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Idaho Association of Mortgage ProfessionalsP.O. Box 7981 � Boise, ID 83707

Phone #: (208) 321-9309 � Fax #: (208) 321-4819E-mail: [email protected]

Web Site: http://www.idahomortgageprofessionals.org

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For information on all IAMP events, call (208) 321-9309 or visit www.idahomortgagebrokers.com.

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JUNE 2011Thursday, June 9

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1:00 p.m. Shotgun StartHeadlines and breaking news from NationalMortgageProfessional.com.

Headlines and blogs from around the web.

IAMP OFFICERS & DIRECTORSPhone # E-mail

Tyler Porter President (208) 389-4709 [email protected]

Alison Gillespie Treasurer/Secretary (208) 378-1013 [email protected]

Steve Cox National Director (208) 514-3978 [email protected]

Chuck Anderson Northern Director/

National Director (208) 449-1789 [email protected]

JJ Astorquia Director (208) 389-4709 [email protected]

Tom Birch Director (208) 343-4065, ext. 111 [email protected]

Bryan Booth Director (208) 409-1731 [email protected]

Travis Dyson Director (208) 608-0059 [email protected]

Michelle Guth Director (208) 853-7878 [email protected]

Chad Harding Director (208) 406-1176 [email protected]

Mark Rodeghiero Director (208) 939-2228 [email protected]

Kathy Smith Director/NAMB WEST Delegate (208) 230-5284 [email protected]

Scott Stingley Director (208) 387-7414 [email protected]

Shanna Wroten-Tucker Director (208) 388-0500 [email protected]

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Advisor Asset Protection Management Bank President Branch Manager Business Analyst Business Development Manager

Client Relationship Manager Client Relationship Specialist Collateral Asset Manager Commercial Loan Officer Corporate Sales Credit Analyst Inside Sales Legal Assistant Licensing Assistant

Loan Administration Manager Loan Originator Mortgage Loan Processor Mortgage Originator National Account Manager National Sales Rep PC Support Admin

Post Closing QC Expert Processor Regional Vice President REO Closer Retail Branch Manager Retirement Planner Reverse Mortgage Specialist Sales Manager

Secondary Marketing Analyst Senior Loan Officer Senior Underwriter Senior Vice President Software Engineer Underwriter Vice President Wholesale Account Executive

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Expanding Realtor Relationships By Stephen A. Marrs 26

Social Media: More Than Just a Buzzword By Chad Jampedro 27

Building Business Relationships Via Social Media By John Seroka 27

Internet Connections … It’s Not What You Think! By BJ Bounds 28

A Roadmap for Building Relationships With Key Sources By Casey Cunningham 30

Is Building Relationships on Social Media Worth It? By Joy Gendusa 31

Truth in Marketing By LoyaltyExpress 12

Value Nation: Appraisers Must be Paid More By Charlie W. Elliott Jr., MAI, SRA, ASA 14

Forward on Reverse: FIT for Reverse Mortgage Lenders(Part IX) … Medical Mobility Risk By Atare E. Agbamu 15

NMP Mortgage Professional of the Month: LisaSchreiber, Executive Vice President of WholesaleLending at TMS Funding 16

The Future of the Mortgage Broker and CorrespondentMarkets: The Sequel By Andy W. Harris, CRMS 19

Lykken on Leadership: How Confident Are You? By David Lykken 21

Leaders on the Frontline: Keeping the EntrepreneurialSpirit Alive By Stewart Hunter and Jim McMahan 24

The Secondary Market Overview: From Bonds toProduction … LO Compensation and the Markets By Dave Hershman 25

FHA Insider: FHA Changes Rules on Advertising By Jeff Mifsud 32

The Changing Landscape of Housing Finance By Teresa Bryce Bazemore 38

NMP News Flash: May 2011 4Heard on the Street 10Letters to the Editor 18New to Market 20Mortgage Heroes: A True Neighborhood Hero 22NMP Mortgage Professional Resource Registry 40NMP Calendar of Events 44

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VisitNationalMortgageProfessional.com.

COMPANY WEB SITE PAGE

Accurate Quality Control .................................. www.accurateqc.com ..........................................10

Bay Equity LLC ................................................ www.bayeq.com ....................................................4

Benchmark Mortgage ...................................... www.iambenchmark.info ..............................5 & 24

Calyx Software ................................................ www.calyxsoftware.com ......................................32

Elliott and Company Appraisers, Inc................... www.appraisalanywhere.com ................................31

FindMortgageJobs.com .................................... www.findmortgagejobs.com ................................ID4

Flagstar Wholesale Lending .............................. www.wholesale.flagstar.com ....................Back Cover

Freedom Mortgage .......................................... www.fmbranch.com ......................Inside Back Cover

Frost Mortgage Lending Group .......................... www.frostmortgage.com/nmp ..............................34

GSF Mortgage Corporation ................................ www.gsfprobranch.com ........................................39

Guaranteed Home Mortgage.............................. www.joinguaranteed.com ....................................33

HVCC Appraisal Ordering .................................. www.hvccappraisalordering.com ..........................29

Icon Residential Lenders, LLC ............................ www.iconwholesale.com ........................................9

Loyalty Express ................................................ www.loyaltyexpress.com ......................................12

Majestic Security LLC ........................................ www.majesticsecurityidsafe.com/nmp.htm ............19

MortgageProShop.com...................................... www.mortgageproshop.com ..................................44

Mortgage Dashboard ........................................ BetterMortgageSoftware.com ................................35

NAPMW .......................................................... www.napmw.org ..................................................13

Nationwide Equities Corp. ................................ www.nwecorp.com ................................................8

PB Financial Group Corp. .................................. pbfinancialgrp.com ..............................................31

REMN (Real Estate Mortgage Network)................ www.remnwholesale.com ....................................37

Ridgewood Savings Bank .................................. www.ridgewoodbank.com ......................................6

StreetLinks National Appraisal Services .............. www.streetlinks.com/SCORe ..........Inside Front Cover

TMS Funding.................................................... www.tmsfunding.com ..........................................11

United Northern Mortgage Bankers Ltd. ............ www.unitednorthern.jobs ..............................29 & 36

US Mortgage .................................................... www.usmortgage.com ............................................7

USA Cares ........................................................ www.usacares.org ................................................22

Windvest Corporation ...................................... www.windvestcorp.com ........................................23

National Mortgage Professional Magazine

TABLE OF CONTENTSNA

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ORTGAGE PROFESSIONAL

MAGAZINE

NMPNMP

A Special Look at “Building Relationships”

Features

Columns

May 2011 Volume 3, Number 5

A Message From NMP Media Corp.Executive Vice President Andrew T. Berman

Building relationshipsBuilding relationships in a hyper-connected world really isn’t much different than when“Add to Your Network” meant filing a contact’s business card in your Rolodex. Instead, wenow use tools like CardMunch (a LinkedIn company) to scan, add to your address book andconnect on LinkedIn. While the tools have changed to allow increased connectivity and tobuild those connections into mutually-beneficial relationships, it’s still your ideas, thought-fulness and willingness to help others that build your relationships … whether it’s throughFacebook, Twitter or your top real estate referral partner’s open house.

Our special look at building relationships starts off with a piece from Stephen A. Marrsof Gold Star Financial discussing how showing your real estate agent referral partners lots of support andlove will help you build a fruitful relationship for years to come. Casey Cunningham of XINNIX looks at tar-geting the right sources in fostering new business relationships. This section also includes four articles fromsome of the brightest marketing minds in the mortgage industry talking about social media. We’ve got ChadJampedro of GSF Mortgage talking about how you should be genuine and yourself on social media. JohnSeroka of PR firm Seroka with a strategic plan behind building relationships via social media (hint … it’s notabout the number of followers). BJ Bounds of Calyx Software breaks down Twitter and Facebook and deter-mining what is the right option for you. Rounding out the section is an article from Joy Gendusa ofPostcardMania detailing a number of ways how to actually generate leads from social media.

The future of housing financeThis month’s issue also features a great article from Andy Harris, CRMS on “The Future of the Mortgage Brokerand Correspondent Markets.” This story is a follow-up piece that Andy did back in July 2010. In this article, Andytakes a step back from his role as a mortgage broker to evaluate the changes that our industry is facing and howthey impact the mortgage broker and correspondent lenders. As we face these changes, strong leadership is cru-cial for the growth of mortgage companies, and our good buddy, David Lykken with his “Lykken on Leadership”column this month, gives an analogy between the mortgage banking industry and the famed Apollo 13 mission.

Crucial to the growth of mortgage companies is keeping the entrepreneurial spirit alive, and mortgagebanking experts Stewart Hunter and Jim McMahan share their thoughts on this topic in their “Leaders onthe Frontline” column on page 24. At the recent Regional Mortgage Bankers Association Conference inAtlantic City, N.J., we had the pleasure of hearing Teresa Bryce Bazemore, president of Radian Guaranty,discuss the rise in FHA premiums and the efforts of the FHA to return to its role as a less dominant play-er in the housing finance industry. Read more about the growing role of private mortgage insurance com-panies like Radian as we deal with GSE reform, QRM and other obstacles the mortgage industry faces inTeresa’a article, “The Changing Landscape of Housing Finance,” on page 38.

Mortgage Professional of the MonthThis month’s Mortgage Professional of the Month is Lisa Schreiber, executive vice president of wholesalelending at TMS Funding, the wholesale lending channel of Total Mortgage Services. Lisa is a long-time heroof the wholesale business and dedicated fighter in keeping the mortgage broker alive and thriving fordecades. Like most, she wound up in the mortgage business by accident, but learned just about every facetof the business, from processing to underwriting and even servicing. It seems to be the best leaders in themortgage business are the ones who have been involved in every area of real estate finance, and Lisa is aprime example of that. Moreover, through the years, I have personally worked with dozens of mortgage pro-fessionals around the country who have showered Lisa with praise about how great of a leader she is. I findit amazing that she was such a driving force in mortgage banking, while being a single mother and veryactive in personal passion projects, such as rehabilitating schools in West Africa and as an advisor to an NGO.Read more about Lisa and her commitment to the mortgage broker beginning on page 16 of this issue.

Rounding things outAlso in this issue, LoyaltyExpress discusses “Truth in Marketing” in its new column on page 12; Charlie W.Elliott Jr. presents his arguments on why appraisers should be paid more on page 14; Atare E. Agbamu dis-cussing reverse mortgages and post-illness medical care on page 15; a look at Mortgage Hero RachelDonovan of Legacy Mortgage in Albuquerque, N.M. on page 22 and Dave Hershman analyzes LO compen-sation and the financial markets on page 25.

Until next month …

Andrew T. Berman, Executive Vice PresidentNMP Media Corp.

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May 2011Volume 3 • Number 5

1220 Wantagh Avenue • Wantagh, NY 11793-2202Phone: (516) 409-5555 / (888) 409-9770

Fax: (516) 409-4600Web site: NationalMortgageProfessional.com

Mortgage PROFESSIONALN A T I O N A L

M A G A Z I N E

Your source for the latest on originations, settlement, and servicing

STAFFEric C. Peck

Editor-in-Chief(516) 409-5555, ext. 312

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Andrew T. BermanExecutive Vice President(516) 409-5555, ext. 333

[email protected]

Domenica TrafficandaArt Director

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Karen KrizmanSenior National Account Executive

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Jon BlakeAdvertising Coordinator(516) 409-5555, ext. 301

[email protected]

Tara CookBilling Coordinator

(516) 409-5555, ext. [email protected]

ADVERTISINGTo receive any information regarding advertising rates, deadlines and require-ments, please contact Senior National Account Executive Karen Krizman at(516) 409-5555, ext. 326 or e-mail [email protected].

ARTICLE SUBMISSIONS/PRESS RELEASESTo submit any material, including articles and press releases, pleasecontact Editor-in-Chief Eric C. Peck at (516) 409-5555, ext. 312 or [email protected]. The deadline for submissions is the first ofthe month prior to the target issue.

SUBSCRIPTIONSTo receive subscription information, please call (516) 409-5555, ext.301; e-mail [email protected] or visit www.nationalmort-gageprofessional.com. Any subscription changes may be made to theattention of “Circulation” via fax to (516) 409-4600.

