Adams. “His persistence and go-getter attitude keep his team’s spirits lifted and the office morale high.”
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Seth Feinman has been with Silver Fin Capital Group for eight years – since he was a secondyear law student at Hofstra Law School. Since 2010, Feinman has served as the company’s vice president. In that capacity, he helps manage the loan origination team while continuing to be a prolific producer himself. Last year, Feinman was responsible for $22 million in volume, and has been instrumental in making Silver Fin the number-one-rated certified lender on LendingTree.com in the states in which it does business.
JASON HUNTER 32, branch manager and VP of mortgage lending Guaranteed Rate With more than a decade of experience, Jason Hunter is one of the top originators in the state of Florida. He also racks up impressive numbers even for Guaranteed Rate, a firm with a lot of stellar producers; in 2014, Hunter was responsible for $70 million in production volume. Prior to his mortgage career, Hunter played football for the University of Florida.
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YOUNG GUNS 2015
“The mortgage industry is all about relationships. Whether with your client, referral partners or your own team, developing these relationships is paramount to becoming successful in this industry” ANTHONY MUSCARELLA 35, branch manager Advisors Mortgage Group Anthony Muscarella joined Advisors Mortgage Group in 2006 and became a branch manager in 2009. Since then, his branch has grown into one of the most successful in the Advisors network. “Anthony’s enthusiasm to connect with his prospective clients and peers is one of the main reasons why he is such a successful branch manager,” says Sean Clark, vice president at Advisors. “With nearly $30 million in sales volume in 2014 alone, his dedication and drive is evident.”
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FEATURES SPECIAL REPORT / YOUNG GUNS
COVER STORY: YOUNG GUNS SCOTT SHANNON 35, branch manager, W.J. Bradley
CHARADIE FINKLE 33, sales manager Academy Mortgage
After originating for big banks, Scott Shannon was looking for a way to focus on continuous production rather than spending his time dealing with unresponsive underwriters and slow turn times. When he joined W.J. Bradley, Shannon found an environment that allowed his talents to thrive; his personal production jumped 60%. A perennial top producer for the company, Shannon was responsible for almost $24 million in production volume last year.
CODY TYSON 31, loan officer, W.J. Bradley
At just 33, Charadie Finkle already has more than 16 years of experience in the finance and lending industries. She started her career in the mortgage industry on the operations side, allowing her to master the technical aspects of lending. Finkle joined Academy Mortgage in 2010 and was named the company’s Rookie of the Year in 2013. A member of Academy’s Top Producers Club, Finkle was responsible for $23 million in volume in 2014.
Just 31 jears old, Cody Tyson has been in the lending business since 2002. Starting in operations, Tyson became a junior loan officer in 2005 and a full loan officer in 2011. Even in an office with more than 30 other loan officers, Tyson stands out, consistently receiving praise from customers and real estate agents for his expertise and professionalism. Already a top producer, Tyson racked up more than $17.4 million in production volume in 2014.
SHANT BANOSIAN AMBER YOUNG
JENNY BOFFY
31, branch operations manager W.J. Bradley
32, loan officer W.J. Bradley
Amber Young joined the mortgage industry just three years ago, but she’s already one of the shining stars at W.J. Bradley. In 2012 and 2013, Young was responsible for more than $66.5 million in sales volume, and in her role as branch manager, she’s taking business at W.J. Bradley even further. “She understands the challenges that loan originators may have with individual loan scenarios and how to work with underwriting to overcome challenging loan conditions,” says colleague Jessica Ruiz-Krout.
With more than a decade of mortgage lending experience, Jenny Boffy has developed formidable expertise in sales, processing and transaction coordination. That multifaceted experience allows Boffy to make sure her customers’ loans are packaged appropriately, and to provide loan scenarios that allow them to compare loans side-by-side to explore their options. That expertise has also translated into sales; Boffy was responsible for more than $15.7 million in volume last year.
MANNY GOMES 31, mortgage planner, Norcom Mortgage Manny Gomes is a leading originator at Norcom Mortgage, posting $20 million in volume in 2014. Just 31, Gomes is already well-known at Norcom for his outstanding customer service and work ethic. “His experience, honesty and hands-on approach are assests during every transaction,” says Norcom colleague and 2014 Young Guns alum Tyler Rhea.
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34, branch manager and VP of mortgage lending Guaranteed Rate Shant Banosian is one of the top 10 mortgage originators in the nation, responsible for $179 million in volume in 2014. A member of Guaranteed Rate’s President’s Club for top originators, the Massachussetts-based Banosian is also a recognized industry expert, frequently sought out for his insight by the national media.
GENE DUPUIS 35, branch manager, Open Mortgage Gene Dupuis was responsible for $10.4 million in originations in 2014. A veteran communicator, Dupuis is very popular with real estate agents in his area for his ability to put their clients at ease and clearly explain the lending process. “Most important for professionals like me is that he answers his phone no matter what is going on,” says RE/MAX agent Atasha Quebedeaux. “My clients are never calling me [and] telling me they were unable to get in touch with their lender or that they don’t know what’s going on with their loan.”
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FEATURES
COVER STORY: YOUNG GUNS
“I know a lot of LOs who focus on things they can’t control, and in an industry with constant change, that only leads to frustration and failure. I personally try to focus on the things I can control, such as building relationships, staying in contact with my borrowers and educating myself on new loan programs”
MICHAEL GONZALES 34, branch manager, Open Mortgage By the time Michael Gonzales was 23 years old, he had already launched his own mortgage branch office. With more than a decade of industry experience under his belt, Gonzales is one of Open Mortgage’s top young originators and has personally helped hundreds of families into the homes of their dreams. In 2013, Gonzales and his team posted more than $15 million in total sales volume. In 2014, Gonzales was one of MPA’s Young Guns and was also recognized by the Financial Educators Council for his contributions to the financial literacy movement in his community.
