HousingWire Magazine, August 2019 - Women of Influence by traci-tkdesignpro

Protecting homeowner data in the digital age of mortgage finance.

P.48

ECLOSING

HOUSINGWIRE MAGAZINE ❱ AUGUST 2019

2019

HOUSINGWIRE MAGAZINE ❱ August 2019

IT SECURITY

The Closing Exchange, DocMagic, Docutech, Lenders One, Pavaso, SnapDocs

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GET READY FOR THE LARGEST MORTGAGE INDUSTRY CONFERENCE FOR INDEPENDENT MORTGAGE BROKERS Register today visit: fuse.aimegroup.com

RYAN SERHANT

GARY VAYNERCHUK

BEHIND THE SCENES

Rita Santamaria

Lisa Robertson Dolly Lenz

HOUSINGWIRE AUGUST 2019 EDITORIAL

CONTENT SOLUTIONS

PUBLISHER Clayton Collins

MANAGING EDITOR Sarah Wheeler

EDITORS Ben Lane Jessica Guerin

DIGITAL CONTENT STRATEGIST Alyssa Stringer

REAL ESTATE EDITOR Kathleen Howley

ASSOCIATE CONTENT EDITOR Jessica Davis

ASSOCIATE EDITOR Kelsey Ramírez REPORTER Alcynna Lloyd CONTRIBUTORS Rohit Gupta, Robert Walker, Michelle Rogers, Melissa Klimkiewicz, Katherine Katz, Steve Smith

10 YEARS HOUSINGWIRE was the first publication to honor women making significant contributions in mortgage and real estate – that was nine years ago. Now, the annual Women of Influence award is stronger than ever, and grows more competitive each year. Women continue to grow in strength and number in the housing finance industry, paving the way for more to follow. This year, we honor 50 Women of

CREATIVE GRAPHIC DESIGN Traci Cortez COVER PHOTOGRAPHER Dina Kantor

Influence, and feature three of these women on our cover. The three featured are powerhouses in the real estate industry, and include Dolly Lenz, Rita Santamaria and Lisa Robertson. Flip to page 30 to read more on these and other women who are paving the way in the real estate and mortgage industries. HousingWire’s recent engage.marketing summit was a huge success! And in case you weren’t able to make it, turn to page 98 to see what some loan officers had to say about marketing, and how LOs learned to

SALES

CORPORATE

NATIONAL SALES DIRECTOR Jennifer Watson Laws jlaws@HousingWire.com

PRESIDENT AND CEO Clayton Collins

CHIEF REVENUE OFFICER Diego Sanchez CALIFORNIA MARKETING MANAGER Christi Lingard Caren Karris clingard@HousingWire.com CLIENT SUCCESS CENTRAL MANAGER Mark Adams Haley Hess madams@HousingWire.com AD OPERATIONS SOUTHEAST COORDINATOR Tamara Wren Matthew Stafford twren@HousingWire.com CLIENT SUCCESS GREAT LAKES COORDINATOR Lorena Leggett Talia Quigley lleggett@HousingWire.com CONTROLLER SALES COORDINATOR Michelle Monroe Emilio Flores

thrive in the marketing place. And while you’re over there, look back a couple pages to see our By the Numbers section which shows the latest profit numbers for independent mortgage bankers. Competition continues to be fierce, but profits are looking up from the fourth quarter.

Kelsey Ramírez Associate Editor @kels_ramirez

Subscriptions are available for $149 for one year. A subscription includes the print magazine and online access to the digital magazine. Canada and foreign are only eligible to purchase the “Digital Only” subscription plan at $149 for one year. Visit www.housingwire.com/subscribe for more information. The information contained within should not be construed as a recommendation for any course of action regarding legal, financial or accounting matters. All written materials are disseminated with the understanding that the publisher is not engaged in rendering legal advice or other professional services. HW Media does not guarantee the accuracy of information provided, and is not liable for any damages, losses or other detriment that may result from the use of these materials.

Tweets From The Streets Ease of use and speed are huge differentiators in business. If you are not striving to make things run consistently faster and easier with technology and processes for both your clients and your team, you are missing out on big opportunities to win.

by @Mishbia15

HOUSINGWIRE ❱ AUGUST 2019 5

AUGUST ‘19

WOMEN OF INFLUENCE 50 women influencing and improving the

mortgage and housing industries.

IT SECURITY

AVMs

ECLOSING

Protecting homeowner data in the digital age of mortgage finance.

It’s time for an update on AVM programs and practices

We profile six firms modernizing the mortgage industry.

By: Rohit Gupta

By: Robert Walker

By Alyssa Stringer

70 UNIQUE SOLUTION

72 SPOTLIGHT

AAG expands its wholesale channel.

Sutherland Mortgage Services enhances AI in the mortgage industry.

By Alyssa Stringer

By Sarah Wheeler HOUSINGWIRE ❱ AUGUST 2019 7

IT’S TIME TO MAKE

THE SWITCH TODAY’S BORROWERS ARE LOOKING FOR MORE OPTIONS AND BETTER SERVICE THAT ONLY INDEPENDENT MORTGAGE BROKERS CAN PROVIDE For much of the past decade, retail outlets ruled

They often get to choose when and where they

the mortgage lending landscape. Borrowers were

work — giving them the ﬂexibility to accommodate

pushed toward big banks or online retail lending

other important aspects of their lives. And they have

institutions for home loans and forced to choose

greater control over their own pipeline, resulting in

from only the products they had to offer. However,

them taking home more of what they earn.

to build a relationship with homebuyers today, lenders must go beyond just a low rate. Delivering

As borrowers have become increasingly aware of

fast turn times and providing exceptional service

the advantages independent mortgage brokers

have become equally essential.

bring, industry support has also been on the rise. Several wholesale lenders, industry associations

Which is why it’s not surprising that retail lenders

and other initiatives are dedicated to helping

are shrinking and independent mortgage broker

independent brokers grow their businesses and

shops are on the rise — some industry experts

to supporting their success. And some of those

predict independent mortgage brokers will reach

same organizations have developed step-by-step

25% of the market by 2020.

processes that take the guesswork out of starting your own shop.

For loan ofﬁcers, the reasons to move from retail to an independent mortgage broker are many.

The only thing standing in the way of you starting

Independent mortgage brokers have important

a career as an independent mortgage broker

advantages over their retail counterparts.

is you. Ready to make the switch? Get started

They have the ability to shop dozens of lenders,

at BeAMortgageBroker.com, where you’ll ﬁnd

giving them access to hundreds of loan options.

everything you need to join the fastest-growing

They have the ability to offer wholesale rates.

segment in the mortgage industry.

Schedule a conﬁdential conversation with our team 1-800-229-6342 | info@beamortgagebroker.com

NMLS #3038

CONTENTS 12

THE LINEUP

The Massachusetts Association of Realtors hires Theresa Hatton as CEO.

Why the “one-click” mortgage is not the endgame for the housing business.

82 REVERSEREVIEW

EVENT CALENDAR

ON THE SHELF

What it takes to boost mortgage applications, and considering opportunities for improvement.

86 OPENHOUSE Baby Boomers are clogging up the housing market — you can’t buy what’s not for sale.

14 DISPATCH

90 CFPB WATCH

Gary Vaynerchuk, Ryan Serhant bringing star power to the AIME Fuse National Conference in October.

The CFPB finds Freedom Mortgage intentionally reported inaccurate HMDA data.

16 DISPATCH

94 KUDOS

Disruptive mortgage automation technology from SoftWorks AI increases lender profitability.

Plaza Home Mortgage donates ovrer $11,000 to support autism treatment.

96 BY THE NUMBERS

Check out the five most expensive homes sold in New York City in 2018.

26 FHA ENFORCEMENT

28 IMPROVEMENT

It’s been a tumultuous start to summer for the reverse mortgage industry.

The coffee bean illustrates a simple lesson to create positive change.

20 A LIST

What decreased reliance on the False Claims Act means for FHA lenders and servicers.

New York City rent regulations prove to be negative for multifamily lenders. 78 LENDINGLIFE

VIEWPOINTS

74 RENTWIRE

10 PEOPLE MOVERS

The Mortgage Collaborative is hosting its 2019 Summer Conference in Tennessee.

BACK DEPARTMENTS

Independent mortgage banks report a profit in the first quarter of 2019.

98 QUOTES FROM EXPERTS 22 TAKE 5 Built Technologies CEO Chase Gilbert gives an inside look at his life by answering five questions.

24 HOT OR NOT The fastest-growing cities in the U.S. have seen their affordable housing decline from 2010 to 2017.

An interview with top prodducers on why marketing is so essetial to their job. 100 Q&A Citadel’s non-QM commercial product expands opportunities for brokers and correspondents.

102 KNOWLEDGE CENTER Quantarium leverages disruptive technologies for its QVM valuation product. 104 COMPANIES/PEOPLE INDEX 106 PARTING SHOT HOUSINGWIRE ❱ AUGUST 2019 9

Theresa Hatton Massachusetts Association of Realtors

10 HOUSINGWIRE ❱ AUGUST 2019

FUCHS

OWEN SIVORI

HAGERMAN HERR

T he Fe d e r a l H o u s i n g F i n a n c e Agency named Sarah Dumont Merchak its new director of legislative affairs. Merchak worked previously as director of federal government relations at USAA. She has also previoulsy held various positions in public policy and advocacy, working at TwinLogic Strategies, Visa and the Smith-Free Group. Notably, Merchak also worked for the government as a for mer sta f f member of t he Senate Banking Committee. Wells Fargo hired Steve Hagerman to serve as the company’s head of consumer lending technology. Previously, Hagerman was chief technology officer, managing director and head of home lending originations technology for JPMorgan Chase. Hagerman spent 17 years at JPMorgan, holding various senior leadership positions in technolog y during his time there, including chief technology officer of customer ser v ice operat ions, chief technolog y officer of consumer and community banking and head of con-

DEBELACK

MERCHAK LEE

Theresa Hatton, Hudson Gateway Association of Realtors former director of professional development and industry relations, was hired as the Massachusetts Association of Realtors CEO. Previously, Hatton was CEO of the Greenwich Association of Realtors.

sumer branch and ATM Infrastructure. Earlier in his career, Hagerman held positions at Bank One, Vobix Corp. and Lexis-Nexis. Consolidated Analytics hired Josh Fuchs as senior vice president of product development and sales for its residential valuations div ision. Fuchs joi n s Con sol idated A na ly t ics f rom Goldman Sachs, where he served as vice president and head of residential valuation for its real estate management division. Fuchs has more than 15 years of leadership experience working at industry leaders like JPMorgan Chase, ISGN and Fannie Mae. Wells Fargo appointed Gar y Owen as its new chief information security officer and head of information security. Owen brings nearly 30 years of experience to the role, most recently serving at WarnerMedia as its chief information security officer. Cornerstone Building Brands recently appointed Jeffrey Lee to the position of executive vice president and chief financial officer. Prior to joining

Cornerstone, Lee served as the senior vice president and chief financial officer at Contech. Notably, he also held leadership positions at Kennametal and Eaton. Va l u a t i o n P a r t n e r s ap p o i nte d Karen Herr as the new vice president of its U.S. western region. Herr brought to the company more than 30 years of experience in the financial ser vices industr y, holding executive roles at severa l la rge mor tgage compa nies. Prior to joining Valuation Partners, Herr served in several leadership positions including senior vice president at Mor tgage Capital Management, a cor re sp onde nt s a le s d i re c tor at Stonegate Mortgage Corp. and a vice president at JPMorgan Chase’s wholesale and correspondent divisions. Wa t e r s t o n e M o r t g a g e re ce nt l y appointed Eric Debelack to the position of area manager of its Southeast Wisconsin region. Debelack has more than 30 years of experience in the financial industry, holding leadership positions at companies like Bell Bank Mortgage and Assured Mortgage. Celink appointed Robert Sivori as its new chairman and CEO. Sivori will also assume the same title for Casa Holdco, Celink’s new parent company. Sivori has more than 25 years of experience in the mortgage industry, serving as the co-founder and chief operating officer of Reverse Mortgage Investment Trust and Reverse Mortgage Funding. Prior to that he was a senior executive of the HECM division of MetLife Bank, co-founder and co-president of EverBank Reverse Mortgage and president of BNY Mortgage Company.

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EVENT CALENDAR

THE MORTGAGE COLLABORATIVE 2019 SUMMER CONFERENCE AUGUST 18-20, 2019 Host: The Mortgage Collaborative Location: The JW, Marriott Hotel Nashville, Tennessee Cost: $185-$995 On the agenda: The Mortgage Collaborative Member Conference is a unique industry event that places a heavy emphasis on peer-to-peer networking. This year, the annual summit will offer an interactive agenda featuring over 25 different breakout sessions. Conferencegoers will learn about new innovation options and some of the latest technology available to the mortgage industry. Learn more at mortgagecollaborative.com

NASHVILLE, TENNESSEE: TMCâ&#x20AC;&#x2122;s 2019 summer conference will be held in Nashville, Tennessee. Nashville, also known as NashVegas, is a city known for its musical heritage. While in town, make sure to visit the Country Music Hall of Fame. This historical museum features some of the biggest names in country music history including, Bill Anderson, Loretta Lynn, Johnny Cash and more. Learn more at countrymusichalloffame.org 12 HOUSINGWIRE â?ą AUGUST 2019

ON THE SHELF The Coffee Bean: A Simple Lesson to Create Positive Change BY JON GORDON AND DAMON WEST JOHN WILEY & SONS

When the going gets tough, are you a carrot, an egg or a coffee bean? The carrot gets soft in hot water, the egg gets hard, and the coffee bean transforms its environment. The book follows Abe, a young man filled with fear as he faces challenges in school and at home. Abe discovers that instead of letting his environment change him for the worse, he can transform his world for the better.

VC: An American History BY TOM NICHOLAS HARVARD UNIVERSITY PRESS

This history of venture capital in America was written by a professor at Harvard Business School. He details the birth of American venture capital starting in the early 1800s with the financing of whaling ships that sailed from Massachusetts ports such as New Bedford and Nantucket. Like todayâ&#x20AC;&#x2122;s high-tech investing, a few big hits paid for the unprofitable stumbles. Nicholas goes on to tell the legendary stories of how VC firms like Greylock Partners, Kleiner Perkins and Sequoia launched companies such as Intel, Genentech and Google. In addition to covering VC history, the book provides a forward look at where early-stage investing is heading.

AIME | SPONSORED CONTENT

Gary Vaynerchuk, Ryan Serhant bringing star power to AIME Fuse National Conference in October The event will be held in Las Vegas on Oct 12

ompetition in the mortgage business appears to be at an alltime high, as lenders consistently jockey to out-duel their competition in any way possible to win over the hearts of consumers and loan officers alike. Disagreements are common and sometimes become public – for example, when leaders from throughout the mortgage industry spoke out against comments made by prominent speaker Gary Vaynerchuk, who slammed homeownership, calling it a “bad use of upfront capital” and “not smart.” Regardless of differing viewpoints that exist about renting and buying, wholesale and retail, the ultimate priority that all housing professionals should rally behind doesn’t revolve around who’s right and who’s wrong, but rather, initiating positive discussion and acting in the best interest of the people they serve. It’s in that spirit of a unified purpose within the industry that the Association of Independent Mortgage Experts (AIME) has actually booked Gary Vaynerchuk as a keynote speaker at its second annual national conference, Fuse, to be held in Las Vegas in October of this year. In addition to Vaynerchuk, AIME has also secured a keynote speaking commitment from Ryan Serhant, U.S. real estate broker and star of the popular Bravo series “Million Dollar Listing New York,” which just wrapped its seventh season.

14 HOUSINGWIRE ❱ AUGUST 2019

This is a big-time exciting announcement from AIME, which has gone to great lengths in its first year to equip independent mortgage brokers with access to resources and opportunities to elevate their business.Their speaking roles having nothing to do with past comments or articles, and everything to do with how their specific avenues of expertise can help independent mortgage brokers excel at their craft. “Gary [Vaynerchuk] said what he believes, and even though I, and a lot of leaders in the housing industry, disagree with his opinion; he’s allowed to feel that way. That’s what makes this business great,” said Anthony Casa, chairman of AIME. “We’re very excited to have both Gary and Ryan on board as headliners at AIME Fuse, as two guys who will provide great insight and tips on their areas of expertise, entrepreneurship and real estate, and help deliver an incomparable experience to AIME members.” Last year’s inaugural conference drew more than 1,300 independent mortgage brokers, loan originators and processors from around the country, along with a robust exhibit hall of product vendors, wholesale lenders and service professionals who specialize in serving the independent broker channel. The 2019 AIME Fuse will be held at the Bellagio on Oct.12 in Las Vegas, Nevada. Registration opened on March 15 and can be accessed at Fuse.aimegroup.com.

SHINING THE LIGHT ON

NON-QM L END ING

Millions of potential borrowers are locked out of today’s conventional mortgage market. Deephaven Mortgage is shining the light on Non-QM lending by providing products specifically designed to address the needs of millions of borrowers who are unable to obtain a traditional mortgage. In return, this allows lenders to expand their business by reaching out to a broader group of borrowers. To become a Deephaven partner, and help shine the light on Non-QM for your potential borrowers; contact us today at sales@deephavenmortgage.com or visit www.deephavenmortgage.com Deephaven Mortgage® LLC. All rights reserved. This material is intended solely for the use of licensed mortgage professionals. Distribution to consumers is strictly prohibited. Program and rates are subject to change without notice. Not available in all states. Terms subject to qualification. For more information on Deephaven’s state licensing, visit the NMLS Consumer Access webpage at http://nmlsconsumeraccess.org/. NMLS #958425

SOFTWORKS AI | SPONSORED CONTENT

Disruptive mortgage automation technology from SoftWorks AI increases lender profitability Trapeze solution delivers true touchless automation

s the mortgage industry headed toward real-time loan processing? If SoftWorks AI has its way, the answer would be a resounding yes. With increasing compliance costs and more intense competition in the marketplace, mortgage lenders are feeling the pressure to minimize their loan processing costs to ensure growth and profitability. As a result, lenders are recognizing the need to fully automate their business, in order to significantly reduce the manual work and expense of processing and approving a loan. In addition to reducing mortgage processing expenses, lenders need to compete successfully in a very time-sensitive environment. As the popularity of programs like Quicken’s Rocket Mortgage increases, lenders are increasingly compelled to process mortgages faster than ever before. This, in turn, is challenging the industry to look at more innovative ways to automate their business, so they can compete in today’s environment. SoftWorks AI, a leader in artificial intelligence and machine learning solutions, is not the first business to attempt solving this problem. But according to founder and CEO Dr. Ari Gross, it aims to be the only touchless automation solution on the market. SoftWorks AI developed its disruptive Trapeze for Mortgage Automation software to transform the mortgage loan process into one that can drive company productivity with minimal human intervention. Its deep knowledge of the mortgage industry, coupled with state-of-the-art computer vision and artificial intelligence technology, enable all facets of the industry to drive higher performance. Because of its roots in a research lab, Gross sees his solution as the only one that can fully automate areas such as origination, underwriting, servicing and post-close review. “Our in-production mortgage automation solution has increased underwriter productivity for our clients by over 100%,” said Gross. “By combining AI and computer vision technologies together, SoftWorks can effectively auto-validate the mortgage classification and data extraction process, streamlining the loan approval process.” The business of mortgage automation has been around for decades. However, other solutions on the market have yet to provide a true touchless solution. As a result, lenders are still relying on humans to correct the software’s errors. “The problem that many of our customers experience is that most automation solutions produce results which are not sufficiently reliable, and that human validation is still required at every stage,” Gross said. So far, Trapeze for Mortgage Automation has delivered clients in origination and mortgage insurance a high degree of touchless 16 HOUSINGWIRE ❱ AUGUST 2019

automation, resulting in correspondingly high rates of process optimization. Trapeze’s proficiency in OCR and computer vision, together with its ability to understand the accuracy of each operation, allows it to process data from mortgage documents both faster and more accurately than the competition. As a result of SoftWorks’ best-in-class solution, a large number of the company’s new clients come from satisfied client referrals and existing clients who are looking to automate additional lines of their business. Despite being just 18 months old, SoftWorks AI works with many of the nation’s top mortgage lenders and insurers.

BORN IN A RESEARCH LAB

Although SoftWorks is new to the mortgage industry, it brings a unique academic perspective to solving today’s problems. Gross started his research and development over 20 years ago in the areas of computer vision and machine perception. His research originally focused on aiding the visually impaired to read scanned content in real-time using 3-D OCR. Over time, Gross realized that these technologies have far-reaching business implications and founded his previous company, CVISION, to help thousands of companies recognize data on structured, semi-structured and unstructured documents. CVISION also developed enterprise solutions to create compressed and searchable PDFs. Realizing a need in the fintech industry for business process automation solutions, the team began development of an AI/ML solution with implications in the mortgage, tax and AP industries. After a successful exit from CVISION, Gross and his team of engineers founded SoftWorks AI to automate many of today’s manually-intensive business tasks and to help knowledge workers achieve higher performance.

WHAT’S NEXT?

The company is committed to automating every aspect of mortgage processing and is now working on audit and compliance, in addition to mortgage-backed securities. It’s also focused horizontally on all areas of lending and funding where knowledge bots can be disruptive through automated income verification and cash flow analysis. “Automating all aspects of the mortgage lifecycle is still a challenge that we’ll need to tackle one use-case at a time. Our ability to understand data with high precision and then design touchless automation solutions for document-centric processes translates into many use cases in financial services,” Gross said.

Join us on August 22nd for a live webinar! aag.expert/aagwebinar Become an AAG approved partner! aag.com/wholesale (866) 964-1109

Partner with Experience Senior housing wealth exceeds $7 trillion¹ and yet 42% of Americans will retire broke². Together, we can do better. Let American Advisors Group (AAG), the nation’s number one reverse mortgage lender, be your partner in success: AAG's Concierge Experience allows your originators and processors to learn while they earn AAG's dedicated Lender Support Team guides the entire loan process from application to submission AAG's online marketing portal gives you 24/7 access to custom marketing materials ¹Senior Housing Wealth Exceeds $7 Trillion For First Time. NRMLA. https://www.nrmlaonline.org/about/press-releases/senior-housing-wealth-exceeds-7-trillion-for--rst-time. ²GoBankingRates.com, Survey Finds 42% of Americans Will Retire Broke – Here’s Why (March 2018). For industry professionals only -- not intended for distribution to the general public. American Advisors Group, NMLS #9392, headquartered at 3800 W. Chapman Ave., 3rd Floor, Orange, CA 92868. License information on www.nmlsconsumeraccess.org and www.aag.com/disclosure.

DIANNE CROSBY Chair, GROW VP of Mortgage Lending Guaranteed Rate

CONGRATS Dianne Crosby & Lizzie Garner

We’re proud to work with women creating change. Both Dianne and Lizzie were integral to the launch of the Guaranteed Rate Organization of Women (GROW). By recognizing the importance of representing women’s voices in a male-dominated industry, Dianne and Lizzie were able to help create a community that fosters strength, confidence and empowerment. LIZZIE GARNER Executive Sponsor, GROW Executive Vice President Guaranteed Rate

To GROW with us, visit joingrnow.com/grow-with-us NMLS ID #2611 (Nationwide Mortgage Licensing System www.nmlsconsumeraccess.org) •Dianne Crosby NMLS 304682 Guaranteed Rate is an Equal Opportunity Employer that welcomes and encourages all applicants to apply regardless of age, race, sex, religion, color, national origin, disability, veteran status, sexual orientation,gender identity and/or expression, marital or parental status, ancestry, citizenship status, pregnancy or other reason prohibited by law.

 THE 

A-LIST The New York City real estate market posted a record-breaking sale in July when former hedge fund manager Philip Falcone’s Upper East Side townhouse sold for $80 million – making it the most expensive residential sale in the city ever.

Here are New York City’s five most expensive homes sold in 2018: 1. 520 Park Avenue $73.8 million

2. 520 Park Avenue $62 million

3. 503 West 24th Street $59.06 million

4. 70 Vestry Street $56.01 million

5. 157 West 57th Street $53.97 million

$59.06 M

503 West 24th Street

$53.97 M

157 West 57th Street

$56.01 M

$62 M 520 Park Avenue

70 Vestry Street

$73.8 M 520 Park Avenue

20 HOUSINGWIRE ❱ AUGUST 2019

A HousingWire Rising Star and Vanguard at just 30 years old, Chase Gilbert co-founded Built Technologies in 2013 after discovering the frustrations, challenges and pitfalls associated with construction lending. Along with his founding partners, Gilbert saw opportunity to solve a critical problem for the trillion-dollar construction industry by simplifying the complex lending process through technology for lenders, borrowers and builders. Below, Gilbert gives an inside look at his life by answering five questions.