Statements, articles and opinions in National Mortgage Professional Magazineare the responsibility of the authors alone and do not imply the opinion orendorsement of NMP Media Corp., or the officers or members of NationalAssociation of Mortgage Brokers and its State Affiliates (NAMB), NationalAssociation of Professional Mortgage Women (NAPMW), National CreditReporting Association (NCRA) and/or other state mortgage trade associations.

Participation in NAMB, NAPMW, NCRA, and/or other state mortgagetrade associations events, activities and/or publications is available ona non-discriminatory basis and does not reflect the endorsement of theproduct and/or services by NMP Media Corp., NAMB, NAPMW, NCRA,and other state mortgage trade associations.

National Mortgage Professional Magazine, NAMB, NAPMW, NCRA,and/or other state mortgage trade associations do not make any misrepre-sentations or warranties concerning the regulatory and/or complianceaspects of advertisers, products or services and/or the editorial content con-tained in NMP Media Corp. publications. National Mortgage ProfessionalMagazine and NMP Media Corp. reserve the right to edit, reject and/or post-pone the publication of any articles, information or data.

National Mortgage Professional Magazineis published monthly by NMP Media Corp.

Copyright © 2011 NMP Media Corp.

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MORTGAGE PROFESSIONAL

MAGAZINE

NMPNMPSign-on weekly at nmpmag.com/lykkenonlending

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National Credit Reporting Association Inc.125 East Lake Street, Suite 200 � Bloomingdale, IL 60108

Phone #: (630) 539-1525 � Fax #: (630) 539-1526Web site: www.ncrainc.org

The National Association of Mortgage Brokers

11325 Random Hills Road, Suite 360Fairfax, VA 22030

Phone #: (703) 342-5900 � Fax #: (703) 342-5905

President—Michael D’Alonzo, CMCCreative Mortgage Group1126 Horsham Road, Suite DMaple Glen, PA 19002(215) 657-9600 � [email protected]

Vice President—Donald J. Frommeyer, CRMSAmtrust Mortgage Funding Inc.200 Medical Drive, Suite DCarmel, IN 46032(317) 575-4355 � [email protected]

Secretary—Virginia Ferguson, CMCHeritage Valley Mortgage Inc.5700 Stoneridge Mall Road, Suite 225Pleasanton, CA 94588(925) 469-0100 � [email protected]

Treasurer—John Councilman, CMC,CRMSAMC Mortgage Corporation2613 Fallston RoadFallston, MD 21047(410) 557-6400 � [email protected]

Immediate Past President—Jim Pair, CMCMortgage Associates Corpus Christi6262 Weber Road, Suite 208Corpus Christi, TX 78413(361) 853-9987 � [email protected]

Michael Anderson, CRMSEssential Mortgage3029 S. Sherwood Forest Boulevard, Suite 200Baton Rouge, LA 70816(225) 297-7704 � [email protected]

Donald Fader, CRMSSMC Home FinanceP.O. Box 1376Kinston, NC 28503-1376(252) 523-5800 � [email protected]

Deb Killian, CRMSCharter Oak Lending Group LLC3 Corporate Drive, P.O. Box 3196Danbury, CT 06813-3196(203) 778-9999, ext. 103 � [email protected]

Olga Kucerak, CRMSCrown Lending222 East Houston, Suite 1600San Antonio, TX 78205(210) 828-3384 � [email protected]

Walter ScottExcalibur Financial Inc.175 Strafford Avenue, Suite 1Wayne, PA 19087(215) 669-3273 � [email protected]

Tom ConwellPresident(248) 473-7400 [email protected]

Donald J. UngerVice President(303) 670-7993, ext. [email protected]

Daphne LargeTreasurer(901) [email protected]

Marty FlynnEx-Officio(925) 831-3520, ext. [email protected]

William BowerDirector—Tenant Screening Chair(800) [email protected]

Mike BrownDirector—Technology Chair(800) [email protected]

Susan CataldoDirectorEducation & Compliance Chair(404) 303-8656, ext. [email protected]

Janet CurtisDirector—New Membership & Elections Co-Chair (212) [email protected]

Renee EricksonDirector—Tenant Screening Co-Chair(800) 311-1585, ext. [email protected]

Nancy FedichDirector—Conference Chair(908) 813-8555, ext. [email protected]

Judy Ryan Director—New Membership & Elections Chair(800) 929-3400, ext. [email protected]

Tom SwiderDirector—Legislative Co-Chair(856) 787-9005, ext. [email protected]

Terry ClemansExecutive Director(630) [email protected]

Jan Gerber Office Manager/Membership Services(630) [email protected]

PresidentGary Tumbiolo, CMI(919) 452-1529 [email protected]

President-ElectLaurie Abshier, GML, CMI(661) 283-1262E-Mail: [email protected]

Senior Vice PresidentCandace Smith, CMI, CME (512) [email protected]

Vice President—Northwestern RegionJill M. Kinsman(206) 344-7827 [email protected]

Vice President—Western RegionTim Courtney(760) [email protected]

Vice President—Central RegionLisa Puckett(405) [email protected]

Vice President—Eastern RegionChristine Pollard(646) [email protected]

SecretaryMurielle Barnes, CME(806) 373-6641 [email protected]

TreasurerHulene Bridgman-Works(972) 494-2788 [email protected]

Parliamentarian Dawn Adams, GML, CMI(607) [email protected]

NAMB Board of Directors

National Association of ProfessionalMortgage Women

P.O. Box 451718 � Garland, TX 75042Phone #: (800) 827-3034 � Fax #: (469) 524-5121

Web site: www.napmw.org

Officers

Directors2011 Board of Directors & Staff

National Board of Directors

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OCC, OTS and Fed HitMortgage Servicers WithEnforcement Action

The Office of theComptroller of theCurrency (OCC), theOffice of Thrift

Supervision (OTS) and the Federal ReserveBoard (FRB) have announced they havecollectively taken enforcement actionsagainst eight national bank mortgage ser-vicers and two third-party servicerproviders for unsafe and unsound prac-tices related to residential mortgage loanservicing and foreclosure processing.

The eight servicers in question includeBank of America, Citibank, HSBC,JPMorgan Chase, MetLife Bank, PNC, U.S.Bank, and Wells Fargo. The two serviceproviders are Lender Processing Services

Inc. (LPS) and its subsidiaries DocX LLC,and LPD Default Solutions Inc.; and MER-SCORP and its wholly-owned subsidiary,Mortgage Electronic Registration SystemsInc. (MERS).

“These comprehensive enforcementactions, coordinated among the federalbanking regulators, require major reformsin mortgage servicing operations,” saidacting Comptroller of the Currency JohnWalsh. “These reforms will not only fix theproblems we found in foreclosure process-ing, but will also correct failures in gover-nance and the loan modification processand address financial harm to borrowers.Our enforcement actions are intended tofix what is broken, identify and compen-sate borrowers who suffered financialharm, and ensure a fair and orderly mort-gage servicing process going forward.”

The enforcement actions require theservicers to promptly correct deficiencies inresidential mortgage loan servicing andforeclosure practices that examiners iden-tified in reviews conducted during thefourth quarter of 2010. The actions requirethe servicers to make significant improve-ments in practices for residential mortgageloan servicing and foreclosure processing,including communications with borrowersand dual-tracking, which occurs when ser-vicers continue to pursue foreclosure dur-ing the loan modification process.

The actions taken by the OCC, OTSand FRB require that each servicer totake a number of steps, including mak-ing significant revisions to certain resi-dential mortgage loan servicing andforeclosure processing practices. Eachservicer must, among other things, sub-mit plans acceptable to the FRB that:

� Strengthen coordination of commu-nications with borrowers by provid-ing borrowers the name of the per-son at the servicer who is their pri-mary point of contact;

� Ensure that foreclosures are notpursued once a mortgage has beenapproved for modification, unlessrepayments under the modifiedloan are not made;

� Establish robust controls and over-sight over the activities of third-party vendors that provide to theservicers various residential mort-gage loan servicing, loss mitigation,or foreclosure-related support,including local counsel in foreclo-sure or bankruptcy proceedings;

� Provide remediation to borrowerswho suffered financial injury as aresult of wrongful foreclosures orother deficiencies identified in areview of the foreclosure process; and

� Strengthen programs to ensurecompliance with state and federallaws regarding servicing, generally,and foreclosures, in particular.

“MERS provides an important, depend-able service for homeowners, their com-munities, the mortgage industry, and reg-ulators. The Interagency Review providedus with some clear guidance on how wecan do better,” said MERS Chairman KurtPfotenhauer. “MERS brings value to thereal estate system today, and we’re confi-dent that the changes we’re making willenhance that value.”

Actions taken against the servicers arebased on the findings of examinationsconducted as part of the interagency hor-izontal reviews undertaken by the federalbanking regulators in the fourth quarter of2010. Examinations of these eight nation-al bank servicers identified significantweaknesses in mortgage servicing andforeclosure governance that resulted inunsafe and unsound practices.

The scope and degree of these prac-tices differed among the servicers;however, based on the sample of filesreviewed by OCC examiners, borrowersin the sample were seriously delin-quent at the time of foreclosures andservicers held the notes and documentsrequired to foreclose.

FHFA Orders GSEs to AlignGuidelines for ServicingDelinquent Mortgages

Federal Housing FinanceAgency (FHFA) ActingDirector Edward J.DeMarco has directedFannie Mae and FreddieMac (the government-

sponsored enterprises) to align theirguidelines for servicing delinquent mort-gages they own or guarantee. The updat-ed framework will establish uniformservicing requirements, as well as mone-tary incentives for servicers that performwell and penalties for those that do not.

“FHFA’s directive to align enterprisepolicies for servicing delinquent mort-gages should result in earlier servicerengagement to identify the best solu-tion available for homeowners, giventheir individual circumstances,” saidFHFA Acting Director DeMarco.

The updated guidelines also addressthe so-called “dual track” by requiringservicers to contact borrowers as soon asthey become delinquent and focus sole-ly on remediating that delinquency. Theforeclosure process may not commenceif the borrower and servicer are engagedin a good faith effort to resolve the delin-quency. The servicer must conduct a for-mal review of each case to ensure a bor-rower has been considered for foreclo-sure alternatives before the loan isreferred for foreclosure. Even after fore-closure processing begins, financialincentives are provided to encourageservicers to continue to help borrowerspursue a foreclosure alternative.

Consistent with statements recentlyissued by federal and state regulators,this initiative is intended to deal withidentified problems in mortgage servic-ing. The updated framework will stream-line and expedite borrower outreach,align mortgage modification terms andrequirements, and establish a consistentschedule of performance-based incen-tive payments and penalties. Fannie Maeand Freddie Mac will each issue detailedguidelines to their servicers in the sec-ond and third quarters of 2011.

“Once fully implemented by the serv-icing industry, the enterprises’ alignedpolicies should give homeowners agreater understanding of the processand faster resolution by requiring earli-er contact, more frequent communica-tion, and prompt decisions,” saidDeMarco. “Equally important, the newlyaligned policies will minimize taxpayerlosses by ensuring that enterprise loansare serviced efficiently and fairly.”

U.S. Slaps Deutsche BankWith $1 Billion Buybackfor MortgageIT Loans

U.S. Attorney PreetBharara has filed amortgage fraud suitin U.S. District Court

in Manhattan against Deutsche Bankand its subsidiary, MortgageIT. The suitclaims that MortgageIT lied about thequality of its lending practices in order

continued on page 6

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to take advantage of the U.S.Department of Housing & UrbanDevelopment’s (HUD) and the FederalHousing Administration’s (FHA) mort-gage insurance program. The govern-ment’s complaint seeks damages andcivil penalties under the False ClaimsAct for repeated false certificationsmade to HUD in connection with theresidential mortgage origination andsponsorship practices of MortgageIT.To date, the FHA has paid insuranceclaims on more than 3,100 mortgages,totaling $386 million, for mortgagesendorsed by MortgageIT.

According to the complaint filed inManhattan federal court: In a 10-yearspan between 1999-2009, MortgageITwas an approved direct endorsementlender, having endorsed more than39,000 mortgages for FHA insurance,totaling more than $5 billion in under-lying principal obligations. These mort-gages were highly marketable for resaleto investors because they were insuredby the full faith and credit of the UnitedStates. MortgageIT and Deutsche Bank,which acquired MortgageIT in January2007, made substantial profits throughthe re-sale of these endorsed FHA-insured mortgages.