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YOUNG GUNS 2015
DAVID MAZOWSKI 32, branch manager, Gateway Funding
HENRY HERNANDEZ 34, loan officer Academy Mortgage Henry Hernandez joined the mortgage industry out of college in 2004. Although he originally intended to become a psychologist, Hernandez found that being a part of the mortgage business satisfied his deep desire to help others. Joining Academy Mortgage in 2009, Hernandez quickly distinguished himself as a first-rate originator. A member of Academy’s Top Producers Club, Hernandez was responsible for $13.7 million in volume last year.
David Mazowski grew up in the mortgage industry, taking over the branch his father started. Since taking the helm, Mazowski has continued to grow his Vineland, N.J., branch, keeping it consistently ranked as one of Gateway Funding’s top 10 branches. Mazowski is also a prolific producer and a perennial member of Gateway’s top 10 originators, posting $22 million in sales volume last year.
TARA GORE 34, mortgage originator, Gateway Funding One of Gateway Funding’s top producers, Tara Gore racked up $12 million in volume last year. A savvy marketer, Gore looks for creative ways to brand not just herself but the company as a whole. Gore is also lauded at Gateway for her concern for customers. “She sees the value in spending an extra couple of minutes to make her clients and partners know how much she cares about them,” says colleague Karissa Stiglic. “Tara brings her kind personality into her business and has a genuine interest in making sure everyone involved in a transaction is satisfied.”
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FEATURES
COVER STORY: YOUNG GUNS JOHN SCUOTTO 34, branch partner, Advisors Mortgage Group Since joining Advisors Mortgage Group in 2011, John Scuotto has been one of the company’s most productive loan officers. Last year alone, Scuotto was responsible for $12 million in loan volume. “Whether it’s a purchase or refinance transaction, he makes sure his clients get the best possible loan program and customer service,” says Sean Clark, vice president at Advisors.
RICH WALKER
MARK S. FISHER
31, reverse operations manager, HighTechLending As reverse operations manager of HighTechLending, Rich Walker has been the driving force in the growth of the company’s reverse division. Under his guidance, HighTechLending’s reverse production has made the company one of the Insight Report’s top 10 HECM lenders.
MICHAEL SCARIMBOLO 35, branch partner, Advisors Mortgage Group Michael Scarimbolo has been in the mortgage business since 2002. He joined Advisors Mortgage Group in 2011 and quickly became one of the company’s top young originators. Last year, he closed more than $13 million in sales volume. “Mike’s wealth of knowledge and positive attitude have helped him grow his business and help people achieve homeownership the right way,” says John Thompson, assistant branch operations manager at Advisors.
26, mortgage originator United Northern Mortgage Bankers Mark S. Fisher, one of United Northern’s top young originators, hit the ground running and has only gotten better. He’s doubled his business every year for the last three years, and racked up more than $27 million in volume in 2014. “Mark attributes his success to providing an excellent borrower and Realtor experience during a transaction and his consistent focus on marketing,” says colleague Linda Torres. “He believes that it is important to stay in touch and let people know that you care.”
KIP WARZON 35, senior loan officer, Inlanta Mortgage
LISA LUND 34, president Lund Mortgage Team Lisa Lund started in the mortgage business in 1998 at the tender age of 18. When she was 29, she founded Lund Mortgage Team, a mortgage brokerage located in Glendale, Ariz. Today, Lund and her team fund an average of $70 million in volume per year. Lund also serves as president of the Arizona Association of Mortgage Professionals and has lobbied for the industry in Washington. Lund is active in her community, working with the ALS Association, the Southwest Autism Research and Resource Center, and many smaller local charities.
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One of Inlanta Mortgage’s top producers, Kip Warzon was responsible for more than $11.5 million in volume in 2014. Recognized as a Five-Star Mortgage Professional four years in a row, Warzon is also a Homes for Heroes affiliate, helping veterans and other local heroes achieve homeownership. Also passionate about community service, Warzon helps orchestrate an annual toy drive to benefit the Children’s Hospital of Wisconsin.
JEREMY PAGE 30, operations manager/loan originator, Inlanta Mortgage Jeremy Page joined the mortgage industry in 2003, and had gained expertise in every aspect of the business by the time he was 26. He’s originated loans, managed a top-producing branch, managed a processing department and single-handedly developed the file flow and best-practice procedures of that department. “Jeremy is known for both his ability to thrive under pressure and his work ethic,” says Inlanta marketing coordinator Ericka Smith. “His well-rounded knowledge of mortgage lending surpasses most seasoned veterans.”
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YOUNG GUNS 2015
LUKE WIELGOT 35, loan officer, Academy Mortgage Luke Wielgot got into the mortgage business in 2007 and has never looked back. Since entering the industry, Wielgot has been a contributor to two of the top-producing origination teams in the country. Wielgot joined Academy Mortgage in 2009. That year, he and his team were ranked the number one FHA loan originators in Arizona, and have consistently ranked among the top teams in the nation ever since. Wielgot himself is a formidable originator, with $38.8 million in volume last year alone, and a member of the company’s Presidents Club for top originators.
JOSHUA SIGMAN vice president, Legacy Mutual Mortgage Joshua Sigman entered the mortgage industry after a brief stint in the insurance business, and was soon outselling even his mentors. Joining Legacy Mutual Mortgage in 2004, Sigman quickly became a top producer, a coach to other loan officers and eventually the top loan officer in San Antonio by volume. Sigman’s success attracted the attention of company executives, leading to his appointment as vice president. Sigman is now part owner of the company.
SHAUL BETESH 34, branch manager and SVP of mortgage lending, Guaranteed Rate One of Guaranteed Rate’s top producers, Shaul Betesh is an acknowledged expert on the New York real estate market. He also oversees one of Guaranteed Rate’s top-producing branches; last year, Betesh and his team were responsible for $446 million in production volume.
