APRIL 2019 THE OFFICIAL MAGAZINE OF GERACI
Industry Spotlight: We Lend, LLC
Brian
Cities to Watch:
Salt Lake City, Utah
Also Inside
April:
MINGHAM
MONEY
The Ground He Calls His Own
St. Jude
of CFSI Loan Managment
GROW YOUR
Microsoft & Verizon
Partnership www.originate.report 1
2 Originate Report | April 2019
contents APRIL 2019
Features
14 Grow Your Money.
20
Edward Brown, Pacific Private Money
18 Current Florida bill aims to remove the longstanding business purpose exception from mortgage lender licensing. What Can You Do? Nema Daghbandan, Esq. & Melissa C. Martorella, Esq., Geraci Law Firm
20 H ow The Private Lending Market Can Benefit from the Microsoft and Verizon Media Partnership Ryan Roberts, Sr. Director of Marketing
10
12
Who to Know 6 Profile
Brian Mingham, CFSI Loan Management Charles Peckman, Originate Report
10 Generosity Report
Appraisal Nation and RCN Capital, partnering to support St. Jude Children’s Research Hospital Erica LaCentra, RCN Capital
12 Industry Spotlight
14
Ruben Izgelov and Moses Suleymanov, We Lend, LLC
In Every Issue
11 Industry Job Watch
22 Cities to Watch
Salt Lake City, Utah
Charles Peckman, Originate Report
24 Upcoming Events 26 Loan Home
22 www.originate.report 3
DISCOVER THE
Symbol of Excellence
FOR PRIVATE LENDING
Members of the American Association of Private Lenders are the new trend-setters in the private lending industry. From their voluntary adherence to a Code of Ethics to their knowledge of the private lending process, they are the gold standard for the profession. Activate your membership with the American Association of Private Lenders to give your business the professional advantage and career boost it needs. You will: • Join a viable network of industry experts. • Get immediate recognition as an industry professional. • Have a voice in creating the standards for the industry. • Have access to exceptional professional development opportunities. • Get added marketing support and opportunities to enhance your business.
It’s time to take your business to the next level. JOIN AAPL TODAY!
AAPLONLINE.COM (913) 888-1250
4 Originate Report | April 2019
CEO Geraci LLP
ANTHONY GERACI Anthony@Originate.Report Vice President Geraci Media
RUBY KEYS Ruby@Originate.Report Editorial Director
MAX BERGER Max@Originate.Report Art Director
PAM HUBER Pam Huber Designs
CONTRIBUTORS Edward Brown • Nema Daghbandan, Esq. Erica LaCentra • Melissa C. Martorella, Esq. Charles Peckman • Ryan Roberts
FOUNDING UNDERWRITERS
MARK HANF President, Pacific Private Money
ORIGINATE ONLINE www.originate.report
GERACI ONLINE www.geracilawfirm.com Interested in advertising in Originate Report? Please reach out at Submissions@Originate.Report For Advertising Submissions, Article Submissions, and Inquiries contact Submissions@Originate.Report
ORIGINATE MAILING ADDRESS Geraci LLP 90 Discovery, Irvine, CA 92618 PHONE (949) 379-2600
Letter from the Editor Welcome to our April Edition of Originate Report! Spring has officially arrived, and hopefully you’ve recovered enough from Daylight Savings to properly enjoy the transition. Time to put away the warm winter clothes, relish the beauty of nature, and switch back to drinking iced coffee! For those of you who had a difficult winter, now is the time for a fresh start and a positive outlook. “If we had no winter, the spring would not be so pleasant; if we did not sometimes taste of adversity, prosperity would not be so welcome.” – Anne Bradstreet We hope you are inspired to push harder and keep moving the needle for your business. Read on to learn about Brian Mingham and his journey through the mortgage industry that led to the creation of CFSI Loan Management. You’ll also be introduced to Ruben Izgelov and Moses Suleymanov of We Lend, LLC, who are quickly emerging as top players in the industry. As always, if you would like to contribute content or advertise with us, do not hesitate to reach out!
Max
Max Berger Originate Report Editorial Director
GERACI CONFERENCES www.geracicon.com
www.originate.report 5
one, trying to figure out what I wanted to do,) I took a job at Citi Bank as a teller. From there I became involved with the selling aspect, and I eventually became a loan officer for home equity lines of credit. I moved to Boston to go to school and worked at a local bank as a loan officer, and when I met my wife, we moved to California.
PROFILE
Brian Mingham
A bit of ground that he can call his own:
Brian Mingham, CFSI Loan Management By Charles Peckman, Originate Report
M
itigating the risks associated with construction loans runs thick in Brian Mingham’s blood. His company, CFSI Loan Management, is based in Los Angeles and oversees the entire process, from contractor review to project feasibility reviews, and from fund control to draw inspections. Mingham, who founded the company and serves as its chief executive officer, ensures that construction projects are completed on time, on budget, and ready for permanent financing. Although CFSI has professionals coast-to-coast, its operations center is located in Denver, Colorado.
Mingham’s company works within a niche that is particularly valuable to lenders. While lenders that originate construction loans are practiced in evaluating borrower creditworthiness, they are often not experts in assessing construction risks such as determining a general contractor’s ability to complete a project, or proper costing for labor/materials in a construction budget, or mitigating the potential of subcontractors and suppliers filing mechanic’s liens on a property. Each one of these issues can cause a construction project to default.
6 Originate Report | April 2019
CFSI lends its expertise to lenders in the form of portfolio audits, as well. Some lenders rely on their partners to manage the construction process from start to finish. These lenders engage CFSI to audit the documents obtained by their partners for contractor review, project feasibility and construction draws/inspections. CFSI provides a detailed analysis of the construction risk in the portfolio and offers suggestions on meeting industry best practices. Mingham admits, however, that these core competencies stem from the team of professionals he has assembled – after a twenty-year career in the finance sector, Brian began CFSI in May of 2013. Mingham’s experience varies “from boots-on-the-ground to executive,” and he has held positions at Countrywide Home Loans, JP Morgan Chase, and NRES. Originate Report sat down with Mingham to discuss his career and the inception of CFSI.
What brought me to begin CFSI was a long, but rewarding journey. I’ve always been a traveling person – when I finished high school and started community college (like every-
In 2009, after 15 years in the mortgage business, I found myself out of a job in a city where that job took my family and me. We knew that we wanted to move back to Southern California, but after trying to find a job, I decided to start my own company. Initially, I started a property preservation company that supported lenders on the default side of the business, but that quickly grew into a national service provider. I used the contacts I gained in the mortgage business to contact people in different aspects of the business; this helped me begin my inspection company, asset management company, construction company, and seven years ago, CFSI. I started CFSI as the “hedge” company which would be going strong as other default businesses were waning. My thought process was correct because we put the default business on the shelf, and have stepped on the gas the last few years and focused on growing a world class Construction Loan Risk Management company. Even though I have brought CFSI into a space of prosperity, I felt an extreme sense of apprehension when I first decided to venture out on my own; after all, we were on the heels of a brutal recession, and I was in my mid-30’s living in Florida with my wife and young son. Being unemployed is not a pleasant experience, and today my friends and colleagues say “I can’t believe you took lemons and made lemonade.” I wouldn’t have been able to start my company without the large corporate experience I had. This experience, however, was quite draining; but even though these experiences were monotonous at times, they allowed me to gain knowledge in a litany of fields, including the mortgage sector and strategic development. The process of creating CFSI wasn’t a solitary one, however – I wouldn’t have been able to do this without my team. Hiring the best team in the industry is always a challenging part of building a successful business. We were fortunate to hire a couple of critical people who created a great team around them and has allowed us to grow, provide excellent customer service, and allow a work/life balance. Our operations center is located in Denver, CO and we have a few employees scattered around the country to provide early and late coverage for our clients. We are in the mortgage business after all, and moving vans are waiting, contractors need to get paid, and our clients rely on us to provide the same excellent service they give their customers, so they earn the repeat business. Our company helps lenders reduce risk related to construction projects nationwide. Our high touch, customer-centric approach allows lenders to concentrate on originating construction loans while CFSI manages the construction phase from beginning to end. From Brian Mingham: continues on pg. 8
www.originate.report 7
Brian Mingham: continued from pg. 6
reviewing project feasibility to confirming a contractor’s ability to complete a project, to managing the construction budget through the draw process, all the way until the project is complete and the loan is ready to roll to permanent financing, we are here and willing to lend our expertise in construction to residential, commercial, and multifamily properties as well as conventional, warehouse, SBA, and commercial lenders nationwide. Even though this is an incredibly multi-faceted field, our services can be broken down into a few key points. Contractor review: This is critical to the underwriting of a project. If you are working with an inexperienced builder who is not licensed, insured, and does not complete projects, it will be incredibly difficult to secure funding if a lender thinks, and rightfully so, that a project will be half completed. Contractors have to be carefully vetted; in many cases, borrowers use search engines to find their contractors. A few people show up, quote the borrowers, who in turn throw out the highest bid. More often than not, these borrowers end up with the wrong people for the job, which is why we take this process so seriously at CFSI. Project feasibility: One of the many components that can contribute to a project going wrong is its feasibility – if the bid or scope of the work is wrong, this can lead to a disaster in terms of the project’s completion. The worst scenario for a banker, in fact, is when the project is underbid, or contains vague line items and change orders from inexperienced contractors. Prior to funding deals, we make sure to evaluate the contractor and project first. If you have an unhappy borrower who may not have the funds to finish a project, the bank may have a half-finished project on their hands that they need to take back and possibly sell for a discount.