According to the complaint,MortgageIT repeatedly made false certifi-cations to HUD to obtain approval of

mortgages that MortgageIT underwriterswrongfully endorsed for FHA insurance.These mortgages were not eligible forFHA insurance under HUD rules.Notwithstanding the mortgages’ ineligi-bility, underwriters at MortgageITendorsed the mortgages by falsely certify-ing that they had conducted the due dili-gence required by HUD rules when, infact, they had not. By endorsing ineligiblemortgages and falsely certifying compli-ance with HUD rules, MortgageIT wrong-fully obtained approval of these ineligiblemortgages for FHA insurance, therebyputting millions of FHA dollars at risk.

In addition, MortgageIT and DeutscheBank never implemented the qualitycontrol (QC) procedures required ofdirect endorsement lenders, but falselycertified to HUD that MortgageIT had therequired procedures in place. On variousoccasions when HUD discovered evi-dence that MortgageIT was violating theQC requirement, MortgageIT falsely stat-ed the failures had been corrected.

“As alleged, MortgageIT andDeutsche Bank ignored every type of redflag and breached every duty of due dili-gence before underwriting thousands offederally insured mortgages,” said U.S.Attorney Bharara. “While the homes thedefendants issued loans for may havebeen built on solid ground, the defen-dants’ lending practices were built on

quicksand. Ultimately, prudence wastrumped by profit, and good faith tooka back seat to good fees. This is exactlythe kind of misconduct that our CivilFrauds Unit was created to combat.”

In 2004, MortgageIT contractedTena Companies Inc. to conduct QCreviews of closed FHA-insured loans.Tena prepared its findings in lettersdetailing rampant underwriting viola-tions found in FHA-insured loansunderwritten by MortgageIT’s branchlocation in Chicago. No one atMortgageIT read the Tena reports whenthey arrived in 2004, as the finding let-ters were forwarded to MortgageIT’sManhattan base of operations andstored in a closet.

“I personally believe there is no waythat all 39,000 loans are bad,” saidTommy A. Duncan, CMT of QualityMortgage Services LLC. “A test of 10 per-cent is what is needed to prove whatpercentage of loans are good, andDeutsche Bank then could have cause todismiss the action.”

Shortly after, MortgageIT hired itsfirst QC manager in December of 2004,who requested to review the Tena find-ings only to be shown a closet contain-ing the unopened letters. MortgageIT’sneglect of the Tena findings preventedthe company from taking actiontowards amending these fraudulentunderwriting practices.

The government’s complaint seekstreble damages and penalties under theFalse Claims Act for the insurance claimsalready paid by HUD for mortgages

wrongfully endorsed by MortgageITthrough the false statements of DeutscheBank and MortgageIT. In addition, theUnited States seeks compensatory andpunitive damages under the commonlaw theories of breach of fiduciary duty,gross negligence, negligence and indem-nification for the insurance claims thatHUD expects to pay in the future formortgages wrongfully endorsed byMortgageIT as a result of Deutsche Bank’sand MortgageIT’s false statements.

Class Action Suit AgainstSaxon Alleges Illegal Useof HAMP

A class action law-suit has been filedagainst Saxon

Mortgage Inc., the Morgan Stanley mort-gage servicer division, claiming that thecompany uses the Homeowners AffordableModification Program (HAMP) to lure cus-tomers into making “trial” payments onloans it has no intention of ever perma-nently modifying. The suit, Gaudin v.Saxon Mortgage Services Inc., was filed inthe Northern District of CaliforniaFederal Court by Peter Fredman of theLaw Office of Peter Fredman and DanielMulligan of Jenkins Mulligan & GabrielLLP. The suit alleges a pattern of miscon-duct by Saxon of collecting trial pay-ments, delaying the processing of loanmodifications, and then denying theapplication altogether for demonstrablyfalse reasons.

continued on page 8

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The lead plaintiff, Marie Gaudin, theowner of a San Francisco bridal boutiquethat suffered hard times as a result of therecession brought on by the mortgage cri-sis, asked Saxon for loan modification onher underwater Daly City, Calif. home.Gaudin was directed to Saxon’s “HomePreservation Department” and providedextensive documentation of her financialcondition. Saxon assured her it was “com-mitted to assisting you in any way we canto complete the [the loan modification].We want to help!” It sent her a writtenagreement that seemed to promise a per-

manent HAMP loan modification after shemade three “trial” payments to prove shecould.

The complaint notes that Saxoninstead delayed the processing of theloan modification, while urging her tocontinue making trial payments. Afterreceiving numerous trial paymentsand fulfilling the rest of her obliga-tions under the agreement, Saxondenied her a permanent modificationfalsely claiming that she had failed tomake payments or comply with docu-ment requests. Saxon’s correspon-

dence with Gaudin shows a pattern ofinaccurate and irresponsible behavioron the part of a major global bank.The company claimed that she did notmake payments, while in the sameletter actually acknowledged that shewas current on all payments. It alsoclaimed that the U.S. TreasuryDepartment was involved in reviewingHAMP applications.

“Saxon and Morgan Stanley are tak-ing advantage of the good faith andintentions of distressed borrowers,”said Fredman. “If they don’t want togive modifications, fine, they shouldface the political music and the floodof foreclosures that will result whenall their underwater borrowers giveup hope. But tricking them into wast-

ing their time and money applying fora modification that Saxon hasabsolutely no intention of handingout is a deceptive debt collectionpractice plain and simple.”

The class action alleges that Saxon’sbreach of contract, rescission and restitu-tion, deceptive debt collection practicesviolated California’s Rosenthal Fair DebtCollection Practices Act (Rosenthal Act)and fraudulent, unlawful, and unfairbusiness practices under California’sUnfair Competition Law (UCL).

Investigation DiscoversFraud Common AmongLoan Mod Providers

Four fair housingorganizations havereleased their find-ings of a year-longundercover investiga-

tion of 80 loan modification companies.The National Fair Housing Alliance, theConnecticut Fair Housing Center,Housing Opportunities Made Equal ofVirginia Inc. and the Miami Valley FairHousing Center have issued the report,“Have I Got a Deal for You! AnUndercover Investigation of MortgageLoan Modification Scams,” which docu-ments the tactics mortgage modifica-tion scammers use to take money fromvulnerable homeowners.

An analysis of the 80 loan modifica-tion companies uncovered commontactics used by scammers to enticehomeowners to use their services:

� 55 percent required an upfront feeto start work or required a low ini-tial fee to conduct minimal work onbehalf of distressed homeowners,such as reviewing loan documents;

� 43 percent guaranteed or prom-ised they could secure a loan mod-ification even before learningabout the homeowners’ financiallimitations;

� 24 percent advised or encouragedhomeowners to stop making theirmortgage payments or to stop con-tacting their lenders;

� 16 percent guaranteed a new, muchlower interest rate ranging betweentwo and six percent on modifiedloans;

� 12 percent discouraged homeown-ers from seeking free help from gov-ernment-approved housing counsel-ing agencies;

� Eight percent encouraged home-owners to provide fraudulent infor-mation to their lenders.

“This is shameful abuse by loanmodification scammers to take advan-tage of desperate homeowners,” saidShanna L. Smith, National FairHousing Association (NFHA) presidentand chief executive officer. “We andour partner organizations will work tosee to it that these companies areprosecuted by the Federal TradeCommission and other federal andstate enforcement agencies.”


continued on page 11

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focused expertise to our respectiveclients that relate to legal and regula-tory compliance within the mortgagebanking and real estate financeindustries.”

The teaming framework between thetwo firms will allow both to pursue,wherever appropriate, joint projectswhere the talents of both firms can beemployed to meet potential clientneeds. Each firm will remain independ-ent of the other.

“The Collingwood Group is pleasedto be joining forces with a well-regard-ed firm such as Patton Boggs,” saidMontgomery. “With Patton Boggs’ legalproficiency and Collingwood’s expertisein both the public and private sectormortgage and financial service indus-tries, there now exists a new and excit-ing opportunity for both our organiza-tions and most importantly for ourclients.”

PIMCO Announces theFormation of NewMortgage REIT

Pacific InvestmentM a n a g e m e n t

Company (PIMCO) has announced theformation of a new real estate financecompany that intends to acquire resi-dential and commercial real estate-related debt. To be called PIMCO REITInc., the Newport Beach, Calif.-basedcompany has filed documents with theU.S. Securities & Exchange Commission(SEC) requesting approval to raise $600million through a public offering ofcommon stock that will trade on theNew York Stock Exchange (NYSE).Jennifer Bridwell, who leads PIMCO’smortgage-related product developmentefforts, will serve as chief executive offi-cer of the new REIT.

Founded in 1971, PIMCO managesinvestments totaling more than $1.2trillion as of Dec. 31, 2010. That figureincluded securitized holdings of morethan $372 billion, of which $46.9 bil-lion were in dedicated directly tomortgage and real estate-relatedstrategies. PIMCO’s other assets con-sisted of $268.6 billion in residentialmortgage-backed securities (RMBS)and $81.6 billion in mortgage creditholdings such as non-agency RMBSand commercial mortgage-backedsecurities (CMBS).

The Collingwood Groupand Patton Boggs FormStrategic Alliance

The CollingwoodGroup LLC hasannounced the

formation of a partnership with PattonBoggs LLP. The partnership combinesthe strength of one of the nation’s pre-mier law firms with one of the top busi-ness advisory groups in the financialservices industry. Patton Boggs’ expert-ise on legal, regulatory and policyissues facing the mortgage bankingindustry will be further enhanced byThe Collingwood Group’s ability toassist clients in defining their businessgoals and identifying ways to strategi-cally implement them.

By leveraging the resources of bothfirms, clients will have access to a morecomplete solution to their industry-related needs. In working together,Patton Boggs and The CollingwoodGroup will provide clients with anunprecedented approach to navigatingthrough industry hurdles, on both thelegal and operational fronts. PattonBoggs and The Collingwood Group willalso collaborate regularly on client-focused written materials, events andmedia outreach.

Patton Boggs’ Mortgage BankingGroup, which is led by Partners RichardAndreano, John Socknat and MichaelWaldron, will spearhead the teamingarrangement on behalf of the firm andin doing so, will work with TheCollingwood Group’s leadership, whichincludes Joe Murin, former presidentand CEO of Ginnie Mae and BrianMontgomery, former Assistant Secretaryfor Housing and Federal HousingCommissioner.

Murin and Montgomery both playedmajor roles in the federal government’sefforts to address the nation’s financialcrisis and restore stability and liquidityto financial markets, and they remainin the spotlight due to their efforts atThe Collingwood Group.

“We’re delighted about the forma-tion of this teaming arrangementwith Patton Boggs. This collaborativeeffort represents the first of its kindin the mortgage banking industry,bringing together thought leaders onhousing and real estate finance withleading legal minds that specialize inthese areas,” said Murin. “This collab-oration will enable us to bring highly continued on page 12

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FinCEN Reports:Mortgage Fraud RisesFour Percent in 2010

The Financial CrimesEnforcement Network(FinCEN) in its latestreport, “MortgageLoan Fraud SAR

Filings in Fourth Quarter and CalendarYear 2010,” has released full year datashowing the number of suspiciousactivity reports (SARs) involving mort-gage loan fraud (MLF SARs) increasedfour percent in 2010 to 70,472 com-pared with 67,507 MLF SARs filed in2009. The report also shows that thegrowth rate of MLF SARs began to slowover the last two to three years.Looking at just the 2010 fourth quarter,filers submitted 18,759 MLF SARs, a onepercent decrease from the 18,884 fil-ings over the same period in 2009.

“FinCEN remains active with lawenforcement and other partner agen-cies to provide lead information and toidentify and combat potential abusesin the mortgage market,” said FinCENDirector James H. Freis Jr. “As a mem-ber of the President’s Financial FraudEnforcement Task Force, FinCEN iscoordinating with the United StatesTrustee Program (USTP) and theFederal Bureau of Investigation (FBI) toidentify potential mortgage loan fraudin a number of areas including identi-fying potential abuse of the bankruptcysystem to facilitate mortgage fraud.”

The FinCEN report found that refer-ences to bankruptcy have steadilyincreased over time in MLF SAR filings.In 2010, six percent of all MLF SARscontained a key term related to bank-ruptcy in the SAR narrative, comparedto one percent in 2006 and 2007. In2010, mortgage loan fraud was cited in54 percent of all SARs referencingbankruptcy fraud, up from 42 percentin 2009. Some MLF SARs specified thetype of bankruptcy filing, most fre-quently Chapter 7, which was cited in27 percent of 2010 reports citing bothbankruptcy and MLF.