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FEATURES
COVER STORY: YOUNG GUNS
MARCO MERATI 29, branch manager and loan officer Village Mortgage
JJ MACK
MIKE NIELSEN
27, branch manager American Pacific Mortgage
34, vice president of mortgage lending Guaranteed Rate
JJ Mack broke into the mortgage industry about six years ago and has seen his star rise ever since. Although Mack is one of American Pacific’s top young originators, his real skills are his leadership and ability to attract fresh blood to the industry, according to Bobbie Jo Seva, regional production advocate for American Pacific. “JJ is bringing in the millennials to APM,” Seva says, “which is important because this industry has taken a lot of hits over the last few years and has not replenished itself.”
One of the top originators in the nation, Mike Nielsen is a member of Guaranteed Rate’s President’s Club for top producers. In 2014, he racked up $64 million in production volume – most of it in the purchase market.
IAN BRANNON 35, senior loan officer, NOVA Home Loans Ian Brannon learned the business as an assistant to two of the best loan officers in the nation, Jon and Paul Volpe. That training helped him hit the ground running when he became a senior loan officer. Last year, Brannon racked up more than $22.9 million in total volume.
MICHAEL McDERMOTT 31, senior loan officer NOVA Home Loans To Michael McDermott, the key to success is simple: Proactive communication and a real desire to offer solutions to potential homebuyers. That attitude helped McDermott rack up more than $19 million in volume last year. McDermott also recently launched a campaign to help veterans realize their homeownership dreams. “There’s something extra-special about being able to assist our active and retired military veterans with purchasing a home,” he says. “We are dedicated to becoming Arizona’s top VA lender.”
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Starting his career just five years ago as a loan originator, Marco Merati quickly became the youngest branch manager at Village Mortgage. “[Merati’s] ability to connect with his peers and prospective clients is one of the main reasons he was offered the branch manager position at Village Mortgage,” says marketing director Jennifer Brabson. “His ability to put his Realtors’ and borrowers’ needs first, his understanding of exceptional customer service and extensive knowledge of the mortgage process is why he has been so successful to date.”
ERIC KATZ 32, regional vice president, The Federal Savings Bank Already an $80 million-a-year originator, Eric Katz began running a $300 million-per-year office last year at age 32. In the fourth quarter of 2014 alone, Katz and his team closed more than $135 million and they’re on pace to close more than $500 million in 2015. “Eric is truly the only person that could have built this office from nothing to where it is now,” says Federal Savings Bank assistant sales manager Paul Franklin.
POUYAN BROUKHIM 34, founder and president, PB Financial Group Pouyan Broukhim founded PB Financial Group in 2006, funding transactions worth between $100,000 and $2 million. Today, the company is one of California’s top hard money lenders, and Broukhim was responsible for $35 million in volume last year alone.
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YOUNG GUNS 2015
“It all comes down to caring deeply about the customer and delivering at such a high level that you exceed their expectations. They are looking for advice and a professional opinion on what will help them reach their financial goals as quickly as possible – that is what we are here for”
RYAN CRAIG 32, production manager 4Trust Mortgage After nearly a decade in the mortgage industry, Ryan Craig has built rock-solid relationships with referring partners, ranging from realtors to financial planners to past customers. Those relationships have paid off; Craig was responsible for $38 million in volume last year. “Ryan has proven that he has many great qualities necessary to thrive in any mortgage market,” says 4Trust Mortgage president Troy Fore. “He has built his business by using his skills in finance to counsel his clients on the best mortgage solutions for them and their family.”
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FEATURES
COVER STORY: YOUNG GUNS
“In order to be successful in the mortgage industry, you need to be an expert in regards to all mortgage guidelines and products. You also have to know your company’s process inside and out. However, even more importantly, you have to genuinely want all of your clients to have a great experience”
PHIL CRESTA 26, inside sales manager Residential Home Mortgage A 2014 Young Gun, Phil Cresta is still going strong in 2015. His attention to detail and responsiveness leads to happy clients and repeat customers – and that, in turn, has led to some pretty impressive numbers. In the last three years, Cresta has racked up more than $70 million in closed loan volume. Cresta has also gained a reputation for leadership at Residential Home Mortgage; as an inside sales manager, he guides other loan officers to become experts in the field and top producers themselves.
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YOUNG GUNS 2015
ANDREW DANSKER
JAKE KRABBE
31, associate director Marcus & Millichap Capital Corporation
27, loan officer, Academy Mortgage
With more than a decade of experience in real estate, Andrew Dansker is one of Marcus & Millichap’s top producers, responsible for securing financing for an array of commercial property types. Dansker’s carefully cultivated relationships with national and regional lending sources make him a force to be reckoned with in the commercial lending world. Prior to joining Marcus & Millichap, Dansker served as a mortgage broker at Cooper-Horowitz and a managing director at Matrix Realty Group.
Jake Krabbe started his career at Academy Mortgage in 2012 and quickly became one of the company’s top originators. In his first year, he was honored as Academy’s Rookie of the Year, and he has been a multiple qualifier for the company’s Top Producers Club. Last year, Krabbe racked up more than $30.4 million in production, most of that purchase business. “Guys like Jake are the future of our industry,” says Academy Mortgage branch manager Chad Melin.
GREG KROHMER 34, branch manager, Advisors Mortgage Group When Advisors Mortgage Group launched its branch network in 2006, Greg Krohmer’s Newtown Square, Penn., branch was one of the first to come on board. Since then, Krohmer’s branch has consistently been one of the most successful branches in the company. Krohmer is also an asset to the company from a recruiting angle; his accessibility and success with the company have helped Advisors land several new branches over the years.
AUSTIN BOWMAN 34, mortgage consultant, Caliber Home Loans With more than a decade in the industry, Austin Bowman has the experience of a mortgage veteran despite his youth. That experience is paying off; Bowman is one of Caliber’s top young originators. In 2014, Bowman was responsible for $30 million in total production – $25 million of that in purchase business.