“I cannot reiterate enough the importance of surrounding yourself with brilliant, like-minded people.” Funds control: Now, the real work starts. We manage the “original” budget, which has the tendency to change at a moment’s notice and keep our eyes on line items. A small issue here, such as a contractor moving money between lines, can cause real issues for lenders and borrowers down the road if the project is not being actively managed. This “money moving,” changing materials, or changing the scope of a project can have a dramatic impact on the value of the project. If a borrower, for example, thinks they are getting granite countertops, but the line item is not managed closely, a development could end up with tile; this, of course, does not make too many people happy, especially if these oversights result in a depreciation of value. Situations like this are part of the reason why receipt collection is so important – even though receipt collection and lien releases are a time-consuming process, it will save you time in the
8 Originate Report | April 2019
long run, trust me. Many states have different forms and requirements, and if you don’t pay attention and keep funding the contractor, you may end up with a project full of liens that need to be cleared up prior to the project’s completion (they also need to be cleared up to receive a clean title.) Inspections: This step in the funds-control process tells the lender, by line item, what percent complete a project is – conducting inspections as a stand-alone product for us is challenging because we didn’t get the “before” look at a project during its feasibility phase. This is where the previous steps come into play and can advance or completely derail a project; if line items aren’t managed closely, you can run into a “detailed scope of work” that consists of vague categories like “plumbing – $15,000,” “kitchen – $20,000,” and so on. What do these categories consist of? Why should a lender pay $15,000 for “plumbing” if they are unsure of the quality of work? The latter steps in the process consist of an amalgamation of previous steps, which can make the work difficult at times. That’s part of the reason why CFSI is present for the entire process. Although this process sounds laborious, and trust me it is, it is also incredibly rewarding. When I started CFSI, it was my hedge against the default business going away. I had been working in a corporate setting for quite some time, attending retreats and sitting through strategy meetings even though I knew it was not the best use of my time or resources. The upside to working in the corporate space, however, is the guarantee of a consistent paycheck, which cannot always be said when starting your own business. When CFSI was still in its infancy, one of the biggest obstacles I overcame was understanding cash flow. Every month we would have revenue and profit, but what I didn’t realize was our clients would pay us 30 or even 60 days after a transaction was completed; this was a step that I just didn’t see at the corporate level, where so much activity takes place behind closed doors. When you own your own business and are heavily involved in its day-to-day happenings, you learn a lot about things you didn’t even realize before. Some of these realizations are positive ones, and others not so much, but at the end of the day you learn something from every situation. Because of margin compression and dwindling profitability, Brian decided to close his national default services business a year ago. It was a very difficult decision to put people out of work because after all, employees become family – but it was a decision I had to make. There was a point in time when the default business was extremely predominant, but it was an ugly business. I have a lot of friends still in the default space and it continues to contract monthly. People don’t realize what a logistics business it is and how dirty it can be; like when the sheriff shows up and we lock them out of their home and move all their belongings to the curb, or when squatters take over a home and live there with no power or water, grow houses, and cutting grass for
25,000 in 35 states. Even though it can be a tough business, I’m glad I have that experience. When I look at some of my competition today, they just don’t have that background. A storm is coming and many of our clients don’t have a clue what to do, but CFSI will guide them through the process. When I look at some of my competition today, they don’t have that background. Even though I closed down that aspect of my business a year ago, it always helps to have the know-how associated with taking back a property because often, it can be a painstaking process. Many people are ill-equipped to handle that process because we aren’t in a significant recession right now. CFSI’s team is experienced and well-rounded. Even though I started this venture myself, I cannot reiterate enough the importance of surrounding yourself with brilliant, like-minded people. Unfortunately, you can never overlook the possibility of foreclosure, so in my line of work, you need people who are well-versed in the “positive” and “negative” sides of the financial sector. Ultimately, the CFSI team itself is our biggest value-add. With that being said, however, running multiple businesses does take its toll, which is another reason it is important to surround yourself with trustworthy people. Before we shut down the default segment of our business, it was common for me to start my days at 5 a.m. and get home around 8 p.m. There is always something happening, and especially in real estate, I had to remain on my toes. Whether this means staying by the phone or mitigating challenges or conflicts depends on the climate of a particular day, but there is rarely a dull moment in this line of work. I’ve always been “on the go” (for lack of a better phrase) throughout my time in the real estate space. Over the course of my career so far, I have witnessed a major recession and a period of relative economic stability from a number of different cities. When I was working for larger companies, I found that corporate America had no problem whatsoever leaving people behind. On top of that, the work was exhausting; even though I am still incredibly busy running my own company, I feel so much healthier now. I don’t remember a specific incident that inspired me to start my own company, but I knew I could do something better. Although it is easy to be overly critical of the pitfalls we all experience throughout our lives, these experiences have to be levied against our triumphs. Coming off the heels of a recession and starting a company may have seemed foolish to some, but I always knew CFSI would be able to grow and expertly serve its clients. As I am quoted on our website, “No man but feels more of a man in the world if he has but a bit of ground that he can call his own. However small it is on the surface, it is four thousand miles deep; and that is a very handsome property.” I firmly believe this, as do all of the professionals CFSI hires.
CONTACT: For more information on CFSI Loan Managaement, visit thinkcfsi.com
Family Entrepreneurship “The buck stops here”
Real Estate Finance Corporation is a family owned and operated business based in Scottsdale, AZ. The saying “The buck stops here”, could not be embodied more than by this boutique firm. “It’s our name on the line, our reputation - not just as a business but as a family” said Alesondra Mora, Operations manager, niece to CEO/President Adam Child. There is a personal stake in each deal and interaction. We are here to build a legacy. Let us help build y o u r s . Contact our team today to discuss your potential investment opportunities.
14362 N. Frank Lloyd Wright Blvd., Ste. 1000, Scottsdale, AZ 85260 NMLS 1433420 | Phone (480) 477-7730 | refcorpaz.com | investorservices@refcropaz.com
www.originate.report 9
GENEROSITY REPORT
Appraisal Nation and RCN Capital, partnering to support
St. Jude Children’s Research Hospital By Erica LaCentra, RCN Capital
T
he mission of St. Jude Children’s Research Hospital, a not-for-profit, section 501 (c)(3) corporation, is to advance cures, and means of prevention, for pediatric catastrophic diseases through research and treatment. Since its opening in 1962, St. Jude has spent more than half a century focusing on finding cures and saving children. Thanks to that mission, treatments at St. Jude have helped push the overall childhood cancer survival rate from less than 20% to 80% today. What is also incredible is Founder Danny Thomas’s vision for St. Jude Children’s Research Hospital that no child should be denied treatment based on race, religion, or a family’s ability to pay. Because of this, the families of the over 8,500 patients the hospital treats a year never receive a bill from St. Jude for treatment, travel, housing or food. This ensures that families can focus on what is most important, their child. What St. Jude Children’s Research Hospital has been able to accomplish and continues to accomplish is nothing short of amazing.