1. Besides my job and my family, my greatest passion is… Learning from and working with other entrepreneurs that are building businesses.

2. The book I can’t stop recommending is… The High Growth Handbook by Elad Gil.

22 HOUSINGWIRE ❱ AUGUST 2019

3. I felt like a success at my job when… I’ve been able to get the right person in the right seat at Built. It’s so fun to watch people take ownership of functions and for me to know they are doing it better than I would be able to do myself.

4. My biggest learning opportunity was… Built has become a platform of constant learning opportunities for me. I know how special the opportunity we have really is, and every day I’m working on ways to ensure we maximize it. In that pursuit, I’m constantly reminded of the power of great people and what can happen when they are empowered to make things happen.

5. After I am finished with my career I hope people remember… That I challenged them in the right ways to be better than they thought they could be had they never known me. And that I encouraged them to do the same with others in their lives.

Congratulations Barbara Pak! Congratulations, Barbara, Vice President, Securitization and Investor Relations, Freddie Mac, and all the other recipients, on being named to the 2019 HousingWire Women of Influence Class of 2019. Barbara, thank you for your leadership in the Single Security Initiative. Your heroic work to create the Uniform Mortgage Backed Security benefits todayâ&#x20AC;&#x2122;s U.S. taxpayers and will help lower costs for future homebuyers.

Hot SIZZLE? Not FIZZLE? 1 1 WHY THE

WHY THE

VA LOAN CAP



The Department of Veterans Affairs can now back loans that exceed the conforming loan limit, as a bill eliminating this cap was recently signed into law. The Blue Water Navy Vietnam Veterans Act allows homebuyers to borrow above the 2019 limit of limit of $484,350 for most counties without any down payment. The move comes after a decades-long fight for veterans to receive health care benefits for diseases related to Agent Orange exposure. The bill will “fasttrack disability compensation” for as many as 90,000 affected former service members.



BIG BANK PROFITS



PAYING MORTGAGES American homeowners are doing a fine job keeping up with their mortgage payments, a strong sign of a healthy, functioning economy. The latest report from the Office of the Comptroller of the Currency showed an improvement in the performance of first-lien mortgages in the federal banking system during the first quarter of 2019. According to the report, 96.2% of these mortgages were current and performing at the end of the first quarter – up from 95.8% a year earlier. Servicers also issued far fewer foreclosures last quarter than they did a year ago.

REMODELING IN THESE CITIES Remodeling activity across the nation has slowed in the last year, but some cities bucked the trend and posted gains despite the nationwide housing slowdown. According to the latest data from BuildFax, remodeling activity increased in May in five of the top 10 metropolitan statistical areas – Philadelphia, Chicago, Los Angeles, Miami and Washington, D.C. Philadelphia and Chicago rose 15.2% and 5.06% . Remodeling also grew a modest 1.57% in Los Angeles, 0.39% in Miami and 0.25% in Washington, D.C., according to BuildFax.

24 HOUSINGWIRE ❱ AUGUST 2019

Big banks are not as profitable as their independent competitors when it comes to the retail residential mortgage business, according to STRATMOR Group. Specifically, large banks lost $4,803 per retail mortgage loan in 2018. By comparison, large independent lenders earned on average of $376 per loan, according to STRATMOR, which said it uncovered the depth of the disparity. According to the group, meetings with lenders highlighted that large banks were suffering from low revenues and high expenses, and that the “trend lines that are moving in the wrong direction.”

AFFORDABLE HOUSING The fastest-growing cities in the U.S. have seen their stock of affordable housing decline substantially from 2010 to 2017, according to Freddie Mac, highlighting a strong correlation in population growth and affordability loss. The fastest-growing cities have seen their population explode by more than 15% in recent years, and this influx of residents is chipping away at low-income housing options. The national average population growth is 5.3%, and in the top 50 metros across the country, the percentage of very low-income housing has fallen 16.5% from 2010 to 2017.

HUD POLICIES FOR DACA RESIDENTS A number of prominent Senate Democrats want the Department of Housing and Urban Development to reverse its new policy of the Federal Housing Administration refusing to back mortgages for Deferred Action for Childhood Arrivals recipients. The Senators want to make sure that other government-backed loans are available to DACA recipients. Democrats introduced the “Homeownership for Dreamers Act,” to ensure that Dreamers cannot be denied a mortgage backed by the FHA, the GSEs, or the Department of Agriculture based on their immigration status.

VIEWPOINTS

By Michelle Rogers, Melissa Klimkiewicz and Katherine Katz

FHA enforcement: What decreased reliance on the False Claims Act means for FHA lenders and servicers HUD officials looking to chart a new course Top officials at the U.S. Department of Housing and Urban Development are looking to chart a new course to win back banks that have fled the Federal Housing Administration lending program following a series of multimilliondollar False Claims Act settlements. In the past, HUD has partnered with the U.S. Department of Justice to pursue settlements under the False Claims Act that left lenders and servicers facing treble damages plus penalties for what the government said were false certifications made in connection with deficient FHA loans. While current HUD leadership has said the government is looking to move away from the act, the steps it has outlined — including FHA’s proposals to revise its loanand lender-level certifications — may not translate into decreased HUD enforcement risk for FHA lenders and servicers. FALSE CLAIMS ACT ACTIONS DECLINING BUT HUD ENFORCEMENT INCREASING HUD’s access to enforcement mechanisms is much broader than the False Claims Act and, in some cases, other tools are easier to use. They include lender monitoring reviews and post-endorsement loan reviews by HUD’s Quality Assurance Division, post-claim reviews by HUD’s single-family post insurance division, administrative actions and civil money penalties by HUD’s Mortgagee Review Board and litigation and administrative actions by HUD’s Office of General Counsel, including under the Program Fraud Civil Remedies Act, the agency’s own “mini False Claims Act.” Recent information suggests that HUD’s reliance on these agency enforcement mechanisms may be increasing. In November, FHA announced it has recom26 HOUSINGWIRE ❱ AUGUST 2019

mended statutory changes to enhance the authorities of MRB. It is also revising its defect taxonomy to enhance its enforcement regime, and data from QAD shows that the number of single-family loans reviewed by FHA is increasing quarter over quarter. USE OF NEW TECHNOLOGY AND OLD REGULATIONS MAKE HUD ENFORCEMENT MORE EFFICIENT The apparent increase in HUD enforcement may, in part, be explained by enhanced efficiencies at HUD. Specifically, the deployment of new technology has made it easier to identify potential violations of FHA requirements, while increased reliance on old regulations could magnify the amount of payments HUD seeks.

NEW TECHNOLOGY MAKES IDENTIFICATION OF MATERIAL VIOLATIONS EASIER AND QUICKER The deployment of the Lender Electronic Assessment Portal in 2014 and Loan Review System in 2017 has made it easier for HUD to identify potential violations of FHA requirements. This has resulted in an uptick in certain types of MRB actions. Take the following examples: Late Annual Certifications: All FHA mortgagees must annually certify within 90 days of their fiscal year-end to compliance with certain statements. Since 2014, that submission must occur through LEAP. Prior to 2014, MRB took action against only a handful of mortgagees each year for failure to complete their annual certification timely. Since then, that number has climbed, reaching 106 in fiscal year 2016. While such actions have started to taper off as mortgagees have realized the consequences of late submission, they remain

Michelle Rogers and Melissa Klimkiewicz are partners, and Katherine Katz is a counsel, with Buckley. They frequently advise FHA lenders, servicers and investors in regulatory and enforcement matters. They can be reached at mrogers@buckleyfirm.com, mklimkiewicz@buckleyfirm. com and kkatz@buckleyfirm.com, respectively.

historically high. Deficient HUD Notifications: FHA mortgagees must also notify HUD, generally within 10 business days, whenever there are changes to information outlined in their application for FHA approval or that may affect their compliance with FHA’s eligibility requirements — such as being sanctioned by a government entity. FHA mortgagees must also attest to compliance with FHA’s eligibility requirements as part of their annual certification, including that they were not sanctioned by a government entity. Since 2014, both the notification reporting function and annual certifications have been consolidated through LEAP, highlighting discrepancies between the mortgagee’s annual certification and intra-year notifications. Not coincidentally, MRB actions related to failure to notify HUD in a timely manner have also climbed over the years from a few notification-related actions each year from fiscal year 2012 to 2015 to nine in fiscal year 2016, 13 in fiscal year 2017, and 10 in fiscal year 2018. Further, the LRS’s implementation of HUD’s defect taxonomy and consolidation of most quality control functions have made it easier and faster for HUD to identify potential program violations warranting indemnification. FHA reports the results of its reviews through the LRS, using its defect taxonomy to categorize the severity of such defects. Mortgagees may

respond only to “unacceptable” findings. If the mortgagee fails to sufficiently cure or respond to “unacceptable” findings, HUD may request or demand indemnification. FHA mortgagees have reported increased indemnification demands since the LRS was deployed. That number may rise further once HUD implements its revised defect taxonomy. OLD REGULATIONS MAKE VIOLATIONS MORE COSTLY Beyond the efficiencies made possible by recent technology, HUD is seemingly looking to older regulations to seek larger payments for the same conduct. For example, a regulation enacted in 1992 allows HUD to use statistical sampling to select FHA claims for post-claims review and to extrapolate the amount of overpayment on the reviewed claims to all FHA claims paid during the review period when calculating the amount due to HUD because of overpayment. Likewise, HUD regulations for over two decades have allowed the MRB to consider each day of a continuing violation to be a separate violation for purposes of calculating CMPs. Reports from some mortgagees suggest that HUD may be taking a more aggressive stance based on these old regulations to demand payments. PROMPT ACTION NECESSARY TO MINIMIZE POTENTIAL BUSINESS IMPACT In light of HUD’s increased enforcement

activity, absent exiting the FHA program, what should FHA mortgagees do to minimize their potential liability? First, mortgagees should re-acquaint themselves with current expectations and requirements, ensuring that they have a strong understanding of HUD statutes, regulations, handbooks and mortgagee letters. Signing up for FHA’s emails and participating in free webinars offered by FHA can help with this understanding, as can reaching out directly to FHA when in doubt. Tracking deficiencies identified in file reviews or audits and incorporating them into one’s processes is also a sound risk management tool. However, mortgagees should not assume they are complying simply because they have always done something a certain way. Second, mortgagees should understand HUD’s enforcement mechanisms and allocate sufficient time and resources to respond to HUD when the need arises, commensurate with the different authority and enforcement powers of each respective arm of HUD. For example, QAD has authority to request or demand indemnification or refer mortgagees to MRB, whereas MRB has authority to impose CMPs close to $2 million per year and withdraw a mortgagee’s FHA lending authority. And of course, HUD’s Office of Inspector General operates independent of HUD entirely, and a request from the OIG — which often works with the DOJ — is not a standard audit or review. Given HUD’s enforcement mechanisms, and the ease with which they can be used, decreased emphasis on the False Claims Act does not necessarily translate into decreased enforcement of FHA requirements. Lenders and servicers should place sufficient emphasis on responding to any HUD inquiry or allegation in a fulsome and timely manner, with a strong understanding of FHA requirements, the particular facts at issue, and any potential defenses that may be available.

HOUSINGWIRE ❱ AUGUST 2019 27

VIEWPOINTS

By Steve Smith

What it takes to boost mortgage applications Consider opportunities for improvement

Rising interest rates often cause homebuyers to think twice about moving forward with a mortgage. In April, mortgage applications fell more than 7% after 30-year fixed mortgage rates reached a high for the month. But even if interest rates begin to climb, that doesn’t mean lenders are out of luck when it comes to boosting mortgage applications. From digitizing the lending process to incorporating expanded financial data, there are several ways in which lenders can set the stage for an increase in mortgage applications. GO DIGITAL While every segment of consumers de28 HOUSINGWIRE ❱ AUGUST 2019

serves attention, lenders would be wise to cater especially closely to the needs and preferences of millennials. Already the largest generation in the U.S. workforce, Millennials will soon wield $1.4 trillion in annual purchasing power. One way lenders can capture the interest of this burgeoning generation of homebuyers is by taking the mortgage application process online. Known for leveraging technology more than almost any other generation,

Millennials are prime candidates for digital mortgage applications. In fact, 70% of millennial homeowners have already used an online application process for their last mortgage. An important step in digitizing the lending process and ultimately attracting additional mortgage applications from Millennials is considering opportunities for improvement. If, for example, there are stages in the lending process where loan officers are kept waiting for necessary data or information – such as verifying assets or income – digitization can help expedite the process. Similarly, a point in the process that’s prone to inaccuracies or fraud may

Steve Smith is the chairman, CEO and co-founder of Finicity. Smith’s passion and experience is in developing innovative and disruptive technologies, products and services that lead to market efficiency and, ultimately, improve consumers’ lives.

“

An important step in digitizing the lending process and ultimately attracting additional mortgage applications from Millennials is considering opportunities for improvement.”

benefit from a digital approach. Rather than relying upon manual data entry or extraction, loan officers will enjoy a more efficient digital lending experience. To ensure a successful transition from a paper-based process to a more robust digital experience, only partners who have a track record with major lenders should be considered. This prior experience can help eliminate potential problems early on and ultimately increase the chances of a smooth shift to online mortgage applications. Lenders should also narrow down their options to partners who have a roadmap for further innovation – not to mention the network needed to turn their vision into reality moving forward. Continuing to improve upon the lending process will give Millennials fewer reasons to look elsewhere for a loan. INCORPORATE EXPANDED FINANCIAL DATA When considering a consumer’s ability to pay off a mortgage, lenders typically turn to a credit score. That’s a problem for the 45 million Americans who don’t have one. Unable to secure a loan, consumers who are either credit invisible or lack a sufficient history often have no choice but to bypass big-ticket purchases such as cars and homes. However, with expanded financial data, that soon may change. One promising development is the inclusion of consumer-permissioned data within the credit scoring process. A variety of expanded data points – such as cell phone bills and utility payments in the case of

Experian Boost and deposit account data when it comes to UltraFICO – could help open up access to loans at some point in the future. Millions of consumers who previously struggled to qualify for a loan could have the opportunity to showcase their financial well-being through new sources of data. In the meantime, lenders can try to take advantage of digital verifications that help simplify the lending process. There’s no need to waste weeks, if not months, clearing a potential borrower manually who is willing to offer up information about their assets or income digitally. Use online verification technologies to conveniently speed things up while also improving accuracy. MAKE IT MOBILE There’s an app for just about everything – and home buying is no exception. According to a 2018 study by the National Association of Realtors, 73% of buyers use a mobile device to search for a home. Lenders looking to open the door for additional mortgage applications should think about developing or leveraging a mobile app that enables consumers to start and end their search in one location. Considering how many homebuyers already leverage mobile apps during their search, chances are a good number would be willing to complete the process within the same app. To ensure consumers are comfortable using an app during their home purchase, lenders need to speed things up. Among

consumers who’ve stopped working with a brand due to a slow app, roughly 70% said they won’t accept more than six seconds of load time. Yet another crucial factor worth considering is security. One out of four mobile apps have at least one high risk security flaw. One such example of a lending app that’s fast, secure and also easy to use is Quicken’s Rocket Mortgage. But before developing a mobile app with industry leaders like Rocket Mortgage in mind, lenders should consider the capabilities of their internal team or look for the right partners. After all, there’s little margin for error when it comes to creating or choosing a mobile app. One out of five users will abandon a mobile app that’s not up to par after just one use. Lenders that accurately assess how much help may be needed from an outside partner stand to increase their chances of implementing a top-notch mobile app on the first try. CREATE A CULTURE From a digitized lending process to a newly minted mobile app, technical implementations are just the first step to driving extra business. Lenders that complement technology with a culture focused on digital innovation promise to usher in additional mortgage applications. Through a clear vision on the empowerment that digitization will bring to the team along with education for borrowers that may not understand when or how to engage with an online lending experience, lenders can create a culture that embraces and fully leverages a digital experience. Despite rising interest rates, additional mortgage applications are well within reach. Lenders have the opportunity to bring in more business by implementing technical innovations such as a mobile app and establishing a culture in which digitized lending is recognized and appreciated. HOUSINGWIRE ❱ AUGUST 2019 29

30 HOUSINGWIRE ❱ AUGUST 2019

WOMEN OF INFLUENCE 50 WOMEN PAVING THE WAY 32

KATE ADAMSON, Plaid

DOLLY LENZ, Dolly Lenz Real Estate

33 ERICA GALOS ALIOTO, Opendoor

SUZY LINDBLOM, Planet Home Lending LISA LUND, Lund Mortgage Team

SUSAN ANTHONY, Finance of America Reverse

JUNE BABIRACKI BARLOW, California Association of Realtors

MAXINE MATTEO, MAXEX

SARAH BATANGAN, First Guaranty Mortgage

ANNE SEGREST MCCULLOCH, Housing Partnership Equity Trust

34 ROHINI BELAVADI, Arch Mortgage Insurance

PATRICIA KORTH-MCDONNELL, Better.com SUSAN MEITNER, Centennial Lending Group

LAURA BRANDAO, American Financial Resources

AMY BRANDT, Docutech

CLAUDIA MERKLE, National MI

MAYLIN CASANUEVA, Teraverde

DAWN MESHEL, Plaza Home Mortgage

35 COURTNEY KEATING CHAKARUN, Roostify

STEPHANIE MILNER, Fannie Mae CAROLYN MONROE, Old Republic National Title Holding Company

JAN CLARK, Black Knight

DONNA CORLEY, Freddie Mac

BARBARA PAK, Freddie Mac

DIANNE CROSBY, Guaranteed Rate

CAROLINE PAYNE, Movement Mortgage

LISA ROBERTSON, Spruce

SARAH DECIANTIS, United Wholesale Mortgage

JAMIE DURAN, Coldwell Banker Residential Brokerage of Southern California

KRISTI PICKERING, Academy Mortgage Corp.

LIZZIE GARNER, Guaranteed Rate

SARA RODRIGUEZ, Titan Title

LIZ GEHRINGER, Coldwell Banker Real Estate

RITA SANTAMARIA, Champions School of Real Estate

JULIA GORDON, National Community Stabilization Trust

KELLI SCOTT, Blend

SHERRY GRAZIANO, SunTrust

CELESTE STARCHILD, Move/realtor.com

DEE GROSSO, Freedom Mortgage

SUSAN STEWART, SWBC Mortgage

CARRIE GUSMUS, Cherry Creek Mortgage

HOLLY TACHOVSKY, BuildFax

CHRISTINE HALBERSTADT, Freddie Mac

FIONA TAYLOR, Roofstock

KIM HOFFMAN, Envoy Mortgage

CINDY TUCKER, WFG National Title Insurance

NANCY LANGER, CoreLogic

GINGER WILCOX, Capsilon

JULIE LEONHARDT LATORRE, Sotheby’s International Realty Affiliates

JERI YOSHIDA, NEXT Mortgage Events

HOUSINGWIRE ❱ AUGUST 2019 31

KATE ADAMSON HEAD OF MORTGAGE

Plaid

Women are a vital part of the housing industry – moving markets and encouraging those around them. HousingWire’s Women of Influence award honors these women. This is HousingWire’s ninth annual installment celebrating the industry’s leading women and their commitment to moving the U.S. housing economy forward. The award has become an industry standard, and the leaders who make our list each year represent an elite and special group. The Women of Influence award honors the shapers, the changers, the ones who are making a difference in the housing industry and paving the path for others to follow. This year includes women from all across the housing spectrum. Our cover this year features three women moving markets forward in the real estate industry. Flip through to read some of their amazing accomplishments.

32 HOUSINGWIRE ❱ AUGUST 2019

S HEAD OF MORTGAGE at Plaid, Kate Adamson manages the company’s lending product team and leads the company’s efforts to digitize and modernize the entire lending lifecycle, from application through servicing. Under Adamson’s leadership, Plaid has united industry stakeholders like Fannie Mae and Ellie Mae and forged partnerships with fintech companies like Floify and Blend. She made an indelible mark on the industry last year by leading the launch of Plaid’s first mortgage product, Assets. Thousands of companies, like Venmo, Robinhood and Acorns, use Plaid’s suite of APIs to build applications that enable millions of consumers to lead healthier financial lives. Today, one in four people with a U.S. bank account have used Plaid to connect to a fintech app. Kate continues to oversee Plaid’s expansion across mortgage lending and into other lending sectors to transform the many dated processes that plague the entire industry. Since Plaid entered mortgage lending, Adamson has proven herself to be a trusted voice on how bank connectivity and consumer-centered products can transform the industry’s processes. In the past year, she has shared her insights with audiences at events including LendIt, engage.marketing and Money20/20 USA. Prior to Plaid, Adamson was an investment banker at JPMorgan Chase and also spent time in the firm’s Office of Regulatory Affairs. Through JPMorgan’s efforts to bring innovation to a legacy-oriented industry, Adamson found her interest in the infrastructure layer of financial technology. That inspired her move to Plaid and her eventual path leading its work to digitize lending.

ERICA GALOS ALIOTO

SUSAN ANTHONY

HEAD OF PEOPLE

CHIEF OPERATING OFFICER

Opendoor

Finance of America Reverse

JUNE BABIRACKI BARLOW

SARAH BATANGAN

SENIOR VICE PRESIDENT AND GENERAL COUNSEL

CHIEF OPERATING OFFICER

California Association of Realtors

First Guaranty Mortgage

RICA GALOS ALIOTO is a seasoned leader with a history of managing large teams that deliver big results. She has built, led and inspired teams at some of the biggest startups in the Bay Area and beyond, first at Yelp where she grew the company’s sales team from two to 2,200, and now at Opendoor, where she serves as head of people and development and oversaw the addition of 800 employees in 2018 alone. A respected leader and mentor, Galos Alioto has dedicated her career to helping others find their passion and reach their full potential. In 2018, Opendoor expanded its services to more than 20 cities and Galos Alioto has been responsible for growing the team from about 500 employees to more than 1,300 in San Francisco, Atlanta and other cities across the country. With such rapid growth and expansion, Galos Alioto has made it a priority to ensure each new employee feels integrated into Opendoor’s strong and supportive culture, whether they are located at the company headquarters or one of Opendoor’s many satellite offices across the country. To achieve this, she has implemented company-wide programs and principles that not only encourage training and development but also promote workplace happiness.

S GENERAL COUNSEL and senior vice president for the California Association of Realtors, the state’s largest trade association, June Barlow is a legal counselor who has a deep understanding of the business of real estate. For over two decades, she has led a team of highly trained attorneys who help real estate professionals to succeed in their businesses and manage their risks. Simply put, Barlow’s work improves people’s lives. After the devastating 2018 California wildfires, her legal department moved quickly to complete the groundwork for the C.A.R. Disaster Relief Fund, a charity which accepts donations and offers housing assistance grants to those who lost their homes in the tragic fires. In the same year, she worked to create a new legal foundation, Californians for Homeownership, that represents the interests of Californians in need of affordable housing and fights Not in My Backyard policies. Due to the housing affordability crisis in California, middle and lower-income families in the state must often devote half of their income to paying rent, which leaves little money for other necessities such as food, healthcare and transportation. Younger Californians cannot become homeowners and attain the security and wealth-building benefits that their parents experienced.

USAN ANTHONY is a visionary who continually finds ways to provide 10-star experiences for her partners, borrowers and team. A 33-year veteran of the mortgage industry, Anthony’s peers and colleagues characterize her as a dynamic and engaging leader with a proven track record of sustainable business growth, product innovation and industry leadership. As an industry titan, Anthony is helping transform the way people approach retirement through the power of education. For Anthony, it’s more than a job, it’s an opportunity to give back. In 2014, Anthony was hired by Finance of America Reverse to implement a new origination system that aimed to improve the company’s productivity and profitability. In 2016, she was recognized for her success and promoted to the position of chief operating officer. Anthony has since been pivotal in the company’s overall success, and now leads a team of more than 100 people. Her day-to-day includes managing the pipelines between sales and operations while working to make sure the company’s software meets and exceeds the needs of her colleagues and clients. Anthony’s leadership within the company is a driving force behind the supportive culture that allows FAR’s team to go above and beyond.