Filers in their SARs also calledattention to debt elimination scams asone of the emerging practices. Debtelimination scams were cited in near-ly 1,300 MLF SARs in 2010. In theseSARs, filers noted subjects sending avariety of documents or bogus pay-ment methods to financial institu-tions, in attempts to eliminate or sat-isfy mortgage obligations. SAR filersover the course of 2010 explicitly ref-erenced “flopping” in 112 SARs lastyear. This compares with relativelystable occurrences of suspicious activ-ity involving broker price opinionsand short sales in 2010.

Flopping occurs when a foreclosedproperty is sold at an artificially lowprice to a straw buyer, who quickly sellsthe property at a higher price andpockets the difference. Anecdotal feed-

back on this practice from law enforce-ment and industry sources suggeststhat the volume of related MLF SARs ismuch lower than the actual number ofsuspected flopping incidents. Theincreasingly dated activities reportedon SARs suggests a lack of emphasis onthis type of current activity.

The FinCEN report also contains dataof state, county, and metropolitan sta-tistical area (MSA) by total number ofand per capita filings of MLF SARs. Forinstance, the report shows that Nevadahad the highest number of MLF SARs

per capita in 2010, followed by Florida,California, Illinois and Georgia.

The five MSAs with the highest percapita filings of MLF SARs in 2010 wereMiami, Fla.; Las Vegas; San Jose, Calif.;Riverside, Calif. and Los Angeles. Thefive counties with the highest numberof MLF SARs per capita were Miami-Dade County, Fla.; Gwinnett County,Ga.; Broward and Orange Counties inFlorida; and Nassau County in LongIsland, N.Y.

FinCEN also reported that all types ofSARs filed by depository institutions in2010 fell 3 percent to 697,389 com-pared with 720,309 SARs filed by depos-itory institutions in 2009. But, the totalnumber of SARs filed in 2010 by alltypes of financial institutions covered

by the Bank Secrecy Act grew nearlyfour percent to 1.3 million SARs upfrom 1.9 million filed in 2009.

Your turnNational Mortgage Professional Magazineinvites you to submit any information onregulatory changes, legislative updates,human interest stories or any othernewsworthy items pertaining to themortgage industry to the attention of:

NMP News Flash columnPhone #: (516) 409-5555

E-mail: [email protected]

Note: Submissions sent via e-mail are pre-ferred. The deadline for submissions is the1st of the month prior to the target issue.


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With all of the dramatic changes that have impacted the mortgage industry,none of us should be surprised by the enlightenment that resulted from the real“truth” in lending that surfaced as a result of years of unacceptable standards andguidelines. Anyone could get a loan (no documentation required) … really?The tragedy isn’t that a fallout occurred; but rather, that it didn’t happen sooner.

And through it all, organizations and individuals guided themselves with awide range of policies and procedures. So wide-ranging, perhaps, that the abil-ity to implement fundamental methodologies and best business practices be-came unattainable. But congratulate the loan officers, banks and mortgagecompanies that had the discipline to embrace high standards of “truth” in everyaspect of their business. They are the leaders of our industry today.

So what does it mean to establish “truth” in marketing? At a minimum, itmeans making a sincere commitment to the relationships that surround a busi-ness and continuously sharing time-sensitive information. Homeowners de-serve lifelong guidance to make sound decisions with their money. With steadymarket fluctuations, educational and timely communication will make a bigimpact on savings and wealth.

The next critical component is to lock down privacy and compliance stan-dards so information sharing does not violate conditions. With ever rigorousrules on external communications, removing loose canons in an organizationis mandatory. It is a major liability to produce marketing on the fly. The bestmethod is to create and centralize branded and compliant materials for enter-prise-wide access (with opt-out information integrated). It can be challengingto implement without proper technology and infrastructure—educating cus-tomers, partners and prospects with relevant information requires centralizeddatabases, the ability to mine data and intelligent alerts. It is well worth the in-vestment and effort. A dependency on reactive, rather than proactive processes,results in delayed access to intelligent, actionable data—and the loss of de-served business.

Realizing the power of professionalism and quality is the next importantelement. When marketing initiatives are being assessed, focus on value ratherthan cost. Mass-produced, junk marketing standards should not be consid-ered. With the proper planning, there is no need to utilize them as a vehicle ofcommunication.

The final core components of high-impact marketing are personalization,automation and cross-media. No matter how many contacts exist in a data-base, segmenting them against specific business rules is key to success. Thesame holds true for one-to-one customer relationships with loan officers.Drilling down and delivering communications based on targeted needs of acustomer from the loan officer of record is the best method to generate higherresponse rates. It will also allow loan officers to receive inquiries from cus-tomers they can immediately assist.

The next step is automation, which relies on core methodologies that aredriven by algorithms that recognize specific database attributes and conditionsto push out targeted communications. It greatly minimizes the need to createfragmented marketing pieces. Chaos also disappears, and the heartbeat of anorganization is complimented with timely communications to steadily capturenew business.

Finally, media formats should not be limited or isolated. Print, e-mail andtelephone campaigns are each relevant to an organization. Cross-media allowsinformation to be shared across multiple formats with sensitivity to opt-outrequirements. If a customer asks not to receive e-mail, it is imperative to uti-lize approved methods.

Overall, being relevant and compliant with marketing standards is beingtrue to you, your customers and organization. Taking shortcuts or thinkingthat “something is better than nothing” is ineffective. If you want to rival thecompetition, take marketing seriously and implement effective strategies. Youwill be pleased with the impact it will make.

Woburn, Mass.-based LoyaltyExpress customizes, automates and managesretention marketing programs that yield extraordinary value. For moreinformation, call (877) 938-1175 or visit http://loyaltyexpress.com.

Truthh inn Marketing

heard on the street continued from page 10

clean and maintained homes and thensell them at market prices.

“Selecting Green River Capitalunderscores HomeSteps’ commitmentto working with proven real estate pro-fessionals who have the capacity anddrive to support our goal of stabilizingcommunities and maximizing recover-ies for Freddie Mac and taxpayersthrough the sale of our REO inventory,”said Chris Bowden, vice president ofHomeSteps.

HomeSteps markets and sellsFreddie Mac REO homes to homeown-ers and investors and manages everystage of the REO process, from han-dling title issues after foreclosure toworking with local listing agents tofacilitate a sale.

“Our goal to help stabilize commu-nities aligns with the objective ofFreddie Mac and HomeSteps, which aredevoted to upholding high propertyand sales standards,” said Joe D’Urso,president of Green River Capital. “Weare proud to have been selected to helpHomeSteps’ REO sales and dispositionefforts and look forward to a long-termrelationship with Freddie Mac.”

Realpoint Launches Unitto Evaluate MortgageServicing Firms

Morningstar Inc.,a provider of inde-pendent invest-

ment research, has announced that itsRealpoint unit has launched an opera-tional risk assessment practice to evaluatethe performance of mortgage servicingfirms. The new practice, which is partof Realpoint’s credit ratings business,will complement its long-standing tradi-tion of providing transparency andinsight to investors in structured financetransactions. Michael Gutierrez, former-ly managing director and head of ser-vicer evaluations for Standard & Poor’s,recently joined Morningstar to lead thisbusiness.

“The addition of operational riskassessment capabilities adds anotherimportant component to Realpoint’sanalytical scope,” said Robert Dobilas,chief executive officer of Realpoint.“We can now enhance our transaction-level ratings and analysis of mortgage-backed securities with a comprehen-sive assessment of the operational riskof the parties to the securitizationprocess. Mike Gutierrez and his teamwill use Realpoint’s robust data set,technology, and industry-leading ana-lytics to develop an investor-focusedsolution that will establish a new stan-dard for operational evaluations in thestructured finance market.”

Initially, the unit will be staffed byGutierrez and three senior operationalanalysts: Michael Merriam, RichardKoch, and Mary Chamberlain.

“Realpoint’s well-known focus oninvestor concerns and its highly devel-

LPS’ SoftPro DivisionAdds North AmericanTitle to Its 360 VendorNetwork

Lender ProcessingServices Inc. (LPS),a provider of inte-

grated technology and services to themortgage and real estate industries,has announced that North AmericanTitle Insurance Company is now help-ing its agents become more productiveby making its underwriting productsinstantly available to its agents viaSoftPro 360, a business exchange plat-form offered by LPS’ SoftPro Division.

“We are pleased that North AmericanTitle Insurance Company is now inte-grated with SoftPro 360, allowingagents to order electronic policy jacketswithout leaving their SoftPro work-space,” said Joyce Weiland, LPS SoftPro’spresident. “By using SoftPro 360, agentswill no longer have to go to a separateWeb site, significantly improving theirday-to-day productivity.”

LPS SoftPro’s real estate closing andtitle insurance software seamlesslyintegrates with North American TitleInsurance Company’s products andservices and links to a variety of addi-tional products and services offered byother vendors in the SoftPro 360 net-work. When agents place orders withNorth American Title through SoftPro360, digital copies of electronic policyjackets are returned to them electroni-cally through the SoftPro 360 interface.No data needs to be re-entered—saving time and reducing the likeli-hood of error.

“North American Title InsuranceCompany is proud to do business theold-fashioned way—by listening to ouragents,” said Emilio Fernandez, presi-dent, North American Title. “Our agentsasked us to simplify their lives and doaway with the need to go to a separateWeb site to get products from theirunderwriter. By offering all of ourproducts via SoftPro 360, our agentscan get everything they need from uswithout ever having to leave their pro-duction environment.“

Freddie Mac SelectsGreen River Capital toSell REO Inventory

Green RiverCapital (GRC),

a real estate-owned (REO) property assetmanagement and loss mitigationprovider, has announced that FreddieMac has selected the company to provideREO sales and disposition services to itsreal estate unit HomeSteps. GRC is one ofthree third-party companies that willsupport HomeSteps in all 50 states andhelp the organization maintain and sellproperties in a timely manner, while pre-serving local property values. HomeSteps’Good Neighbor Practices protect neigh-borhoods by requiring agents to show

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any way that works best for them, fromself-managing their appraiser panels,working with multiple AMCs, to a com-bination of both self-management andAMC outsourcing.

Clayton Holdings FormsNew Asset-BackedSolutions Firm

Clayton HoldingsLLC, a leader in

providing customized risk analysis, lossmitigation, operational solutions andstaffing services to the mortgage andfixed-income industries, has announcedthat it is forming an independent finan-cial analysis and consulting group andhas hired a team of seasoned, struc-tured-finance professionals to run thepractice. The new subsidiary, AssetBacked Solutions (ABS) LLC, will focus onproviding litigation support and valua-tion services to market participants inthe structured finance space.

David Lehman has been named pres-ident of ABS and will report to PaulBossidy, chief executive officer ofClayton Holdings LLC. Tyler Simpsonand Florin Nedelciuc were named direc-tors of the new venture, the companysaid.

Among other activities, ABS will pro-vide independent valuations and finan-cial analysis to market participants fac-ing legal challenges linked to the valua-tion of complex structured products andrelated assets. ABS will assist firms andindividuals with issues surrounding thevalue of residential mortgage-backedsecurities (RMBS), whole loans, CDOs(cash and synthetic) and other securitiesthat were issued and sold prior to thecredit crisis. The group will also consulton asset valuations tied to mergers andacquisitions, transaction advisory servic-es and risk management.

The new ABS team has a strong trackrecord in assisting clients and their legalcounsel on the valuation of complexfinancial instruments in the context ofsecurities litigation, bankruptcy,restructuring, and regulatory scrutiny.The team includes: David M. Lehman IIwho joins Clayton from NavigantEconomics, New York City, a subsidiaryof Navigant Consulting; FlorinNedelciuc, who also joins Clayton fromNavigant Economics, where he advisedcapital market participants and theirlegal counsel on the valuation of struc-tured products in various securities liti-gations, bankruptcy and restructuringmatters; and Tyler T. Simpson, who waspreviously head of residential capitalmarkets at Pentalpha Capital Group andled that firm’s RMBS and residentialwhole-loan business including its sub-prime, alt-A and prime sectors.