10 Originate Report | April 2019
So, when RCN Capital’s Managing Director, Jeffrey Tesch, learned that the company was scheduled to attend a Single-Family Rental Summit in Memphis, TN, he knew immediately that he wanted to make the trip that much more memorable by visiting and donating to the St. Jude Children’s Research Hospital while in the area. When he realized that Appraisal Nation would be attending the same conference, he reached out to his long-standing friend and CEO of Appraisal Nation, Michael Tedesco, to see if the company would also like to get involved. Mike jumped at the opportunity to contribute to the organization. “It is incredible what St. Jude has built. They really have thought of everything to make the lives of the children affected by cancer as well as their family’s lives better while they are going through something so unimaginably hard,” said Mike Tedesco, CEO of Appraisal Nation. “I am proud to be part of a company and part of a partnership that wants to help and give back to such an amazing charity as St. Jude.”
On March 10th, employees from both Appraisal Nation and RCN Capital came together to take a guided tour of St. Jude Children’s Research Hospital. Learning more about the history of the organization, what they have been able to accomplish, and continue to do for patients and their families and seeing the staff that make so much of it possible was an inspiring experience. “The opportunity to tour St. Jude while in Memphis was a very emotional but uplifting experience,” said Erica LaCentra, RCN Capital’s Director of Marketing. “It was incredible to hear about all that they do at the facility but what made it even more amazing was to hear all of this from our tour guide, who was a former patient that is alive today because of the treatment he received at St. Jude. It really reinforced the immense impact this organization has had on their mission of ending childhood cancer”. One of the facts that came to light during the tour was that all of the treatment that occurs at St. Jude comes
at a significant cost. Operating costs are approximately one billion dollars a year and the organization relies on private donors to cover more than 75% of those
expenses. For that reason, Appraisal Nation and RCN Capital ended their tour of St. Jude with a joint donation to the organization.
“The RCN Capital and Appraisal Nation family were moved by their visit to St Jude Children’s Research
Hospital on our recent trip to Memphis. The amazing work this institution is doing cannot be over stated. Families receive no bill for treatment, housing, or food
for their time with the hospital. It is truly an honor to have our team interact with such worthy causes on our travels around our great nation.”
By donating to St. Jude Children’s Research Hospital,
RCN Capital and Appraisal Nation hoped that their contribution would help with the organization’s ongoing efforts to end childhood cancer and inspire others to donate. We strongly encourage others to learn more
about St. Jude Children’s Research Hospital and donate at: https://www.stjude.org/give.html
CONTACT: To learn more about St. Jude Children’s Research Hospital, visit stjude.org.
You can find RCN Capital online at rcncapital.com; Appraisal Nation can be found at appraisalnation.com.
INDUSTRY JOB WATCH
Look Wh o’s Hiring! Looking to fill a posit Originate ion? Adve Report’s rtise it he Industry re in of thousa Jobs to g nds of qu alified can et it in front didates. Contact u s at (949) 629-396 1.
Money360, Inc., Ladera Ranch, CA Commercial Real Estate Loan Underwriter must be able to evaluate loan opportunities, including, the real estate collateral securing the proposed loan, the surrounding market and demographic area and the adequacy of the loan structure of the transaction and/or relationship. Primary duties include the underwriting of commercial real estate and bridge loans, reviewing loan documents, spreading financial statements, evaluating borrow/guarantor financial support and management, and developing rationale for pricing decisions. The role will be responsible for all aspects of a proposed loan from the time the borrower executes the term sheet through closing. Interested parties should contact Paul Cleary. CONTACT: paulcleary@money360.com | www.money360.com
www.originate.report 11
SPOTLIGHT
Industry Spotlight:
Ruben Izgelov, Founder/CEO & Moses Suleymanov, Co-Founder/COO
We Lend, LLC
12 Originate Report | April 2019
L
ong before graduating from St. Johns University and the Touro School of Law, Ruben Izgelov was a flyer boy. Although he began this job when he was eight years old, he took that work ethic with him to St. Johns and Touro, where he earned a BS in legal studies and his JD, finishing cum laude and magna cum laude respectively. While he was in college and law school he worked full-time; afterwards, and on the heels of over a decade in the real estate space, Ruben founded We Lend, LLC. During his tenure in the real estate field, Izgelov focused on the fix and flip arena, or acquiring, flipping, developing, and selling over $100 million in real estate. To Ruben, the most successful time in his career was during the 2009 financial crisis; during this time, he bought, fixed, and sold distressed properties, which showed his determination in bullish and bearish markets. Ruben got married while in law school, and has two children. Moses Suleymanov is no stranger to the value of a hard day’s work. Graduating from St. Johns University in 2016 cum laude, Suleymanov, a licensed real estate agent, has been working since he was 12 years old. In addition to his real estate license, Moses has nearly a decade of experience in the field with an emphasis on the ‘fix and flip’ arena. Even though Suleymanov is still looking towards the rest of his career, he has already acquired, flipped, developed, and sold over $100 million in real estate. Originate Report: How have you seen We Lend grow and expand in the last year? We Lend, LLC: We have seen We Lend grow from a two-man operation to a 22-person operation, all under a one-year span. When we first started, we were mainly dealing with first time investors. Now most of our business comes from active investors, real estate offices and various referral sources. We contribute this expansion to all the experience we gained while in the fix and flip space (from which our borrowers are reaping the benefits), and to our committed staff. Originate Report: What has been one of your biggest successes and one of your biggest failures in your career? We Lend, LLC: Many say that doing business with family is inadvisable. We disagree. Our biggest success is keeping our family in the business, and those who are not blood related are treated as family. Our biggest failure was not understanding the power of leverage when we entered the fix and flip space many years back we’ve learned from that mistake all too well. Originate Report: How has your company vision evolved from Day 1 to Today? We Lend, LLC: As our company continues to grow, we learn new things – many of which are voids in the industry. There are many entrepreneurs who are ready to enter the fix and flip space, but have little knowledge of the business; they also have difficulty sourcing good fix and flips. Many of our existing borrowers, despite having experience, run into the same problem – they struggle with finding enough deals. Considering our
Moses Suleymanov and Ruben Izgelov, We Lend, LLC
background and experience in the fix and flip space, we have hands-on knowledge of how to source new fix and flip deals. Our vision has evolved to assist new and existing borrowers in sourcing sensible fix and flip deals – we truly believe that adding value to our borrowers is essential. Originate Report: What are some of your goals for 2019? We Lend, LLC: Our goal for 2019 is to introduce programs that are creative enough to make a small difference to our bottom-line, but a huge savings for the borrower. We also have our eyes set on moving into other states and becoming as active as we are in NYC. Originate Report: What is something that most people don’t know about your company? We Lend, LLC: Most people do not know that we were in the fix and flip space for many years prior to starting We Lend. That experience allows us to better serve our borrowers by helping them understand the business and source new fix and flip deals. Also, every phone number that you see associated to us is a cell phone. What that means is that someone is always answering the borrower’s call - day or night, weekday or weekend, We Lend and We Answer. Originate Report: What does success look like for you? We Lend, LLC: Success to us is creating a business that will serve generations to come. We are here for the long run.
Originate Report: What is one piece of advice you have learned and carried with you throughout your life? We Lend, LLC: We were fortunate enough to start working at very young ages. That allowed us to learn many lessons. Putting all these lessons into perspective, we can say in full confidence that hard work with a combination of complete honesty, a bit of luck, and respect to everyone (regardless of their status) will always pay off. And one more thing: there is no such thing as overnight success in business. Originate Report: What mistakes have you seen others make in this industry? How does We Lend avoid making those same mistakes? We Lend, LLC: Some hard money lenders cannot compete with our terms, so they tell their borrowers that they can match or beat what we offer and then change the terms the day of the closing – yes, the borrower still closes with that lender, but they will never send them any business. This type of behavior also brings a bad reputation to the industry. We only offer terms that we know we will fund – we look at everything with longevity – and we are here to stay. CONTACT: 212-777-7780 | ruben@welendny.com | moses@welendny.com | www.welendny.com
www.originate.report 13
FEATURE
Grow Your Money.