AY IN AND DAY OUT, Sarah Batangan walks into the office ready to elevate her employees and company to reach their full potential. She leads FGMC as chief operating officer and produces stellar optimization results, but what is truly striking about Batangan is her commitment to empowering women. She is active in educating and mentoring women in and out of the mortgage industry and is committed to driving FGMC forward with innovation and integrity. Batangan also serves as a “sister” for Women for Women International, a nonprofit humanitarian organization that provides practical and moral support to women survivors of war. Leadership is Sarah Batangan’s way of life. Inside and outside of her office hours, she is a woman who inspires others. Over the course of her 20-year professional career in the mortgage industry, she has held several leadership positions including senior vice president of strategic business operations and senior vice president of correspondent operations before taking on the role of chief operating officer at FGMC in 2018. When she is clocked in, she is directing, uplifting and managing the many teams that report to her. She is also a member of the National Association of Professional Women and is active in Mortgage Bankers Association’s mPower movement. HOUSINGWIRE ❱ AUGUST 2019 33

ROHINI BELAVADI

LAURA BRANDAO

SENIOR VICE PRESIDENT, HEAD OF IT

PRESIDENT

Arch Mortgage Insurance

American Financial Resources

AMY BRANDT

MAYLIN CASANUEVA

PRESIDENT AND CEO

CHIEF OPERATING OFFICER

Docutech

Teraverde

S THE HEAD OF IT at one of the country’s largest mortgage insurance companies, Rohini Belavadi plays a critical role in supporting the company’s infrastructure. In this role, Belavadi supervises a team for more than 170 employees who are focused on technology, supporting a broad range of customers and 800 internal users. Belavidi joined United Guaranty Corp. in 2004, where she worked her way up to vice president of solution delivery in 2015. When Arch acquired UGC in late 2016, Belavidi played a key role in integrating the two companies’ operations and technologies. Belavidi was named Arch’s head of IT in November 2018. In the past year, Belavidi’s team introduced an MI buy-down tool, RateStar Buydown, which the company calls an “industry first.” Using RateStar Buydown, loan originators can customize a monthly MI premium for each borrower, ensuring that all available lender and seller credits are used to get the lowest MI premium possible. Earlier this year, Belavidi also oversaw the development and rollout of CONNECT, Arch MI’s new online MI origination portal. According to the company, Belavidi and her team created the “most user-friendly origination platform in the MI industry.”

S PRESIDENT AND CEO of Docutech with more than 20 years of experience in the mortgage and software industry, Amy Brandt understands the initiative and dedication it takes to succeed, and you can look no further than her own story for evidence of that. Brandt began her mortgage career directly out of law school, becoming a top sales producer and rising through the ranks to become president of WMC Mortgage before even turning 30. She then moved on to Prospect Mortgage, where she helped reduce operational expenses by as much as 40% as chief operating officer, and then served as a board member for Bluebeam Software, where she worked from its founding through its successful sale. Brandt has worked in all aspects of the mortgage business, taking those experiences with her to help her better serve clients looking to employ technology to enhance their customers’ experience. Since joining Docutech in 2017, Brandt has led the increase in the company’s revenue of approximately 40% in a down market. Passionate about ensuring the success of Docutech’s clients deliver an end-to-end digital mortgage experience, Brandt has spearheaded the adoption of the company’s eClose solution. Through Brandt’s leadership, the company has more than doubled its market share within two years. 34 HOUSINGWIRE ❱ AUGUST 2019

AURA BRANDAO is president of American Financial Resources, and the driving force that has catapulted AFR to the top of manufactured home, one-time close, and renovation lending in the U.S. A skilled mortgage industry executive with more than two decades of experience, Bandao seamlessly rolls out new specialty products based on market demand, and is a sought-after speaker for industry events – heralded as a champion for brokers, builders and other partners – where she shares her infectious passion for independent mortgage experts and bringing more families home. Under Brandao’s leadership, AFR has introduced an impressive range of innovative value-added solutions for clients, from technology to professional expertise and convenient education opportunities. Free AFR university training and certification allows clients to become AFR certified, at their own convenience, in unique loan programs for manufactured housing, renovation lending and one-time close construction. Brandao worked with the Department of Veterans Affairs to expand the guidelines on their VA Renovation Program, designed to help the men and women who serve our country repair or upgrade their home with low rates.

AYLIN CASANUEVA’S command of technology and mortgage banking has made her a sought-after advisor in non-QM lending. Over the last 25 years, she has provided capital markets and product development thought leadership to institutions like Quicken Loans, Angel Oak Mortgage and TD Bank. By combining her mortgage banking, securitization and technology experience, Casanueva has helped the industry address some of the most pressing pain points in the loan origination process. In 2015, Casanueva began developing the Coheus Profit Intelligence platform for capital markets applications, and rapidly led the development efforts to expand into loan origination, servicing and risk management. The solution gathers data from a variety of systems, enabling mortgage bankers to make well-informed decisions in real-time. Additionally, Coheus permits lenders to visually identify production and loan level costs, providing actionable intelligence over branch, loan officer and lender profitability. Earlier this year, Casanueva established a partnership with Ellie Mae to bring Coheus integrations to the Ellie Mae Encompass LOS, leveraging the company’s API and DataConnect infrastructure. With the integration, management teams can now easily identify patterns by analyzing data.

COURTNEY KEATING CHAKARUN CHIEF MARKETING OFFICER

Roostify

JAN CLARK SENIOR VICE PRESIDENT OF SALES AND MARKETING

Black Knight

DONNA CORLEY

DIANNE CROSBY

OURTNEY KEATING CHAKARUN currently serves as the chief marketing officer of Roostify. In her position she combines her passion for marketing and innovation to advance the digital lending customer experience. She has a laser focus on the customer and has developed a proprietary 360-degree research methodology to garner feedback from the mortgage ecosystem and uncover customer “delighters” and challenges in the application for a loan. Keating Chakarun is a thought leader in omni-channel marketing, customer research and the infusion of hyper-personalization to better the customer experience and elevate the lender brand. She spearheaded a new customer experience research methodology that works to eliminate common bias and drives to understand the mindset of applicants and unearth key customer concerns and challenges with a home lending experience. Keating Chakarun championed an evolved marketing structure with a digital first focus and provided thought leader in understanding how to infuse hyper-personalization into the mortgage origination process. She has a more than 20-year track record of driving growth in digital applications, platforms and consumer lending solutions.

SENIOR VICE PRESIDENT

Freddie Mac

ONNA CORLEY is one of the most influential women at mortgage giant Freddie Mac. Motivated by innovation and how she can bring a fresh perspective to managing risk, she leads a team of approximately 475 employees responsible for analyzing and managing the risks that impact Freddie Mac’s single-family business of financing more than 1.5 million homes annually. Corley establishes credit policy that fosters access to credit in responsible ways, manages the credit performance for single-family mortgages and oversees counterparty credit, fraud risk and vendor risk. Previously, she led Freddie Mac’s credit pricing, risk transfer and securitization team. She designed pricing strategies for single-family mortgages so that prices accurately reflected risk profiles, oversaw the development of innovative structures to sell credit risk and managed the issuance, sale and distribution of Freddie Mac’s single- and multi-class securities. Her team was awarded Euromoney’s Global Structured Deal of the Year award and The Banker’s Deal of the Year for the Americas for their first structured agency credit risk transaction. Corley began her Freddie Mac career as a research analyst and held various portfolio manager positions within the investment and capital markets division for ten years.

HEN YOU LIST all that Jan Clark does on a daily basis as senior vice president of sales and marketing at Black Knight, it’s easy to see why she is such an influential contributor. Clark oversees sales, marketing, client services, account management and support services for the company’s suite of Ernst Fee Services. Clark was actually the ninth employee at Ernst, where she worked starting in 2003 until Black Knight acquired the company in 2018, a development she helped complete. Now, Clark dedicates much of her time to advancing the Ernst Fee Services suite. According to her colleagues, the success of the fee service can be largely attributed to Clark’s ability to develop strategic partnership with key players that range from data providers to tech partners. Clark has an impressive history in pushing for progress in the mortgage industry. During her time with Ernst, she worked with HUD and the CFPB to analyze how new legislation and rules were impacting fees, and worked with government representatives to set up educational panels for industry associations to help navigate new legislation. Clark sought out to tackle mortgage fraud, drawing on her past experience as an instructor for the FBI Academy at Quantico and the U.S. Department of Justice.

VICE PRESIDENT OF MORTGAGE LENDING

Guaranteed Rate

S THE VICE PRESIDENT of mortgage lending at Guaranteed Rate, Dianne Crosby uses her success to help influence positive changes in the world. Whether it’s getting a client into their dream home or assisting her colleagues in accomplishing their goals, Crosby is dedicated to helping others. A natural born leader, Crosby is involved in numerous organizations, including currently serving as the treasurer for the Community Funds Committee for the Oakland Berkeley Association of Realtors. Through her role as treasurer, Crosby has helped the organization raise money and award grants to local organizations serving the youth, homeless and elderly. Notably, Crosby is also a member and Chair of the Berkeley ADU Task Force and a founding member of the Business Growth Network, a BNI Chapter with an annual shared business volume of over six million dollars. Most recently, Crosby played a crucial role in getting the Guaranteed Rate Organization of Women off the ground by serving as a chairwoman. GROW is a mentorship program for women attempting to increase production volumes, by advocating for their inclusion within the mortgage industry. The organization, which initially started as a small and informal group of women, has expanded exponentially under Crosby’s leadership. HOUSINGWIRE ❱ AUGUST 2019 35

SARAH DECIANTIS CHIEF MARKETING OFFICER

United Wholesale Mortgage

N THE LAST FEW YEARS, United Wholesale Mortgage has become a top-3 overall lender and the nation’s largest wholesale lender. And that growth simply would not have been possible without the leadership of Sarah DeCiantis, who leads UWM’s marketing team. Under DeCiantis, UWM devised marketing campaigns and developed a redesigned website that have increased brand recognition by 36% in the past 18 months. DeCiantis leads marketing and strategy for UWM, overseeing advertising, public relations, social media, creative and customer relationship management that have helped build the company into one of the nation’s largest lenders. DeCiantis leads a 40-person marketing team and transformed it from more of a sales support team to an actual driver of revenue growth. In 2018, DeCiantis directed the re-launch of a new website for consumers to find a mortgage broker and for loan originators to find out how to become a mortgage broker. The sites, FindaMortgageBroker.com and BeaMortgageBroker.com, are dedicated to promoting the advantages of working with a mortgage broker for borrowers as well as real estate professionals and helping both of those groups effectively locate mortgage brokers in their area.

JAMIE DURAN PRESIDENT

Coldwell Banker Residential Brokerage of Southern California

REAL ESTATE PROFESSIONAL in Southern California for over 25 years, Jamie Duran is president of the Southern California companies of Coldwell Banker Residential Brokerage, which ranks as the top residential real estate company in the local markets. She manages approximately 4,440 agents and 74 offices in Southern California, including the Greater Los Angeles, Orange County, Riverside County and San Diego markets. Duran continually strives for excellence and inspires those she leads to achieve new records. She recently received the Industry Leader of the Year Award from the North San Diego County Association of Realtors. She also was recently recognized as one of the most powerful people in residential real estate by being included on the 2019 Swanepoel Power 200 list, the second consecutive year she has been chosen. Prior to her current role, she was regional vice president for Coldwell Banker Residential Brokerage in Greater Los Angeles for five years, managing 15 offices and 1,000 agents from Santa Barbara to Pasadena. She also led 130 agents as a branch manager and district manager for the Coldwell Banker Studio City office for 12 years.

LIZZIE GARNER

LIZ GEHRINGER

EXECUTIVE VICE PRESIDENT

CHIEF OPERATING OFFICER

Guaranteed Rate

Coldwell Banker Real Estate

HEN LIZZIE GARNER arrived at Guaranteed Rate in 2012, she recognized a true opportunity for innovation and development within the onboarding process for new employees. Garner’s inspiration led to the creation of a national training platform, which launched several new initiatives and departments to spearhead a centralized communication strategy. Guaranteed Rate employees are now provided with some of the best-in-class live training, coaching and on-demand resources. Garner even played a paramount role in helping Guaranteed Rate tackle inclusivity within the mortgage industry. Over the past year, Garner has served as the backbone for the expansion of Guaranteed Rate’s Organization of Women also known as GROW. GROW is a mentorship program that aims to help industry women increase their confidence and production volume. Integral to the launch, Garner was able to convey the importance of appealing to women as an analytically backed perspective. Garner and the women of GROW wish to ensure that women in the typically male-dominated mortgage industry feel empowered and that their voices are heard. Through Garner’s backing, GROW was able to launch its first conference, which featured 15 women who represent $1 billion in loan origination volume. 36 HOUSINGWIRE ❱ AUGUST 2019

IZ GEHRINGER is known for her one-to-one leadership style, which has enabled her to gain a deep understanding of the needs of franchisees, forge relationships in a short amount of time and build an impenetrable foundation of trust with those who work with her. At Coldwell Banker, Gehringer has elevated the company’s brand and helped spur growth in new areas. Her colleagues credit her for guiding affiliates through a major rebrand and fostering inclusion through the creation of the Women in Leadership platform. Through this program, Gehringer gives credence to female voices within the network, supporting and encouraging female broker-owners and identifying and championing Coldwell’s next generation of female leaders. She has repeatedly expressed her commitment to ensuring that more and more women at Coldwell Banker see a path to leadership and have the tools and training to realize their professional dreams. Gehringer joined Coldwell Banker in 2018 after serving as chief ethics and compliance officer at its parent company, Realogy Holdings Corp. There, she built an award-winning ethics and compliance program that received global recognition. In her current role at Coldwell, Gehringer oversees the brand’s field service, operations, learning, talent attraction, and international and events teams.

JULIA GORDON

SHERRY GRAZIANO

PRESIDENT

SENIOR VICE PRESIDENT, MORTGAGE TRANSFORMATION OFFICER

National Community Stabilization Trust

SunTrust

ULIA GORDON is known for her dedication to strengthening neighborhood housing markets and supporting sustainable homeownership. As president of the National Community Stabilization Trust, Gordon has written numerous papers on housing finance and policy and has testified as an expert before Congress on multiple occasions. Gordon is a regular speaker at conferences that address affordable housing concerns and advises public figures on the issues at hand, meeting regularly with HUD and FHFA officials, as well as with key staff in the House of Representatives and Senate. Gordon helped transition nearly 7,000 foreclosed properties to mission-oriented developers and land banks. She also helped expand the organization’s Neighborhood Stabilization Initiative footprint to 28 different metropolitan statistical areas with high volumes of low-value REO inventory. Under Gordon’s leadership, NCST has emerged as a strong policy voice on blight prevention, non-performing loan sales, single-family rental, the GSEs’ Duty to Serve, mortgage policy and affordable housing. At NCST, she has raised the profile of several critical issues through an effective blend of policy work, coalition building, media engagement, and relationships with regulatory and executive agencies.

INCE JOINING SUNTRUST in 2011, Sherry Graziano has carved out her own unique leadership journey. Graziano first joined the company as a retail loan consultant, where she eventually become a top producer within months. Graziano then joined the sales and performance excellence team, leaving her role as consultant to become the company’s lead sales strategist. In this position, Graziano developed and implemented two employee training programs – the Mortgage Loan Associate Program, a comprehensive rookie training program, and a new Loan Officer Onboarding Program. Additionally, Graziano led sales readiness, reward and recognition programs and critical change initiatives for three of the company’s primary mortgage distribution channels, including retail, consumer direct and correspondent lending. In 2016, Graziano became the Orlando Operations Leader, a position that required her to provide oversight for end-to-end mortgage fulfillment in both retail and direct production channels. Under her leadership, Graziano’s team has consistently manufactured superior quality loans with an outstanding client experience. SunTrust has increased client satisfaction scores by 26% under Graziano.

DEE GROSSO

CARRIE GUSMUS

EXECUTIVE VICE PRESIDENT OF HUMAN RESOURCES

SENIOR VICE PRESIDENT OF NATIONAL PRODUCTION

Freedom Mortgage

Cherry Creek Mortgage

EE GROSSO has 25 years of experience working in human resources, and that fact is readily apparent in her tremendous success as executive vice president of Human Resources at Freedom Mortgage. Grosso began her career at Freedom in 2013 when the company tripled its headcount to 4000 employees in roughly three years through four acquisitions and natural growth. Through Grosso’s leadership, Freedom’s HR team build an infrastructure designed to uphold the momentum, expansion, development and day-to-day operations. While Grosso was responsible with developing an HR team that could handle such a high head count, she also had to react to market conditions that required the company to right-size at certain times, a task that can be equally challenging. Grosso’s colleagues credit her with creating an impactful performance review process that embodies the company’s values: integrity, customer focus, responsible growth, collaboration, creativity and community spirit. Grosso has also been a champion for promoting diversity and inclusion in the workplace, launching a D&I team to specifically advance this cause. Her skills for connecting with people is evident in the fact that her team members have long tenures in their roles, a testament to her natural ability to inspire loyalty.

ARRIE GUSMUS has been a leader in the mortgage industry for more than 17 years. At Cherry Creek Mortgage, Gusmus successfully recruits, manages and coaches national employees at all levels across the sector. Gusmus takes pride in her strong, honest communication style that simplifies complexity and leads to understanding. She strives daily to maintain positive accountability at all levels within her team and beyond. Gusmus’ daily actions inspire others to do more, dream more, learn more and become more. As a result, she’s cultivated a work environment that empowers employees to achieve the next level in their career path. In her first nine months with Cherry Creek, Gusmus renegotiated the company’s credit contract, saving them over $750,000 on credit reporting. She also successfully recruited and onboarded over $500 million in loan production and started a consumer direct division that continues to thrive. Additionally, Gusmus influenced leadership to make changes to financial reporting to consolidate systems and reports and make them more usable for the company’s production and financial managers. With Gusmus, you not only have the one of the best recruiters, you also have someone who thinks outside of the box and can jump in at any level in the mortgage industry to solve a problem. HOUSINGWIRE ❱ AUGUST 2019 37

CHRISTINE HALBERSTADT

KIM HOFFMAN

VICE PRESIDENT OF STRATEGIC TRANSFORMATION

EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER

Freddie Mac

Envoy Mortgage

S VICE PRESIDENT OF STRATEGIC TRANSFORMATION for Freddie Mac Multifamily, Christine Halberstadt is helping the digitization of Freddie Mac’s multifamily business, which is the leading commercial real estate mortgage company in the country. Halberstadt has been with Freddie Mac for more than 13 years. Ten years ago, Freddie Mac began its transition from being a portfolio lender to a securitization lender. During that transition, Halberstadt played a key role as a leader within the product development group, serving as a bridge between Freddie Mac’s capital markets and mortgage origination groups. One of the biggest achievements of Halberstadt’s career was the development, execution and launch of the Freddie Mac Multifamily Servicing Standard. On that project, Halberstadt led a team that defined the Freddie Mac Multifamily borrowing experience, differentiating the government-sponsored enterprise from other secondary market participants. In developing the servicing standard, Halberstadt worked to influence and align the interests of all parties involved in the securitization pipeline, including legal counsels on the bond side and the origination side, lenders, B-piece buyers, investors and rating agencies.

NANCY LANGER EXECUTIVE AND GENERAL MANAGER, REAL ESTATE TAX AND PAYMENT SOLUTIONS

INCE JOINING ENVOY MORTGAGE in 2018, Kim Hoffman hit the ground running. With a core focus on operations and customer experience, she has made it her mission to inspire and enhance each of Envoy’s processes. Whether Hoffman is launching a new initiative or giving career advice to a young colleague, Hoffman proves daily that she is a valuable mentor. With more than 25 years of experience in mortgage banking, Hoffman has a proven history of operational excellence in fields including end-to-end mortgage operations, offshoring, underwriting and process engineering. As chief operating officer, Hoffman oversees the design of Envoy’s loan fulfillment processes, ensuring the efficiency and seamless integration of its U.S. and India operations teams. Recognized nationwide for her ideas and insight on industry topics, Hoffman often speaks at industry-related conferences and events. And among her many accolades, Hoffman was recognized as one of Housing Wire Magazine’s Women of Influence in 2016 and has transformed the processes for other companies, including Morgan Stanley Residential Lending and mortgage operations at Royal Bank of Canada.

JULIE LEONHARDT LATORRE CHIEF OPERATING OFFICER

CoreLogic

Sotheby’s International Realty Affiliates

ANCY LANGER shakes up legacy systems by finding more efficient and effective ways to operate through innovation and leverage of data and technology. She strives to build strategic partnerships with customers to better understand their pain points, then produces solutions to help them exceed their goals. As a true woman of influence, Langer understands the value of leveling the playing field and elevating every team member’s ideas to shape the next generation of payment innovations for lenders around the world. Within CoreLogic, her leadership style is based on collaboration as she believes every member of her department— from entry-level to those with more than 20 years of industry experience— can provide interesting perspectives to meet the organization’s overall goals. As a direct manager overseeing more than 2,000 CoreLogic team members, Langer’s colleagues describe her as a direct yet thoughtful leader. Langer shares her breadth of knowledge in and out of the office by volunteering her time with a variety of organizations including Ellevate, a global women’s professional network committed to helping each other succeed, and Year Up, a nonprofit dedicated to closing the skills gap and opportunity divide for urban young adults. 38 HOUSINGWIRE ❱ AUGUST 2019

ULIE LEONHARDT LATORRE’S contributions to Sotheby’s International Realty Affiliates helped the luxury real estate brand achieve a record-breaking 2018 in terms of sales volume reporting $112 billion in sales globally. She continues to implement new initiatives including the introduction of a Next Gen and a Women’s group and a Next Level Business Solutions servicing platform to help support the growth and success of the luxury real estate brand’s 990 offices in 72 countries and territories and more than 22,500 affiliated sales associates worldwide. Leonhardt LaTorre introduced a Next Gen and a Women’s group within Sotheby’s International Realty to help engage the respective groups, and provide both with networking and development opportunities in the U.S. and internationally. She contributed significantly to the luxury real estate brand’s overall growth both in U.S. and abroad, which resulted in Sotheby’s International Realty achieving a record-breaking 2018 in terms of sales volume reporting $112 billion in sales globally. Leonhardt LaTorre helped grow the network’s U.S. affiliates through her creation and hiring of a strategic new role that focused on gathering and utilizing data to identify growth markets and drive market share.

SUZY LINDBLOM EXECUTIVE VICE PRESIDENT OF NATIONAL OPERATIONS

Planet Home Lending

DOLLY LENZ FOUNDER AND CEO

Dolly Lenz Real Estate

OLLY LENZ is a real estate agent in New York City. She owns Dolly Lenz Real Estate, a luxury real estate consulting, sales and marketing firm. After 25 years as a senior real estate executive with Sotheby’s International Realty and Douglas Elliman operating in sales, marketing and branding, Lenz founded DLRE with a handpicked team of veteran professionals. Deciding against taking a transactional approach, the firm operates under the private banking model, providing advisory services to its clients in every part of the globe and at all price points. Drawing upon decades of experience and market-specific knowledge, its operating paradigm is powered by market specific information, cutting edge innovation and an unrivaled client database. It is estimated that through 2007 Lenz sold a full $7 billion in real estate including $748 million in 2006. But that was only the beginning. During her illustrious career, she has sold more than $11 billion in property. This amount includes two of her most recent record-setting sales, a $57-million triplex penthouse, which she sold to billionaire Rupert Murdoch, and The New York Foundling’s West Village Mansion, which Lenz sold for $45 million. In fact, this $11 billion record has even earned Lenz the ultimate Stratosphere Award, a level of achievement of which she is the sole recipient. Her firm currently now represents more than $500 million in luxury properties. And due to the depth of her experience and the breadth of Lenz’ knowledge in real estate matters, she is repeatedly sought after to represent some of the most exclusive properties in the world. As a regular guest on CNBC’s Power Lunch, Kudlow Report and Fox News with Neil Cavuto, as well as appearances on MSNBC, Bloomberg TV and The View on ABC, Lenz has developed a broad following and continues to opine on current real estate issues in various media publications including The New York Times, Wall Street Journal, The Financial Times and Barrons. Lenz is a CNBC contributor and is featured on CNBC’s documentary series called: Mega Homes: Secret Lives of the Super Rich. She is also the host of CNBC’s real estate special series Million Dollar Home Challenge. In addition to her media presence, Lenz also sits on various charitable boards including New York City’s Police Athletic League, The Lincoln Center Council, and The Chopra Foundation.

UZY LINDBLOM is a trailblazer, known for designing operations platforms for the best brands in mortgage banking. As executive vice president of national operations at Planet Home Lending, Lindblom is an innovative leader and mentor whose core mission throughout her four-decade career has been understanding what drives satisfaction for business partners, customers and employees. As her team at Planet says, Lindbolm drives operational success by “knowing the numbers and loving the people.” Those who work with her call her an expert in a wide range of skills that highlight how exceptional she is, including managing risk, mitigating losses, underwriting, project management, post-closing and compliance. Over the past year, Lindblom led the redesign of an operations platform to support Planet Home Lending’s entry into distributed retail. Through her help, Planet was able to reduce turn-times and loan fulfillment costs by a whopping 50%. Lindblom is also responsible for streamlining the company’s organizational processes and centralizing its retention group, prompting the opening of a new operations center in Texas and doubling the operations team’s productivity.