“We are pleased to add David, Florinand Tyler to the Clayton team,” saidPaul Bossidy, chief executive officer ofClayton Holdings. “There is a criticalneed for independent valuation andanalysis of complex financial instru-ments. Our Asset Backed Solutionsgroup will continue the Clayton tradi-

oped analytical infrastructure willallow us to take operational risk ana-lytics to an entirely new level,”Gutierrez said. “It is increasingly appar-ent that mortgage servicing, as well asorigination, and the ancillary serviceproviders involved in both businesses,play a crucial role in the performanceof structured transactions.”

InHouse to OfferAppraiser CredentialsManagement

InHouse Inc., anappraisal man-agement compa-

ny (AMC) and provider of appraiser man-agement technology for banks, lenders,servicers, credit unions and other mort-gage originators, has announced that itsConnexions appraisal management sys-tem now offers a new feature for man-aging appraiser credentials and ensur-ing credential compliance. Lenders andservicers can order the new option forany appraisal with the click of a mouseat minimal cost.

Lenders and servicers face layers ofnew regulations under the Dodd-FrankAct appraiser independence rule, fed-eral interagency guidelines and newstate appraiser and AMC licensingrequirements, making compliant man-agement of appraiser credentials criti-cal when any violation can result in stiffcivil fines. It takes time and effort togauge if appraisers around the countryare appropriately credentialed for thetype of appraisal or valuation workordered, and not all AMCs are licensedto do business in every state.

InHouse’s credential managementfeature automatically verifies anappraiser’s licensing credentials withthe National Registry of State Certifiedand Licensed Appraisers. In addition, itallows the assignment of an AMC that isproperly licensed in the state in whichan appraisal has been ordered throughits services. The new Connexions fea-ture tracks an appraiser’s errors andomissions and license status for lendersand servicers, and will automaticallynotify appraisers on the InHouse plat-form when their license is expiring or ifit has already expired. With the creden-tial management feature, no orderswill be placed with an appraiser or AMCthat does not have the appropriate cre-dentials for the type of appraisal orbroker price opinion. The new creden-tial option costs only $5 per appraisalordered, reducing appraisal coordina-tor overhead for lenders.

“Especially for lenders self-manag-ing their appraisers and AMCs, theConnexions platform can reliably man-age their compliance with state andfederal appraiser credential guide-lines,” said Jennifer Creech, presidentof InHouse. “Not every state has thesame licensing requirements for thesame scope of work. For example, realestate sales persons cannot complete aBPO in the state of Michigan.”

InHouse’s Connexions platform givesfinancial institutions the freedom andagility to run the appraisal process in continued on page 14

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agers: Debbie Hood for the PacificNorthwest region; Rhett Hubbardfor the Orange and San DiegoCounty regions; and Justin Smithfor the Los Angeles, Riverside, SanBernardino and Ventura Countyregions.

� Real Estate Mortgage Network Inc.(REMN) has named Tom Conklinwestern division sales manageroverseeing wholesale operations onthe West Coast.

� TMS Funding, the wholesale residen-tial lending channel of Total MortgageServices LLC, has named six newaccount executives: Alan Caldwell,Patrick Creighton, Ingrid Helfgott,Mark Karanovich, Samantha Hayand Kathleen McLaughlin.

� Coester Appraisal Group hasannounced the hiring of HaroodKhalid as chief developer andJoseph Bryant as national salesdirector.

� Jerome T. Lienhard has beennamed president and chief executiveofficer of SunTrust Mortgage Inc.

� CoreLogic Valuation Services has pro-moted Wes McDaniel to the newly-created position of chief appraiser.

� J.I. Kislak Mortgage LLC hasannounced the appointment ofFelix Beck as senior advisor to thecompany.

� James Zeldin has been named exec-utive vice president and chief salesofficer of Default Resource.

� BrokerPriceOpinion.com has namedChris McLain as director of businessdevelopment.

� Pamela S. Morris has joined ColonialNational Mortgage as branch manager.

tion of offering superior independentadvice in these situations. In addition, asthe securitization markets recover, weexpect David, Florin and Tyler to signifi-cantly enhance the depth of Clayton’sofferings and advisory services.”

Mortgage Professionalsto Watch� John Axt has joined ISGN as title prod-

ucts operations delivery executive.

� John Van Tassel has been namedvice president of strategic growth forHammerhouse LLC.

� Mortgage Capital Trading (MCT)has named Rhonda Beck regionalsales director for the firm’sCharlotte, N.C. office and will leadthe company’s expansion into thesoutheastern United States.

� ICON Residential Lenders hasnamed three new area sales man- continued on page 22

the foundation of their mortgageinvestment.

Appraisal fees to the consumer mustbe increased soon to head off a criticalshortage of professional appraisers. I sug-gest that, across the board, appraisal feesshould increase by a minimum of 50 per-cent within the next year to avoid a criti-cal shortage of qualified appraisers. Thiswill not guarantee that a shortage will notoccur, but it will be a step in the rightdirection. We must provide young peoplewith an economic incentive to join ourprofession if we are to have a pool ofqualified professionals to draw from. Wedeserve the best and brightest in our pro-fession, and we will only get this if we payour professionals fairly and competitively.

Charlie W. Elliott Jr., MAI, SRA, is presidentof Elliott & Company Appraisers, anational real estate appraisal company.He can be reached at (800) 854-5889, e-mail [email protected] or visit hiscompany’s Web site, www.appraisalsany-where.com.

Appraisers Must Be Paid More Lately, we have seen spectacles from vari-ous groups of different professionals, com-plaining about not getting paid enough.This seems to have been mostly govern-ment workers who are members of laborunions. There have been marches,demonstrations, civil disobedience; youname it … all in the name of eitherincreasing pay to various groups of work-ers or justifying existing pay levels andbenefits. These are usuallysanitation workers, police-men, firemen and teach-ers. These people usuallyget a number of weeks ofpaid vacation, liberalhealthcare benefits, lucra-tive retirement packagesand sick leave. I generallyapplaud the efforts of thesepublic servants and sup-port their well-deservedright to a comfortable stan-dard of living, excludingsome who seem to positionthemselves to receive a dis-proportionate share of thetaxpayers’ hard earnedmoney.

There is another groupof professionals who, in mymind without question,deserve more compensa-tion than they receive.They typically get nohealthcare benefits, paid vacation, 401(k)programs or sick pay, and they have nolabor union to negotiate on their behalf.These people are the real estate apprais-ers who perform the service of evaluatinghomes, land, and the many differenttypes of commercial property.

While there is no source for which Iam aware that provides statistics on theamount of compensation these people asindividuals receive, there is much anti-dotal evidence that supports my con-tention. Please consider the following:

� My memory tells me that the goingrate for a home appraisal 20 yearsago in most areas was about $300.Today, in many areas, the going rateis still at or close to this rate. After

considering the cost of managing theappraisal process, many appraisersperform appraisals at rates that aremuch less than this.

� Younger people are not entering theappraisal business. According to theAppraisal Institute, among its mem-bership, the average age of a desig-nated appraiser is 60, and the average

age of a non-designatedappraiser is 53. Theappraisal schools are gen-erally void of students tak-ing pre-licensing courses.The economic incentive isjust not there, especiallywith the current recession.Obtaining a real estateappraisal license requires,on an average, three-to-four years for a residentialappraiser and four-to-fiveyears for commercialappraisers. During training,appraisers are typicallypaid apprentice rates,which are significantlylower that those paid expe-rienced valuation profes-sionals.

Some complain thatappraisal managementcompanies (AMCs) are the

reason that appraisers are paid so little.As the owner of a non-bank-ownedAMC, I disagree. I have experienced thevery competitive nature of the businessfirsthand, especially for residentialappraisals. The restricted rate that inde-pendent AMCs can charge, coupled withthe overhead associated with increasedregulations, leave them with even lessto pay their appraisers, not more. Thereis pressure from every angle, and thoseof us who want to pay appraisers moreare not able to do so due to the low feeswe must charge in order to remaincompetitive.

Unless material changes are madesoon to compensate appraisers fairly andequitably for their efforts, we will find ashortage of qualified people to perform

By Charlie W. Elliott Jr., MAI, SRA, ASA

“Unless materialchanges are made soonto compensate apprais-ers fairly and equitablyfor their efforts, we will

find a shortage ofqualified people to per-form the tasks of prop-

erty evaluation.”

the tasks of property evaluation. It is notinconceivable that, when the marketturns around, it could take four to sixweeks to obtain a residential appraisaland six to eight weeks to obtain a com-mercial appraisal.

What must happen to correct thisproblem? It is probably too late to avoida shortage if the economy improvessoon, as most of us would hope. It is nottoo late, however, to begin to correctthe problem. This should be doneimmediately. Appraisal fees are con-trolled by the major banks. It has beenestimated that 80 percent of all mort-gages are originated by the four largestbanks in the United States. The man-agement of these banks control apprais-al fees to the customer. We mustencourage these institutions, along withall of the smaller banks, to raiseappraisal fees if they are to insure theavailability of appraisals in a timelymanner to underwrite their loans.These professionals are the bank’s onlyhope for accessing collateral, which is

John Axt

John Van Tassel

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Hospital or nursing home re-admis-sions are serious financial risks forolder Americans, especially those with-out strong family or social support.

So, what do reverse mortgages andhospital and nursing home re-admis-sions have in common? Three words:Medical Mobility Risk. And what is med-ical mobility risk in reverse mortgagelending?

It is the chance that a chronic illnessor poor post-discharge planning couldcompel seniors to shuttle between theirhomes and the hospital or nursinghome, hurting their ability to stay athome long enough to benefit from theirloan funds and limiting their capacity(in case of heavy out-of-pocket healthexpenses) to meet critical borrower obli-gations, such as residing in the home,paying taxes and homeowner’s insur-ance, and maintaining the home.

In gauging a senior’s ability to stay athome and profit from a reverse mort-gage over time, why is it important forlenders and counselors to pay attentionto medical mobility risk?

Hospital and nursing home re-admissions are major challenges in ouracute-care, hospital-dependent health-care delivery system. Re-admissionscosts Medicare approximately $12 bil-lion annually. MedPAC, the researcharm of Medicare, says 17.6 percent ofall hospital admissions in America areactually re-admissions. One in fiveMedicare beneficiaries who is dis-charged from a hospital re-enters a hos-pital within a month. As boomers age indroves in the years ahead, we canexpect these numbers to climb if cur-rent trends hold.

This is the socio-medical context for“yellow flag” seven in the FinancialInterview Tool (FIT) process. As thought-

ful and prudent reverse-mortgage lend-ing professionals, you should find waysto discuss this risk if it comes up in theFIT summary.

Although how you bring it up andhow you discuss it will depend on thedynamics of the loan interview and yourskill in framing questions, it is importantthat you discuss it during the loan-appli-cation interview. For illustration, let’s trythis question as an example:

“Mr. Jones, at FreeFloat Bank, we prideourselves on helping our customers thinkthrough complex financial decisions fortwo reasons: Our customers deserve ourbest thinking, and it is good businesspractice. During counseling, you men-tioned health issues that required hospi-talization and re-hospitalization. Ibelieve we should talk about what it maymean for you down the road, shall we?”

It may not be an easy conversa-tion. While some seniors consider areverse mortgage to pay for healthexpenses, others may be reluctant totalk about such personal issues. Forthis reason, some fine commentatorsin reverse mortgage blogospherehave suggested that the FIT questionsand process are too invasive andtime-consuming.

Like surgery, prudent mortgagelending is inherently invasive. That iswhy in forward mortgage lending, weask for divorce decrees, bankruptcypapers, child-support papers, financialstatements and other very personaldocuments that could have bearing onthe mortgage lending decision. Onlyfools lend other people’s money with-out asking relevant personal questions.In the wake of our recent mortgagelending-led national and global finan-cial meltdown, normal invasiveness inservice of sound lending for all partiesis a good thing.

On the time-consuming charge, anextra 20 or 30 min. conversation to getit right at the critical primary marketlevel is a bargain if it helps seniors and

FIT for Reverse Mortgage Lenders:Part IX

lenders make a better decision for allparties in the reverse mortgage assetchain.

To paraphrase the great IndianIndependence leader Mahatma Gandhi… “There is more to reverse mortgagelending than speed.”

Atare E. Agbamu is author of ThinkReverse! and more than 140 articles onreverse mortgages. Since 2002, he writes thenationally-distributed column, “Forward onReverse.” A former director of reverse mort-gages at Minneapolis-based AdvisorNetMortgage LLC, Agbamu has years of hands-

on experience marketing and originatingreverse mortgages. Through his advisory,ThinkReverse LLC, Agbamu advises financialprofessionals, institutions and regulatorsacross the country. In a 2007 nationalreport on reverse mortgages, AARP citedAgbamu’s work. He can be reached byphone at (612) 203-9434 and e-mail [email protected].