The Importance of Not Losing Money in your Portfolio over Extended Periods of Time By Edward Brown, Pacific Private Money
W
arren Buffett said, “Rule #1: Don’t lose money. Rule #2: Refer to Rule #1.”
Einstein famously quoted, “Compounded interest is the eighth wonder of the world.” However, what is not included in this quote is how it is important to avoid loses, for compounding is a double edge sword. The power of compounding only works when you do not lose money. This is also true when considering dollar cost averaging. If there is a continual downward market, dollar cost averaging only means that you will have more and more shares that lose value [as you purchase more shares when the price is lower than before]. Losses that compound are even more devastating than compounding interest [or gains]. For example; if one were to invest $100,000 and lose 20% the first year, the ending balance of the account would be $80,000. The following year’s return would have to be an increase of 25% [$80,000 X 25% = $20,000] just to break even. This does not include making a profit over the two year period; it just means that, over a two year period, the return would be zero.
14 Originate Report | April 2019
If the same $100,000 earned 20% per year compounded for three consecutive years and then suffered a 20% loss, the annualized compounded rate of return would be less than 8.5% rather than 10% [3 years X 20% = 60%, less 20% = 40% / 4 years =10%];
Here is how the figures work:
Original investment $100,000 Year 1 20% increase: $120,000 [Value at the end of year 1] Year 2 20% increase $144,000 [Value at the end of year 2] Year 3 20% increase $172,800 [Value at the end of year 3] Year 4 20% decrease $138,240 [Value at the end of year 4] The time value of money shows that a $100,000 investment turning into $138,240 in four years equates to compounded rate of return of less than 8.5%. Thus, the effect of losing money, even after gaining three years in a row [in our example] is worse than a steady increase. If, in the above example, the investment simply increased 10% compounded per year, after
four years, the account would have grown to $146,410. The difference of $8,170 [more than 2% per year on average] represents the severe hit the investment takes when there is a loss of any real magnitude; thus, the importance of a steady positive return per year versus the ups and downs that an investment may experience over time. The main reason for the powerful downside impact of losing money is that, if the loss happens before any gains [early in the investment years], there is less principal to work with to achieve a significant increase. If the losses happen after significant gains, then there is a fairly sizeable loss of investment as seen in the above example between years 3 and 4. The larger the swings in increases and decreases, the more significant the difference in risk adjusted rates of return. The example above showed 20% increases for three years and then a 20% decrease. The difference in a fluctuating return [of both positive and negative years] reduced the return of a potentially steady rate of 10% down to less than 8.5%; however, what if the first three Grow Your Money: continues on pg. 16
Revenue diversification
Fix N’ Flip, Bridge, Refinance, Ground Up & Small Balance Commercial
TODAY’S MARKET OPPORTUNITY: •
•
•
100 billion dollar non owner-occupied investment space SFR ’s 1-4 Fix N’ Flip, Bridge, Refinance, Ground Up & Small Balance Commercial Diversify product offering and add new revenue opportunities you may be missing out on Legally compensate your most prized relationships (Realtors) for referrals
WHAT TO LOOK FOR IN A BROKER + CAPITAL PARTNER RELATIONSHIP: • • •
Concierge across product offering with underwriting, training, service and support Dedicated call center for loan origination support and fund control Marketing materials provided including product tear sheets, pitch decks and web banners
In today’s market, refinancings have limited availability and there’s not much new housing inventory to lend against. For mortgage Brokers, this means the obvious; there are a lack of transactions in the market to profit from. For shops that are only doing refinance or traditional mortgages, opportunities only come around every 5-7 years. You’ve got to have a big client base to have volume. With financial products across SFR ’s 1-4 Fix N’ Flip, Bridge, Refinance, Ground Up & Small Balance Commercial, the sales cycle is faster, there is significantly higher recurring business, and a few lenders have teams dedicated to helping you succeed.
BROKERS, PARTNER TODAY
Think of it as a new product offering which results in the diversification of your potential revenue. All of this is well within reach, and much easier than you may think. The NON-O/O investment space is a 100 billion dollar industry that has come full circle since the last market downturn. Over the last decade private lending has been growing, and the comeback of property investors is at an all-time high. Here’s what it takes to do these types of loans and a good private lender will handle these things for your Brokerage… • • • • • • •
Review and process loan applications Document collection Facilitate Appraisal Coordinate Title & Escrow Complete underwriting Facilitate Funding Pay you
Traditional Realtors and Mortgage Brokers have the misconception they need an NMLS license to be a lender in this product space. The main point in dealing with a private lender is while they primarily fund SFR’s, these loans are governed under commercial guidelines. Thus we are not governed under RESPA, TRID or TIlLA. These loans are funded only into business entities allowing 7-10 business day closings and can pay anyone under a Brokerage license a referral fee or commission on the HUD at closing. There are two avenues a Brokerage launching this type of product to Real Estate professionals can expect to see. You can be a Correspondent Partner (the lender would fund in your name)
http://triumph.capital/brokers
or an Origination Partner (the client would see the lender’s name on the HUD). Most deals are funded under a single set of product guidelines allowing training, underwriting and servicing to be easily understood. CORRESPONDENT PARTNER (CP): You look and feel like the lender, a complete white-label product. ORIGINATION PARTNER (OP): Traditional Broker + lender relationship, lender shows on HUD. A full concierge service for Broker partners handling everything from A-Z is an entirely new model for private lending and Mortgage Brokers / Real Estate professionals. Working with a direct lender enables Mortgage Brokers to keep the lion’s share of the profit and have the potential to earn from the yield spread as well, all while monetizing on much more frequent lending transactions, instead of the normal 5-7 year customer lifecycle. There many private lenders chasing this strategy and it’s safe to be wary of who to work with. While choosing a partner, look for someone who understands the business and has a strong reputation for closing transactions. You’ll also need support with marketing materials. Having the right documents and product tear sheets (one-pagers) for conversations, trade shows, etc. is helpful in positioning the opportunity with your existing book of referral business from Realtors.
For more information call
877-450-9741
ROB JENNINGS robert@triumph.capital
GEORGE O. FLINT goflint@triumph.capital
www.originate.report 15
Grow Your Money: Continued from pg. 14
years were 40% positive and then a loss of 40% in year four?
Here is how the numbers would look: Original investment $100,000 Year 1 40% increase
$140,000 [Value at the end of year 1] Year 2 40% increase
$196,000 [Value at the end of year 2] Year 3 40% increase
$274,400 [Value at the end of year 3] Year 4 40% decrease
$164,640 [Value at the end of year 4]
Rather than a 20% return per year [40% X 3 years = 120% less 40% = 80% / 4 years = 20%/yr], the return is
13.27% per year [$100,000 turning into $164,400 after four years at 13.27% compounded annually]. The dif-
ference in interest rates of 6.73% is significantly higher than the previous example due to the higher percent-
ages of rates of returns [both positive and negative]. In
summary, the higher the rate of returns involved, the
wider the gap in total rate of return when looking at an
investment that has both positive and negative potential returns.