LISA LUND OWNER

Lund Mortgage Team

ISA LUND plays many roles as a friend, mentor and the owner/broker of Lund Mortgage Team located in Glendale, Arizona. She started out in the mortgage industry at 18 years old and worked her way up to become the owner of her own company at just 29 years old. She strongly supports the mortgage broker industry and makes it a priority to guide and mentor up-and-coming mortgage brokers. Some of Lund’s most recent accomplishments include being chosen as a finalist for Mortgage Professional America’s Woman of Distinction award, being chosen to speak on a panel of mortgage experts at the recent Association of Independent Mortgage Experts Workshop in Florida, receiving the award for No. 1 mortgage broker in Arizona from national lender United Wholesale Mortgage, receiving the award for Hot 100 Mortgage Professionals of 2018 from Mortgage Professional America and receiving the award for 40 under 40 Top Mortgage Professionals from National Mortgage Professional magazine. Lund has led a team of nine employees for more than 10 years. Her passion and focus is on the customer and providing them with superior service. She leads and teaches this to others by example and always has a creative solution to any problems that may arise in the loan process. HOUSINGWIRE ❱ AUGUST 2019 39

MAXINE MATTEO

ANNE MCCULLOCH

CHIEF RISK AND ADMINISTRATIVE OFFICER

PRESIDENT AND CEO

MAXEX

Housing Partnership Equity Trust

PATRICIA KORTH- MCDONNELL

SUSAN MEITNER

CHIEF MARKETING OFFICER

Centennial Lending Group

AXINE MATTEO has come a long way since beginning her career in the real estate industry as a loan secretary, ordering credit reports and appraisals. Matteo’s first goal was to become a real estate appraiser, but was told by her boss that she wouldn’t be allowed to go into the field and appraise while wearing a dress. But Matteo became an appraiser anyway. Then, she became an underwriter, and later learned loan servicing. Matteo then went into sales, and then into loan securitization, and eventually into mortgage trading on Wall Street. Matteo also started a warehouse lending company. At other points in her career, Matteo led a team of 750 at Bank of America. Matteo also worked with Sheila Bair at the FDIC, and oversaw the first securitization after the financial collapse in 2008. Now, Matteo serves as the chief risk and administrative officer for MAXEX in Atlanta, Georgia. In the last year, the exchange continues to add buyers. MAXEX’s leadership team has raised more than $50 million in additional capital. Matteo developed MAXEX’s risk management charter and the metrics for managing the company’s book of risk and the all the reporting metrics to assess counterparty risk as well as loan level risk and the risk appetite framework for counterparty risk.

Better.com

ETTER.COM is expanding, and Patricia Korth-McDonnell has been instrumental in the company’s growth. A marketing industry veteran known for turning small companies into industry titans, under her watch, Better.com has increased its customer base by 276%, has seen a 300% growth in revenue, increasing the disruptor’s valuation to more than $500 million. In fact, it is projected to reach $1 billion by the end of 2019. She also launched major partnerships with the biggest banks in the world, which is a huge feat for a startup only three years young. Korth-McDonnell no stranger to HousingWire, and is also an Advisory Board Member for the company and spoke at the engage.marketing conference in June in Charlotte, North Carolina. Patricia’s 20-year career is marked by her propensity to build and scale companies in emerging industries from the bottom up, while ensuring diversity and inclusion is front and center of workplace culture. When she joined digital marketing company Huge in 1999 as the startup’s 13th employee, the internet was just launching and the concept of digital advertising seemed light years away. Under her vision, the firm grew to a 1500-person global company and industry leader, producing digital marketing for 20% of the Fortune 100. 40 HOUSINGWIRE ❱ AUGUST 2019

NNE MCCULLOCH is a housing innovator whose career has spanned the industry, from her service as a senior advisor at the Federal Housing Administration, to her tenure as a senior vice president at Fannie Mae, and currently as president and CEO of an affordable housing REIT. Over the last year, McCulloch has focused on delivering value to investors while serving families making 57% of AMI, without deep federal subsidy; building nonprofit capacity to serve tenants in market-rate properties; and preserving critical affordable housing in some of the most expensive cities across the country. McCulloch has positioned HPET as a serious competitor for well-located, Class B and C apartment properties. Under her leadership, HPET has partnered with leading nonprofit tax-credit developers to expand their reach, while strengthening platform operations and profitability. She previously led efforts to analyze market changes, understand the buying patterns of Millennials, Gen Xers, and Boomers, engage with key customers and industry stakeholders and build products that respond to those changes. McCulloch is a thought leader and frequent speaker in the housing industry, focusing on how impact investors can achieve strong risk-adjusted returns while changing lives.

PRESIDENT

USAN MEITNER is the president and founder of Centennial Lending Group. After running the company for nine years, Meitner successfully orchestrated a merger with the Centennial Lending’s partner company, Success Mortgage Partners. This merger brought increased value and products to the companies’ customers and employees. Meitner led the way searching for a partner. Using her ties in the mortgage community, Meitner identified a company in Success Mortgage Partners that shared the same vision and values that Meitner used to found and run her company. The move will allow the company to continue down its original path at a quicker pace, thereby enabling its employees to take advantage of the latest technology while still providing its valued high-level personal service. Meitner is also on the board of The Mortgage Collaborative, which has pioneered many initiatives in the mortgage industry. Meitner also serves on the board of trustees at Gwynedd Mercy University and offers time and support to Gwynedd Mercy Academy High School. At Gwynedd Mercy Academy High School, Meitner helped implement the Catherine Learning Program, which helps assist students with documented learning differences to develop individualized strategies for academic success.

CLAUDIA MERKLE

DAWN MESHEL

CEO

SENIOR VICE PRESIDENT, SPECIAL PROJECTS

National MI

Plaza Home Mortgage

STEPHANIE MILNER

CAROLYN MONROE

DIRECTOR OF CAPITAL MARKETS

PRESIDENT

Fannie Mae

Old Republic National Title Holding Company

VER THE PAST YEAR, Claudia Merkle’s leadership and guidance helped National MI continue to grow its high-quality insured portfolio at an industry-leading rate. Merkle’s performance has been so outstanding, the company promoted her from chief operating officer to president and from president to CEO in the past year alone. She’s now the only female CEO in the private mortgage insurance industry. Under Merkle’s leadership, National MI delivered record 2018 fourth quarter financial results, capping a year of standout success in customer development, portfolio growth, risk management, and financial performance. National MI was recently named a Great Place to Work by Fortune Magazine, for the fourth straight year. Merkle credits her success as a leader to her excellent analytical and problem-solving skills, her ability to listen carefully to others, and a “roll up your sleeves management style.” As she has said, “One of the most important lessons I’ve learned along the way is that you really have to care about other people’s success, not just your own. Caring goes hand in hand with leadership and authentic followership.” Prior to National MI, she served as vice president of national and regional accounts, risk and operations at PMI Mortgage Insurance.

S DIRECTOR of Capital Markets at Fannie Mae, Stephanie Milner heads the GSE’s Market Outreach and Single Security Initiative Readiness program. Milner was instrumental in the launch of Fannie’s Uniform Mortgage-Backed Security. Through a multi-year effort to prepare stakeholders for the transition, holding roundtable discussions, hosting webinars, speaking at events and having one-on-one conversations to ensure that each investor was fully prepared for the advent of UMBS. She also co-led a team of representatives from Fannie, Freddie and the Federal Housing Finance Agency to drive regulatory change that was critical to the success of the single security. She also worked closely with the Securities Industry and Financial Markets Association to ensure its backing of UMBS and its rollout plan. In her nearly 13 years with the company, Milner has risen through the ranks in large part by developing others. She demonstrates diplomacy by reaching out across the organization to involve others in her thinking, incorporating varying points of view, and accounting for the needs of all parties impacted by a decision or program. She is a role model for continuous improvement in her focus on measurable progress, and she promotes empathy in her efforts to persuade, influence and establish business cases.

S SENIOR VICE PRESIDENT of special projects for Plaza Home Mortgage, Dawn Meshel is the “go-to person” for whenever one of the nation’s largest wholesale and correspondent mortgage lenders wants to create new products or implement new technology. Meshel joined Plaza Home Mortgage more than eight years. Prior to serving in her current role, Meshel was the regional branch manager of Plaza’s Phoenix branch. In 2016, Meshel was promoted to her current role and assigned the task of getting and keeping critical special, technical projects on track. Regardless of her role with the company, Meshel has always been a driving force in reinventing Plaza from a technology and workflow perspective. Some of the recent projects Meshel has overseen include the successful transition to Plaza’s BREEZE loan origination system. Two years ago, a majority of Plaza’s broker and correspondent clients were not using BREEZE. Meshel, in conjunction with the company’s IT team, enhanced the LOS’ capabilities, delivering better technology and an improved customer experience. Meshel then led the initiative to get clients to use BREEZE for 100% of loan submissions. In less than 10 months, that stretch goal was reached.

N DEC. 31, 2018, Carolyn Monroe broke more than a century of precedent when she was named the president of Old Republic National Title Holding Company, the parent company of Old Republic Title. Monroe is the first woman to hold that title in the 112-year history of the company. Monroe joined Old Republic Title in 2009 as vice president and Southwest direct operations manager. Monroe has been promoted several times. In 2015, Monroe became the first female president of the company’s Western title division, where she oversaw operations for seven states, Alaska, Arizona, California, Hawaii, Nevada, Oregon and Washington and more than 1,500 employees through 2018. Last year, Monroe helped combine the company’s disparate marketing divisions and merged them into the company’s first national marketing team. Under her leadership, the marketing team launched a new company website, created a company blog, implemented a social media advocacy program, upgraded the company’s customer relationship management platform and introduced a more efficient system for processing marketing job requests, all in 2018. As president of the company, Monroe is responsible for the bottom-line profitability of the company’s direct, agency and commercial operations. HOUSINGWIRE ❱ AUGUST 2019 41

BARBARA PAK VICE PRESIDENT OF SECURITIZATION AND INVESTOR RELATIONS

Freddie Mac

ARBARA PAK is credited for playing a role in the creation of the $4 trillion “To Be Announced” market for Freddie Mac and Fannie Mae’s mortgage-backed securities called the Single Security Initiative. As the Common Securitization Initiative’s program director and later as Freddie Mac vice president of securitization, Pak rallied thousands of stakeholders to overcome operational, technical, industry and regulatory obstacles to implementation of the Single Security Initiative. Pak managed a team of 200 experts in finance and technology that planned, developed and will soon operationalize this revolutionary infrastructure. To push the single security forward, Pak educates lending markets, capital markets, policymakers and regulators about the requirements, risks and opportunities of the single security program and the Common Securitization Platform. Pack worked alongside others to secure an IRS ruling on the tax treatment of the combined securities as well as new FHFA rules to facilitate implementation of the single security and common platform. She also helped successfully launch forward trading of the UMBS, where prices of the two formerly separate securities have already converged as expected.

CAROLINE PAYNE SENIOR VICE PRESIDENT CAPITAL MARKETS OPERATIONS

Movement Mortgage

S SENIOR VICE PRESIDENT capital markets operations, Caroline Payne is responsible for the development and rollout of all mortgage products offered by Movement Mortgage. Prior to her time at Movement, Payne served as partner and head of operations and transaction management at AltaMira Mortgage. Earlier in her career, Payne spent time in investor relations, contract finance, product development and transaction management at First Union, Wachovia and Wells Fargo. At Movement Mortgage, Payne’s team has been instrumental in developing a suite of mortgage products including: proprietary expanded and non-QM product offerings, prime jumbo programs with multiple investor outlets, competitive affordable lending programs targeted for first-time and low-to-moderate income homebuyers, construction-to-permanent conventional and renovation loan programs, as well as competitive extended lock programs. The company touts these products as “paramount” to the success of its loan officers and the company’s continued growth. In this role, Payne uses her breadth of knowledge in the mortgage space to articulate her thoughts and ideas to senior leadership, peers and teammates to gain buy-in on complex issues. 42 HOUSINGWIRE ❱ AUGUST 2019

LISA ROBERTSON EXECUTIVE VICE PRESIDENT OF NATIONAL REAL ESTATE OPERATIONS

Spruce

ISA HAS MORE THAN thirty years of experience in the mortgage, title, and real estate services industries. Prior to working with Spruce, Robertson was the group senior vice president at Stewart Lender Services. She also served as First American’s vice president of national operations and spent 16 years at Citi Mortgage, leading operations for mortgage originations, small business lending and home equity. She is known for building top performing teams that support high-volume accounts. Robertson has in-depth experience with managing large scale operations, executing complex business initiatives and diving into unknown territories to identify opportunities that enable a business to improve or be ahead of the curve. Robertson’s commitment to collaborative leadership throughout her career has earned her honors including service excellence awards from Citi Mortgage and a Magnificent Manager award at Stewart Lender Services. She is also Six Sigma Certified. Over the last year, her leadership is most exemplified by her ability to understand how the real estate industry on the whole is changing. Consumers want a better end-to-end solution–which includes a more digital, cost-effective, and transparent title and escrow process. Robertson often says “the status quo has continued to overshadow innovation in this industry” and fundamentally believes that real estate closings can and should be effortless. Her commitment to transparency and re-imagining the customer experience is at the core of how she manages on a daily basis. By taking this approach, she is leading the charge toward empowering homeowners with their most important asset and making real estate transactions more pleasant experiences for everyone involved. Robertson has had a multitude of professional accomplishments within the last 12 months, but some that stand out are: Upon joining the Spruce team in October 2018, Robertson was tasked with opening the new 10,000-square-foot office in Dallas. The Texas office was a pivotal step toward scaling operations beyond the New York headquarters–enabling Spruce to serve more clients nationwide. Robetson’s proven track record and success in building great teams, with a focus on the needs of mortgage lender and real estate clients, made her uniquely qualified for this challenge.

KRISTI PICKERING SENIOR VICE PRESIDENT OF PROCESS AUTOMATION

Academy Mortgage Corp.

K RITA SANTAMARIA CEO AND FOUNDER

Champions School of Real Estate

ITA SANTAMARIA is the CEO and founder of Champions School of Real Estate, a real estate education provider. Santamaria has grown her business from a single classroom to eight campuses throughout Texas, seven state-of-the-art ChampionsLive virtual classroom studios, independent curriculum development and online divisions and a loyal team of over 100 full-time or contract employees and instructors. Under Santamaria’s leadership and direction, Champions School of Real Estate has shaped the Texas and national real estate landscape in the education of thousands of real estate professionals–about 20,000 in the past year alone. Santamaria first launched Champions School of Real Estate out of a single-classroom building in Houston, Texas in 1983. In the thirty-five years since she started the company, thousands of students have begun or continued their real estate careers walking through the doors of a Champions School of Real Estate campus. A few of these students may have even been with Champions since the beginning, watching as Champions School of Real Estate transformed from a single-classroom campus to the present eight-campus system located throughout Texas’ major metropolitan areas. Champions School of Real Estate offers pre-licensing and continuing education for the real estate, appraisal, loan origination, and home inspection career professions. In 2018, Champions School of Real Estate taught nearly 20,000 students, making it the education provider with the highest student count in the state of Texas. In 2018, Santamaria launched a monthly live broadcast Super Star Interview Series. This series, a free educational opportunity for students, features Santamaria as the host interviewer and guests, top-producing real estate professionals from across the state that provided the tips, strategies, and best practices that brought them success in their careers. Based on the quality of the content received in the Super Star Interview series, Santamaria began work on the publication of a new nationally-distributed book series, Successful Tendencies of Real Estate Champions, published May 2019. In 2018, Santamaria launched Taking the Lead with Champions, a six-month leadership series in which she brought recognized motivational, entrepreneurial and business leaders to speak about several different topics with host Logan Stout.

RISTI PICKERING is a self-made mortgage professional with more than 25 years of industry experience. Throughout her career, Pickering has acquired invaluable knowledge that has enabled her to see the bigger picture. As a result, Pickering’s leadership experience is deep and varied as she has held positions at several institutions, including Caliber Home Loans, Bank of America and Countrywide Home Loans. While at Caliber, Pickering served the company as its senior vice president of national retail operations. In this role, Pickering managed 850 operations employees across the United States and 80 offshore employees. Additionally, Pickering oversaw three acquisitions while at Caliber, including the merger of Caliber Funding and Vericrest Financial, which resulted in a full-service residential mortgage banking platform. This year, Pickering was hired as the senior vice president of process automation at Academy Mortgage Corporation, where she is responsible for working with the sales, operations, and technology teams to assess, identify, build and implement technologies that enhance the customer experience. Currently, Pickering is overseeing the company’s launch of two major technology developments, My Mortgage and AMY—tools that will have a significant impact on improving the origination process.

SARA RODRIGUEZ COUNSEL AND CEO

Titan Title

ARA RODRIGUEZ’S ability to inspire and execute at the highest levels places her among the most effective housing leaders in the country. Since 2005, Rodriguez has taught DPOR approved courses through various state licensed schools in both English and Spanish to educate the community, realtors for credit and attorneys in the Virginia area. As the CEO, owner and founder of Titan Title, Rodriguez has worked to make a difference in the industry and her community. When Hurricane Maria devastated Rodriguez’s home island of Puerto Rico, she knew something had to be done. Rodriguez, who was elected the 2019 president of the National Association of Hispanic Real Estate Professionals, sprang into action by initiating several local and national relief efforts. Rodriguez worked closely with both HUD and then-Deputy Secretary Pam Patenaude to bring attention to support re-building efforts by leveraging NAHREP’s industry connections. Rodriguez’s and NAHREP’s efforts were responsible for the raising of over 100,000 pounds of relief items, which were personally distributed hand by hand in Puerto Rico. Additionally, Rodriguez worked side by side with Virginian legislators to implement changes that enabled displaced Puerto Ricans to work under their current professional licenses. HOUSINGWIRE ❱ AUGUST 2019 43

KELLI SCOTT

CELESTE STARCHILD

GROUP MANAGER OF SERVICES AND SUPPORT

SENIOR VICE PRESIDENT AND GENERAL MANAGER

Blend

Move/realtor.com

ELLI SCOTT manages a team of 60 as group manager for services and support at Blend, where she oversees the company’s efforts to solidify and strengthen partnerships with its 140 mortgage lender clients. In the year that she has been with Blend, Scott has helped elevate the company’s customer satisfaction rate to 98-99%. Key to this rating is Scott’s development of a disclosures process that enables Blend’s customers to stay within a single system for the duration of their mortgage application. Scott works closely with Blend’s compliance and legal teams to ensure that Blend is testing potential issues consistently throughout the deployment process. She also championed transparency between teams in order to better pinpoint customer needs, as well as to identify industry insights that would drive Blend’s product roadmap. Scott has also placed an emphasis on improving training procedures and heightening transparency within the organization. Scott has become a champion for driving positive change within Blend and prioritizes face-to-face communication with clients. Her style of management makes Blend’s relationships more personal and drives conversation beyond just implementing technology and augmenting processes.

N AN INDUSTRY that is being transformed by technology, Celeste Starchild is at the forefront of that evolution. Her leadership in data strategies and syndication, product development and marketing has helped build the infrastructure that gives real estate professionals the ability to expose their clients’ for-sale homes to the largest possible audience, and allows millions of people every year to search for homes online. Nearly 150 million consumers visit a real estate website each month, most looking at, dreaming about and searching for online listings that are displayed largely because of the work Starchild does behind the scenes. As part of the leadership team at Move/realtor.com, Starchild drives data-related initiatives and strategies to propel innovation and create opportunities for the company’s customers, which include multiple listing services, Realtor associations, brokers, agents and publishers. Starchild is responsible for overseeing realtor.com’s data strategy. In this role, she is a crucial link between realtor.com’s consumer experience and customer service, providing leadership to the company’s internal teams across product, engineering and relationship managers to determine how best to support both of these audiences with data-powered products and experiences.

SUSAN STEWART

HOLLY TACHOVSKY

CEO

SWBC Mortgage

BuildFax

N INDUSTRY VETERAN with nearly 30 years in the mortgage business, Susan Stewart is the CEO of SWBC Mortgage, a Texas-based mortgage lender. As CEO, Steward leads a company of 615 employees and manages annual sales of $3 billion, with a servicing portfolio of more than $10 billion. Stewart she joined SWBC in 1989. Since then, the company has grown from three employees to 615 staffers operating in 39 states throughout the country. Beyond leading SWBC, Stewart also serves as the 2019 vice chairman of the Mortgage Bankers Association, placing her in line to lead the MBA in 2021 as chairman. Stewart is also a member of the MBA’s board of directors, and is the immediate past vice-chair of MBA’s Residential Board of Governors. In her roles with the MBA, Stewart helps guide the mortgage industry trade group on the top issues facing the industry, including GSE reform, technology and innovation, and pushing for diversity and inclusion in the workforce. Stewart is also a board member of MBA’s Opens Doors Foundation, which provides mortgage and rental assistance to families with critically ill or injured children, allowing parents and guardians to be by a child’s side during treatment without fear of losing their home. Stewart is also a past president of the Texas Mortgage Bankers Association. 44 HOUSINGWIRE ❱ AUGUST 2019

OLLY TACHOVSKY is a serial entrepreneur and the CEO and Founder of BuildFax, a provider of property condition and history insights for insurance, financial and real estate institutions. Under her leadership, BuildFax has grown from a startup founded at the height of the 2008 financial crisis to a multi-million dollar company. Tachovsky has devised an entirely new way of doing business. Tachovsky created a previously nonexistent class of data in the property data space and then took that idea to market. She raised funding for BuildFax in the midst of the 2008 financial crisis – a difficult time for the company and the economy as a whole. Nonetheless, the business began gaining traction and ultimately raised more than $12 million in funding from Londonbased DMGT. Methodically, one customer at a time, she built out a product, drove adoption, and now, BuildFax property condition data is considered the industry standard. It’s used by the largest insurance, lending and real estate platforms in the world. Not only is Tachovsky a successful leader who grew a company that sits at the intersection of the male-dominated tech industry, but she is also a relentless advocate for other women entrepreneurs and an active member in the Austin community.

FIONA TAYLOR

CINDY TUCKER

VICE PRESIDENT OF OPERATIONS

PRESIDENT

Roofstock

WFG National Title Insurance

GINGER WILCOX

JERI YOSHIDA

SENIOR VICE PRESIDENT OF MARKETING

CO-FOUNDER

Capsilon

NEXT Mortgage Events

NATURAL BORN LEADER, Fioana Taylor’s colleagues say she possess a rare combination of superb leadership, action-oriented problem solving and a warm-hearted outlook. With roles spanning various industries, from credit ratings to energy, Taylor is passionate about working with innovative companies that are looking to disrupt and scale. During her tenure at both Tesla and SolarCity, Fiona led teams of over 350 individuals and oversaw multiple billion-dollar investment vehicles that grew the firms nearly 50 times in size. As a senior business leader at Visa, Taylor focused on global revenue forecasting, planning and analysis. Similarly, as a senior director at Fitch Ratings, Taylor managed a team of twelve analysts in corporate, sovereign and asset-backed securities. In 2018, Taylor joined Roofstock as its vice president of operations, where she continues to play an integral role in the company’s continued expansion. Process-oriented to the core, Taylor’s strengths lie in establishing and implementing scalable solutions, and at Roofstock, is tasked with growing the firm’s presence globally. In particular, she is focused on expanding the real estate investment startup’s footprint, as well as structuring its operations to facilitate tremendous growth and volume.

INCE JOINING CAPSILON in 2018, Ginger Wilcox has played a substantial role in the development and launch of technology solutions that are helping drive the mortgage industry’s digital transformation and solving pain points for mortgage borrowers, lenders, investors and servicers. Wilcox helped launch Capsilon IQ, the company’s digital mortgage platform, which uses AI and machine learning to capture mortgage data from any source. The platform solves the data issues that many companies face by capturing data points from documents and digital sources and standardizing them into an authoritative record for each loan file. More recently, Wilcox aided with the rollout of Capsilon Digital Underwriter, a suite of fully integrated cloud-based digital mortgage applications focused on automating the mortgage underwriting process. The program helps lenders and investors make rapid, informed loan eligibility decisions with perfected data. Prior to joining Capsilon, Wilcox was part of the team that launched Sindeo, a consumer direct mortgage startup that raised more than $30 million. In her role as chief marketing officer at Sindeo, Wilcox helped with the launch of the SindeoOne platform. Earlier in her career, Wilcox was an early employee at Trulia where she built and led the industry marketing and relations group.