JONATHAN MCKINNIES 30, loan originator, Hallmark Home Mortgage
NATE HYMAN 28, senior managing director Eastern Union Funding Despite his youth, Nate Hyman is one of Eastern Union’s top originators, closing more than half a billion dollars in 2014. He’s formed close relationships with leading investors, institutions and capital sources, and has cultivated an enviable expertise in every aspect of the business. Among other deals in 2014, Hyman closed a $26.5 million permanent takeout loan against a new 53-unit Williamsburg building, a $9.85 million acquisition loan for a 48-unit multifamily property and a $13.4 million deal for the acquisition of a 332-unit Miami apartment complex.
In the six years Jonathan McKinnies has been in the mortgage business, he’s become a star. Over the last three years, McKinnies has closed an average of 150 units per year, 90% of which was purchase business. He was third in the company in 2014 in unit application volume, and has been a member of the Hallmark Mortgage Hall of Fame every year for the last five years. McKinnies is on the board of directors of the local Michiana chapter of the Indiana Mortgage Bankers Association and the Young Professional Network Realtor Association.
AYUSH KAPAHI 31, partner and co-founder, HKS Capital Partners Ayush Kapahi joined the commercial finance world in 2005 as a commercial originator at Pergolis & Swartz Associates. In 2011, Kapahi, along with partners Jerry Swartz and John Harrington, co-founded HKS Capital Partners, and the company immediately took off, securing billions in commercial financing. Since its founding, HKS has secured more than $9.5 billion in financing, and from the beginning of 2012 to the third quarter of 2013, Kapahi himself secured $2.16 billion in loans for commercial properties. Currently, he has more than $750 million loan requests in the marketplace, and the firm has more than $1 billion in the pipeline.
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FEATURES SPECIAL REPORT / YOUNG GUNS
COVER STORY: YOUNG GUNS JUSTIN BORUCHOV 32, director, Massey Knakal Capital Services Justin Boruchov has been with Massey Knakal Capital Services since its inception, and is one of the company’s top originators. In 2014, Boruchov closed more than $175 million in financing. Prior to joining Massey Capital, Boruchov was a vice president at Guardhill Financial, where he started as a mortgage banking analyst before transitioning to sales and quickly becoming one of the company’s top producers.
WHITTNEY CURRAN 33, loan officer, Academy Mortgage
JODIE TANGA 33, director of business development, Pacific Rim Mortgage
With more than 10 years’ experience under her belt, Whittney Curran is both a trainer and mentor to other loan officers – and a heck of a salesperson herself, producing $12 million in volume last year. For Curran, finding her customers the perfect loan is the most important part of the business. “The most important thing to me is that you receive the right loan with the least costs possible the first time,” Curran says. “Many people can get you a loan. What I promise to do is get you the right loan, and get it all done cheaply and on time.”
Jodie Tanga was only 22 when she set up her own branch of a friend’s mortgage company in 2005. Since then, her business has grown by leaps and bounds, and Tanga herself has become a prominent player in the mortgage industry. She’s a past president of the Hawaii Association of Mortgage Professionals, and was recently named Hawaii’s best loan officer by the Honolulu Star-Advertiser, the state’s largest newspaper. She’s also been recognized as a top mortgage professional by Honolulu magazine. Tanga still finds time to be a top producer, with $75 million in personal production in 2014.
INDEX BY COMPANY Company
page Name
Company
page Name
4Trust Mortgage
37
Craig, Ryan
Academy Mortgage
40
Curran, Whittney
Lund Mortgage Team
34
Lund, Lisa
Academy Mortgage
30
Finkle, Charadie
Marcus & Millichap Capital Corporation
39
Dansker, Andrew
Academy Mortgage
33
Hernandez, Henry
Academy Mortgage
28
Jones, Mark
Academy Mortgage
39
Krabbe, Jake
Academy Mortgage
35
Wielgot, Luke
Legacy Mutual Mortgage
35
Sigman, Joshua
Massey Knakal Capital Services
40
Boruchov, Justin
Maverick Funding
28
Arocho, Edwin
Maverick Funding
28
Levesque, Zachary
Norcom Mortgage
30
Gomes, Manny
Advisors Mortgage Group
39
Krohmer, Greg
Advisors Mortgage Group
29
Muscarella, Anthony
NOVA Home Loans
36
Brannon, Ian
Advisors Mortgage Group
34
Scarimbolo, Michael
NOVA Home Loans
41
Haines, Justin
Advisors Mortgage Group
34
Scuotto, John
NOVA Home Loans
36
McDermott, Michael
American Pacific Mortgage
36
Mack, JJ
Open Mortgage
30
Dupuis, Gene
Caliber Home Loans
39
Bowman, Austin
Open Mortgage
32
Gonzales, Michael
Colorado Mortgage
28
Shotnik, Michael
Pacific Rim Mortgage
40
Tanga, Jodie
PB Financial Group
36
Broukhim, Pouyan
Eastern Union Funding
39
Hyman, Nate
Gateway Funding
33
Gore, Tara
Gateway Funding
33
Mazowski, David
Guaranteed Rate
30
Banosian, Shant
Guaranteed Rate
35
Betesh, Shaul
Guaranteed Rate
28
Hunter, Jason
Guaranteed Rate
36
Nielsen, Mike
REMN Wholesale
28
Lewandowski, Tina
Residential Home Mortgage
38
Cresta, Phil
Silver Fin Capital Group
28
Feinman, Seth
The Federal Savings Bank
36
Katz, Eric
United Northern MortgageBankers
34
Fisher, Mark
Village Mortgage
36
Merati, Marco
Hallmark Home Mortgage
39
McKinnies, Jonathan
HighTechLending
34
Walker, Rich
W.J. Bradley
30
Boffy, Jenny
30
Shannon, Scott
HKS Capital Partners
39
Kapahi, Ayush
W.J. Bradley
Inlanta Mortgage
34
Page, Jeremy
W.J. Bradley
30
Tyson, Cody
Inlanta Mortgage
34
Warzon, Kip
W.J. Bradley
30
Young, Amber
40
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YOUNG GUNS 2015
“What used to work well yesterday is no longer the case today. Without being open to these changes, I do not believe we would be able to provide the level of service needed to excel in this business.” JUSTIN HAINES 30, senior loan officer, NOVA Home Loans “What helped Justin produce the results he currently has is that he is never afraid to try something new,” says NOVA Home Loans marketing director Kym Adair. “In a world where companies are spending money to set themselves apart from the rest, Justin stays on my toes to keep ahead of the curve.” Haines’s boldness has paid off; in 2014, he was responsible for almost $19.5 million in total loan volume.