“Many people believe the real estate market crashed during the Great Recession, but, in reality, real estate had a slow, steady decline. Investors who stayed true to investing only in conservative mortgages did not see a loss of principal, and, in many cases, earned more than what they envisioned.” Since no one can accurately predict when investments
will have their up and down years, it would appear that a more conservative, steady, return is more beneficial, as
long as the return is not insignificant, and one needs to evaluate how an investment should be risk adjusted for comparison. For example, comparing a T-Bill, which is
considered essentially riskless, might produce a return
of 1% per year over a specified period of time, to an over the counter stock that might have wild fluctua-
tions [as in our example{s} above] is not appropriate. The aggressive investment produced either the roughly
8.5% return or 13.3% return, so one might presume that one should always invest in the riskiest vehicle because of the huge gap between the riskless investment [1%]
and the aggressive investment [8.5%-13.3%]; however,
nobody knows if the aggressive investment will be a net positive return over a specific period. For example,
what happens if the aggressive investment consistently losses money every year and never recovers; or maybe
16 Originate Report | April 2019
so much time has elapsed that the compounded rate of return is fairly small?
three years] loans such as 1st mortgages on stable real
For such an example, one might look at the NASDAQ. By the beginning of 2000, the NASDAQ was about 4,200. 15 years later, the NASDAQ was about 4,600. A 400 point increase over 15 years turned out to be a paltry .61% compounded rate of return. The NASDAQ experienced a lot of volatility over those 15 years. The point here is not to presume that all investments that have a wide swing in returns will always, over time, produce a better return than a more conservative investment.
2018 period produced consistent positive returns of no
One cliché that is always heard is that, “Over a long period of time, the stock market has produced a good return for investors; you can allow for swings in the market, sometimes producing gains and sometimes producing losses, but, as long as you stay in the market, you will have a good return on your money” [or some such quote]; however, which indices is this quote referring to? The S&P 500? The Dow Jones Average? Small Cap Stocks? Also, what other types of investments is this quote comparing to? For example, for the last 30 years ending December 31, 2018, the Dow Jones Average produced an annualized compounded yield of about 8.2%. This obviously includes the incredible run up in the market from 2002 to 2007; the Great Recession starting in 2008, and the bullish years that followed. One might want to compare this against the Prime Rate. Although the Prime Rate is not necessarily indicative of what an investor could or should earn, it is a widely accepted interest rate in the market place; mostly for the cost of borrowing, but it gives a general idea of prevailing rates of interest and the direction of where they are headed. The Prime Rate during this last 30 years started at 10.5% in December 1988 and immediately rose to 11.5% by the end of February 1989. The “less” Great Recession that started in June 1989 pushed interest rates lower until July 1992, when the rate dropped to as low as 6%. Rates increased thereafter until they peaked again in May 2000 when the Prime Rate stood at 9.5%. It continually dropped until it hit a low of 3.25% in December 2008. It started to increase again in December 2015 and steadily went up until December 2018 where it hit 5.5%. The average annualized compounded yield for the Prime Rate over the last 30 years [if one could invest in such a benchmark], would have been just short of 7%, so, the Dow Jones Average over the past 30 years produced a greater return than the Prime Rate by a little over 1% per year. However, what if we look at another relatively conservative investment such as a 1st mortgage? Private lenders have been producing private loans collateralized by real estate since Ally Ooop borrowed on his cave to put in a swimming pool 10,000 years ago. [Ok, not really, but the point is that private loans have been around since Biblical times]. Conservative, short term [less than
estate [both commercial and residential] that were no higher than 60% loan to value over the same 1988-
less than 9% in any year and for many years were in the
10-12% range hitting as high as 15%. Even during the Great Recession [and including the less Great Reces-
sion], conservative investors were always in the positive
during 1988-2018 if they kept to the formula of having low loan to values and relatively strong real estate areas
because, although real estate declined, as did everything else during the recessions, a low loan to value protected the investment.
Many people believe the real estate market crashed
during the Great Recession, but, in reality, real estate had a slow, steady decline. In the San Francisco Bay Area [a strong real estate market by most standards],
the real estate market took four years to decline about
25% in total. Investors who stayed true to investing only in conservative mortgages did not see a loss of princi-
pal, and, in many cases, earned more than what they envisioned as a trouble borrower was mandated to pay
late fees, and, in some cases, default interest that added upwards of 4-5% more than the note rate. Of course, the downside to this was the delay in receiving interest, but,
in some instances, the investor received a windfall if the
borrower failed to pay and the investor/lender acquired
the real estate through foreclosure. Most lenders would
prefer to just receive the intended interest they signed up for, but the notion of additional interest and possi-
bly owning the real estate that was collateralizing the loan is a potential benefit. Lenders need to make sure
they are willing and wanting to potentially own the real
estate they are lending on should there be a time when the borrower can no longer make the interest payments.
As with all investing strategies, an investor needs to do proper due diligence before investing money; this in-
cludes the stock market as well as real estate. That being said, as pointed out earlier, one needs to think about
whether a more conservative, steady, positive return investment is more advantageous than one with wild swings of both positive and negative returns, especially
if the conservative, steady investment outperforms the wild one.
ABOUT THE AUTHOR: Edward
Brown is in the Investor Relations department at Pacific Private Money in Novato, Calif.
CONTACT:
(415) 883-2150 pacificprivatemoney.com
You’re going places. Don’t stop until that place is the top. If you’re a loan originator looking to build your business and gain insight from the nation’s top mortgage brokers, bankers, lenders, and lawyers, Originate Report is for you. Distributed to 35,000 professionals in the private lending industry every month, this is where you come to see and be seen. To discuss submitting original articles, or for general Originate Report questions, email us at submissions@originate.report.
behind you all the way. find us online at www.originate.report www.originate.report 17
FEATURE
Current Florida bill aims to remove the long-standing business purpose exception from mortgage lender licensing.
What Can You Do?
I
By Nema Daghbandan, Esq. & Melissa C. Martorella, Esq., Geraci Law Firm n 2008, the United States Congress passed the Safe and Fair Enforcement for Mortgage Licensing Act (SAFE Act), which required all state regulators to regulate mortgage loan originators who originated consumer loans secured by 1-4 unit residential properties (“Dwellings”). The states were empowered to legislate more restrictive licensing requirements if they desired. To date, ten states, mostly in the western region of the United States, require a mortgage lender license to make a business purpose loan secured by a Dwelling and the remaining forty do not. Utah was the most recent state to start requiring a license for originating a business purpose loans when secured by a Dwelling when it passed legislation last year.
Previous Legislation Attempts
During the 2018 Senate session, Florida legislators introduced two bills covering private mortgage lenders. The bills, introduced by Sen. Rene Garcia (R-Miami) and Rep. Jeanette Nunes (R-Miami), aimed to eliminate the longstanding business purpose exemption for loans secured by a Dwelling. Ultimately, in a welcome move, the legislation was extensively modified to remove the licensing requirement based on property type and instead put into place common sense regulations and penalties. The passed legislation did not modify licensing requirements.
18 Originate Report | April 2019
In 2017, an almost identical bill previously passed through the legislature, but was ultimately vetoed by then-Governor Scott in June. Former Governor Scott issued a letter at the time stating that the regulation “would make Florida one of the most restrictive states in the nation in the residential mortgage lending arena.”
Current Pending Legislation
On March 1, 2019, Sen. Annette Taddeo introduced Florida Senate Bill 1632 (SB 1632). After the initial filing, SB 1632 has been introduced in the Florida Senate as of March 13. The bill should alarm private lenders because it makes a major substantive change to current law. Like previously proposed legislation, the current bill aims to remove the long-standing business purpose exception from mortgage lender licensing. Specifically, SB 1632 revises the definition of the term “mortgage loan.” The current definition is: “Residential loan that primarily for personal, family, or household use which is secured by a mortgage, deed of trust, or other equivalent consensual security interest on a dwelling….”[1] The new definition removes the following language “primarily for personal, family, or household use.” If this bill is signed into law, every lender who makes a loan secured by a dwelling, regardless of the purpose of the loan would need to obtain a mortgage lender license.