INDY TUCKER was the second employee at WFG National Title Insurance when the company was founded in 2010. Over the yearas, Tucker played a critical role in establishing and growing WFG into the sixth largest title insurance underwriter in the nation. As president of WFG National Title’s Oregon Division, Tucker opened WFG’s flagship office in Portland, which became the model for the company’s growth. She also recruited hundreds of talented professionals throughout Washington, Oregon and Arizona, all while raising money for charitable organizations over the course of her career. Tucker is responsible for growing WFG’s Portand office so that it now holds a 20% share of the title and escrow business in the area has loans for 29 of the 100 top-producing Realtors operating in this market. Tucker is also involved in establishing the company’s title operations in other western states, growing WFG’s business in Washington and Arizona over the past year by recruiting dozens of title agents in these states. Tucker has developed processes and systems and fostered a culture that has been the model of other WFG locations, helping the company become the fastest title insurance underwriter in history to achieve a national footprint.

ERI YOSHIDA, as co-founder of NEXT Mortgage Events, the mortgage industry’s only technology summit for women executives, has demonstrated leadership by assuring a continued platform for women to grow their visibility and career opportunities in the mortgage industry. She ensures that women have a means for being recognized as qualified candidates for promotions and opportunities. She also offers opportunities to women mortgage executives in marginalized segments, so they are considered as equals. Yoshida provides access to intel and individuals that women mortgage executives need to succeed. In 2019, Yoshida collaborated to secure a strategic alliance between NEXT and Housing Finance Strategies, an advisory firm founded by HousingWire Vanguard and Women of Influence winner Faith Schwartz. This alliance is of great importance to the mortgage industry because it broadens women’s access to quality information. If NEXT has proven anything, it is that women executives are more likely to attend an event that focuses on their needs. This alliance expands NEXT’s reach into the government/policy sector of the mortgage and housing industry, and in doing so, will introduce and provide policy-focused intel and opportunities to NEXT’s current attendee base. HOUSINGWIRE ❱ AUGUST 2019 45

Congratulations Christine Halberstadt! Congratulations, Christine, Vice President, Strategic Transformation, Freddie Mac Multifamily, and all the other recipients, on being named to the 2019 HousingWire Women of Influence Class of 2019. Christine, you exemplify what it means to be a change agent. Your visionary leadership is driving the digital transformation of our OptigoSM platform and the commercial real estate industry.

Teraverde Congratulates Maylin Casanueva Chief Operating Officer

Teraverde would like to congratulate Maylin Casanueva on being recognized as one of HousingWire’s Women of InfluenceTM. We are honored to celebrate your leadership and achievements for both our company and the mortgage industry.

PROTEC TING HOMEOWNER DATA in the digital age of mortgage finance

48 HOUSINGWIRE ❱ AUGUST 2019

Purging the inefficiencies from the mortgage process

BY: ROHIT GUP TA

HOUSINGWIRE â?ą AUGUST 2019 49

According to Verizon’s 2019 Data Breach Investigations Report, 10% of the 2,013 breaches that occurred in 2018 were within the financial industry. Personal data was compromised in 43% of those breaches, which were largely attributed to privilege misuse, errors or unsecure web applications. Within real estate industry breaches, twothirds of reported incidents resulted in the actual exposure of data to an unauthorized party. Sitting squarely across those two industries, the importance of strong data security processes in mortgage finance is clear. While we can agree on that point, how to efficiently build those processes across the many players in the mortgage pipeline is a bit less clear. Our industry’s current decentralized approach to data security is not only cost prohibitive as we each take on significant expense to secure our part of the process, but also less secure as it creates multiple points of potential data exposure as data is gathered where PII was affor or passed fixed permanently to each f rom step to document. Over the past step. From 30 years, the mortgage blockchain to tokenization to industry has “digitized,” regular purgonly to turn paper into ing of personalelectronic bits and bytes. ly identifiable infor mat ion, there is tremendous opportunity to better safeguard homebuyer data while managing costs within the mortgage finance industry.

every participant in the loan transaction – lender, mortgage insurance company, title company, appraiser, servicer, closing attorney and others. The mortgage industry was born in the age of paper where PII was affixed permanently to each document. Over the past 30 years, the mortgage industry has “digitized,” only to turn paper into electronic bits and bytes. However, it’s still the same data in the same basic format. This creates inefficiencies in the overall system as there are multiple copies of data and documents stored in multiple locations. Any given borrower is at risk of data loss if any of these participants’ platforms are compromised thereby breaching the portion of the data and documents they possess. Protecting all this data is costly—but it’s even more costly to remedy when breaches occur, and consumer data is exposed. Deloitte’s 2019 Future of Cyber Security Report Survey results show that financial firms spend $2,300 per employee attempting to address cyber security concerns. This pales in comparison to the average cost of a data breach of $148 per record, according to IBM’s 2018 Cost of a Data Breach Study by Ponemon. Investing in your data security capabilities pays off, though. Results show the average total cost of a data breach is $2.88 million for organizations that fully deploy security automation, compared to $4.43 million for organizations that do not deploy automation—a net total cost difference of $1.55 million. What does that security solution look like? It could take on various forms, depending on our industry’s appetite for change. There are many different types of technologies that have the capability to simplify the management of PII within the mortgage industry, and as an industry it’s important to continue exploring different options as it relates to data security. Some options worth exploring include blockchain and the tokenization and purging of PII.

CURRENT STATE Today, each participant in the mortgage finance ecosystem receives and stores at least one copy of a borrower’s PII. Beginning with the lender, any other services utilized in the transaction may receive one or more documents containing PII. These documents get copied and transferred to

THE BIG SWING: BLOCKCHAIN One of the newer tech buzzwords in an era of efficiency and security, blockchain technology is a distributed shared ledger that records and provides an audit trail of transactions that flow through a process. Like a ledger, information is not edited—a new copy of the record is stored with

THE MOR TG AGE INDUSTRY WA S BORN IN THE AGE OF PAPER

50 HOUSINGWIRE ❱ AUGUST 2019

the updated changes, leaving a permanent and unchanging “paper trail” of all changes and activity on a single record. Acknowledging that the players in any particular mortgage process, as well as the contents of a blockchain, can vary, here’s an oversimplified illustration: • Buyer completes a pre-approval application with a loan officer, including PII • Loan officer adds the full loan application to the blockchain, starting a new record • Buyer selects a home and an appraisal is ordered • Appraisal company receives a security key to access that single record within the blockchain for the information they need to complete the appraisal; they do not have access to other entries within the blockchain • R inse and repeat for mortgage insurer, titling company, servicing company, etc. throughout the life of the loan If changes to the record occur at any point, such as marital status, salary, address, the party that takes in the change will add an updated entry to the record which will then replicate to all other parties with the key for that record. This creates a single source of truth that bridges not only players in the mortgage finance process, but also stages, while minimizing access to PII and capacity for tampering. Blockchain could play a role throughout the mortgage finance lifecycle, enhancing data security, reducing inefficiencies, and creating space for evolution within the industry. In the loan origination space, blockchain could be used to share and secure customer financial information. In the case of title and related insurance, blockchain could be used to record and track ownership of the asset removing the need for title insurance. In the case of mortgage claims pro-

cessing, smart contracts could automate the business process triggering claims payments automatically and removing many of the manual steps. In the case of servicing, blockchain could be used to automate payments and mortgage servicing rights transfers, among other areas. Beyond the loan process, blockchain also can bring improvements to more traditional mortgage finance processes such as securitization. The use of blockchain and smart contracts in securitization could bring transparency and cost savings to the process. A blockchain could provide investors with “real time” data to all underlying collateral in a mortgage security providing investors with a more accurate assessment of its exposure and risk. By using blockchain to handle consumer data, one can be assured that data is not tampered with and if tampered there is readily available audit information on what, how and who tampered with the data in the blockchain ledger. “A blockchain also can be structured so that no single user can decrypt all data, which compartmentalizes any potential breaches by removing any ‘single points of failure,’” explained Carey Kirkpatrick, Ranieri Solutions chief development officer. “Finally, data sharing can be done within the blockchain to limit external file distribution and information leakage.” So, with all these benefits, why hasn’t mortgage finance gotten on-board with blockchain already? The complexity of aging systems within the space create one challenge and according to Chak Kolli, Tata Consultancy Services chief technology officer, the challenges in adapting blockchain technology as a solution are mostly cultural with many enterprises still experimenting and waiting for others to lead. “Success depends on the parties coming together to form a consortium to define and exchange shared information HOUSINGWIRE ❱ AUGUST 2019 51

and processes via the blockchain,” Kolli said. “The consortium should come to a consensus on how the solution will be governed, who will be the neutral party that enables this governance and identifies issues that may arise and provide consensus solutions by which the entire ecosystem abides.” While there are a plethora of products and services available that promise blockchain solutions for housing, the most successful approaches are where servicers and originators review their core processes from a fresh perspective and then consider how blockchain can help. Many processes in servicing and origination exist solely to overcome a challenge presented by legacy systems and technology or to comply with new or modified rules or regulations. By removing those system shortfalls, it allows servicers and originators to rethink how processes could run and implement more efficient processes while still operating their businesses within the guidelines of the ever changing regulatory environment. TOO MUCH CHANGE? TRY TOKENIZATION. While blockchain would be a sea change for the industry, tokenization presents a less invasive way to drive efficiency in protecting homebuyer data throughout the mortgage cycle. Historically, the borrower is linked to every document by their name, address and social security number. While addresses may change over time, name and SSN typically do not. They are static values or tokens of identity for an individual—but should we limit ourselves to these static values? Tokenizing these values into some otherwise meaningless value that could be affixed to each document would remove the sensitivity of any given document because the identity of any individual is obscured. This token could then be passed through the ecosystem as a placeholder 52 HOUSINGWIRE ❱ AUGUST 2019

for the individual’s identity, linking documents and transactions together. In a dynamic digital world, the tokens could be assigned uniquely per individual per document, and then be time-based and/ or dynamic, so the token value on one document would not necessarily match the token on another document even though it’s the same borrower. Any time the true identity is required, an identity broker responsible for managing identification tokens for all borrower identities in the ecosystem could de-tokenize to the real value. With this notion of a central identity broker, any time the true identity was released, the borrower could either opt in or deny, or at least monitor, all disclosures, putting the consumer in greater control of their PII. The concept of tokenization has existed for quite some time, but is only now being explored in use cases, whereas the concept of an identity broker and tokenization of the identity is relatively new and not yet in widespread use. While this solution would require integration of industry participants to utilize the identity protocols for document attribution, all documents would then be free of PII, reducing data security expenses at each step in the mortgage process. The compromise of individual documents would be of no value since they could not be linked to an individual. The compromise of the identity broker, while difficult on its own, would require the additional compromise of all the individual documents stored elsewhere to link to individuals by deciphering all tokens—an arduous task. Additionally, individual institutions could retain and store documents and data they may need for analytics like risk or pricing without concern of PII data loss. At the end of the life of the mortgage, if the document data is still required for analytics, the token value could be removed from the document or data making it completely anonymous.

that retained PII records are minimized. Purging In the meantime, purge. Any shift from our industry’s current decentral- PII on a regular basis will not only reduce the atized data security approach will require a cooper- tractiveness of the organization to an attacker, but ative mindset and time, but you can start driving it’s also good practice and a requirement per some efficiency in your organization today by regularly state and industry regulations. Demonstrating a purging PII from your systems and processes. Our commitment to protecting PII speaks volumes not previous mindsets of keeping all the data because only to consumers, but also to regulators. it might be useful or because it’s too hard to deCONCLUSION lete must be disData security plays a carded. A strong critically important data security prorole in the mortgage gram depends on f i n a nce i ndu st r y PII being purged whe re b or rowe r s as frequently as entrust their most possible. I n a valuable and identiperfect world, it will not only reduce fiable information to would be done the attractiveness of the various institutions in near real-time, organization to an attackas they navigate an as retention reintricate process. quirements exer, but it’s also good pracA s leaders a nd pire, and be built tice and a requirement per players in the indusinto applications, some state and industry try, it’s imperative to not activated as a regulations. continue evaluating separate process. and enhancing curTo do this, you rent security meaneed to know exsures to minimize actly what data and prevent the numyou have, its age, ber of data breaches. and where it’s stored—and then use that information to develop Whether those enhancements come in the form of an intentional strategy about what to keep and a Blockchain solution or tokenization—or simply what to delete. Engage your IT team in evaluating doing a better job of purging PII—securing borthe best approach for your environment, based rower information will remain a top priority for on the age and complexity of your systems, data savvy institutions for years to come. structures, and regulatory retention policies. Do you want to keep non-PII elements while removing sensitive information? Is your data stored About the author: Rohit Gupta is President and CEO of in a single location or stored redundantly in sev- Genworth’s U.S. Mortgage Insurance Business, where eral places? How do you manage data security in he works with lenders, regulators and policy leaders your archives and/or paper files? Your specific to advocate for the value of mortgage insurance to situation may dictate what is possible, but taking a sustainable housing finance system. Along with his a thorough and thoughtful look at your practices advocacy, Gupta served as chairman and remains a will more than likely yield some level of improved board member of the U.S. Mortgage Insurers trade aseffectiveness and efficiency, as well as minimize sociation. He also serves on the Boards of the Mortgage your data footprint across your organization. Bankers Association Residential Board of Governors, While a solution that centralizes PII across Housing Policy Executive Council and Genworth MI the industry within a single environment would Canada, a publicly-traded company. The statements further facilitate effective data reduction, we can provided are the opinions of Rohit Gupta and do not each work within our current construct to ensure reflect the views of Genworth or its management.

PUR GING PII ON A REGUL AR BA SIS

HOUSINGWIRE ❱ AUGUST 2019 53

54 HOUSINGWIRE ❱ AUGUST 2019

VA L U A T I O N S :

NEW NEW TECH,

A PPROACHES Time for an update on AVM programs and practices By: Robert Walker

HOUSINGWIRE ❱ AUGUST 2019 55

weeping changes periodically realign the mortgage industry in part or as a whole. They may come after a seismic economic shift, a spate of new regulatory requirements resulting from a financial crisis, or, on the positive side, a groundbreaking technological innovation. In the case of innovation, the financial services professionals who are willing to embrace a new technology â&#x20AC;&#x201C; and the new thinking that it may demand â&#x20AC;&#x201C; stand to grow their companies in ways that increase market share and profitability. We have seen this reality borne out time and time again over the past decades of revolutionary innovation and now accept the fact that, as digital technology and the Internet have become the drivers of change for lenders and real estate professionals, no program or practice is static. Even tried and true methodologies are not immune to technological evolution and becoming out of date. In 2017, I helped design and develop a new valuation solution with the logic within its deci-

56 HOUSINGWIRE â?ą AUGUST 2019

sioning engine to solve a previously unsolvable riddle. I then began an industry-wide campaign to introduce this new solution to lenders and providers of valuation services. When HousingWire invited me to write an article covering the evolution of valuations, I decided to share the logic that went into developing this latest step in that evolution and hopefully show the logic of regularly using it.

THE FUNDAMENTAL VALUE OF AUTOMATED VALUATION I started in our industry in the early 1990s when AVMs were first being introduced. At that time, innovators who recognized the value of emerging AVM technology were investing time and energy to promote it to lenders across the country and pave the way for its greater acceptance. Then, just over a decade ago, our industry experienced all three of the change agents I mentioned above: a financial crisis of historic proportion, a significant regulatory response and the ongoing introduction of new technology. Since then we have rebounded to a point where

regulations are slowly being relaxed and interest rates slowly rising under the Federal Reserve’s control. Rising interest rates and prices caused by limited housing supplies are having the effect of prompting many homeowners to think twice about selling and moving into a new home. Instead, they are reinvesting in their current properties with the help of a new HELOC to pay for renovations. As a result, originations are down and home equity applications are rising. In 2017, TransUnion forecasted that the number of consumers opening HELOCs could double between 2018 and 2022, and backed it up in a subsequent company-sponsored report that said as of April 2018, household home equity was at “its highest level – $14.87 trillion – since at least 2000.” If these trends continue, alternative forms of valuation will be pressed into greater service because of their speed and reduced cost, and of these, the automated valuation model is the most affordable. AVMs are relied upon throughout the loan cycle, but particularly in home equity lending. When AVMs were gaining popularity as a property evaluation tool back in the 1990s, the technology got another boost in 1994 from the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Corporation. At that time, the agencies set a $250,000 value threshold below which a property would not require an appraisal conducted by a licensed or state certified appraiser. Last November, the agencies proposed raising this limit – called the de minimus threshold – for the first time in 25 years to $400,000.

INTRODUCING CASCADE LOGIC As the new century began, an important new advance in AVM technology was introduced to address a potential AVM deficiency. AVM dependence on local public records made them suffer in areas where those records were missing or unreliable. Cascades now offered a solution, using an automated process that guarded against this issue yet still provided results. Cascades would run as many AVMs as were needed in order to deliver widespread geographic coverage to the lender. By the time I joined Veros Real Estate Solutions as its vice president of analytics in April 2017, I had become aware of some tears in the logic behind the AVM cascades. Since 2010, hit rates and coverage for the top-tier AVMs had increased markedly, with current nationwide hit rates averaging as much as 90 percent for leading brands. As a result, the cascade’s original advantage over stand-alone AVMs was largely mitigated, as both accuracy and hit-rates for leading models had increased significantly since inception. In other words, cascades became less necessary due to the improved data quality and analytics available to all the top AVMs. In a January white paper issued in support of the agencies’ proposal to raise the de minimus threshold to $400,000, the Mortgage Bankers Association gave its assessment of the current value of AVM technology, which now has vastly better underlying data to “fuel the models and their confidence scores.” As the MBA explained it, real property data “has significantly improved in terms of geographic coverage, depth and granularity, availability of new information, currency of information and the overall integrity and accuracy of available data sources.” Gone are the days, as the white paper also points out, when AVMs depended entirely on public records data, which are generally comprised of purchase transactions, title transfers from country recorders or tax data from the local assessor’s office. Today, access to public records is not only much easier and more dependable it can be obtained from regional or national aggregators as quickly as from the traditional local sources. And, beyond the better access is the fact that – in just the past decade – the public records themselves have become far superior in their coverage, currency and integrity. Similarly, MLS and other detailed property data, which were historically extremely hard to come by, is now readily available and regularly incorporated within AVM models.

About the Author: With more than 20 years in the analytics and automated valuation space for residential real estate, Robert Walker has built a solid reputation for product innovation, providing market insight and anticipating customer needs. In his current role of vice president of sales for Veros, Walker is responsible for leading the company’s sales team and market strategy and for driving innovation and creating a disruptive force in the market. He also has the rare honor of holding both the Certified Mortgage Banker and the Certified Mortgage Technologist designations.

HOUSINGWIRE ❱ AUGUST 2019 57

Another issue with cascades is that they had been designed to determine the most accurate AVMs based on available county look-up tables. This produced another fundamental problem in that cascade logic was therefore built on automatically running sequential AVMs. This means that after the first AVM fails to get a hit, the second is now running either on a property that the first AVM deemed unsuitable or on one that is appropriate for AVM use, but for which the first model didn’t render a high-confidence value. That means that any result it generates is very likely to be inaccurate and, therefore, unusable. The bottom line is there is a reason the first AVM did not return a successful valuation. Cascades could be excused, since they had never been designed to ask what should have been the first question posed when doing an AVM valuation: Is an AVM the best valuation choice for this property?

IN GOOD COMPANY TO ASK A FUNDAMENTAL QUESTION In a recent article entitled “The Wild, Wild West of Automated Valuations,” AVMetrics Owner Lee Kennedy stated, “We…believe in using the right tool for the job, and we believe there is a place for automated valuations in prudent lending practices.” In recent years, I had begun to wonder if the industry was ready to take AVMetrics’ thinking to the next logical step, and ask the question, “Is this subject property even appropriate for an AVM?” It was clear that not all properties are good candidates. The benefits seemed obvious: If lenders were able to determine in advance that an AVM was

58 HOUSINGWIRE ❱ AUGUST 2019

suitable to use for property valuation on a specific property it would save them time and expense, as well as reduce the risk of proceeding with potentially inaccurate information. This “suitability scoring” would allow an AVM to score a hit when a property is consistent with neighborhood norms and there is sufficient data available on the property, its neighborhood and recent sales of other comparable, nearby properties.

SCORING A WIN FOR SUITABILITY After confirming that an AVM is the suitable tool for valuing a property, lenders and other valuation service providers receive a suitability score based on an analytics-driven formula and casebased reasoning to assess the subject property’s fitness for AVM utilization. If the property is a good candidate for an AVM, the system determines the most accurate and appropriate AVM for that specific property. In addition, complete, transparent, and easy-to-understand due diligence data is provided to the customer up front and on an ongoing basis. When the subject property is not a good AVM candidate, several valuation options are afforded to the user as part of the complete and fully automated valuation solution. This led us to wrestle with the old question about the reliability of the cascade logic. Once a property’s AVM-suitability was determined, we saw that the accuracy level for what would have been the second AVM in a cascade dropped well below the plus-or-minus ten percent an effective AVM registers. See chart below: This poses a problem for banks and credit unions because, in addition to the inaccuracy,

there is greater outlier risk, which affects those returned values that are at least 25% above or below the appraised value. We found the outlier level could be four or five times greater for AVMs attempting to value non-suitable properties. It makes sense, therefore, that properties deemed unsuitable for AVM use should have a much lower accuracy level. To test that proposition we ran five independent AVMs on 107 properties that had been deemed unsuitable. Note that the valuation accuracy level, within 10% of the appraised value, is less than 50%. When a high-quality AMC sees large and repeating valuation errors from an appraiser, what does it do? If the appraiser’s incorrect valuation approaches aren’t corrected, the AMC immediately stops sending orders to the appraiser. That’s exactly what this process does. It halts the unsuitable AVMs from being returned. Unfortunately, in today’s AVM cascading approaches, lenders are getting values on both suitable and unsuitable properties and, when an AVM in the second cascade position is ordered, do not know which properties fall into each category. When compared to the recent non-purchase appraisal benchmark values, here are the results for properties deemed non-suitable for AVM use:

Brand

P10*

MDAE

AVM1

43%

16.9%

AVM2

51%

12.6%

AVM3

43%

17.9%

AVM4

40%

20.8%

AVM5

50%

20.1%

AVG

45%

17.6%

(median absolute error)

AMCS: THE PARTNERSHIP THAT COMPLETES THE END-TO-END SOLUTION Once the suitability engine determines that the property is a good candidate for an AVM, it can immediately run the appropriate AVM for that specific property from predetermined top-performing providers. It then delivers to the lender a clear and easy-to-understand report that can be shared with a customer. By contrast, at the lender’s direction, unsuitable properties can be automatically routed to a predetermined traditional valuation method. This provides a great opportunity for Appraisal Management Companies to provide their valuation customers with a complete end-to-end solution. Lenders have been putting faith in AMCs for some time because AMCs are required to under-

stand the nuances of collateral valuation on a national scale. They act as the prudent risk manager on matters related to collateral valuation.

When a high-quality AMC sees large and repeating valuation errors from an appraiser, what does it do? Their recommendations are always subject-property based. If the subject property is a small rural home with massive acreage, then the indicated appraiser is one with rural property experience. If the subject property is an apartment complex with ten units, then an appraiser with income property experience is the right person for the assignment. The same analogy can be applied to appraisal or valuation products. Based on the underwriting risk, lenders and AMCs work to select the relevant valuation product for the lending assignment. For many years, the drive-by appraisal was the product of choice for home equity lenders. In 2019, the preferred product may be an evaluation or a desktop appraisal. This innovative approach to AVM use was developed specifically for distribution by AMCs for the home equity application and equips them with a valuation alternative to AVM cascades. It gives lenders a reliable, efficient and compliant tool that is complemented by the expertise and valuation acumen of the AMC.

SHARING THE LOGIC OF LOGIC-BASED VEROPRECISION I spent 2018 promoting both the benefits and efficiencies that this process can offer. In industry presentations and white papers, which were made available to HousingWire readers, I explained how this suitability decisioning leverages robust analytics, artificial intelligence, and machine learning to determine if an individual subject property is best served by AVM valuation or if it should be routed to an appraisal or other traditional valuation process. It is currently tested on more than 30,000 properties each month and the results are compelling. In conclusion, when using AVMs – and with the proven accuracy and efficiencies provided by today’s AVMs, there is no reason lenders shouldn’t be using them – it is imperative to ask and answer the most basic question. Is the subject property a suitable candidate for AVM analysis? Your credit policy folks will love you for it. HOUSINGWIRE ❱ AUGUST 2019 59

MBA Congratulates HousingWireâ&#x20AC;&#x2122;s 2019 Women of Influence Honoree!

2019 HousingWireâ&#x20AC;&#x2122;s 2019 Your commitment and Women of Influence Honoree outstanding leadership

Susan Stewart 2019 Vice-Chairman Mortgage Bankers Association CEO, SWBC Mortgage

are inspiring and critical to moving our industry forward. Congratulations on this well-deserved honor.