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FEATURES
INDUSTRY ICON
FLIPPING THE SCRIPT For American Advisors Group CEO Reza Jahangiri, changing the face of the reverse mortgage industry wasn’t without its challenges
THE ODDS weren’t in Reza Jahangiri’s favor when he decided to start American Advisors Group [AAG] more than 10 years ago. The decision came at the height of the financial crisis – a time when Americans viewed reverse mortgages with a heaping dose of skepticism. So how was Jahangiri able to build AAG from the ground up in a volatile market to become the top reverse mortgage lender in the country? “When my friend introduced me to reverse in 2004, it just really resonated with me,” Jahangiri says. “I saw an opportunity based on the actuarial nature of the product and that there was a real need for it, along with the secular trend of aging demographics. Also, there were so many misconceptions. So to me, that translated into an opportunity to share the real story – that a reverse mortgage can empower seniors by tapping into their home equity to help fund retirement.” Joining the industry Jahangiri incorporated AAG in late 2004 and formally launched the operations in July 2005. Unfortunately, he says, challenges began to arise in the company’s early years – 2007 and 2008 – during the credit crisis. “At that stage, we had to decide whether to stay very nimble and small and ride the market downturn, or move to raise capital at a challenging time in the economy. It was a difficult decision to make.” In late 2008, the market began to turn, and Jahangiri decided it was time to raise
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capital. He recruited a senior team of executives formerly with the Senior Lending Network and then teamed up with JAM Equity Partners in early 2009. “JAM, like us, still believed in the industry,” Jahangiri reflects. By mid-2009, they wrapped up fundraising and began to build out AAG’s management team. With JAM’s money, AAG invested heavily in growth infrastructure – moving to mortgage banking, phone systems, software, mul-
Then Jahangiri’s team started to get creative and began selling leads, and in 2010, AAG hired former US Senator Fred Thompson as its spokesperson. “We stuck to our guns and believed in the business,” Jahangiri says. “It was a defining moment to see Fred Thompson on air for AAG the first time and celebrating with the team after being in a distressed situation just months before,” Jahangiri adds about one of his most memorable moments at AAG. “Also, I’ll never
“If your house is clean, then you can take care of your customer. I think if you focus on short-term goals and gratifications, you’re never going to be able to build a long-lasting, sustainable business” ti-state expansion, compliance systems and television commercials. However, shortly after the company recruited Mission Impossible actor Peter Graves for its national marketing campaign, he passed away. With the death of their first spokesperson and a market in recession, Jahangiri says the first years were challenging. “I remember at that time going to the board and asking, ‘How do we pivot and re-establish the brand now that we’ve made such a large investment in?’”
forget how we all felt when we learned AAG moved into the top lender spot. We had always thought of ourselves as the underdog, and becoming number one was a great achievement – one that I’ll never forget.” While 2014 was a tough year for the reverse mortgage industry as a whole due to new regulations, AAG grew its wholesale business by more than double and increased overall market share from 12% in 2013 to 24% by the end of 2014. “AAG was the top grower in
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“There were so many misconceptions. So to me, that translated into an opportunity to share the real story – that a reverse mortgage can empower seniors by tapping into their home equity to help fund retirement”
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FEATURES
INDUSTRY ICON AAG AT A GLANCE
both retail and wholesale volumes over the past 12 months,” Jahangiri says. “This is significant, particularly during a time when industry volumes were down 16% overall.” Employees always come first Jahangiri has the innate ability to exude the confidence required to run a highly successful company without coming off as pretentious and self-serving. His business philosophy is simple: employees first, customers second, followed by revenue and other metrics. “If your house is clean and in order, then
team has had no fallout, which is a huge accomplishment,” Jahangiri says. “Everyone at AAG really does have a passion for what they’re doing. There’s a lot of camaraderie, and we are strong proponents for work-life balance and helping others.” Corporate social responsibility is also central to AAG’s operations and Jahangiri’s business philosophy. AAG Gives Back supports charitable organizations at both a local and global level. Employees host drives, contests, raffles and events to raise money and supplies to fight common societal issues
“I’ll never forget how we all felt when we learned AAG moved into the top lender spot. We thought of ourselves as the underdog, and becoming number one was a great achievement” you can take care of your customer,” he explains. “I think if you focus on short-term goals and gratification, you’re never going to be able to build a long-lasting, sustainable business.” Jahangiri has learned that being a good CEO means never becoming complacent and making tough decisions upfront. “As the company grows rapidly, you have to make some decisions that may be contrary to how you feel emotionally,” he says. “Making moves within our executive team has been challenging at times, but I realize the importance of structuring the team to make sure each individual is in the right position as the company grows, to optimize our results. To stay ahead of the curve means you should consistently question how you do things and challenge the status quo.” These doctrines have helped Jahangiri build a unique work culture that has resulted in little turnover in leadership. “I’m proud of the phenomenal management team that we’ve put into place to help build the business. The
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in Orange County, California, and beyond. The program is also a major supporter of the Kwagala Project (AAG’s anchor charity), a nonprofit organization that helps victims of human trafficking in Uganda. The cause became important to Jahangiri after visiting the region in 2011 with his wife and friends. “It was very heart-wrenching to be exposed to, but we saw how effective the group [Kwagala Project] is in helping women survivors become self-sufficient,” he says. “What’s really gratifying is hearing that many of these women go on to pay it forward and help others.” AAG gives to The Kwagala Project each month, and every quarter, it supports other causes. “AAG Gives Back provides our employees with options to give to causes that they feel passionate about,” Jahangiri says. “To know we are doing something for a greater purpose gives more meaning to our daily work. At AAG, we are committed to helping seniors live the lives they’ve earned and helping others in need. ”
TOP OF THE HEAP In 2013, AAG was named the number-one reverse mortgage lender in the nation
SATISFIED CUSTOMERS AAG customers surveyed give the company a 97% satisfaction rate
HIGHLY RATED A fully accredited business, AAG has an A+ rating from the Better Business Bureau
GIVING BACK AAG has a history of charitable giving, including funding the Kwagala Project, which aids victims of human trafficking in Africa, and donating to the Fisher House Foundation, which supports housing for veterans and their families
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Another Great Conference is Coming, Mark Your Calendar Now! 32nd Annual Regional Conference of Mortgage Bankers Associations March 8 - 12, 2015 Borgata Hotel Casino & Spa Atlantic City, NJ A new venue for the Regional Conference of Mortgage Bankers Associations, The Borgata Hotel Casino & Spa, a beautiful location with great restaurants, free wi-fi and free access to the health club for Regional Attendees and a $109 room rate! Two days of commercial mortgage lending/brokerage followed by the residential mortgage conference, still the best after 31 years! Attend both commercial and residential or pick the one of your choosing, either way a great choice! The exhibitor prospectus will be available soon so watch for further information about the Regional.