If the bills become law, the legislation would empower the state Office of Financial Regulation to regulate mortgage loans made for business purposes, require brokers of these loans to be licensed, and allow examination of firms offering or making private loans. To obtain a mortgage lender license the lender must produce expensive audited financials documenting a net worth of at least $63,000. Further, any control person of the company must be fingerprinted and undergo FBI and Florida State background checks as well as provide a credit report, among other requirements. The audited financial requirement alone will have a significant chilling effect due to the prohibitive costs of hiring an accounting firm and will drastically reduce the number of lenders capable of making mortgage loans in the state. Finally, the intent of the pending legislation is on its face contradictory. Specifically, the bill states that “the Legislature finds that Florida borrowers who apply for and receive business purpose loans, which are mortgage loans for business purposes which are secured by dwellings, are afforded limited CONSUMER protection.”[2] It is only rational that corporations and other business borrowers should NOT be afforded consumer protections as they are not consumers. These same borrowers are exempt from most federal consumer protections such as the Truth in Lending Act and the Real Estate Settlement Procedures Act. It is common sense that these same borrowers should not be treated as consumers because they are not consumers. Otherwise, these business borrowers will only see a reduction of available credit as lenders become hamstrung by irrelevant regulations and unnecessary red tape. Ironically, if this legislation passes, a private lender would not be required to conduct a foreign registration of their company in the state of Florida as the state legislature intentionally exempted mortgage lending from registration requirements,[3] but would instead need to pay more than thirty thousand dollars to obtain audited financials no matter how small the business was. Florida like most states exempts mortgage lending from foreign registration requirements in a bid to attract foreign investment capital into the state. However, this legislation if passed would clearly have the exact opposite effect.
AAPL and its General Counsel Geraci LLP’s Position. It is too soon to tell if this is a case of “how goes Florida, so goes the rest of the country” situation, but these developments should, at a minimum, alarm those in the private lending industry. This bill significantly impacts how brokers and lenders will operate under Florida law. Many association members make loans in the state of Florida and many lenders will assuredly choose not to become licensed due to the extensive administrative process. Further, all neighboring states including Alabama, Georgia, Tennessee, North and South Carolina all exempt business purpose loans from licensing require-
ments. Ultimately if the bills become law, the state of Florida which is going through a massive fix and flip resurgence should expect fewer market entrants and a corresponding increase in the cost of credit due to the lack of competition. Private lenders provide much needed capital to a marketplace which is underserved by large financial institutions and this regulation appears to harm the individuals it ultimately seeks to protect by consolidating power to a few licensed parties. We agree with former Governor Scott’s comments when vetoing previous legislation as this change “would make Florida one of the most restrictive states in the nation in the residential mortgage lending arena,” which is bad for the economy of Florida and the private lending community as a whole.
Why You Care and What You Can Do
Any association member who is making a loan in the state of Florida should make their voice heard. Let the Florida legislature know that passing this bill will harm the residents they are trying to protect. Less market competition will necessarily translate to higher interest rates which only harms Florida residents. Reducing capital to business borrowers who fix and flip homes in the state will only restrict the supply of properties into the market driving costs up for the final end users. Borrowers will have less options for capital, potentially driving interest rates up, and closing the market off to those with the ability to go through length licensing processes. Professional business parties should be able to work with each other without significant regulatory intervention. If this bill potentially affects your business, we urge you to reach out to policy-makers in the state of Florida and urge them to vote against SB 1632. Below, find simple instructions on contacting Florida senators to voice your concern.
Contact Instructions:
To reach your senator, visit the Florida Senate webpage at https://www.flsenate.gov/Senators/#Senators. Once on the webpage, locate your senator by searching for your county in the right column. Click on the name of your senator, which will direct you to their page. Alternatively, you can also contact Senator Tadeo’s office directly by going here: https://www.flsenate.gov/Senators/S40 where you are able to e-mail or call her office. ABOUT THE AUTHORS:
Once on your senator’s page, locate the blue “e-mail this senator” button on the left side under their photo. After clicking this button, a contact screen will pop-up. Choose “Jobs and the Economy” as the topic. Then, copy and paste the following language into the “Your Comment or Question” box and fill in the blanks with your information: Dear Senator __________, Thank you for your contributions and political leadership in our community and the state of Florida. My name is _____, and I transact business in Florida as _____. It has come to my attention that proposed legislation, Florida Senate Bill 1632, poses great risks to the people, businesses, and economy of Florida. I strongly urge you to vote against Senate Bill 1632. Specifically, this bill would devastate Florida’s private lending industry. Senate Bill 1632 would eliminate the long-standing “business-purpose” licensing exception, an exception many private lenders transact business under. Around 40 states recognize this useful exception. To change the norm in Florida would make the state unduly restrictive and encourage borrowers and lenders to make transactions elsewhere. This bill will personally affect myself and my business, as a member of the private lending community. To date, I have made around ______ loans in the state of Florida. This totaled to approximately _____ dollars. Should this legislation pass, I will be unable to operate in your state. Senate Bill 1632 has potential grievous effects on the economy, as it would drive out lenders who have made
loans in the state for many years. Further, borrowers
will have less options for capital, hurting Florida property owners seeking a competitive mortgage loan mar-
ket. For the reasons stated above, I urge you to vote against Senate Bill 1632.
Thank you for your consideration. Sincerely, [Your name] Next, complete the rest of the online form with your
information, and press the “send email” button on the bottom left of the screen to complete.
Nema Daghbandan’s (left) practice encompasses all facets of real estate transactions representing lenders and brokers, including loan documents for commer-
cial, residential, construction, multi-family, servicing agreements, spread agreements, assignments (of all types), leases, lien releases, procurement agreements, intercreditor agreements and subordination agreements throughout the country. Mr. Daghbandan also leads the firm’s non-judicial foreclosure practice and advises clients on all default related matters. Mr. Daghbandan has closed hundreds of millions of dollars in loans throughout the country. CONTACT: 949-379-2600 | www.geracilawfirm.com
Melissa Martorella (right) joined Geraci Law Firm as an Associate Attorney in the Banking and Finance section in August 2015. Ms. Martorella’s experience includes representing lenders and brokers, preparing commercial, residential, and construction loan documents, as well as drafting assignments, extensions, modifications, and subordination agreements. Ms. Martorella also has experience assisting with negotiating the terms of transactions, drafting custom language, and closing loans. Ms. Martorella has prepared loan documents for transactions all over the country and ensures compliance with state-specific laws.
CONTACT:
949-379-2600 | www.geracilawfirm.com
www.originate.report 19
FEATURE
How The Private Lending Market Can Benefit from the Microsoft and Verizon Media Partnership By Ryan Roberts, Sr. Director of Marketing
I
In January 2019, Microsoft announced their newly formed and strengthened relationship with Verizon Media (formerly known as Oath). It is by-product of Verizon taking a huge $4.6 billion write-down on Yahoo and AOL as they failed to meet expectations.
From March 31, 2019, Yahoo Search traffic will be exclusively served by Bing Ads and this is to include traffic currently acquired from Oath Ad Platforms (previously known as Yahoo Gemini) and other search advertising platforms.
This update means that whereas before you had to access multiple distinct platforms to manage your search and display campaigns, you can now use a single platform for your search campaigns for Bing, Yahoo, and AOL.
20 Originate Report | April 2019
But what does this mean for the future of private lending and advertising and what are the best ways for you to take advantage of it?
Yes, a competitive edge with Bing, Oath, and Verizon
Currently, the average loan for a private lender doing Non-Owner occupied residential, Multi-Family and Mixed-Use investments costs around $3500 to acquire and close. This means that you want to be doing as much as possible to streamline and coordinate your customer acquisition efforts so that you’re not spending extra money. The enhanced partnership will make your search campaigns easier to manage while helping you reach a valuable audience across Microsoft and Verizon Media properties and partner networks.
In the world of Google’s dominance of all, the truth is that other sources have been underutilized and under optimized from an advertising perspective in private lending. Yet with a little bit of focus in the right direction, you can ensure that you are doing everything you can to expand your search reach. The newly presented opportunity here makes it easier to find, purchase and monetize on advertising inventory and impressions across search terms that convert to leads - and closed funding scenarios. It allows advertisers to centralize advertising efforts under a single platform across those networks and measure quality, impressions, and conversions from a single source.
Why Bing and not Google Pay Per Click
Before we go into how this can benefit you, it’s important to clarify the distinctions between Bing and Google and how you can work these to your advantage.