Visit author Atare E.Agbamu’s blog at thinkre-verse.com for his thoughts

and insights on the reversemortgage marketplace.

Medical Mobility Risk

“Only fools lend other people’smoney without asking relevant

personal questions.”

The event includes:� The NAMB Annual Meeting; � Delegate Council Meeting & Legislative Update;� Installation of New Board & Officers;� A Special Reception Honoring NAMB President Michael J. D’Alonzo,

CMC; and� An Eight-Hour NMLS Continuing Education Program.

Program of events(Subject to change)

Saturday, June 47:30 a.m.-1:30 p.m. ................................................................Registration

7:30 a.m.-8:30 a.m. ................................................Continental Breakfast

8:00 a.m.-Noon ....Eight-Hour NMLS Continuing Education Session (Part I)

1:30 p.m.-3:30 p.m. ................................NAMB Delegate Council Meeting

4:00 p.m.-6:00 p.m. ..............................NAMB Board of Directors Meeting

6:30 p.m.-8:30 p.m. ................................................President’s Reception

Sunday, June 58:00 a.m.-Noon....Eight-Hour NMLS Continuing Education Session (Part II)

For more information, call (703) 342-5900 or visit www.namb.org.

2011 National Association of Mortgage Brokers

Mid-Year MeetingSaturday-Sunday, June 4-5

Crowne Plaza Valley Forge Hotel260 Mall BoulevardKing of Prussia, Pa.

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Each month, National MortgageProfessional Magazine will focus on one ofthe industry’s top players in our “MortgageProfessional of the Month” feature. Ourreaders are encouraged to contact us by e-mail at [email protected] consideration in being featured in afuture “Mortgage Professional of theMonth” column. This month, we had achance to chat with Lisa Schreiber, execu-tive vice president of wholesale lending atTMS Funding, the wholesale lending chan-nel of Total Mortgage Services. In this role,Lisa is responsible for defining and imple-menting the company’s vision, strategyand day-to-day execution to build TMSFunding into a leading nationwide whole-sale lender.

Prior to joining TMS Funding,Schreiber was chief strategy officer ofNetMore America, where she focused onbuilding out NetMore’s lending platformto include the highest utilization ofWeb-based technologies, a communica-tion strategy for both internal and exter-nal customers and defining performancemeasurements.

Formerly, Schreiber was an executivevice president at American BrokersConduit (ABC), where she led the visionand implementation of the platformthat drove ABC to become one of thefastest-growing and most respectedwholesale mortgage lenders in theindustry. During her tenure of just overfive years, ABC grew its production to

Lisa Schreiber, Executive Vice President of Wholesale Lending at TMS Funding

more than $33 billion at the end of 2006from just $1.9 billion in 2002 and main-tained a 95 percent employee retentionrate and delivered the industry’s numberone ranking in customer service. Prior toABC, Lisa demonstrated success in salesmanagement at Bank of America, whereshe grew the Southeast region to a toptier region in volume, profitability andquality of performance.

Lisa has been recognized as a valuedspeaker in the mortgage industry and alsoapplies her business knowledge and energyin working with charitable organizations.Today, Lisa has completed the rehabilitationof a school in West Africa and is an advisor toan NGO (non-governmental organization),www.grandmotherproject.org.

How did you get started in the mort-gage business?Like many in our industry, I came by myfirst job in the mortgage business by acci-dent. I was a single mom with two youngchildren, newly divorced. I realized that Ineeded to step up my career to support myfamily, so I decided to pursue a paralegalcertificate. I should have done moreresearch because at the time, it was themid-1980s and paralegals only madearound $15,000-$16,000 annually. Since Iwas looking for a better salary, I turned tothe classified section in the newspaper andlooked for jobs in the legal field. I foundmy first job doing post-closing work withFirst Performance Mortgage in northernNew Jersey. I lived in central New Jersey, sothe commute was about 90 min. each way,but it paid $18,000 a year so I was excited.

I had already completed the real estatesection of my paralegal studies, so I hadsome knowledge of the subject, but I foundthat the job was too slow-paced for my per-sonality. I went to my boss, Pat Burns Taylor,who happened to be president of theMortgage Bankers Association of New Jerseyat the time, a great lady, and told her that Ididn’t think I was going to able to stay. Sheasked me what else I wanted to do within

the company, and I pointed to the closingdepartment where everyone was runningaround with plenty of activity. I said it“Looked like fun,” so I became a closer andcame up through there.

To continue my goal of gaining expe-rience and improving my income, Ieventually moved on to a small savingsand loan in Chatham, N.J. owned byWeichert Mortgage. It was a small shop,so I got my feet wet with everything—selling bridge loans and seconds, pro-cessing, underwriting, and even didmortgage servicing when our servicingrep was out on maternity leave.

I met a rep with MGIC who was look-ing for a sales service rep and MGIC hiredme in 1989. It was a sales-oriented posi-tion and it gave me the opportunity topolish my sales skills. With each new role,I was able to increase my income so thatI could support my family, but I alsogained valuable career knowledge andimproved my skill set through theprocess increasing my value to myemployers and myself.

From MGIC, I ended up moving tonorthern Virginia in 1991, and got a jobat Dominion Bancshares. I was hired byFaith Schwartz, who currently serves asexecutive director of HOPE NOW. I start-ed working with Dominion’s purchaseprogram which was a correspondentgroup, so I learned the whole corre-spondent aspect of the business. I was incharge of purchasing compliance, andstarted working with the secondarymarket, jumbo loans and pricing forwholesale.

It’s fascinating that, in such short periodof time, you were exposed to so manyareas of the mortgage business. Did youfeel overwhelmed by any of this?For me, I was always driven. I had a cou-ple of motivating factors; I wanted tomake more money to support my family,but I also loved to learn about the busi-ness. I always wanted to know more, soeach time I encountered a new depart-ment, I wanted to learn their operationsthrough and through. At Dominion, I wasdoing all kinds of things that I had no ini-tial experience in, but I learned thesetasks quickly and thoroughly, and provedmy value to the company.

In 1992, I was going to leave Dominionto work for Chase as a wholesale rep, butDominion asked me to stay and be therep for their new wholesale group.Unfortunately, Dominion was bought byFirst Union about two weeks later, but itworked out well for me because we tookthat tiny little wholesale group and tookour team to Arbor National Mortgage,working for Ivan Kaufman. It was a time ofrapid growth, and my boss at Arbor left thecompany within nine months of our arrival.I had a great opportunity to go from an AEto a regional manager. In 1993 as an AE, didapproximately $260 million in sales whichtruly solidified my love for wholesale andnow I could grow a wholesale region.

Two years later, we were bought byBank of America where my boss was EdKalush, a wholesale leader. When Bank ofAmerica and NationsBank merged a coupleof years later, the new entity’s corporateoffices moved from California to Charlotte,N.C. in the heart of my territory. This was agreat opportunity for me as I was able to getcorporate exposure at the company andgain more global knowledge.

The real game-changer for me camewhen Bank of America assigned a projectto Guy Taylor and I, as sales leads, called“Wholesale Reinvention.” I believed theintent of this effort was to solidify Bank ofAmerica in a position of strength and lead-

“For as long as I have been in themortgage business, I’ve just been

lucky. I think it’s a combination ofopportunity, the willingness to

jump in, wanting to be challengedand understanding things quickly.”

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ership within the wholesale lending chan-nel. We were given a budget in the mil-lions for the project, and spent a yearbuilding new technology, working withbroker focus groups, collaborating withdesign consultants, and basically workingon a re-launch of their entire wholesaleprogram from scratch. It was now 2001,and I remember delivering theWholesale Reinvention presentation toour entire wholesale team of 250-300. Iwas on my way home from the airportafter delivering that presentation, andgot a call from my boss saying that hewas really sorry, but Bank of America waschanneling all of their resources towardBankofAmerica.com, their banking plat-form. Our resources to implement thework we had done were no longer avail-able to us!

How did you feel about all that hard workthat seemed like it was for nothing?I had a friend who was a recruiter whohad been calling me all along, saying thatif my role with Bank of America didn’twork out, then make sure to call him. Ihad been at Bank of America for sevenyears at that point, but as soon as I foundout that our resources were being dedi-cated to BankofAmerica.com, I called myrecruiter friend. They said that MichaelStrauss of American Home Mortgage waslooking for someone to develop a whole-sale channel for the company, and I said,“I have one in my trunk.” Michael startedlaughing and I told him that I wasn’t kid-ding! If he wanted a wholesale program,I was the right person for the job whicheventually led to my role in the develop-ment of American Brokers Conduit (ABC).

What do you think was the greatest accom-plishment in your professional career?When we were at American HomeMortgage just starting to build ABC, wewere kind of chugging along and slowlybuilding the wholesale platform. When Ifirst got there, they were doing about$15-$20 million kind of scattered and itwasn’t really a true wholesale program.They were calling in for deals and scenar-ios; we started with a ratesheet buildingus to $200 million a month which is whenwe brought on the CapCom Group.

It was a difficult transition for the com-pany and for me personally, because I feltlike I had done a lot of good, solid work,

and all of a sudden, we had all these folksrepresenting what could be a couple bil-lion dollars for us coming in and they wereall very strong in what they believed to bethe way to do business. To me, the biggestchallenge and biggest accomplishmentwas finding a way to come together as ateam and turning that foundation into theABC people remember.

Now that I am with TMS Funding,the wholesale lending channel of TotalMortgage Services LLC, I am reallyenjoying my role because I know that Ican truly be a valuable contributor tothe organization and its growth strate-gy. I bring my many years of buildingout successful platforms, includingtechnology, branding, managing salesand broker relationships, for a qualityproduct. I am happy to help wherever.Although I’ve been hired to run thewholesale channel, if they’re workingout some things with their technologyside, I can lend a hand in developingthose goals as well.

My goal is simple … I want to have asuccessful wholesale program for our com-pany, and I want to see brokers succeed.Brokers are the people whom I’ve donebusiness with for so many years and are anentity I respect. I see great value in brokers.

When hiring others, do you try to hiresomeone like yourself, someone who iswell-rounded and knows all areas ofthe industry? Or, do you try to hiresomeone who is more of a specialistand just knows how to work with bro-kers on finding deals and closing them?What do you look for when you’re hir-ing account executives specifically?Because I am recruiting account execu-tives right now, what I am looking for isan AE that is very seasoned. I am lookingfor someone who has been in the busi-ness—has seen the industry’s ups anddowns—and has continued to be suc-cessful throughout. I come across AEs allthe time who seem so downtrodden—alot of them say they just need a homewhere they can be successful againbecause they love what they do. They arevery close with their brokers and knowthe business and just want to find ahome where they can have fun again. Noone has been having fun. Attitude in AEsis very important to me.

The other thing for me right now isthat I want the AEs I am recruiting to beentrepreneurs. I want them to treat theirterritory like their own business and besuccessful from the minute they start.

If you don’t believe in yourself, you’renot going to be successful. I’ve been in anumber of markets nationwide, so Ihave a sense of what those markets arelike and what it takes to be successful inthose areas. I look to support AEs andtheir brokers in each market we enter tobe as successful as they can be!

As they are always facing regulatoryhurdles and competition, what doyou think the future holds for themortgage broker?It’s interesting because I think that we arein another year of transition, but in a pos-itive way this time. With the new loanoriginator compensation rules from theFederal Reserve Board, the wholesaleworld will be very well-defined. I think it’spretty straightforward, you pick a plan forlender-paid, so everybody is pretty muchon the same page there. I think it’s cer-tainly clearer on the wholesale side thanthe retail side.

On the retail side, it’s kind of grey,especially for banks, and I reallybelieve that banks will not pay theirLOs. If you think of a bank, banks aregenerally cheap. They don’t generallywant to pay their people more thanthey believe the job is worth … theydon’t get paid big dollars. If there is away for the banks to get away from pay-ing LOs big dollars, I think they will usethis as another way to cap what an LOcan make. They have always wanted todo that. I think that a lot of people whoran to banks to hide from licensing reg-ulations or because they were afraid ofwhat was going on with licensing willbegin to come out of the banks andlook toward mortgage bankers. On theretail side, you may also see many vari-ations in compensation plans.