www.mbanj.com
MBA-NJ Platinum Sponsors
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All Western Mortgage
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www.awmnow.com
888-296-0300
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AmCap Mortgage American Advisors Group AmeriFirst Home Mortgage Axia Home Loans Bay Equity Carrington Mortgage Services Catalyst Lending Cole Taylor Mortgage
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Continental Home Loans Envoy Mortgage
TL Huynh
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Flagship Financial Group
Mark Ballantyne
www.branchleader.com
877-569-3328
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FMC Funding
David Goldberg
www.fmcfund.com
888-297-4440
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Gateway Funding
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www.joingatewaynow.com
866-331-4184
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Gateway Mortgage Group
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www.gatewayloan.com
888-317-1974
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Pete Crenshaw
www.genevaopportunities.com
702-326-2543
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1:41 AM
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RESOURCES
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262-901-1444
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49
6/02/2015 4:07:43 AM
FEATURES
BUSINESS STRATEGY
5 marketing do’s for 2015
Your old ways of reaching customers may not be working anymore. Kim Goldstone offers 5 ways to get through to today’s client businessmen sitting around tables, and use graphics that show a younger, more diversified borrower. Show borrowers in a real-life situation to make your piece stand out and evoke more emotion. You have mere seconds to entice someone with a piece of direct mail before it potentially ends up in the trash. Anything that catches your customer’s attention and makes them pause to read your collateral is a success. If you include that interactive element and they actually take it into the house and save it? You’ve won the battle.
2
WITH A new year upon us, it’s not uncommon to focus on doing things better, more efficiently and with more impact than in prior years. This is true for marketing. Whether you are a marketing director, a branch manager or a loan originator, there are things you can do right now to take your marketing to a higher and more meaningful level.
1
Know your audience Knowing your audience is rule #1, whether you’re considering a single piece of marketing collateral or an entire campaign. More often than not, marketing dollars are a precious resource that must be spent wisely to maximize impact and get you a solid return on
50
your investment. Consider your audience in a thoughtful way before going into design and copywriting. Are you targeting millennials? Consider fresh colors and design elements that a younger audience will relate to. Research what their concerns are, and address the questions they may have about the product you are selling. Present your message in a way that will eliminate their concerns and address any potential questions or hesitations. Offer an interactive element, such as a URL, to redirect them to a site where they can find additional information or reach you for one-on-one help. Consider eliminating the cold, corporate-designed pieces of generic handshakes and
Engage and educate, don’t sell People are generally tired of being ‘sold.’ Today, consumers want to be engaged, educated and empowered. They seek information and relationships with trusted advisors. Give your customers a reason to want to work with you by positioning yourself as a SME (subject-matter expert) in the home lending arena. Avoid old-school flashy call-out banners and statements of desperation or urgency in your direct mail. Instead, dedicate that space to a statement that will engage your customer or educate them. For example, if you are doing a refinance direct mail piece, get rid of the starburst that screams ‘Call Me Today!’ and replace it with a crisp, sleek box that offers a statistic of how many people you refinanced in 2014 and how much money you saved your clients every month last year. Let the consumer generate the idea in their mind that you are a person who saves their clients money and not someone who relies on sales gimmicks. If you are a loan origina-
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tor, elevate your personal brand by being an educator, and empower your customer with information and scenarios to consider whenever possible.
3
Get automated The more customers and prospects in your database, the harder it can be to effectively stay at the top of their lists when it comes time for a refinance or to purchase a new home. Not even the most ambitious loan officer would be able to manage his or her relationships with hand-written notes and cookie-cutter mass marketing. The pros have a secret – and that is to use a CRM that contains fresh, relevant and compliant email and direct mail options for you to send to your clients based on varying factors or triggers. Most CRMs today have dashboards that will tell you which clients you should focus on based on their rate as it compares to today’s rates, clients who you have flagged for follow-up or any other client that you have set up to trigger in certain scenarios. If your goal is to go after any FHA loan you have done in the past four years and attempt to do a FHA Streamline refinance based on the new lower FHA mortgage insurance premiums that became effective January 26, you can do an advanced search of those customers and send them an automated campaign letting them know about this new rate and how to contact you. A good CRM and automated marketing partner will monitor what’s going on in the lending world and will most likely have this campaign already developed for you.