Bing currently has 34% of the desktop search engine market share worldwide, and importantly, you have access to 63 million individuals searching who cannot be accessed with Google Adwords. Even more important, 40% of the Bing demographic is aged 35 to 54 years old - a particularly close match for the average borrower demographic for private lending. So if you’re not using Bing Ads, that’s a substantial amount of missed opportunity. Almost 40% of the Bing Network ranges from 35 to 54 years old which is a very
close match to average borrower demographic within private lending -- especially for surfacing potential SFR investors as customers. Bing also offers a more reduced cost per click opportunities, ranging from 20-35%. This means that a $20 CPC could cost as little as $13 on the new platform.
Google CPC Insights
White Collar, Tech Savvy, Skews younger < 35 years old, College Degrees, Majority of Search Market, Greater Worldwide Reach, Extremely competitive CPC market, Higher CPC’s
Bing CPC Insights
Blue Collar, Less Tech Savvy, Skews Older 35-55 years old, Average HHI > $100k, Less search volume, Mostly U.S. search traffic, Less competitive, Lower CPC
What To Do With Your Ad Campaigns
word from Microsoft recommends adding a 10% budget buffer to avoid getting constrained. The process to replicate is pretty easy. There’s plenty of tooling in place to “copy and paste” your existing Google PPC campaigns on this network in a matter of minutes.
Make sure that you then keep your Oath Ad Platforms search campaigns running, while building up your Bing Ads. Keeping these search campaigns running is the best way to avoid the loss of volume during the migration period.
If you run campaigns on Bing Ads only then you might find that you receive additional clicks, mainly from US traffic. This would be a great time to increase your Bing Ads budget so that you don’t miss out on the potential increase in traffic volume. Adding 10-15% budget buffer will allow you to avoid campaign pauses. If you run campaigns targeting other countries, it’s unlikely that you’ll notice any additional volume.
Centralize Your Campaigning & Customer Deal flow is key. Surfacing new funding scenarios can Acquisition be time consuming and it’s never easy. When it comes to building and running your customer acquisition campaigns, Microsoft has been clear about how the new platform is going to roll out.
If you are currently run search campaigns on Oath Ad Platforms your campaigns will keep running until March 31st, and you don’t have to worry about stopping them. Instead, you’ll have til mid-March to replicate your campaigns and campaign budgets on Bing Ads. The official
When it comes to efficient and effective campaigning and customer acquisition, you want to make sure you can centralize your strategy. The new Bing platform means that no longer will you have to maintain conversion tracking code for separate advertising platforms. So, you can easily test, scale, and evaluate your results across the different inventory & impression streams. In fact, this is quite possibly going to be the biggest “hidden treasure” where lower costs conversions are avail-
able because fewer industry competitors have invested the same time and money as they have in platforms like Google or Facebook ads.
It will also make re-marketing efforts for lead loss and conversion recovery easier. It opens up a single source for display campaigns and makes it possible to use Bing and Google to maximize potential efficiency between each platform.
ABOUT THE AUTHOR:
Ryan Roberts is a Sr. Director of Marketing for a San Diego based joint venture real estate investor and operator. The firm’s principals have a combined 40+ years experience in property development and real estate finance. Parent holding companies portfolio totals 10M+ square feet and is valued in excess of $1.4 billion. For the last 8 years of his career, he’s worked with the world’s leading companies and venture-backed startups across various qual/quant marketing functions. Prior, he held software engineering roles for large-scale e-commerce ventures. Ryan’s extensive technical background, rooted in product management, hardware, and software development lends well to a scientific approach in marketing. 1M units shipped, $22M in retail sell-out on products created.
CONTACT:
(616) 635-9732 or ryan@e1even.com
www.originate.report 21
CITIES TO WATCH
Cities to Watch:
Salt Lake City O By Charles Peckman, Originate Report
nce known as “Great Salt Lake City” (the Great was dropped from the name during the 19th century,) this metropolis was founded by Brigham Young and other founders of the Church of Jesus Christ of Latter-day Saints. Despite the once arid, inhospitable landscape, the city’s founders rigorously cultivated the land and contributed to its population boom. This increase was certainly assisted by the mining booms of the 19th century, the first transcontinental railroad, and today, the intersection of I-15 and I-80. It also helped that the city hosted the 2002 Winter Olympics; a mix of tourist-friendly attractions like skiing and a history steeped in the American Dream contribute to Salt Lake City’s reputation as an ‘underrated gem.’
Must-see locations
Within a two hour drive from Salt Lake City you will encounter 60 national and state parks – this, coupled with the multitude of trails, scenic pathways, and avenues of exploration contribute to this city (and its sur-
22 Originate Report | April 2019
rounding area) as a must-visit location for lovers of the outdoors. Even if you aren’t necessarily an outdoorsman (or outdoorswoman,) it is impossible to not have your breath stolen by the rich skyline and breathtaking, millennium-old natural wonders. Salt Lake’s official website, in fact, features a ‘scenic route guide,’ pointing weary travelers in the direction of wonders large and small.
Even on dreary days, Salt Lake does not disappoint with its indoor attractions – the Natural History Museum, for example, immerses its visitors in the age of the dinosaurs and other poignant times throughout the Earth’s history. Nestled behind Salt Lake’s mountain-town image is also a poorly-kept secret (in the best way possible,) the city’s deep artistic history. The first public building in Salt Lake, in fact, was a building focused on gathering and discussing art. Today, visitors and “townies” alike can stroll through Modern West Fine Art or the Phillips Gallery (depending on your artistic preferences, of course.)
Nightlife
Whether your day has been full of meetings, rigorous hiking, or leisurely strolls amongst Salt Lake’s natural splendor, the dwindling sunlight breaths a new kind of light, the light of this city’s vibrant night life. Although it may be easy to assume that New York or Chicago are the only locations that yield any sort of activity to partake in at night, that is certainly not the case. The Tavernacle Social Club, for example, is open until 1:00 a.m. every day of the week and features drinks, dueling pianos, karaoke, and bingo every Monday. Another must-visit, Quarters Arcade Bar, offers vintage to modern games (and, of course, drinks) to curb the child and adult in all of its guests. While some prefer a relaxed cocktail at the end of the day, others prefer to let loose on the dance floor – luckily, venues such as Metro Music Hall offer just that, in addition to live music.
Dining
Over the course of the last decade, Salt Lake has transformed itself into a must-visit food lover’s destination. Regardless of any potential hankerings for everything from a hamburger and fries to upscale, multi-course meals, there is something for any set of taste buds. Take The Tin Angel Cafe, for instance, which pairs quirky décor with an ever-changing selection of European fare, or the rustic atmosphere and nostalgic American cuisine
Salt Lake City, Utah Economy: of the Copper Kitchen. From pizza to upscale Italian, there is no shortage of culinary adventures to have. What many people may not know about Salt Lake is its selection of microbreweries and locally-owned taprooms. Throughout the early part of the 20th century, the city proved to be one of the largest beer producers in the West, and that tradition certainly continues today with locations like Red Rock Brewing Company and Outlaw Distillery. Whether you would like to sample an IPA or a locally-produced spirit, Salt Lake has you covered – plus, April is the city’s official ‘Craft Beer Month.’
• Major industries: Top fields include finance and insurance, real estate and rental leasing, manufacturing, and healthcare • Minimum wage: $7.25 • Cost of living: 26.8 percent higher than the national average
Housing:
• Median household income: $71,510 • Median home price: $400,800
• Home price change: 15.9 percent one-year increase • Home ownership: 48.2 percent • Median rent price: $1,323 (average for a two-bedroom apartment)
Job Market:
• Forbes List: Best places for business and careers #20 • Unemployment: 2.5 percent • Job growth: From Dec. 2017–Dec. 2018, Utah’s job growth rate was 3.1 percent • Loan originator average salary: $57,059
Attractions
As it turns out, Salt Lake has been coined – at least in the genealogical sphere – as the “Genealogy Capital of the World.” The city is known for its myriad of records and databases for family-based research. If this suits your fancy, not to mention the plethora of historical and nature-oriented spaces to visit, it comes as no surprise that Salt Lake has a reputation as a well-versed destination. If you happen to have a gaggle of children with you while traveling, there is no reason to fret – planetariums, zoos, museums, and a score of parks will certainly keep young minds curious.
www.originate.report 23
UPCOMING EVENTS
Upcoming Events Don’t be left out! Showcase your upcoming event here! Contact a.carter@geracillp.com for more information.