Congratulations to Single-Family Chief Risk Officer Donna Corley on being honored as one of HousingWire’s 2019 Women of Influence™

An influential leader who leads her Freddie Mac team to greater success every day. We’re proud of you for your outstanding contributions to our business and the industry.

The Women of Influence program recognizes the outstanding efforts of women in driving the U.S. housing economy forward. Donna and the Freddie Mac leadership team continue to think of smart new ways to reimagine the mortgage experience and build on the industry’s growth. That includes supporting and helping to advance women, which is key to all our successes. Freddie Mac’s new #LeadingTheWay campaign focuses on moving past barriers and championing women’s rights in the workplace.

Learn more about Donna and other Freddie Mac senior executives who are leading the way at Freddie Mac, and find out more about the campaign freddiemac.com/leadingtheway

eClosing

62 HOUSINGWIRE ❱ AUGUST 2019

Solutions Many lenders’ first steps toward the digital mortgage experience started at the beginning of their loan process — with apps for borrowers to apply and submit documents online. Now, the end of the loan process is getting the same attention, with a number of tech companies offering eClose solutions that complete the automation loop and deliver a more seamless experience for borrowers. In this section, we highlight six companies providing the digital closing solutions lenders need for a streamlined, efficient process.

Pavaso

Docutech

Closing Exchange

Lenders One

DocMagic

Snapdocs

HOUSINGWIRE ❱ AUGUST 2019 63

eClose Solutions Special Report

The Closing Exchange

THE EXECUTIVES Alan Frelix, CEO Alan Frelix has more than 25 years of experience in financial and business services and has spent the last 14 years in senior executive level roles in strategy and operations. Most recently, Frelix was the managing director, strategic development for Stewart Lender Services, a division of Stewart Information Services Corporation. Prior to Stewart, Frelix served as president of LandSafe Services LLC, a title and closing agency, which was a wholly owned subsidiary of Bank of America, and senior vice president, title and closing executive for Bank of America, heading the Bank’s National Title Platform (a managed network of title and closing providers) where he provided title and closing strategy, vendor management, and performance oversight. He is also a founding member of the Signing Professionals Workgroup. Marvin Bantugan, Chief Technology Officer Marvin Bantugan has more than 25 years of experience in financial and business services as well as management consulting. Previously, Bantugan served as a principal for North Highland Consulting and worked on implementation and change projects for a top 5 bank along with numerous acquisitions, due diligence and integration projects. Bantugan also previously served as executive vice president with Countrywide Financial Corporation and senior manager with Deloitte & Touche LLP. Landon Smith, EVP of Client Strategy and Business Development An accomplished business executive with more than 25 years experience in the lender ser vices and title industry, Landon Smith focuses on all aspects of the lifecycle of the loan. Previously, Smith served as senior vice president, strategic sales and enterprise lender relations for ServiceLink, and group executive vice president, title and default services for Stewart Lender Services.

he closing experience is one of the last opportunities lenders have to make a positive impact on a borrower, but an easy, painless signing experience that allows consumers to choose how and when they want to close has been missing from the mortgage loan process. After witnessing firsthand the growing need to deliver a seamless signing experience for businesses and their customers, a unique team of industry veterans created The Closing Exchange. “Our experience across multiple industries and at various parts of the value chain led us to build a technology and services model to enable our clients to transform their closing experience in a practical and flexible way,” said The Closing Exchange CEO Alan Frelix. The Closing Exchange built CXChoice, an integrated signing services platform, to finally fill the void in the industry for a modern closing solution and give users a dynamic platform that allows them to tailor their closing services to their customers’ needs. CXChoice provides flexibility and multiple closing options, including mobile notary, eSignings, Remote Online Notarizations (RON) and hybrid closings. Frelix explained that the solution is a combination of technology and managed services, putting the power in clients’ hands. “The software provides the user with the ability to define their experience, leveraging our professional vetting and compliance, client-specific signing agent training, and our eClosing facilitation services,” Frelix said. CXChoice can be customized to a client’s workflow and transaction-specific requirements, so they can conveniently adjust to any type of closing option the customer might need. Clients benefit from an effective deployment of their eClose strategy, with simple APIs that allow frictionless integration with transaction management platforms. With consumers constantly needing a uniquely tailored closing experience, businesses need to be able to quickly adapt without having to worry about investing in the technology or infrastructure to support each type of closing. Through the power of CXChoice, every company can become e-enabled, allowing them to focus on offering the best closing experience possible for their customers.

“Our experience across multiple industries and at various parts of the value chain led us to build a technology and services model to enable our clients to transform their closing experience in a practical and flexible way.” MISSION

To facilitate a dynamic model that allows clients to configure their service model, shifting the model as needed by leveraging our technology, integrations and managed services. FAST FACTS +F ounded in 2017 via the acquisition of tw0 long-tenured signing services com-

panies by industry veterans who wanted a better signing experience. +N etwork of more than 70,000 mobile signing agents located in all 50 states. + Serves 4 of the top 5 reverse mortgage lenders and top reverse mortgage title

agents. 64 HOUSINGWIRE ❱ AUGUST 2019

DocMagic

growing wave of digital adoption is quickly transforming into the new standard, motivating more companies to take the leap and invest in robust technology solutions. As customers experience innovative technology in other industries, they’re starting to demand that from the mortgage industry. While ease of use and convenience are helping to fuel this growth, increased efficiency, reduced costs and enhanced compliance are also major contributing factors, supporting both consumers and businesses. As this digital shift sweeps through the mortgage industry, DocMagic, which provides some of the most powerful and widely used solutions in the mortgage space, continues to deliver new forward-thinking innovations, including Total eClose, a new end-to-end eClosing system that provides everything a company needs for a 100% paperless eClosing. The seamless digital workflow includes all hybrid eClosing options and is comprised of DocMagic’s comprehensive suite of eSolutions, leveraging SMARTDoc eNotes, in-person and remote online eNotary options, Certified eVault and Investor eDelivery technology. “We’re positioning our customers for an inflow of new business that will be conducted digitally,” DocMagic CEO and President Dominic Iannitti said. “Once customers understand the true value and savings to be found in aligning with our single-source platform, they realize that offering an incomplete or cobbled-together digital process may leave them hitting the restart button within 12 to 18 months… and searching for a new solution.” Borrowers can preview loan documents and disclosures prior to closing and electronically sign documents, putting the power in their hands. Total eClose is also intuitively designed to consume data and documents from any source, allowing the system to e-enable and auto-prepare third-party documents not produced by DocMagic. “Our Total eClose system helps companies provide unparalleled customer service in the new tech-driven world, reducing borrower time at the closing table to as little as 15 minutes,” said Brian Pannell, vice president of client services. DocMagic partners with companies to develop a strategic technology plan, so they are best equipped to go to market, easing the user adoption process and providing invaluable eMortgage expertise. Businesses can then close loans faster, compliantly and at a lower cost, with more control and accountability, removing the risk of potential surprises that can create delays at the closing table. “Total eClose offers a true eClosing solution that involves no paper whatsoever, ensuring accuracy and delivering newfound efficiencies for borrowers, notaries and settlement providers. “The system allows lenders to focus on increasing market share, making the loan process easier and helping create a superb overall experience,” said DocMagic’s Director of Product Development Michael Morford.

“Our Total eClose system helps companies provide unparalleled customer service in the new tech-driven world, reducing borrower time at the closing table to as little as 15 minutes.”

MISSION

DocMagic’s mission is earning our customers’ complete confidence every day with new and innovative digital mortgage solutions that simplify even the most complicated aspects of the loan process.

eClose Solutions Special Report

THE EXECUTIVES Dominic Iannitti, President and CEO As DocMagic’s visionary leader, Dominic Iannitti influences an empowered environment where the entrepreneurial spirit is cultivated. Iannitti founded DocMagic with a commitment to provide the mortgage industry with superior solutions and services that would reduce and eventually eliminate the use of paper. More than 30 years later, that vision continues to inspire the work behind DocMagic’s full enterprise technology stack. Brian Pannell, Senior Implementation Executive DocMagic’s Senior Implementation Executive Brian Pannell is responsible for all post-sales activities for customers who are adding eMortgage (eSign, eNotary and eVault) as well as post-closing (MERS eRegistry) technologies and efficiencies to their business models. Pannell has initiated industry-leading implementation processes for DocMagic’s entire suite of eSolutions. Michael Morford, Director of Product Development DocMagic’s Director of Product Development Michael Morford is responsible for the development and implementation of technology solutions. He oversees software development, server management with overall responsibility for the development of interfaces with third-party Loan Origination Systems, Electronic Document Management platforms, and other mortgage service technology providers.

FAST FACTS + D ocMagic was founded in 1987 in

Carson, California. +A premier provider of document gen-

eration, automated regulatory compliance and comprehensive eMortgage solutions for the national mortgage industry, DocMagic’s customers include some of the largest banks, lenders, investors and servicers. HOUSINGWIRE ❱ AUGUST 2019 65

eClose Solutions Special Report

Docutech

THE EXECUTIVES Amy Brandt, President and CEO Amy Brandt is the president and chief executive officer of Docutech. As a highly accomplished entrepreneur and senior executive, Brandt brings over 20 years of success within the mortgage, software, tech, aerospace and financial services industries to her role at Docutech. Brandt drives the company’s strategic vision and leads its growth initiatives by adding new products, entering new market segments and seeking strategic acquisitions. She has also been a recent recipient of both HousingWire’s 2018 Vanguard Award and the 2019 PROGRESS in Lending’s Most Powerful Women in FinTech award.

MISSION

Docutech provides document technology solutions for mortgage, home equity, and consumer lending, ranging from document generation to eDelivery, eSign, eClose, eVault, and print fulfillment. Docutech’s knowledge and solutions empower lending professionals to efficiently produce accurate loan packages in all 50 states to ensure compliance with constantly changing laws and regulations. FAST FACTS + Docutech was founded in Idaho Falls,

Idaho in 1991. + Since launching ConformX in 2004,

Docutech has generated over a billion mortgage documents. 66 HOUSINGWIRE ❱ AUGUST 2019

s lenders aim to close loans faster, reduce costs and deliver a seamless borrower experience, implementing a comprehensive eClose platform is an increasing priority. Docutech is the industry leader in dynamic document services, eSign and eClose technology — providing a streamlined mortgage process. Docutech introduced Solex eClosing in late 2017, a solution that enables loans to be as “e” as they can be. Since inception, Solex has helped leading lenders close over 10,000 mortgages electronically, providing the competitive advantage of a complete digital mortgage offering. The solution is approved by Freddie Mac and Fannie Mae for eClosing, eNote and eVault functionality and has eSigning efficiencies from initial document generation through post-closing. “Solex is unique because it is a complete end-to-end integrated eClosing solution platform for lenders, borrowers and title/settlement closing agents,” said Docutech President and CEO Amy Brandt. Solex is integrated with ConformX, Docutech’s dynamic document engine. When disclosures and closing documents are generated, they are automatically tagged for eSigning, eliminating manual labor and any missed signature points. Through integration with Simplifile, lenders can utilize Docutech and Simplifile’s intelligent eEligibility engine to analyze each closing package according to state, county and investor variations. Hybrid options include eSigning of ancillary documents, plus options for SMART Doc eNotes, eNotarization and eRecording. Accessed though Solex, the Simplifile closing agent portal enables title and settlement agencies to seamlessly add their documents to the lender’s closing package. In addition, eNotaries can electronically notarize (in permissible states) the applicable closing documents and closing agents can easily facilitate electronic recording of closing documents. After eClosing, lenders can register their eNotes on the MERS eRegistry through the Solex eVault, either manually or automatically. Once registered with MERS, lenders can transfer control to an investor, update servicer and location when needed, and flag an eNote as being paid off, assumed, modified or other life-ofloan events. “Lenders are racing to be the fastest to close home loans,” said Brandt. “As a complete end-to-end integrated eClosing solutions platform, Solex enables each transaction to be as ‘e’ as it can be.” While a more digitally focused closing process certainly promotes an improved, more informed and convenient experience for the borrower, the benefits for lenders are significant. A hybrid eClosing improves loan quality, data accuracy and compliance while also accelerating the overall loan process. Greater efficiency from an operational standpoint is achieved by eliminating reliance on outdated processes, providing significant cost savings. As an example, a lender originating 12,000 mortgages per year with an average loan value of $250,000 can save approximately $155 per loan, which adds up to a whopping $1.8 million in savings annually when moving from paper closing processes to hybrid eClosing. Hard cost savings for a full eNote eClosing are even more significant compared to manual paper processes. Lenders can review their own potential cost savings by accessing Docutech’s eClose ROI calculator on the company’s website. “At Docutech, it is our mission to provide innovative dynamic document services and technologies that streamline and simplify financial transactions for consumers and lenders,” Brandt said. “We achieve that through our Solex eClose platform.”

LendersOne

he industry shift to eMortgages and eClosings are no longer a future vision for mortgage companies, options are available now and homebuyers want access to them. Although implementation is easier than one would think, lenders need the right tools, partnerships and trusted advisors to help accelerate them into a fully digital mortgage — all while maintaining compliance, operational efficiency and exceptional customer service. Lenders One, a leading cooperative for 220+ mortgage bankers nationwide, delivers a complete eClosing solution for borrowers, lenders and investors. “Our eClosing technology is at the center of a growing eMortgage evolution,” said Lenders One President Brian Simon. “Our seamless connectivity to e-ready partners can accelerate your move into eMortgage.” Lenders One platform, L1 eClosing by DocMagic, is a true all-in-one, end-toend eClosing solution that helps enable first generation data to be recorded and delivered in a fully electronic environment. This eClosing solution also helps keep pace with the ever-changing legal and regulatory requirements. In addition, Lenders One advisors help users design and deploy a rollout strategy inclusive of testing, training, and settlement and referral partner alignment, extending support far beyond implementation. Lenders One members receive a number of exclusive L1 eClosing benefits: • Negotiated pricing and single-price bundles • White-glove service at implementation and beyond • Managed relationships across a network of eMortgage-ready investors, warehouse lenders, title companies and servicers • Dedicated user groups for best-practice sharing with peers • Lenders One has an eClosing industry expert leading members’ eClose journey with consultation that is unique to the industry and free with the L1 eClosing solution L1 eClosing integrates with all major LOS platforms for loan document creation in minutes, with zero re-keying. Users can get started with a hybrid or full eClosing solution that supports Remote Online Notarization (RON), where legally permitted. The solution also leverages an extensive library of state-specific documents enabled with eSign technology. For eNotes, the solution provides Lenders One eNotary Technology, available for all 50 states and a support team monitoring eNotarization legislative changes to help keep users compliant at all times. In addition, it generates a MISMO SMARTDoc eNote and offers direct connectivity with the MERS eRegistry. Lastly, L1 eClosing provides a secure, certified eVault for long-term storage and eDelivery to warehouse banks and investors. The platform contains a date and time-stamped audit trail to help demonstrate compliance and tamper-evident seals to help ensure data integrity. “L1 is your eClosing partner from idea to implementation to rollout and beyond. We’ll provide the support and counsel from Lenders One at every step of your eClose journey,” Simon said.

“Our eClosing Technology is at the center of a growing eMortgage evolution... Our seamless connectivity to e-ready partners can accelerate your move into eMortgage.”

eClose Solutions Special Report

THE EXECUTIVES Brian Simon, President Brian Simon leads Lenders One as president and is focused on defining and executing the overall strategic direction of the cooperative. Simon delivers unique value to members through new benefits, innovative solutions and opportunities to connect. With over 20 years of mortgage experience, Simon has held many C-level leadership positions at some of the largest independent mortgage banks in the industry. He has also been a long-time member of both the Fannie Mae and Freddie Mac Lender Advisory Boards and has been voted one of the top 100 mortgage banking executives in the industry. Jason Wright, Director, Lenders One eMortgage Services Jason Wright is the Director of Lenders One eMortgage Services, where he helps Lenders One members capitalize on the technological advantages and opportunities created by the technology and services provided by the cooperative and in the market. Wright has over a decade of experience in the eClosing space and has facilitated thousands of electronic closings, with a unique perspective and experience from the title, attorney, compliance, technology and lender aspects of the eMortgage transaction.

MISSION:

Mortgage lenders join Lenders One to collectively tackle industry and business challenges. Our team of mortgage veterans helps our members access new opportunities through a unique combination of offerings. FAST FACTS +L enders One was founded in St. Louis,

Missouri in 2000. + Today, Lenders One is one of the largest

mortgage co-ops in the country with a diverse mix of 220+ member companies covering the entire lending spectrum — from banks, credit unions, independent mortgage banks and real estate/ builder-affiliated firms, and they originate between $50 million to $12 billion per year. HOUSINGWIRE ❱ AUGUST 2019 67

eClose Solutions Special Report

Pavaso

W THE EXECUTIVES Cheryl Baillis, EVP of Operations Cheryl Baillis is an industry veteran bringing 20+ years of experience and a wealth of operational management experience to Pavaso. Baillis uses her industry knowledge and experience to strengthen Pavaso’s operations, while also expanding the company’s services by developing solutions for all parts of the real estate transaction, from contract to close. Tim Anderson, SVP of Business Development Tim Anderson is responsible for developing products, strategies and relationships that drive adoption of Pavaso. He brings over 25 years of industry experience on both the lending and vendor sides of the business. Anderson is known for promoting strategic applications and trends in technology, including ESIGN and MISMO category one SMARTDocs. Jay Hollis, VP of Product Strategy Jay Hollis was promoted to director of product management and helped to design the Pavaso platform, Digital Close and Signing Table applications from the beginning. Hollis focuses on designing new products and enhancements to Pavaso’s solutions. He also works with the development and marketing teams to ensure that all solutions meet defined requirements and provide a quality user experience.

MISSION

We are dedicated to providing an unsurpassed, single-source solution for eClosings and eNotarizations that creates an easier process for everyone by connecting all permissible parties in a single, secure and collaborative platform. FAST FACTS + Pavaso was founded in Plano, Texas, in

2011. + Pavaso’s eClosing platform is one of the

most utilized and deployed in the real estate industry.* 68 HOUSINGWIRE ❱ AUGUST 2019

hen Pavaso was founded in 2011, the mortgage industry was just beginning to shift toward a more streamlined, automated and digital process. As one of the first creators of an eClosing platform, Pavaso has been focused on the future of closings and delivering a more holistic approach that unites all parties involved in the closing process in one secure portal. “We are proud to be an industry innovator, guiding the adoption of eClosings, along with continuing to educate the industry to embrace technology to satisfy customer expectations in the digital age,” said Cheryl Baillis, executive vice president of operations at Pavaso. Pavaso’s eClosing platform includes Digital Close Enterprise for business purposes and Digital Close for consumers. In-person eNotary and remote online notary tools, along with the capability to eSign an eNote and securely eDeliver it to the selected eVault provider, are available within Digital Close Enterprise. The eClosing solution connects all permissible parties to review and digitally or wet-sign documents; exchange information; and communicate and collaborate in real time. Additionally, both homebuyers and sellers have access to lender- and/ or title- provided educational materials and resources that can be linked directly into corresponding documents – all for a superior customer experience. The platform is designed to enhance and expand existing relationships and processes for lenders and title companies – not replace them. If existing relationships are not ready to transition to eClosings, users have the option to connect with businesses already utilizing the platform. “Every member of Pavaso’s client-centric team, from account management, implementation, training and support, is available and ready to help every step of the way to ensure a successful transition from a paper closing to an eClosing process,” said Jay Hollis, vice president of product strategy at Pavaso. Pavaso’s eClosing platform offers the flexibility to provide four different closing options to customers, including remote online notarization, fully digital, hybrid and traditional. It also allows users to complete post-close activities quicker by reducing errors at closing and delivering the final closing package digitally faster, after completion of the eClosing. Additionally, when an eNote is included in the transaction and transferred to an eVault from Pavaso, a watermarked copy is available to permissible parties on the platform.

Through the platform... Homebuyers and sellers can: • Review and indicate their intent to sign the documents ahead of the closing • Stay connected and informed throughout the closing process through communication features on the secure platform • Complete a closing in as little as 15 minutes Lenders and title companies: • Provide a superior customer experience and service • Deliver a competitive market differentiator • Improve data integrity and loan quality • Reduce time, cost and errors at closing “Pavaso’s platform empowers lenders, title companies and real estate attorneys with tools to deliver fully digital and hybrid eClosings through one secure platform — streamlining the entire closing process,” said Tim Anderson, senior vice president of business development at Pavaso. *Due to state law, regulation or both, electronic notarization and remote online notarization are not available in all areas.

Snapdocs

eClose Solutions Special Report

enders are hyper-focused on digitizing their mortgage application process, but that’s only half the battle — much of the opportunity for efficiency gains and an exceptional digital borrower experience comes from the closing. Snapdocs is a leading digital closing platform with a proven track record of helping lenders and settlement achieve eClosings at scale. “We’re truly unique in three critical ways, each of which solve the larger underlying problems that have to date made eClosing adoption incredibly difficult,” said Snapdocs’ CEO Aaron King. 1. Snapdocs has the industry’s largest network of settlement companies actively using the platform. This solves settlement adoption challenges that lenders often struggle with when trying to roll out digital closings and ensures a consistent, seamless digital experience for borrowers. 2. Snapdocs is the only solution with advanced AI capable of automatically identifying, sorting and annotating any lender and any title company’s documents into wet-sign and eSign packages. Without this, digital closings require more work for most, nullifying the promised efficiency benefits. 3. Snapdocs believes the path to the full eClose starts with successfully streamlining lenders’ workflows and how they work with their settlement partners. Once lenders and settlement are aligned and able to manage every closing from a single platform in a standardized way, moving to full eClosings at scale becomes possible.

Snapdocs arms both lenders and settlement with the tools to fix underlying operational inefficiencies through advanced automation and patented AI — working to improve the closing process for all. “Most other solutions only cater to either the lender or settlement company, but not both,” said Snapdocs’ Director of Product, Briana Whelan. “When it comes to mortgage closings though, you need to solve for both parties since they’re both integral to the closing process and share the same customer.” Snapdocs takes a fundamentally different approach that enables lenders to choose their preferred mix of wet, hybrid and fully digital closings. Because eClosings are being adopted in a fragmented way — slowly, by county and by investor — lenders need a solution to easily manage multiple closing types. With Snapdocs, lenders can do so through a single, standardized process that’s already actively used by their settlement partners. When it comes to implementation, Snapdocs’ plug-and-play solution is compatible with any LOS and document preparation provider. Lenders can introduce Snapdocs without having to rip out existing technology, causing minimal disruption to their workflow. Snapdocs delivers value to customers right out of the gate. Lenders are able to close faster and with greater accuracy, while also saving money on closing-associated costs. On average, Snapdocs shaves two days off the closing process. Lenders enjoy a transparent, stress-free closing process where they can wow their borrowers. There’s also significant ROI for settlement. Errors that appear at the closing table are reduced by 80% and the in-person closing appointment can be as short as 15 minutes. “We grew up through settlement and have over 4,300 settlement companies using our platform every month, so we know their world and bring them real value too,” King said.