4
Get social You would be hard-pressed to find a loan originator today who is not at least on LinkedIn or Facebook. However, simply setting up a profile or two does not equate to being engaged in social media, nor does it set you apart from the millions of others who have done the same thing. Real engagement involves spending time exploring and understanding how to use social media as a tool for establishing yourself as a SME. While many loan originators have Twitter accounts, the reality is that most people are not looking for tweets on current rates or saving opportunities. Focus on social out-
lets that are appropriate for the business of lending. For example, if you log into LinkedIn and go to your profile, there is an area just under your photograph and basic information that is called ‘Posts.’ If you have nothing there, then you’re not doing enough to establish yourself in the worldwide web of experts. Take whatever angle of focus you can think of and get your thoughts out there, whether it’s ‘Top 10 Reasons You Should Consider a Refinance’ or your own personal ‘Why Work With Me’ mission statement. Be thoughtful and intentional about what you write, and then publish
half that, and spend the other $15,000 on a combination of Facebook advertising (which you can set your price at using cost-per-click), one month of banner advertising on a local news site, sponsor in a local race or community event, and then donate $500 of it to a charity and send out a press release about it. People like people who give back to the communities they live and work in – and to return to the diversification point, this plan reaches people who actually read bulk mail, young parents posting their child’s pictures to Facebook, the group who reads local news online – and you’ve established yourself as
Diversification of your marketing portfolio is one of the smartest things you can do for yourself, because while you may have one single message, different people react to and engage with various mediums in diffferent ways it. Once it’s published, share it with your connections. Join some groups that are relevant to the lending industry, or even groups that are relevant to your interests outside the office. You can establish yourself as an expert and get a whole new doorway into prospects by sharing your expertise within groups of people that may know you simply for your love of fly fishing.
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Diversify your mediums An investment advisor would tell you not put all of your investment dollars into a single basket, but instead to reduce your risk and maximize your returns by investing in different areas that will react differently to the same event. This is exactly the case in marketing. Diversification of your marketing portfolio is one of the smartest things you can do for yourself, because while you may have one single message, different people react to and engage with various mediums in different ways. For example, rather than spending $30,000 a month on direct mail only, spend
someone who cares about the community around you. These five tips are merely things you should consider as you evaluate how you spend your marketing dollars in the upcoming year. Each of these topics could be delved into on a much deeper level, but the goal is to get you thinking about what you are putting out there, how it is being perceived, how efficient your marketing is, whether you are truly engaged on social media and what mediums you are using to get your message out to the world. Spending just a little extra time on being thoughtful of your audience, crafting your brand, maximizing your reach and diversifying your marketing efforts can go an incredibly long way and yield you much higher results. Be smarter and more intentional this year and every year after, and you should have no issue remaining fresh and relevant – and watching your success grow to whatever level you ultimately want to achieve. Kim Goldstone is director of marketing for Mortgage Returns.
www.mpamag.com
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FEATURES
BUSINESS STRATEGY
How to use video to grow your business
Videos that promote your business and inform potential customers are now expected by the vast majority of visitors to your website. Video production expert Geoff Anderson reveals what content your potential viewers are looking for IF YOU want to stand out from your competition and be seen as an expert mortgage advisor, video is an essential tool in showcasing your unique skills and point of difference. Video has the power to move your audience. It can engage them with compelling information and, more important, can connect with your audience emotionally. After all, selling is an emotional sport, so you may as well play the game well! For many, approaching a mortgage broker can be an anxious experience. Purchasers probably have their heart set on a new home (or a first home), and they are hoping they will be able to borrow enough cash. With the right type of video, you can assure them that you have the answers and solutions to their borrowing situation. Video allows you to build rapport before you have even met your customer. It allows you to show some personality and build trust in an authentic way – in a way that is far more powerful than the written word or that corporate headshot on your website or LinkedIn profile. Video is not going away. It has become the easy way to communicate online, to gain buy-in and to manage expectations. A recent survey found that 96% of consumers say video assists
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them with their buying decisions. Research also supports that customers now expect video on any reputable website, and 77% of consumers believe companies that create videos are more engaged with their customers. If that weren’t enough, 73% of those interviewed said that they are more likely to purchase a product or service after watching a video that explains it. So, what are you doing to build your business with video? Here are five ways you can use video in your marketing plan. Introduce the team Produce short clips – up to a minute maximum – that introduce the people on your team. Build rapport with your customers, and show your viewers who you are and why you do what you do. Share why you love your job and what makes you good at it. Don’t be afraid to include personal information about you – are you married, do you have kids and do you play sport? What hobbies or interests do you have? Let your customers know you are a real person who understands them, as this is a great way to build rapport.
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Tips for getting the financing you need What are some of the common issues you have to deal with? Prepare some tips for your customers to help make their financing journey easier. They could include topics such as: • Know how much you can borrow before you make an offer • How to save for a deposit • What you need for a quick approval • The benefits of an offset facility • When interest-only is a good idea • Why the banks don’t want you to refinance
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Commentary on issues As movement happens in the industry, provide some video commentary about it. Sometimes nothing has happened – the Fed hasn’t changed interest rates. Then put out a video to explain why they haven’t changed interest rates and what this means from a borrower’s perspective.
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Testimonials Hearing your customers explain how your service enabled them to get their dream home is very powerful. Video testimonials are more energetic and credible than the written word. A video testimonial can give your viewer the reassurance that you understand the individual needs of each customer and can provide the right solution for their situation. A testimonial is different than a case study. A testimonial will usually focus on the quality of the service you provided and less on how it impacted them. Be smart if you embark on the video production route. Plan your videos and book the video production company so that you can create many videos in the one booking. Generally production companies charge for a half-day or a full-day shoot. If you ask your clients to come by to provide testimonials or case studies, then you could easily fill up the day with filming. This will provide you with plenty of content. If you film your customers, then ask them to supply photos of their homes. At the end of the day, this is what you are selling, and by seeing the end result of your work, your prospects will be more emotionally connected to you. If you are presenting to the camera, then consider using a teleprompter. This will enable you to focus on how you deliver the information without the pressure of having to remember the lines. The teleprompter can have the text loaded up for you to read. With a piece of glass that acts as a two-way mirror you can read the text while looking straight down the lens of the camera to the audience beyond. Once you have your content, then be strategic with how you deliver it. Regularity is the key. If you have enough content, then provide a video every month, fortnight or week to your audience. Whatever it is, stick to it. It has been proven that regular content builds and maintains an audience.