All of the basics of why somebody wentto be a broker now apply again. I actuallythink we are going to see more LOs want togo out on their own, but I don’t think they’llbe big shops. Broker/owners are going tostruggle with how to pay their loan officers;I think that’s one of the biggest challengesa broker/owner has today.

How you support a broker as a whole-saler in today’s market has completelychanged. What does TMS Funding doto support their brokers to win theirloyalty away from other wholesalers?It’s funny because it really hasn’t changedvery much. You would think that it wouldhave changed dramatically, but I reallyfeel that our industry is returning to aback-to-the-basics approach to conduct-ing business. The things that a brokerlooks for that we will provide is good pric-ing, but we will not be in and out of themarket, we will provide consistency.Today, there are big banks trying to buytheir way back into the market, and thatwill happen all the time as somebody willbe in trying to buy the market but brokerscan’t rely on that.

Our technology is very simple. I’ve beenshowing it to new AE recruits, and basical-ly when I have that second phone call withthem after they’ve had the opportunity tolook at the technology, they are usuallyready to go. We don’t even have to trainbrokers. We have a product and pricingengine, so they lock online and upload theinfo. The whole thing is completely paper-less and yet it’s that easy.

Total Mortgage Services has alreadycome up with these characteristics forTMS Funding which are perfect for doingbusiness with brokers … making theprocess easy, with consistent pricing, and

then, of course, quality customer service,specifically investing in great ops people.Where else have you heard of a companythat truly understands that a great processand delivery is the backbone to success?Whenever I roll out a new product or serv-ice, I think of myself as the customer, andthen I call my friends and brokers and askfor their honest opinion. Even with LOcompensation, we’re trying to give thebest options we can. We were able to takea look at all of the lenders, what they arecoming out with and are trying to take thebest of all options. If you have a deal andyou set it up as lender-paid or consumer-paid, and throughout that deal you seethat it’s not going to work for your bor-rower, we’re going to let them change theoption as long as they meet all of the reg-ulations. If we can do it, we are going tooffer it in order to keep the customerhappy, at the end of the day, there is aborrower and we can’t forget that.

I used to hear that a wholesaler tar-geted to get 60-70 percent of a bro-ker’s business and that was the tar-get. Is that number still accurate orwhere do you see that number today?I certainly think that having a deeperrelationship is better for everybody. It’sbetter for the broker because theylearn your process and we both get bet-ter results because they know what yourequire. It’s all about setting and meet-ing expectations on both sides. It is atrue partnership when you can get acertain portion of a broker’s business

We are trying to broaden our productset so that we can do more of that broker’sbusiness. Today, we’re offering FederalHousing Administration (FHA) business,we’ve got agency and high balance, UnitedStates Rural Development (USDA) loans,and we’ve applied to do U.S. Departmentof Veterans Affairs (VA) loans. We’ve seenjumbo and conduit loans creep back in alittle bit, so we want to be able to offerthose as well. Our goal is to offer a com-plete product set so somebody can sendme 60 percent of their business. That is abig goal of ours at TMS Funding.

Do you see any other challenges intoday’s market?As a wholesale group, as in the past,our AEs would have 15-20 brokers. Ourbest AEs would concentrate on themand would get a good portion of that 15or 20 brokers’ business and make areally good living. I think that is muchharder to do these days. We’re talkingmore about what I would call wide net.TMS Funding’s philosophy with our AEsis to give them more of a territory, notless of one, so that they can go widerand get more brokers.

For example, in the D.C. area, manycompanies have five to 15 reps between


“Total Mortgage Services hasalready come up with these

characteristics for TMS Fundingwhich are perfect for doing busi-ness with brokers … making the

process easy, with consistent pricing, and then, of course, quality customer service ...”

“My goal is simple … I want tohave a successful wholesale

program for our company, and Iwant to see brokers succeed.”

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Dear National Mortgage Professional Magazine:I read Charlie W. Elliott’s article “How Will the Dodd-Frank Act AffectAppraisal Fees?” in the March 2011 issue with great amusement.

Not long ago, Charlie was writing articles extolling the virtues of the HomeValuation Code of Conduct (HVCC) regulation on the housing industry and con-sumers, regardless of its “unintended consequences” of increased cost to con-sumers, both directly through an immediate spike in fees, and indirectly by cre-ating more administrative red tape in the loan process. It seems Mr. Elliott nowhas a completely different view of the HVCC derived regulation and its “unin-tended consequences” as it increases costs to his business and may affect his abil-ity to compete … the exact same issues independent appraisers voiced beforetheir careers were extinguished by the HVCC. Maybe now Mr. Elliott sees the mon-ster HVCC has created for consumers. As more inefficiencies are added to anyprocess, the cost to the consumer rises and the economy suffers as a whole. Thepurported benefits of the HVCC were suspect from the start, it is now more appar-ent than ever that the HVCC’s costs far outweigh its purported benefits. We shouldall support U.S. Rep. Michele Bachmann’s bill to repeal the Dodd-Frank Act.

Sincerely,

Brian TataAdvanced Mortgage Corporation, Warwick, R.I.

Dear Mr. Tata:Thanks for your interest in my articles. I do think that I must set straight myposition on some of these issues.

First, I never have supported the Dodd-Frank Act and would not do so.Second, I did support, in principle, the HVCC and still do.

These are two entirely different issues in my mind, even though theyshare a few overlapping characteristics. Few, if any, of the big government,excessive-regulation and inefficient canons of the Dodd-Frank Act are foundin the HVCC. Unlike the Dodd-Frank Act, the HVCC was written on a fewpages and created little, if any, government waste, bureaucracy and/oronerous regulation. It simply addressed the issues that contribute to mort-gage fraud and collusion.

Being an appraiser and managing an appraisal company, I have main-tained, and still do, that no one having a vested interest in a loan closingshould select, supervise or pay the appraiser. There is simply too muchtemptation and room for collusion. We are seeing some of the results ofsuch relationships between lenders and appraisers in the recent economiccrisis, which was caused, at least in part, by inflated appraisals. If you ques-tion the severity of the mortgage fraud problem, I suggest that you visit theFBI’s Web site and read the FBI Mortgage Fraud Report 2009.

Thanks again for your interest in my column. I am currently writing oneon appraisal fraud, which will provide more detailed information on thesubject. If interested, you should find it in next month’s issue of NationalMortgage Professional Magazine.

Sincerely,

Charlie W. Elliott Jr., MAI, SRA, ASAElliott & Company Appraisers, Greensboro, N.C.

mortgage professional continued from page 17

that I met there were Peace Corps-typeof people and people that work forNGOs [non-governmental organiza-tions]. They have very little by way ofmaterial goods, and yet they smile,they’re happy. They live their life andappreciate everything that they haveeven though in our eyes it might be solittle. I’m amazed by people that give uptheir life to live in African villages,administer vaccines and help assist thevillagers. I could be a Peace Corps per-son I think. I would love to do some-thing like that. I would say those are thepeople whom I admire the most thatjust do for others all the time without alot in return. I actually funded schoolrehabilitation in Ghana and workedwith an NGO in Senegal when ABC wentunder. It really brought home to mewhat good I could do with the money Ihad earned. It just felt great.

As far as books go, it’s funny becauseI really don’t read self-help books. Ihave some self-motivation books thatpeople have given me, but my motiva-tion comes from within. I have readAtlas Shrugged and many other novelsreferencing the past, and I think it isinteresting is to see history continuous-ly repeat itself. We have cycles of greedand good, and desperation and war …these things are not new. I think it ismost interesting and telling on how wehandle these issues.

Life is unpredictable, and on a dailybasis, something bad could happen.Maybe its something as minor as puttingsoy milk in my coffee instead of regularmilk, or something as serious as thedeath of my uncle, which actually justdid happen. Of course, I’m very sad andfeel horrible for my family, but life goeson. He was very ill and it’s better that ithappened so quickly. The key is remem-bering and placing those feelings appro-priately in something positive.

Any closing comments?I’m really happy that I’m finding peo-ple who are still very excited about ourbusiness. There are people out there,like me, who just really want to do welland get back to business; get back tomaking deals and getting people intohouses … just doing our thing. There isa lot of passion out there.

We have been dealt with restrictiveregulatory issues like LO compensation,changes to the Real Estate SettlementProcedures Act (RESPA), the HomeValuation Code of Conduct (HVCC), etc.but we’ve always been able to deal with it.

For as long as I have been in themortgage business, I’ve just been lucky,that’s certainly how I feel. I think it’s acombination of opportunity, the will-ingness to jump in, wanting to be chal-lenged and understanding thingsquickly. And I’ve been lucky enough tohave had learned from some greatmentors and people along the way. Iam grateful!

Maryland, Virginia and D.C. What hap-pens is you only get two or four reps thatcan actually make a living. Everybodyelse is starving. They are doing a couplemillion a month because all of the goodaccounts are with the top four reps. Ourphilosophy with TMS Funding is to havethree or four reps in that area andthey’ll share that area based on rela-tionships. I don’t mind if my northernVirginia rep goes into Maryland, or if myMaryland rep goes into northernVirginia. I want them to be able to get awider net so that they do well and obvi-ously stick with TMS.

There have also been a lot of acquisi-tions in the industry. I’m not singling outWells Fargo specifically, but Wachoviarolled up into Wells and when that hap-pened, all of the Wachovia reps lost allthe accounts they had because the WellsFargo reps already had them. Again, alot of that has been happening at thebigger companies, and you know, I wantto give these guys a chance to make agood living.

How would you define your manage-ment style? Do you employ any partic-ular sort of management technique?I am very straightforward. I expect peo-ple to know their job and the productsthey are selling. I don’t mind anybodyasking a question, as long as it’s notsomething that we’ve discussed 20times. That gets a bit frustrating. I real-ly love self-motivated people. I will doanything for a self-motivated person. Iask my employees repeatedly, what doyou need? I am here to support them …I’m not a game player. If I’m challengedwith something, I’ll tell you. If I’mhappy … I’ll tell you. When I came toTMS Funding, I got so many e-mailsfrom past co-workers asking if theycould come and work for me. It wasreally nice; it made me feel great as Iwill always give my all for anyone I workwith. I think people appreciate knowingwhere they stand.

Do you have anyone who has servedas a mentor to you professionally?Have you been inspired by any booksyou’ve read?I think that I’m inspired by people allthe time. I’ve traveled all over theUnited States obviously for business,and I meet people all the time thathave a passion for what they do.

I’ve visited Africa on several occa-sions, and I think those experienceswere amazing for me because it’s just acompletely different world withoutthings we take for granted. The people

“TMS Funding’s philosophy withour AEs is to give them more of aterritory, not less of one, so that

they can go wider and get more brokers.”

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gage loan originator has different back-grounds and levels of involvement inour industry, the biggest challenge iswith education and communication forall to understand. Some of the ques-tions I’ve heard come up on many dif-ferent conference calls (with only weeksfrom the rule being implemented) weresimply shocking to say the least. Iunderstand that all the interpretationsand details may have been confusing,

but too many generally donot understand the basicsof the rule and are relyingon their employer, lenderor others to decipher forthem.

Most of us, of course,disagree with the unin-tended consequences theLO compensation rulegenerates. We will contin-ue to fight for what isright, but no one shouldhave been unprepared bythe April 1st implementa-tion date. Time shouldhave been more focusedon compliance ratherthan complaints aboutthe LO compensation rule,given the direction gov-

ernment regulation is moving. I person-ally don’t like the outcome to the con-sumer on heightened costs and willfight to make the plan a better one, butI do agree with anti-steering rules andthe inability for an LO to be compensat-ed based upon the terms of the loan.

As we know, creditors are not regu-lated under the rule for paymentsreceived on the sale of a closed loan onthe secondary mortgage market. Onlythe LO is subject to the rule in the pri-mary mortgage market, while dealingwith the consumer under any origina-tion channel. Because of the possibilitythat the rule favors owners and credi-tors over originators, it’s very importantthat LOs understand how this willimpact their choices and compensationgoing forward.

For an owner, it primarily comesdown to balancing overhead and prof-its, while not leaning too far towardgreed or too far toward generositywhen setting compensation plans, cor-responding rate sheets and lenderagreements. For LOs, it comes down toclearly understanding their options anddetermining a compensation plan andchannel that doesn’t price them out ofthe market.