THE EXECUTIVES Aaron King, Founder and CEO Aaron King is a 20-year industry veteran. King worked at a mortgage company after obtaining his notary license at the age of 18. He started a nationwide notary signing service at 21. During this time, King personally experienced the pain and stress of the mortgage closing process. He set out to build a platform that truly addresses the underlying problems that have held the industry back for so long. In 2013, King founded Snapdocs, a real estate technology company focused on perfecting mortgage closings. Briana Whelan, Director of Product As Director of Product at Snapdocs Briana Whelan owns the product strategy and road map, and oversees both the product management and product design teams. Prior to Snapdocs, she led the product management team at Applied Predictive Technologies, a MasterCard company, for six years. Christian Hjorth, Vice President of Sales and Customer Success Christian Hjorth has built the sales team from the ground up and has developed the playbook and sales strategy for Snapdocs. Prior to Snapdocs, he was the chief revenue officer at Folloze, a marketing technology company focused on account-based marketing. MISSION:

We are a real estate technology company absolutely obsessed with perfecting mortgage closings. At Snapdocs, we are committed to working together with lenders and settlement to develop innovative solutions that improve the mortgage closing process for all. FAST FACTS + S napdocs was founded in San Francisco

in 2013 and powers over 750,000 closings a year. + O ver 4,300 companies use Snapdocs

every month. + O ver 50,000 mortgage professionals

actively use Snapdocs each month. HOUSINGWIRE ❱ AUGUST 2019 69

UNIQUE SOLUTION:

A M ER IC A N A DVISOR S GROUP | SPONSOR ED CON TEN T

AAG unveils expansion of wholesale channel High-touch, high-functioning wholesale channel offers robust support

merican Advisors Group (AAG), whose combination of vision, energy and execution have made it the nation’s No. 1 reverse mortgage lender, is now utilizing that same vigor to rapidly grow its wholesale/correspondent division. All the critical components are in place to support this growth in recognition of the company’s holistic “AAG & You, Better Together” philosophy. “We continue to accelerate our investments into every aspect of our infrastructure so that our partners, in turn, are able to deliver that same best-in-class support and service to their clients,” said Kimberly Smith, senior vice president of wholesale/correspondent lending. TOP EXECUTIVE TALENT Bolstering an already deep executive team, AAG has brought on board Joe Stephenson as senior vice president of operations. Most recently, Stephenson served as head of mortgage operations for Morgan Stanley and earlier as chief operating officer for Bank of America’s reverse mortgage channel. He joins Smith in executing AAG’s ambitious and expansive wholesale strategy. “AAG’s recognition of home equity as a viable and practical solution for older Americans seeking a better retirement has made the company a standout in the industry,” Stephenson said. “I look forward to supporting our wholesale channel, providing even more seniors with access to an array of reverse mortgage solutions for their retirement.” THE VALUE PROPOSITION Driving AAG’s massive reboot is a story that keeps getting bigger and bigger. “Today, older Americans have about

70 HOUSINGWIRE ❱ AUGUST 2019

$7.1 trillion in home equity, which, if accessed and used responsibly and strategically, could help many seniors supplement traditional, but increasingly problematic, retirement vehicles like Social Security, pensions and 401(k) plans,” said Jesse Allen, executive vice president of alternative distribution. “When you combine that staggering amount of home equity with the fact that about 10,000 people are turning 65 every day — a trend AARP does not expect to slow until the 2030s — you create an unprecedented market opportunity,” continued Allen. As a result, AAG launched its “AAG & You, Better Together” program this spring, amplifying its message to its wholesale partners that the Baby Boomer cohort is a sizable segment of business worth pursuing and a viable alternative to exclusively chasing Millennials to grow their businesses. “Our ‘AAG & You, Better Together’ program is delivering on every front for our wholesale partners,” Smith said. “By investing in the success of our partners, it’s a win for them, it’s a win for us, it’s a win for our industry, and, most importantly, it’s a win for our senior population.” EXPANDED VISION AAG’s concerted and robust expansion of its wholesale channel, greatly benefiting its partners and the senior clients they serve, shouldn’t be a surprise to anyone familiar with the company. “Fifteen years ago, I started AAG as a passion project with a simple goal of helping seniors,” said AAG CEO and Founder Reza Jahangiri. “Today, we’re focused on going much further and helping solve the retirement crisis.” Central to that big idea was developing

a high-touch, high-functioning wholesale channel so that mortgage brokers, mortgage bankers, credit union lenders, community bankers, and other financial service partners could confidently offer the highest level of support and service. To complement AAG’s fixed- and adjustable rate HECMs, the company successfully set out to offer reverse mortgages for owners of higher-value homes that appraised for more than the government’s HECM limits. These proprietary fixed, flex and select products now offer loan limits of up to $4 million, which allow the company’s wholesale partners to offer a far greater range of reverse mortgage solutions to their customers. Meanwhile on the operations front, AAG is streamlining every process and procedure possible to ensure industry-leading service levels and a turn-key service experience second to none. “From submission through funding, our goal was to make our operations a highly interactive, seamless and satisfying experience for all our wholesale partners,” said Stephenson. C O M P E L L I N G C O L L AT E R A L A N D UNMATCHED TRAINING SUPPORT The company has also invested vast resources in overhauling its marketing materials, adding more product-specific, compliance-reviewed content that its wholesale partners can further customize and curate for their specific needs seven days a week, 24 hours a day. Further marketing support comes in timely and topical webinars and informative newsletters containing industry news, current business trends and senior-based statistics that provide its wholesale partners with unique insights

UNIQUE SOLUTION:

CEO / FOUNDER

Reza Jahangiri

A M ER IC A N A DVISOR S GROUP | SPONSOR ED CON TEN T

EXECUTIVE VICE PRESIDENT OF ALTERNATIVE DISTRIBUTION

into how they can better reach and serve the Boomer generation. “Our wholesale strategy is informed by our experience that every company operates differently and therefore has a need to customize solutions,” said Smith. “Therefore, we work closely with each of our partners to design and implement a plan that helps them grow their business.” This collaboration also means providing industry-leading training, and offering on-site as well as online learning programs. As part of this, the company offers the AAG Concierge Experience (ACE), which assigns an internal team of processing experts to each AAG wholesale partner to ensure their success. In a continual effort to improve and hold itself to the highest service standards, AAG regularly monitors and surveys the effectiveness and efficiency of its operations team each month — mea-

Jesse Allen

SENIOR VICE PRESIDENT OF WHOLESALE/CORRESPONDENT LENDING

Kimberly Smith

sured by a Net Promoter Score (NPS). For April, AAG’s NPS score was 90%, compared with a banking industry average of 35%. THE 360 DEGREE EXPERIENCE Resulting from its immense service commitment and the sales momentum it continues to create for its partners, AAG’s servicing turnaround times are now at a record pace. The company’s partners are both big and small, and all share a commitment to helping improve the lives of seniors. As a high-integrity, home equity solutions leader, AAG is also easy to align with. It has built a caring, driven and ethical culture that supports and advances the goals of its customers, employees, partners and the many communities it serves. The company has been named a “Top Workplace” on both coasts (its home base in Orange County, California, by the

SENIOR VICE PRESIDENT OF OPERATIONS

Joe Stephenson

Orange County Register, and Long Island in New York by Newsday) and a Better Business Bureau (BBB) Torch Award for Ethics finalist. Currently, AAG has expanded its partnership with the Better Business Bureau to produce the Savvy Seniors program, a senior-focused f raud prevent ion initiative. Meanwhile, the AAG Foundation, the company’s charitable arm, makes consistent community contributions by empowering employees with volunteer time-off, supplying monetary donations and hosting fundraising events. Better Together? AAG certainly thinks its all-in wholesale approach will be a winning formula for its many partners and help the company dominate the wholesale market. Its progress will be fun to watch, and when AAG does deliver, there may be 88 million seniors and their families ready to say thank you. HOUSINGWIRE ❱ AUGUST 2019 71

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SUTHERLAND MORTGAGE SERVICES | SPONSORED CONTENT

True domain expertise informs tech solutions

Sutherland Mortgage Services offers process transformation through automation

ortgage lending has undergone a sea change in the last several years, requiring mortgage companies to do more with less as they look to meet increased borrower expectations in a low-volume environment. In order to deliver a seamless experience in a cost-effective manner, mortgage companies have turned to a wide array of technology solutions that solve discrete problems, but don’t always work well together. To achieve true process transformation, mortgage companies are partnering with Sutherland Mortgage Services Inc. (SMSI), which combines technical acumen with human-centered design for optimal outcomes. SMSI occupies a technological sweet spot where it can leverage the process transformation knowledge of its global parent company, Sutherland, which serves 120 clients from the Fortune 1000 and has developed conversational AI platforms for powerhouses like Google, Uber and Disney. For the past 10 years, SMSI has been applying that intelligence to the mortgage industry, with a domain expertise that ensures it understands what clients need. The company’s executive team is comprised of mortgage bankers with an average of 18 years’ experience in the industry, and they lead a group of 1,500 mortgage professionals with significant experience processing, underwriting, closing, servicing and auditing mortgages. “We have been in our clients’ shoes — dealing with the issues that our clients are dealing with,” said Global Head of Mortgage at Sutherland Krish Swaminathan. “The depth of knowledge 72 HOUSINGWIRE ❱ AUGUST 2019

we have on our leadership team gives us a distinct advantage.” The company’s domain experience means that SMSI understands at a deep level what its mortgage clients need, and take a holistic approach to providing solutions. The company’s always-on organization features capabilities in multiple locations so clients can utilize efficient solutions without impacting customer experience. For example, SMSI recognizes that certain functions are best executed from the U.S. — like those related to voice quality. At the same time, using offshore locations can make the most sense for more administrative tasks. “Essent ia lly, we follow a model of keeping the loan in motion for 24 hours — there is someone working on the loan at all times. This has resulted in better turn times, and in one case study Sutherland was able to improve end-to-end cycle times by 25% to 30%,” Swaminathan said. The company understands the complexity of each client’s tech stack needs and offers a flexible engagement model so that clients can choose what’s right for them — whether that’s a true endto-end fulfillment solution or a strategy that uses ala carte options. Solutions are customized for each client to ensure the right cost structure for their particular situation. In addit ion, because Sut herland Mortgage Services employs mortgage professionals at every level of the organization, the company doesn’t need a sixmonth ramp-up time to figure out client processes and come up with solutions. “When clients look at digital, they think it’s going to come with a heavy cost and a lot of intensive work on their end,”

said Neil Armstrong, head of global business development at Sutherland. “But we already understand their pain points. We can show them a very quick path forward and help them become more digital without sacrificing customer experience.” SMSI has a number of tools at its disposal, and the first step of its due diligence with a new client is looking for low-hanging fruit that can save money in the short term by improving efficiency. Oftentimes, SMSI quickly identifies repetitive tasks that can be automated to free up staff for more complicated work. “Repetitive, easily automatable tasks should be done by a robot, not a highly paid resource that can focus on higher-end work,” Swaminathan said. “At the same time, while a robot is a great thing, it doesn’t solve problems by itself. We combine robotic tools with other automation to solve the real issues.” For example, SMSI has a client that asked for a specific robotic process automation project from another vendor, requesting bots that did specific tasks. That vendor delivered the bots according to the client’s requirements, but they didn’t work as well as expected and ran into issues once they were live. That client gave SMSI the same robotic ask, but SMSI’s bot was more efficient and functional because SMSI understood the nuances of handling disclosures and combined the bot with a smart OCR solution and a smart extraction solution. “What truly differentiates us in these situations is we don’t build it, deliver it to the client and go away. Because we’re mortgage bankers serving mortgage bankers we stay on and maintain our solutions and make sure they are working well. We understand the whole of

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their process and we’re not just offering one-off solutions,” Swaminathan said. Armstrong agreed. “Automation is not one thing, it’s a combination of things. We actually understand mortgages, so we’re not just doing what is written in the business requirement document.” In another instance, SMSI worked with a servicer to handle their customer call volume, which had escalated out of control. SMSI looked at the servicer’s business cycle and found that chat bots would be a good fit for the kinds of tasks consumers called in about. SMSI built a mobile app that gives customers the option to take care of these tasks through their smartphone, with a chat bot ready to answer any questions. Instead of opening a second call center, the servicer was able to decrease call center volume with self-serve options while increasing the customer experience.

“Some of the world’s largest organizations trust us for this kind of conversational AI customer experience and we’re happy to bring what we’ve learned from those partnerships into the mortgage space,” Armstrong said. Sutherland has long been known for its robust business process outsourcing (BPO), but has seen even more impressive results since opening its Sutherland Labs in San Francisco and London. The company brings clients into its labs so design teams can study their challenges first-hand, often conducting journey mapping exercises to illuminate areas for improvement in the user experience and identif y automation opportunities. Working with one client led Sutherland Labs to conduct in-home interviews with customers who had started a loan application but fell out in the process.

The insights they gained from first-person interactions helped design thinkers to rebuild the application process for significantly better outcomes. “We work with our clients to uncover areas where it makes sense to use business process outsourcing,” Armstrong said. In this regulatory environment, with such a high cost to originate, BPO is a smart way to help offset the cost of the loan. “As we walk clients through the process as their customer experiences it, many executives have that ‘aha’ moment where they can see where the bottlenecks are and where automation could help. “Lenders and servicers have an open invitation to come and see how they can improve their business,” Armstrong said. HOUSINGWIRE ❱ AUGUST 2019 73

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RentWire

NYC rent regulations prove negative for multifamily lenders NEW LAWS COULD HURT PROPERTY VALUES AND OCCUPANCY RATES BY JESSICA GUERIN, KATHLEEN HOWLEY

NEW York State Senate and Assembly leaders recently passed tions in history,” Assembly Speaker Carl Heastie and Senate expansive changes to rent control laws that stunned the real es- Majority Leader Andrea Stewart-Cousins said in a joint statement. “For too long, power has been tilted in favor of landlords and these tate industry. The state’s governor, Andrew Cuomo, signed the bill a day be- measures finally restore equity and extend protections to tenants across the state.” fore the existing, more moderate law expired. The Editorial Board of The Wall Street Journal had a different Legislators won’t have to worry about wrangling over tenant protections every few years, like the old law. The bill makes these view. In a piece titled, “Albany goes wild.” “There’s a lot of ruin in New York, but progressives who conchanges permanent. The legislation makes it more difficult to evict non-paying ten- trol the state and city governments are intent on showing how ants and tightens restrictions on the rent increases landlords are much,” the newspaper said. “Law by law, Gov. Andrew Cuomo and Democrats are chipping away at the policies that made New allowed to make after improving buildings. It repeals provisions allowing removal of units from rent sta- York City livable after decades of decline and returning to the bilization when the tenant’s income is $200,000 or higher in the bad old days.” The move became possible after 2018 voters swept progressives preceding two years. It also eliminates a provision allowing landlords to raise rents as much as 20% each time a unit becomes into office in a wave of anti-Trump sentiment that not only flipped control of the state Senate and replaced the state’s Republicans, vacant. “These reforms give New Yorkers the strongest tenant protec- but it also booted out a host of moderate Democrats who supportHOUSINGWIRE ❱ AUGUST 2019 75

“

These reforms give New Yorkers the strongest tenant protections in history. For too long, power has been tilted in favor of landlords and these measures finally restore equity and extend protections to tenants across the state.”

- Speaker Carl Heastie and Senate Majority Leader Andrea Stewart-Cousins

ed a less stringent version of rent control laws. According to The New York Times, real estate developers made frantic last-minute efforts to avert the final approval of the strictest rent control law in decades, but it was too late. From the New York Times article: Mr. Cuomo rebuffed the developers, telling them that “they should call their legislators if they want to do something about it,” said a person briefed on the call, which lasted about 15 minutes. The phone call capped a humiliating moment for an industry that had long reigned in the state capital. “There was some arrogance on the part of the real estate industry that was based on how things have functioned in Albany for a long time,” Sen. Zellnor Myrie, D-N.Y., a Brooklyn Democrat who is a member of the new group of progressives, told the Times. Governor Cuomo rebuffed eleventh-hour pleas from real estate leaders such as Douglas Durst, Richard LeFrak and William Rudin, who are involved with some of the most iconic buildings on the New York City skyline such as One World Trade Center and 3 Times Square. The New York times article explained that, “The phone call capped a humiliating moment for an industry that had long reigned in the state capital.” “The best bill they can pass, I will sign,” Cuomo said at a news conference. “If you want to hear an explosion in this state, you let the rent control laws expire.” And while it seems no one working in New York’s real estate 76 HOUSINGWIRE ❱ AUGUST 2019

market is especially thrilled with the new regulations, a recent report from Fitch Ratings details just how damaging they could be. According to the report, the new regulations have negative credit implications for multifamily lenders that are long on NYC real estate. “This will translate into lower growth in rental and operating income, less room for capital improvements and potentially result in declining property values,” Fitch stated in its report. The report went on to state that new regulations may reduce investor appetite for rent-stabilized apartments, and this could send property values on a downward spiral. “If realized, a significant decline in property values, and hence borrower equity, presents refinancing risk for highly leveraged borrowers, which Fitch views as the primary downside credit impact associated with the new law,” the report states, noting that the losses may take time to manifest, as the average tenor of multifamily loans securing rent-stabilized properties is five to seven years. Further, Fitch says the new regulations could negatively impact occupancy rates by deterring the capital investment required for property upkeep. Importantly, the new laws curb a landlord’s ability to raise rents after major capital improvements, capping an increase at 2% instead of the old 6%. “Unlike loans funding rent-stabilized properties, loans that back apartment capital improvements tend to be higher risk,” Fitch states. “Absent significant creditor protections, exposure to such loans is viewed as incrementally credit negative in light of the MCI proposals,” it states.

Dee Grosso Congratula 2019 Women of Influence

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Freedom Mortgage Corporation, 907 Pleasant Valley Avenue, Suite 3, Mount Laurel, NJ 08054, 800-220-3333. Lender NMLS #2767 (www.nmlsconsumeraccess.org). Equal Housing Opportunity. ÂŠ 2019 Freedom Mortgage Corporation. HR287(0619)

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DID YOU KNOW Ben Lane sends LendingLife updates twice a week by email? Go to HousingWire.com/newsletter to sign up and stay informed!

Movement Mortgage, Better.com CEOs on why the “one-click” mortgage is not the endgame for the housing business TOP MORTGAGE EXECS ON WHY THE HUMAN ELEMENT WON’T DISAPPEAR BY BEN LANE

FOR the last several years, much of the narrative surrounding the housing business (and HousingWire is just as guilty of this as anyone) has been focused on the digitization of the mortgage and home buying process. Seemingly every day, there’s another lender or bank unveiling a digital mortgage process, tempting borrowers with added simplicity and convenience. And every few weeks, it seems as if there’s another iBuyer joining the market, offering homeowners the opportunity to sell their home with the click of a button. Things in the housing industry seem to moving towards the lit-

eral manifestation of Quicken Loans infamous “Push Button, Get Mortgage” tagline from its 2016 Super Bowl commercial, which led to a sea of observers suggesting that another housing crisis was on the horizon due to apparently non-existent underwriting. And while that’s clearly not the case (underwriting still exists and existing regulations prohibit any kind of rerun of what happened in the mid-2000’s), the industry is heading one way: a mortgage at your digital fingertips. But two of the top CEOs in the mortgage business said recently that the “one-click” mortgage is not the endgame that so many HOUSINGWIRE ❱ AUGUST 2019 79

people seem to think it is. According to Movement Mortgage CEO Casey Crawford and Better.com CEO Vishal Garg, the human element will likely always be involved in the mortgage business. And even beyond that, Garg said that the fully digital “oneclick” mortgage is likely one to two decades from actually being a reality. “The Amazon effect has taken hold,” Crawford said recently during the keynote session at HousingWire’s engage.marketing conference in Charlotte, North Carolina. “A lot of folks are driving towards one-touch home purchase, being able buy the house with one-click,” Crawford continued. “There are a whole lot of innovators that are moving that way: Zillow, Redfin, Opendoor, and companies like that. But we see the future as a marriage of digital and people.” Garg told the crowd in Charlotte that he started Better.com (first known as Better Mortgage) after trying to buy his first home and seeing that the mortgage process was “broken.” The initial goal of Better, according to Garg, was to create a lender that functions basically like the ETrade of the mortgage business, allowing people to complete the mortgage process on their own without ever speaking to a person. And initially, Better found success in the refinance market with that model, but when the company expanded into purchase mortgages in 2017, the company found that most borrowers aren’t Garg said. So Better now embeds educational videos and documents into its loan origination system, helping borrowers along actually ready for a fully digital experience. “A lot of people came to us for purchase, but they didn’t stick,” the way. We’re seeing a much higher conversion on people who watch Garg said. According to Garg, out of every roughly 100 people that were coming to the company for a purchase mortgage, maybe only the videos,” Garg said. “We’re trying lower the understanding gap between consumers and investors.” four people were actually getting a mortgage. Part of that is done through technology, simplifying the process, “People aren’t ready for ETrade yet. They need Charles Schwab,” Garg said. “They need a trusted advisor. Even up to last year, 85% and in Better’s case, passing those savings along to customers. “So much focus in the (mortgage) industry has been on how do of our locks had no human contact, but that’s probably only about we reduce the cost to produce a loan,” Garg said. “Our process has 25% of the market. But people need hand-holding.” And despite the push to go digital, Garg said the “one-click” been how do we reduce the price for the consumer.” Crawford agreed, citing Movement’s mission to be a trusted mortgage is not actually close to becoming a reality, even for the resource for consumers. people who want it. “We exist to love and value people,” Crawford said. “To love is “We know it’s going to be 15 to 20 years before it’s one click to to act long-term in the best interest of another. And what people buy a home,” Garg said. “I’m a child of the ‘80s and ‘90s,” Garg said. “People want get- really want is to shop online and then talk to someone about. ting a mortgage to be like Contra, where’s just bang, bang, bang, We see marrying up that digital capability with local people. It’s but it’s more like Legend of Zelda, where sometimes it’s boring, really about how you build trust within social networks.” Building trust is a big portion of Crawford’s vision. It’s one of the sometimes you have to slow down to hear some of the story.” And because of that, Better has shifted its model to be signifi- reasons Movement got into the banking business in 2017. “We want to help people with their financial life,” Crawford said. cantly more people-focused. “We’ve changed to delivering a ser“We think there’s an opportunity to rebuild trust in the banking vice,” Garg said. “It’s become a lot, lot, lot more human.” For Better, that involved building in many opportunities to ed- industry.” Along those same lines, Garg cited the lack of financial educaucate borrowers throughout the mortgage process. “The consumer is short on time and even shorter on attention,” tion as a detriment to all consumers. 80 HOUSINGWIRE ❱ AUGUST 2019

“People don’t know who to trust in financial services,” Garg said. “The education process is broken. There are still no financial education courses in high school.” “There are all these benefits of buying a house, but no one is teaching people that,” he continued. “But the banking industry has lost the moral authority to do that.” And to rebuild trust in the financial services industry, it takes more than just technology. It takes people too. That’s why Better has increased its workforce from 50 people to 450, with a number of those employees being non-commissioned loan officers. “People shouldn’t get paid more just because a house is $300,000 versus $200,000,” Garg said. Asked about a piece of advice the crowd could take back to their own companies, Garg said building trust is key. “Examine every action, every communication and think, ‘Does that build trust?’” Garg said. “The process is all about engendering trust. Do we build trust or take away trust? The American consumer is looking for the person they can trust, the company they can trust.” For most people, they can’t develop trust in a company unless there’s a person there they can trust. It’s one of the reasons that loan officers exist, to serve as that trusted point of contact for a borrower during one of the most complex and stressful times of their lives.

“

Examine every action, every communication and think, ‘Does that build trust?’ The process is all about engendering trust. Do we build trust or take away trust? The American consumer is looking for the person they can trust, the company they can trust.”

Combine that fact with technology that is simply not as advanced as it would need to be to truly “push button, get mortgage,” and you begin to see that people will still play a role in the mortgage process for a long, long time. And because of that, the “one-click” mortgage is not the destination, it’s just part of the journey. HOUSINGWIRE ❱ AUGUST 2019 81

ReverseReview

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DID YOU KNOW Jessica Guerin sends home equity and reverse mortgage updates by email? Go to HousingWire.com/newsletter to sign up and stay informed!

ReverseReview

It was a tumultuous summer for the reverse mortgage industry TWO MAJOR PLAYERS EXIT THE BUSINESS WHILE USA TODAY PUBLISHES HIGH-PROFILE HIT PIECE BY JESSICA GUERIN

THIS summer was tumultuous for the reverse mortgage industry, as several major developments made national headlines. First, top 10 HECM lender Live Well Financial abruptly closed its doors, and a whole lot of drama ensued. Then, Ditech Holdings revealed that it has found a buyer for its struggling reverse mortgage business. Finally, USA Today published an investigative story about reverse mortgages that paints the product in a seriously unfavorable light. All three major developments lead to lots of HECM headlines as the weather warmed up. LIVE WELL CLOSES SHOP, DRAMA ENSUES In May, Live Well Financial took the industry by surprise by announcing that it was shuttering operations effective immediately.