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“Video allows you to build rapport before you have even met your customer. It allows you to show some personality and build trust in an authentic way” If the property market is on the move, then explain why now is a good time to acquire a new property. Interview success stories If you have customers who are doing great things with their investments, then share the love! Interview them about their strategies. How did they get into the market? When did they decide to make property a key point in their financial goals? What influences their buying decisions? Do they mix negatively geared with positively geared properties?
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Case studies You also can include case studies. These might be stories from different customers about how you provided the ideal facility for them – often in spite of themselves. If someone else can sing your praises with a specific story, it is extremely powerful.
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The typical case study will follow this format: What was happening in the customer’s life • before you? What was their need? Why did they go looking for you? What did you do for them? (Asked the • right questions, showed options they didn’t know existed, explained solutions they hadn’t considered … ) How is their life now? How relieved are • they? How happy are they? How are they feeling? How excited are they that they have their new home? I’m a bit of a fan of case studies because it is subtle selling with great power. The story should focus on the journey of the customer. It is about them. It just happens that at a critical time in the story, you were there to provide a solution they needed. And then at the end, they are in a much better place because of it. It’s about providing quality content that your audience will find valuable.
Geoff Anderson is owner of Sonic Sight, a corporate video production company. He is also the author of the Amazon Bestseller Shoot Me Now: Making Videos to Boost Business. Visit www.sonicsight.com.au
www.mpamag.com
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THE CHOICE IS YOURS WITH
MAGAZINE - E-MAG - TABLET
WEBSITE - E-NEWSLETTER - MULTIMEDIA
Mortgage Professional America magazine features a series of industry reports recognizing the achievements of key individuals and businesses as well as providing the latest in business best practice. Have every issue mailed to you, read it on your tablet, or choose our e-mag delivery and have it delivered directly to your inbox.
MPAmag.com is an online industry hub committed to delivering the latest industry news and analysis, interactive forums, comprehensive searchable lending directories and career opportunities to mortgage professionals. Our website is supported by a daily newsletter featuring need to know industry headlines and updates.
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PEOPLE
CAREER PATH
THE RIGHT FIT Tim Peterson, currently executive vice president with Academy Mortgage, never intended to join the mortgage industry – but mortgage banking got into his blood... At age 18, Tim Peterson went to work in the marketing department of a local mortgage firm. “Due to some of my successes in the marketing department, one of the originating managers asked me if I wanted to come originate loans. I agreed to do that and did it for a short period of time.”
Peterson worked in the mortgage industry during the heyday of loose credit and stated-income loans. Frustrated by the lack of anything-goes attitude, he left to work for accounting firm KPMG. “I didn’t see a lot of professionalism in the industry at that time. Anybody could throw a loan to the wall, and it stuck.”
2014
FINDS HIS HOME
2008
HAS AN EPIPHANY
Peterson left the business world for two years to do service work in Brazil. “I had no desire to be a part of the mortgage industry when I came back, but I’d developed a competency for it.”
1998
TAKES A SABBATICAL
1997
STARTS IN THE BUSINESS
2000
GETS FRUSTRATED DURING MORTGAGE BOOM
Peterson went to work for Academy Mortgage, a company that he feels values integrity and professionalism as much as he does. Soon, he’d become a top producer and the manager of one of the firm’s largest and most successful branches. “I kind of had a personal epiphany – you can bring professionalism to anything you do. I saw an opportunity. The industry, which was in disarray, needed consistency.”
Peterson was eventually promoted to executive vice president of operations at Academy. In his new capacity, he oversees all field-facing operations for the company. “I’ve found a home in the mortgage industry. Bringing a high level of professionalism and dedication to this industry results in it becoming a sustainable career. I’ve really hung my hat on that thought.” www.mpamag.com
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PEOPLE
FAVORITE THINGS
JJ MACK
Branch manager, American Pacific Mortgage An Arnold Palmer on a Hawaiin beach or a pepperoni pizza while re-watching Top Gun on the TV. These are JJ Mack's favorite things
Favorite vacation spot: I like Oahu, Hawaii. It brings back memories of being there when I was younger. And obviously, it’s Hawaii – sun, sand and a good time.
Favorite drink Whenever I go out, I get Arnold Palmer, so I guess that’s probably my favorite drink, but I’m not a big alcohol fan.
Favorite celebrity Probably Warren Buffet – his approach on life, his business concepts and the ideas that make him who he is. I also like his philanthropic giving.
Favorite place to be: I like to be at home – just sitting at home with my family.
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Favorite food: That would have to be a good pepperoni pizza. Either that or a nice steak dinner, depending on my mood. You can either go all out with a steak dinner, or just go with pizza.
Best part about working in the mortgage industry I’d have to say my favorite part of being in this industry is being able to help individuals successfully navigate through the mortgage process and come to a common goal of purchasing a house or refinancing their house. You know, closing that transaction and having that moment of happiness – it’s always been a very cool thing.
Favorite music Probably country music. It depends on the mood, obviously, but my favorites would have to be Hank Williams Jr., George Strait and Jason Aldean.
Favorite movie That’s easy: Top Gun. Ever since I saw it when I was younger, it’s been one of those movies I’ve always liked. I’ve always liked jets and planes, so I’ve always liked it for that reason – and also because it’s just a well-filmed movie.
www.mpamag.com
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