Non-Conventional Investor Club 2019 April 5 • Los Angeles, CA www.geracicon.com
The Broker Exchange 2019 May 9-10 • Dallas, TX www.geracicon.com
Captivate 2019 August 21-23 • Las Vegas, NV www.geracicon.com
All event dates subject to change. Please visit conference websites for agendas and details. 24 Originate Report April 2019
You have knowledge. You have ideas.
Let us showcase your voice.
Currently we’re looking for articles showcasing: Business Development • Fintech/Newest Loan Programs • Automation in Today’s Evolving Society • Upcoming Trends & Changes • Marketing & Outreach Essential Tools & Technologies • New Legal Issues and Regulations. Another idea? We’d love to hear that, too.
Write for us. Email submissions@Originate.Report for more information.
www.originate.report 25
LOAN HOME
Help Make Dreams Come True TYPES OF LOANS
AN LO M
XI M
MU www.atgcapitalfunds.com bobby@atgcapitalfunds.com Tarzana, CA
400K 3.5M √
√
√
√
√
√
√
√
65-70/ 12-18
√
√
√
√
√
√
√
√
√
Direct Lender
Fidelity Mortgage Lenders, Inc.
www.fidelityca.com psteigleder@fidelityca.com Peter Steigleder (818) 422-8879
Helvetica Group
www.helveticagroup.com loans@helveticagroup.com (310) 575-3301
50K 15M
Direct Lender
www.jcap.net info@jcap.net (949) 236-6600
√
√
√
√
√
√
√
√ 55/30 √
√
√
√
√
√
√
√
CB Real CALBRE 00388229
100K 10M √
50K
5M
√
√
√
√
√
√
√
√ 75/30 √
√
√
√
√
√
√
√
*All 50 States
√
100K 50M √
√
√
√
√
√
√
√
√
√
√
√
√
75/2
√
√
√
√
√
√
√
√
√
√
√
√
√
√
AL, AK, AR, CA, CO, CT, DE, FL, GA, HI, IL, IN, IA, KS, KY, LA, ME, MD, MA, MI, MO, MS, MT, NE, NH, NJ, NM, NC, OH, OK, PA, RI, SC, TN, TX, VA, WA, WV, WI, WY
√
√
√
√
√
√
√
90/30
√
√
√
√
√
√
√
√
2019
Direct Lender
AK, AZ, AR, CA, CO, CT, DE, FL, GA, IL, IN, AI, KS, KY, LA, MD, MA, MI, MN, MS, MO, MT, NE, NV, NH, NJ, NM, NY, NC, OH, OK, OR, PA, RI, SC, TN, TX, UT, VT, VA, WA, WV, WI, WY
Let Lenders know you found them in Originate Report!
Are you a lender? Advertise with Originate Report’s Loan Home and be seen by 35,000 industry professionals each month. Contact our Loan Home director at (949) 629-3961.
26 Originate Originate Report Report || April April 2019 2019
√
Rev. 01.14.19
www.lockettnhomes.com Info@lockettnhomes.com
√
* AZ, CA, NV
Direct Lender
Lockett-N-Homes
√
CA, TX, WA
Direct Lender
JCAP Private Lending
√
* = states lending in
ATG Capital
MA
MI
NI
LENDER
$ U Co mm M L O AN Co erci ns al $ um e Br idg r e Co rpo r Ac at io qu ns/ isi T No tion rusts tes s a / L nd ega Pu De l E rch ve ntit lop ies Re ased me ha nts b/ Bla Re m nk od e Se t Lo eled an co s / Re n no Jo d M va int ort ted Ve ga Fo ntu ge s rei r es g Ot n Na he t i on r als MA XL oa nCh urc to-Va lue he La s (% nd / Te (B mp ) / MA a le Au tom re/ C s/ S X Te rm y o Re otive mm nag (yr erc og s) tai u l (S ial e s /L En ho ot) ter p ta s/ Ga inm Strip s S en Ma t lls Le tatio ) isu ns re Ho (G sp olf it C Mi ality our s xe d-u (Hot es/ M Re se els) ari sid Pr na I o nd e ) Ra ntia per t ustri l a ies nc I l n v h Se es a estm lf-s nd e tor F nt Re ag arm Prop sta e ert s ies u Of rant fic s e
Let lenders know you found them in Originate Report!
TYPES OF PROPERTIES WE LEND TO
TYPES OF LOANS
TYPES OF PROPERTIES WE LEND TO
MI www.pacificprivatemoney.com loans@pacificprivatemoney.com (415) 883-2150
150K 5M
√
√
√
√
√
√
70/30
√
√
√
√
√
√
Direct Lender
www.patchofland.com originations@patchofland.com (888) 250-2216 Sherman Oaks, CA 91403
Redwood Mortgage Corp. www.redwoodmortgage.com RMC@redwoodmortgage.com (800) 659-6593 San Mateo, CA 94402
Sandstone Capital, Inc. www.sandstonecapital.net josiah.p@sandstonecapital.net Josiah Puder (310) 909-8555 Ext. 1040
Sunset Equity Funding www.sunsetequityfunding.com lending@sunsetequitygroup.com (833) 786-7381 Los Angeles, CA 90010
√
√
√
√
√
√
√
√
√
√
√
85/2
√
√
√
√
√
100K 10M
√
Direct Lender
*65% For commercial and mixed-use and 70% for multi-family and residential investment. 5 years (custom terms are available)
100K 10M
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
65/5*
√
70/5*
√
√
√
√
√
75/5
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
CA, CO, HI, TX, WA
√
√
√
√
√
√
√
√
√
√
√
90/2
Direct Lender
2M
√
* CA
Direct Lender
50K
√
AL, AK, AR, CA, CO, CT, DE, FL, GA, HI, IL, IN, AI, KS, KY, LA, ME, MD, MA, MI, MS, MO, MT, NE, NH, NJ, NM, NY, NC, ND, OH, OK, OR, PA, RI, SC, TN, TX, VT, VA, WA, WV, WI, WY
Direct Lender
50K 50M
√
√
√
NATIONWIDE EXCEPT ALASKA, SOUTH DAKOTA, NORTH DAKOTA
√
√
√
√
√
90/2
2019
www.zincfinancial.com office@zinc.net Tom Valentino
3M
Rev. 01.14.19
Zinc Financial Inc.
50K
* CA
SFR
Patch of Land
√
* = states lending in
Pacific Private Money
XI M
NI
LENDER
MA
MU
M
LO
AN
$ U Co mm M L O AN Co erci ns al $ um er Br idg e Co rpo r Ac at io qu ns/ isi T No tion rusts tes s a / L nd ega Pu De l E rch ve ntit lop ies Re ased me ha nts b/ Bla Re m nk od e Se t Lo eled an co s / Re n no Jo d M va int ort ted Ve ga Fo ntu ge s rei r es g Ot n Na he t i on r als MA XL oa nCh urc to-Va lue he La s (% nd / Te (B mp ) / MA a le Au tom re/ C s/ S X Te rm y o Re otive mm nag (yr erc og s) tai u l (S ial e s /L En ho ot) ter p ta s/ Ga inm Strip s S en Ma t lls Le tatio ) isu ns re Ho (G sp olf it C Mi ality our s xe d-u (Hot es/ M Re se els) ari sid Pr na I o nd e ) Ra ntia per t ustri l ies al nc I n v h Se es a estm lf-s nd en t t Re orag Farm Prop sta e ert s ies u Of rant fic s e
Look for this Lender’s Ad in this issue of Originate Report
Direct Lender
AZ, CA, CO, IN, MI, NM, OH, TN, TX, WA
www.originate.report www.originate.report27 27
PROVIDING PEACE OF MIND As a full service law firm that caters to the private lending industry, Geraci’s team of bankruptcy, banking and finance, litigation, securities, corporate, and real estate attorneys has provided our clients with peace of mind for over a decade. Let us deal with the legal side of your business—so you can stay focused on what’s really important.
28 Originate Report | April 2019
Geraci Law Firm | 949.298.8050 | www.geracilawfirm.com