The Virginia-based lender and servicer was a long-time player in the reverse mortgage space, most recently coming in at No. 7 with 305 loans year to date and 3.1% market share. A letter penned by Paula Foster, Live Well vice president, controller and human resource director, said conditions outside the lender’s control led to the decision to permanently shut down all of its operations in their entirety. “Due to sudden and unexpected developments in the markets for certain financial assets the company uses as collateral for certain credit facilities that provide this liquidity, these lenders have reduced significantly the amount of liquidity they make available to the company,” Foster said. “This reduction in credit availability combined with challenging conditions in the markets for mortgage loans, which were conditions outside of the company’s control, along with related HOUSINGWIRE ❱ AUGUST 2019 83

ReverseReview Flagstar also said that in regulatory issues, have reearly June, it was contacted sulted in the company having by the Bank Fraud Division of insufficient available cash to the FBI regarding a potential continue operations,” Foster The program has evolved over the investigation into Live Well. continued. “Despite the company’s years, with stronger counseling DITECH FINDS A BUYER exercise of commercially Meanwhile, Ditech Holdings, reasonable business judgrequirements, enhanced consumer parent company of HECM ment, it could not reasonably protections, limitations on loan servicer Reverse Mortgage foresee these circumstances Solutions, ended months of and therefore was unable to amounts and nonborrowing speculation about what will provide 60 or more days’ nospouse provisions. Today, reverse come of its HECM business by tice of the closing and related announcing its pending sale layoffs,” Foster added. mortgages are an important in mid-June. But it seems some of Live retirement planning tool.” Mortgage Assets Well’s creditors took issue Management will acquire the with this, suggesting that stock and assets of RMS in a perhaps the situation was not “stalking horse” agreement, entirely out of Live Well’s conmeaning that if a better offer trol and that mismanagement comes along, Ditech can bail may have played a role. Now, those creditors – which include Flagstar Bank, Mirae on the deal and set up an auction to allow all bidders to compete Asset Securities and Industrial and Commercial Bank of China for the sale. After filing for bankruptcy a second time, Ditech said it was Financial Services – are seeking to force Live Well into involuntary Chapter 7 bankruptcy to collect the more than $130 million considering “strategic alternatives” that could include selling off some of the company’s assets, changing the company’s business they say they are owed. In its affidavit, Flagstar also questioned Live Well’s manage- model or selling the company. In the end, it apparently chose the latter. ment and control. For the last year, some have speculated who would even want “Given the Debtor’s recent mass layoff, there are serious questions regarding the management and control of the debtor, its the assets of the struggling reverse mortgage company. Ditech said itself that RMS was operating at a sizable loss, notability to protect and preserve assets (including any potential causes of action that may exist as a result of Live Well’s activities), ing that it incurred “significant losses” in 2017 and 2018 in a and liquidate in a manner that will maximize value for its credi- filing with the SEC, and said the trend was unlikely to turn around anytime soon. tors and other stakeholders,” the affidavit stated. But it seems someone found RMS valuable. Affidavits from Flagstar and Mirae also revealed that Live Well Through its Washington, D.C. office, Mortgage Assets may have other legal issues to content with, saying that both companies were contacted by authorities investigating Live Well’s Management manages portfolios of mortgage servicing rights, applying risk management initiatives and emphasizing a positive collapse. According to Mirae, it received a phone call from the Securities borrower experience, according to the company. No details have been released yet on the specifics of Mortgage and Exchange Commission on the very day Live Well announced its closing. In sworn testimony, Mirae said that it learned during Assets’ side of the deal. that call that authorities are investigating the lender and its repUSA TODAY PUBLISHES REVERSE MORTGAGE HIT PIECE resentatives, including its CEO, Michael Hild. Then, Mirae said that less than three weeks later, the Assistant Members of the reverse mortgage industry were incensed in midU.S. Attorney from the Southern District of New York contacted June when USA Today published released a scathing investigative story that took aim at reverse mortgages, blasting lenders Mirae about a potential investigation into Live Well. Flagstar made similar claims in its own filing, stating that it for targeting impoverished, elderly homeowners and leading a was subpoenaed by the SEC on May 9 for records regarding its substantial number of them into foreclosure. Then, the publication’s editorial board followed up with an dealings with Live Well.

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ReverseReview

op-ed that called reverse mortgages a “platform for predatory lending” and questioned whether the government should be enabling these loans. (Laughably, the authors also describe HECM lending as “the flourishing business of reverse mortgages.” One has to wonder if they did any research on the current regulations and endorsement volume, or if they were perhaps more interested in using the colorful stories of a few defaulted borrowers who failed to fulfill the loan’s obligations to paint a picture that fit into their narrative.) Unsurprisingly, the National Reverse Mortgage Lenders Association fought back, publishing its own op-ed in USA Today and calling out the crucial errors in the publication’s research and explanation of the loan. For starters, the USA Today story roasted the loan for its high foreclosure rate, but then acknowledged only briefly that a foreclosure often represents the natural conclusion of the loan, as the lender sends the property though the foreclosure process if the borrower passes away and the heirs forgo the option to repay the loan and retain the property. “An important point USA Today overlooks is that a foreclosure is often the natural resolution of a reverse mortgage after the borrower passes away,” wrote NRMLA President Peter Bell in the oped. “Few result in actual displacement. If the balance due exceeds the home’s value, or there is no next of kin to handle a sale, the estate will simply allow the home to go into foreclosure.” The investigative piece also told the story of a widow of a reverse mortgage borrower who was evicted after her husband passed

away because she failed to file the proper paperwork. The article briefly touches the fact that rules have changed, but does not elaborate on guidelines have been put into place to protect the non-borrowing spouses of borrowers who pass away. In fact, one of the key problems with the article is that it discusses old issues with the HECM program that have since been resolved through regulations that were put into play in 2014 and 2017. But the article barely mentions that guidelines have changed, leaving readers to conclude that these are still major problems with reverse mortgages. Bell stresses this fact and notes that reverse mortgages are now considered to be a financial planning tool for retirees. “The program has evolved over the years, with stronger counseling requirements, enhanced consumer protections, limitations on loan amounts and nonborrowing spouse provisions,” Bell points out. “Today, reverse mortgages are an important retirement planning tool.” Bell writes that lenders never want a loan to default and will continue working with regulators and counselors to educate all parties involved so that this doesn’t happen. “A reverse mortgage loan can be a lifesaver, particularly for those in need of cash with few options, as there are no monthly payments and nominal income requirements,” he states. Reverse mortgages can help older borrowers pay for daily expenses or medical bills, Bell writes, but the owner must pay their taxes. As with all loans, there are obligations that must be fulfilled. HOUSINGWIRE ❱ AUGUST 2019 85

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DID YOU KNOW KK Howley sends OpenHouse twice a week by email? Go to HousingWire.com to sign up and stay informed!

OpenHouse POWERED BY

Baby Boomers clogging up the housing market YOU CAN’T BUY WHAT’S NOT FOR SALE BY: KATHLEEN HOWLEY BABY Boomers, the 75 million Americans born between 1946 and 1964, are clogging up the housing market. Instead of moving to retirement communities like many of their parents did when they got older – think The Villages in Florida, with a population of more than 125,000 retirees, or any of the Del Webb Sun City communities scattered across the nation – Baby Boomers are opting to age in place. That’s keeping about 1.6 million houses off the national market, according to a Freddie Mac analysis. Boomers staying put, coupled with homeowners of all ages who don’t want to give up rock-bottom mortgage rates, is creating gridlock for Millennials who are trying to buy their first homes, according to First American Chief Economist Mark Fleming. “Today we are in an unprecedented homebody era as many existing homeowners continue to feel rate-locked into their homes and seniors continue to age in place,” Fleming said. “Looking ahead, more than half of all existing-homes are owned by baby boomers and the Silent Generation and they will eventually age out of homeownership. But right now, housing supply remains tight – you can’t buy what’s not sale–and market potential is lower because of it.”

More than half of Baby Boomers plan to age in place, according to a survey released by Chase and Pulsenomics earlier this year. About 88% of that generation are planning to renovate within the next three years. They might need a first-floor master bedroom so stairs can be avoided, wider doorways in case a wheelchair is needed someday, and other accommodations. The Housing Confidence Index surveyed 3,000 heads of households, 753 of which were Baby Boomers. Among this group, 52% said they will never move from their current home, and 88% said they plan to make improvements to their home, with bathroom renovations topping the project list. At the metro level, Boomers in San Antonio expressed the greatest desire to stay put at 62%, while Boston-based Boomers scored the lowest at 28%. Nearly two-thirds of respondents said they think home values are rising in their area, which provides incentive for homeowners to tap their equity in order to age in place–and enhance their investment. Amy Bonitatibus, chief marketing officer for Chase Home Lending, said Boomers are likely to explore loans that grant access to equity in order to fund home improvements. HOUSINGWIRE ❱ AUGUST 2019 87

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Like the general population, seniors in expensive and unaffordable metros rent at much higher rates. The higher the income required to purchase the median home, the lower the proportion of senior households that could downsize.”

“With home prices generally healthy across the country, twothirds of these homeowners are turning to financing options like home equity lines of credit or cash-out refinances to complete their upgrades,” Bonitatibus said. “On average, homeowners are financing about $18,000 per household with more than half saying they intend to start remodeling within a year.” The U.S. homeownership rate was 64.2% in the first quarter, the Census Bureau said. For Americans under age 35, it was 35.4%, for the 35 to 44 age group it was 60.3%, for 45 to 54 year-old Americans, it was 69.5% and for people over 65 years old, it was 78.5%. In some cases, Boomers aren’t just aging in place–they’re putting off retirement entirely. A study released last year by Trulia examined the housing situations of homeowners 65 and older 88 HOUSINGWIRE ❱ AUGUST 2019

and compared it with a decade ago. It uncovered a 3.4% jump in the number of seniors working in 2016 compared with 2005. It also showed that seniors appear to be holding off on downsizing just the same as they were 10 years prior. Not every Boomer is staying put, of course. About 5.5% of seniors are moving, but the size of the generation still makes that a pretty hefty number, according to a Trulia study. Among those who moved, the split was pretty even between single-family and multifamily residences. “Because the Boomer generation is so much larger than previous generations, that 5.5% moving rate translates into very different raw numbers across the years,” Trulia analyst Alexandra Lee said. “There were about 7 million more senior households in 2016 than 2005, meaning 386,000 more senior households

OpenHouse

moved in 2016.” The study sought to examine whether Baby Boomers holding onto their homes was driving up home prices. In looking at the nation’s top 100 metros, it determined that Boomers were not eroding affordability. “Like the general population, seniors in expensive and unaffordable metros rent at much higher rates,” Lee wrote. “The higher the income required to purchase the median home, the lower the proportion of senior households that could downsize.” The age at which seniors decide to downsize has also shifted. The survey revealed that in 2005, seniors were moving into multifamily residences by age 75. By 2016, this had moved to 80. Lee pointed out that a lack of affordable options for downsizing is likely part of the problem. “The acute shortage in starter home inventory can make it difficult for retirees to move to smaller homes,” Lee said. “Not only are seniors not responsible for making inventory-scarce metros unaffordable, they’re feeling the inventory pinch themselves.” By 2030, the number of people who are 65 and older will be larger than the number of people under the age of 18 for the first time in the nation’s history, according to the National Association of Realtors. The year 2030 is when the last of the baby boomer generation will turn 65. After that, one in every five Americans will be of traditional retirement age. Baby Boomers shaking up traditional notions of retirement will reshape the housing market in the next decades. But, please don’t call it “aging in place,” NAR said. “Using the words `age in place’ to describe renovations for the aging population may not be as enticing to Baby Boomers as the term `thriving in place,’” NAR said, citing a report from Home Advisors. “Whether we’re 25, 45, 65 or 85, our homes aren’t for aging. They’re for thriving. From pancake breakfasts with our kids and Sunday brunches with our friends to holidays with family, movie nights with our spouses and curling up with a good book, our homes are where we do the things we love to do, with the people we love to do them with.”

Top 5 ZIP codes attracting the most Baby Boomers By: Jessica Guerin

Baby Boomers’ decision to stay put as they age is keeping 1.6 million houses off the market, creating a “near-gridlock” in the market.

But just where are these Boomers concentrated? A recent survey by RentCafe, which looked at U.S. Census data in 250 of the largest U.S. cities, highlighted the ZIP codes with the great populations of Baby Boomers. Among the survey’s discoveries: Many Boomers eschew suburban living for city life, with New York ZIP codes dominating the top 20 list. In fact, contrary to the belief that many older Americans decamp for Florida in their later years, New York is home to the largest Boomer population, with New York City alone housing nearly half as many Boomers as the entire state of Florida – 1.4 million versus 3.9 million, RentCafe revealed.

Here are the top 5 ZIP codes where Baby Boomers are living: 1. 11234 – Brooklyn, New York (19,450 Boomers)

2. 11236 – Brooklyn, New York (18,672 Boomers)

3. 10025 – Manhattan, New York (18,277 Boomers)

4. 11229 – Brooklyn, New York (17,238 Boomers)

5. 94112 – San Francisco, California (16,876 Boomers)

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CFPB Watch

90 HOUSINGWIRE ❱ AUGUST 2019

CFPB Watch

CFPB finds Freedom Mortgage intentionally reported inaccurate HMDA data BUREAU HITS FREEDOM WITH FINE FOR HMDA REPORTING ERRORS BY BEN LANE, JESSICA GUERIN

LOAN officers at Freedom Mortgage intentionally reported inaccurate Home Mortgage Disclosure Act data over a several-year period, the Consumer Financial Protection Bureau said. The CFPB announced it is fining Freedom Mortgage, one of the country’s largest lenders, for submitting HMDA data to the bureau that contained “errors” from 2014 through 2017. The latest HMDA data shows Freedom Mortgage ranked No. 12 largest lender in 2017 when measured by volume, and No. 11 when measured by number of loans. And its influence is only continuing to grow. Freedom Mortgage and RoundPoint Mortgage Servicing are planning to merge. The deal will make RoundPoint – which

services and subservices about $91 billion in mostly agency loans – a wholly owned subsidiary of Freedom, a full-service, nonbank mortgage lender and servicer. It will also boost Freedom’s portfolio of mortgage servicing rights to more than $300 billion, making it the seventh largest servicer in the U.S., the companies said. The acquisition will provide Freedom with an active subservicing platform and broaden its origination network by folding in RoundPoint’s retail and correspondent origination channels. RoundPoint CEO Kevin Brungardt said the deal will benefit RoundPoint by providing access to Freedom’s origination platform. “This merger will create a much larger and stronger organization with significant

synergies,” Brungardt said. “RoundPoint will benefit operationally in many ways, including having access to Freedom Mortgage’s substantial origination platform.” “I am pleased to welcome RoundPoint’s highly successful and professional team to the Freedom family,” Freedom Mortgage CEO Stan Middleman said. “We very much appreciate the hard work by everyone involved in making this merger happen, and look forward to working together.” The companies said that they have entered into a merger agreement and the deal is expected to close in the third or fourth quarter of 2019, subject to regulatory approval. Financial terms of the deal were not disclosed. But as the company’s influence grows, HOUSINGWIRE ❱ AUGUST 2019 91

CFPB Watch it is also coming under more scrutiny, and a new investigation from the CFPB shows the company reported inaccurate HMDA data. According to the bureau, an investigation found that Freedom reported “inaccurate race, ethnicity, and sex information” and that “much of Freedom’s loan officers’ recording of this incorrect information was intentional” during that time. The bureau stated that “certain loan officers” at Freedom were told by their managers or other loan officers to select “non-Hispanic white” for the ethnicity of loan applicants who elected not to provide information about their race or ethnicity, regardless of whether they were actually white or not. From the CFPB’s consent order: Within certain audio recordings reviewed by the Bureau of applications taken over the phone from approximately 430 applicants from 2014 through part of 2017, at least 125 applicants did not provide the requested race and/or ethnicity, yet Respondent reported these applicants as non-Hispanic white. For example, in response to being asked his race and ethnicity, an applicant in 2015 twice stated he did not want to answer. Yet Respondent reported this applicant as non-Hispanic white. This incorrect reporting identified by audio recordings occurred in seven different call centers, associated with over 80 different loan officers, in all four years reviewed. Audio recordings reviewed by the Bureau show that Respondent misreported data in another way in approximately 300 instances. Specifically, respondent incorrectly reported applicants as non-Hispanic white even though the applicants provided requested race or ethnicity information other than non-Hispanic white, overstating the number of non-Hispanic white applicants. HMDA regulations require covered lenders to collect, record, and report each loan applicant’s and co-applicant’s race, ethnicity and sex. At issue was Freedom’s proprietary elec92 HOUSINGWIRE ❱ AUGUST 2019

tronic system-of-record, which the CFPB identifies as “Lakewood.” As part of the loan process, loan officers would enter applicants’ information into Lakewood, but if certain information was missing, the system would generate a “hard stop” that would prevent the loan file from moving forward in the process. According to the CFPB, if loan applicants did not provide their race or ethnicity over the phone, loan officers were instructed to enter the borrowers’ information in a way that created a “hard stop.” But, some loan officers had a method to “get around” the hard stop, according to the CFPB. “To get around this hard stop, certain loan officers were told by managers or other loan officers that, when applicants did not provide their race or ethnicity, they should select non-Hispanic white (regardless of whether that was accurate),” the CFPB said in its consent order. According to the bureau, the system programming that created this hard stop was in place from 2014 through October 2017, and the practice of entering non-Hispanic white into the system whether it was true or not was not limited to a “specific location, loan officer, or time period,” the CFPB said. During the time period in question, Freedom employed more than 700 loan officers at a time in six to eight call centers and generated most of its HMDAreportable loan applications through these call centers. According to the bureau, this misreporting of HMDA data was found when the bureau reviewed audio recordings of loan applications being taken over the phone. The CFPB’s consent order states that out of approximately 430 applicants from

2014 through part of 2017 reviewed by the CFPB, at least 125 applicants did not provide the requested race and/or ethnicity, but Freedom reported these applicants as non-Hispanic white. Freedom also misreported borrower data in an additional way in approximately 300 cases. According to the CFPB, Freedom incorrectly reported mortgage applicants as non-Hispanic white even though the applicants had stated that they were not white. As a result, Freedom overstated its number of non-Hispanic white applicants. “Much of [Freedom’s] loan officers’ reporting of incorrect race, ethnicity, and sex information was intentional,” the CFPB concluded. The bureau noted that Freedom “in the interest of compliance and resolution of the matter, and without admitting or denying any wrongdoing,” consented to the settlement. Under the terms of the settlement, Freedom must pay a civil money penalty of $1.75 million and “take steps to improve its compliance management to prevent future violations.” In a statement, Freedom noted that no customers were harmed by the reporting issues. “Freedom Mortgage values and respects its relationship with all its customers and all consumers considering home financing. As one of the nation’s 10 largest mortgage lenders, Freedom Mortgage has experienced tremendous growth over the past five years by constantly improving business processes to create great lending experiences for customers,” Freedom Mortgage said in a statement. “While the issue raised by the CFPB has resulted in no harm to our customers, Freedom Mortgages takes reporting consumer information very seriously and is fully cooperating with the CFPB on this matter,” the company continued. “The company is and has always been committed to ensuring compliance with data collection, recording and reporting requirements as well as delivering a high quality customer experience,” the company concluded.

Kudos Nick Maddocl Erica Davis

GIVING BACK

• PLAZA HOME MORTGAGE DONATES $11,441 TO SUPPORT AUTISM TREATMENT Plaza Home Mortgage donated $11,441 to Red Autismo, a non-profit organization based in Los Cabos, Mexico, that provides alternative treatment options to families of children with Autism Spectrum Disorder. The lender said the funds were a result of contributions from wholesale and correspondent loans brought in by Plaza account executives who won its 2018 Select Circle sales rewards and recognition program. The winners recently attended an awards trip in Cabo San Lucas, where the company wanted to give back to the community. “It is an honor to contribute to Red Autismo and to help them provide the necessary therapeutic and support services for children with ASD and their families,” said James Cutri, Plaza co-founder and vice chairman. “Today, one in 59 children are diagnosed with ASD, so we are extremely proud to be one of Red Autismo’s corporate contributors that can help them achieve their goals in their community.” 94 HOUSINGWIRE ❱ AUGUST 2019

REAL ESTATE INDUSTRY UNITES TO RAISE FUNDS FOR DIABETES RESEARCH More than 60 real estate companies faced off at the JDRF Real Estate Games in New York City in June. The event raises money for JDRF, which raises money for type one diabetes research. As part of the games, participating companies competed against one another in dodgeball, a “Hot Shot” basketball competition, rock climbing relay races and Jenga-like tower power challenge. Participating teams were drawn from a wide range of companies from the housing industry and include Bank of America, Blackstone, Boston Properties, Brookfield Office Properties, Clune Construction, Douglaston Development, The Durst Organization, Eastdil Secured, Empire Realty Trust, Fisher Brothers, Fried Frank Harris Shriver & Jacobson, Glenwood Management, Hines, JLL, Langan, Newmark Knight Frank, REBNY, Rudin Management, Savills, SL Green Realty Corp., Tishman Realty, Tishman Speyer, Two Trees Management and Vornado Realty Trust. Sponsors for the event included companies such as 99 Solutions, Colliers, AECOM, Chiesa Shahinian & Giantomasi, Cushman & Wakefield, Deloitte, Donald Zucker, Gensler, Gibson Dunn, Good Hill Partners, Global Strategy Group, Greenberg Traurig, Jamestown, Kasirer, L&L Holding Company, Lalezarian, Loeb & Loeb LLP, Loffredo Brooks, Marathon Strategies, Mercury Public Affairs, Muss Development, Proskauer Rose, Rockrose Development Corp., RXR Realty, SKDKnickerbocker, Solow Management, TF Cornerstone and WeWork. With support from Tishman Speyer for the team fundraising challenge, additional donors to the games include the Ackman-Ziff Real Estate Group, Abrams Garfinkel Margolis Bergson, Aethos, LLP, Avison Young, The Brodsky Organization, Carlyle Group, Gotham Organization, The Hudson Companies, Kensington Vanguard, Lazard, LCOR, Lettire Construction, Plaza Construction, Jack Resnick & Sons and Wells Fargo. The JDRF Real Estate Games originated in the Washington, D.C., area 26 years ago, and last year expanded to Chicago with plans for further expansion in 2020. The three events raised over $1.3 million for T1D research in 2019.

Brandon Andrews

AWARDS • GUILD MORTGAGE ORIGINATORS WIN FREDDIE MAC HOME POSSIBLE RISE AWARD Three loan officers from Guild Mortgage won Freddie Mac’s Home Possible RISE Award. Brandon Andrews, Erica Davis and Nick Maddock were recognized for helping low- to moderateincome homebuyers achieve homeownership. RISE, which stands for Recognizing Individuals for Sustained Excellence, is an annual program designed to recognize Freddie Mac’s top clients for their exceptional performance across multiple categories with Home Possible mortgages, Freddie Mac’s affordable lending program. “We focus on providing innovative programs and products that deliver the promise of home to more potential buyers in the communities we serve,” said Mary Ann McGarry, Guild Mortgage president and CEO. “We are honored to work with Freddie Mac to meet a broad range of homebuyer needs, and thank Brandon, Erica and Nick for their outstanding work serving their communities. They are each deserving of the Home Possible RISE Award recognition.”

BY THE NUMBERS

INDEPENDENT MORTGAGE BANKS REPORT A PROFIT Independent mortgage banks and mortgage subsidiaries of chartered banks reported a net gain of $285 on each loan they originated in the first quarter, up from a reported loss of $200 per loan in the fourth quarter, the Mortgage Bankers Association reported. The MBA Quarterly Mortgage Bankers Performance Report said average pre-tax production profit rose to seven basis points in the first quarter, up from an average net production loss of 11 basis points in the fourth quarter and 15 basis points from a year ago.

“Independent mortgage bankers experienced improvements in the first three months of the year,” said Marina Walsh, MBA vice president of industry analysis. “This was a welcoming sign following a very difficult end of 2018, in which profitability reached its lowest level since our survey’s inception in 2008. Mortgage application volume picked up strongly towards the end of the first quarter as rates dropped, increasing the pipeline of loans for the second quarter. Given the drop in rates, lenders also enjoyed a boost in secondary marketing gains.”

Q1 2019 vs Q4 2018

IMB profit:

$285 vs. -$200

Purchase share of total originations:

76% vs 79% Production revenue per loan:

$9,584 vs. $8,411 96 HOUSINGWIRE ❱ AUGUST 2019

Net secondary marketing income per loan:

$7,591 vs. $6,466 Average production volume per company:

$385 million vs $440 million

Average loan balance for first mortgages:

$257,374 vs. $253,689

Loan production expenses:

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QUOTES FROM THE EXPERTS

DID YOU KNOW

AN INTERVIEW WITH TOP ORIGINATORS Loan originators are still working to regain the trust of homeowners after the housing crisis. This is just one of the many reasons why marketing has become an essential part of the LO’s job. At HousingWire’s engage.marketing conference in Charlotte, North Carolina, Movement Mortgage Senior Loan Officer Lindsey Goins and MVB Mortgage Senior Loan Officer Daniel McCoy and Mount Diablo Lending Broker/Owner Ramon Walker talked about the LO/marketing relationship.

“Working with good people on interesting problems is what I’ve always liked doing. Online notary is a very interesting problem, a re-envisioning of a process that has been around forever, but has barely changed.” -Goins

Marketing “You got to get back to playing offense. When you’re busy you’re playing defense, you’re taking the calls and making the calls. Good marketing takes away three to four conservations so you can get that transaction and save time.” -McCoy

“Entering the business in 2012, loan officers did not have a good reputation. So, for me, I pride myself a lot on being honest and being a woman of my word. And I really took it seriously on what my brand was going to be. I knew I had to develop my own personal brand, but in a way that could reach people, and I did that through my daily interactions with clients, Realtors or the business professional sending me the deal.” -Goins

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“Something that has changed a lot just in the last few years is video marketing; it’s just what we look at every single day on Instagram. So, for me, with video marketing you can get specific to your process.” -Goins