The primary issue I’ve seen withoperating the Fed’s rule is that owners

In July of 2010, I wrote an article about thefuture of our industry primarily as it relatesto non-depository lending institutions.After spending several months on legisla-tive issues, visiting Washington, D.C. andtalking with hundreds of loan originators,I felt drawn to do a follow-up on this topicnearly a year later as the level of continuedconfusion surrounding our industry isunprecedented. The Federal ReserveBoard’s ruling on loan originator (LO) com-pensation has only addedto this confusion and it’simportant to me that Icommunicate topics that Ifeel to be extremely impor-tant moving forward.

In my last article, I dis-cussed the importance ofawareness and concernswe should all have aboutindustry pessimism, fear-based recruiting and/orself-promotion, excessivenet branching, along withindustry monopolizationtoward limited originationplatforms which reducescompetition. There is nodoubt that our industryhas gone through signifi-cant change, but many aremaking decisions too quickly or not takingthe necessary time to understand theimplications of their actions. I want toexpand on this topic, primarily as it per-tains to the recent reform in compensa-tion. I also want to clearly state, as I didbefore, that I support all channels of ethi-cal loan origination for healthy competi-tion and accountability, which ultimatelyprotects the consumer. Both wholesaleand correspondent channels must thrivemoving forward.

I have recently read opinion articlesfrom “industry gurus” with a product tosell or self-promoting bias companymanagers talking about the “difficult”times ahead for the mortgage broker(don’t make me laugh again) and manydon’t even originate loans themselves!Listen, if you do not personally origi-nate mortgage loans in the present orhave not in the recent past, there is noway you can fully understand or relatewith the implications of these rules, letalone how they pertain to a mortgagebroker under the wholesale channelexclusively. For the purpose of this arti-cle, I am defending the abused mort-gage broker and wholesale originationchannel which is now completely mis-understood. The gloves are off …hands up, chin down.

To begin, the new Federal ReserveLO compensation rule needs to be putinto perspective. Because every mort-

The Future of the Mortgage Brokerand Correspondent Markets:

The SequelBy Andy W. Harris, CRMS

“Most of us, ofcourse, disagree with

the unintended consequences the LOcompensation rule

generates.”


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LoyaltyExpress LaunchesCustomerManager 4.0

LoyaltyExpress has announced therelease of its fourth generation market-ing automation software-as-a-service(SaaS), CustomerManager, deliveringretention marketing services to mort-gage brokers, lenders, and banks. Newfeatures include electronic closing sur-veys (with loan officer scoring andreporting), as well as robust compliancecontrols to prevent loan officers frommarketing in non-licensed territories.

“CustomerManager continues to bethe most demanded and flexible mar-keting service in the mortgage indus-try,” said Jeff Doyle, chief executive offi-cer of LoyaltyExpress. “With an excep-tionally diverse and notable roster ofclients, we continue to advance ourofferings and solutions to steadily con-quer—and exceed—existing andfuture user requirements and expecta-tions. Our proprietary platform is builton flexible and scalable architecture,which continues to satisfy even themost demanding requests for special-ized components and functionality.”

The 4.0 release builds upon the origi-nal success of the service with the fol-lowing enhancements: Post-closing,electronic closing surveys with scoringand loan officer performance feedback;referral submission by survey recipientand instant alert to loan officer forimmediate follow-up; hierarchicalreporting on survey results for branchmanager, regional and divisional man-agers, and corporate marketing users;expanded license fields for corporateNationwide Mortgage Licensing System(NMLS), corporate banking license, loanofficer NMLS, loan officer state license, andstate-specific disclaimers; LicenseLock, thesuppression of mailings to recipientswhere a loan officer is not licensed, pre-venting any regulatory infractions; datasharing with PromotionalMaterials (theLoyaltyExpress Web-to-print flyer site),eliminating duplicate data entry require-ments; automated e-newsletter and e-mail functionality on client retention pro-grams for multi-media marketingimpact; and automated lead campaignsconsisting of direct mail and e-mailcommunications.

CSi and MortgageFlexAnnounce DocumentTechnology Collaboration

Compliance SystemsInc. (CSi), a providerof compliance doc-umentation tech-

nology, and MortgageFlex Systems Inc., aprovider of mortgage technology, haveannounced the integration of their coreproducts. CSi IntelleDocs are now avail-able via MortgageFlex’s loan originationsystem (LOS), the Residential LendingSystem. CSi IntelleDocs reduce processingtime for lenders by eliminating the needfor a separate “doc prep” company inter-face. CSi’s Document Selection Logic vali-dates and selects all the required docu-ments for loan transactions. Additionally,CSi warrants the compliance accuracy asregulatory conditions change, proactivelyupdating documents.

“We are ever mindful of providing ourcustomers with the latest technologyadvantages and have formed this allianceafter an extensive evaluation of availableproducts,” said Craig Bechtle, executivevice president of MortgageFlex. “The lastthing our customers need to worry aboutis compliant loan documents. Thisalliance with CSi gives them additionalcompliance confidence while reducingbusiness process time.”

“Each IntelleDoc is a smart softwareapplication that streamlines the creationof loan packages and helps mitigatecompliance risk,” said Dennis Adama,president of CSi. “The combination of ourintelligent documentation system withthe capabilities of the ResidentialLending System is unique in the industryand will deliver tremendous efficienciesto our mutual customers.”

Xerox Mortgage ReleasesBlitzDocs eXtendedEdition to StreamlinePaperless Process

Xerox Corporationis expanding thebenefits of paper-

less loans to closing agents with thenewest release of BlitzDocs eXtendedEdition (XE). The new software connectsparticipants electronically so they canwork together to process loans withoutdelays or bottlenecks. BlitzDocs XE now


the sequel continued from page 19

are not thinking like LOs and LOs arenot thinking like owners. The othermajor hurdle is trying to balance all ofthis with the least amount of damage tothe consumer. The higher your com-pensation plan, the higher your ratesheet. The question is on what eachorigination channel can provide incomparison for an LO since it’s all aboutbasis points (BP) and the correspondinginterest rates and flexibility. Keep inmind that we are in a transaction-basedindustry without the benefits of passiveor residual revenue. This forces busi-nesses to revise policies when volume isup or down.

How do we solve the compensationand interest rate puzzle? It really comesdown to the marketplace, the employ-er’s overhead and how they are balanc-ing anticipated risks with unknownprofits. I predict that we’ll be in a test-ing phase for a good portion of 2011.

Understanding what a“Banker” and “Broker” is,pre- and post-compensationreformI can only hope that any LO reading thisunderstands that they are ultimately athird-party originator (TPO) to FannieMae, Freddie Mac and Ginnie Mae withthe exception of any rare portfolio loanhere and there which likely are still notowned or serviced by your employer.Drawing from a warehouse line of cred-it does not change your position or sta-tus. Although the futures of these agen-cies are unknown, there is no doubt thatwe are all puppets to a system that pullsthe strings. It makes absolutely andentirely no difference if you are broker-ing or banking a loan to the consumer.

One definition for a bank is a char-tered institution empowered to receivedeposits, make loans, and providechecking and savings account services,all at a profit. Most correspondentlenders truly are not banks, however, theterm “mortgage banker” is loosely used.I’m personally okay with that unless anindividual with this title is brainwashedinto thinking a warehouse line of creditis any different than or superior to bro-kering a loan. That is completely false inevery sense of the word. If I borrowedmoney from my bank and then lent it toa friend temporarily whom I felt to be alow credit risk, would I then be a“banker” until I repaid that loan sincethe loan is in my name? You get whereI’m going with this …

Those working for retail correspon-dent bankers/brokers or net branches

have been told for years to sell “in-house” programs due to internal under-writing benefits, fast turn-times, serv-ice, “we know we’ll get it done,” etc. tojustify using their credit lines for morerevenue over-brokering. Add significantcompensation incentives and you havethe fuel to make brokering look like it’sa disease. I view this as the heavysmoke and mirrors hiding reality.Transaction performance, turn timeand loan quality are all derived fromthe human being originator and thesystems and lenders their chosenemployer has in place … not the chan-nel of origination. All of these benefitshave nothing to do with banking or bro-kering a loan.

We are all mortgage professionalsThe terms “banker” and “broker” meannothing more than the channel used inthe primary market to provide con-sumers access to residential real estatefinancing. These terms do not providecredentials or leverage in the non-depository lending world. The FederalReserve LO compensation rule will con-tinue to commoditize our product. It’stime we get rid of titles and focus on fil-tering the problems with this crazylending climate from our consumers asbest we can with a smile on our facesand a focus on protecting their interestsfor continued referrals. If you are an LOworking by referral, self-branding isalways better than channel branding.

Understanding steering,pre- and post-compensationreformThe Federal Reserve’s anti-steering rulehas people concerned when theyshould not be. While the safe harbordisclosure is optional, an LO’s presenta-tion should have always had this type ofcomparison done prior to rate lock.Sure, showing the very lowest rate andhighest discount points available makesno financial sense and the details needto be relevant, but not providing thisdisclosure or not offering your borrow-er multiple rate and fee structure choic-es within reason is a disadvantage toany LO. Most are not using this formunless brokering, but full disclosure isan advantage and not a disadvantage.

I highly suggest that a mortgage


“Time should have been morefocused on compliance rather thancomplaints about the LO compen-

sation rule, given the directiongovernment regulation is moving.”

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“Houston … we have a problem!” wasthe famous line from the movie Apollo13. Tom Hanks, playing the role of JimLovell, mission commander, radioedNASA’s Mission Control Center in Houstonwith those infamous words. As you mayrecall, he was advising Mission Controlthat they had just experienced a majorsystem failure and they were in serioustrouble. The key to a successful conclu-sion in the Apollo 13 story was that therewas strong leadership that organized anamazing collaborative and creative solu-tion to the crisis. They demonstratedamazing character, as well as an intenseconviction and confidence that there hadto be a solution to the crisis.

I find some interesting parallelsbetween the mortgage industry todayand the Apollo 13 mission. Between theyears of 2001-2006, we as an industrywere “going where no man had ever gonebefore” (excuse yet another line fromanother space odyssey). As an industry,we were using experimental loan prod-ucts never used before to advance home-ownership to new levels. Just like theApollo 13 mission, the mortgage industryexperienced major systemic failure acrossmany of our “systems.” This was in partbecause we were venturing into unex-plored realms of “affordable” homeown-ership, which culminated in the infa-mous “mortgage meltdown” and housingand economic implosion. However,unlike the team at Mission Control inHouston, who creatively and collabora-tively worked around the clock to identi-fy a workable solution to save “the mis-sion,” our “leaders” (and in this case, I amspeaking of politicians) worked aroundthe clock to put safeguards in place tomake sure we didn’t have another crisis.They failed to recognize that we neededto engineer a way in which we couldavert a crisis, figuratively speaking, andsafely land the economy.

What I find most astounding is thatRep. Barney Frank and Sen. Chris Dodd,who “unwittingly” contributed to thedemise of Fannie Mae and Freddie Macat great cost to the American taxpayers,were the same two “leaders” that “engi-neered” a legislative “solution” andthen had the gall to name the solutionafter themselves … the “Dodd-Frank”Act! What a boondoggle!

So, we had a failure of leadership atthe federal level, but I ask you: “Wherewere our industry leaders to challengethese misguided federal misfits?” Theresidential market is a $10 trillion indus-try. You would think that any industry ofour size would have had leaders thatwould have been more effective instemming the tide of legislation such asthe Dodd-Frank Act. The harsh reality isthat we didn’t! Instead, we, as an indus-try, became “the villain and reason” forour failed economy. Why? No leader-ship! Unfortunately, the number oneindustry leader of that era became theposter child of greed and mismanage-ment. It is for this reason that in Januaryof this year, I started writing this seriesof articles on the topic of leadership.

In my February 2011 article, I out-lined the seven characteristics, “The 7-Cs”of Leadership. In March, I wrote aboutthe first of the 7-Cs which was character,the cornerstone of every great leader.Last month in the April issue, I wroteabout the second of the 7-Cs whichfocused on the importance of having

“conviction” as a leader. This month, Iam writing about important it is for aleader to confidently follow his convic-tions and to communicate in confidence!

As I started writing this article andthinking of an example of a leader thatoperated with confidence, I thought ofGene Kranz, the NASA Flight Director ofthe Apollo 13 Mission. Throughout theApollo 13 crisis, he demonstrated amaz-ing character and conviction, all thewhile, leading with a calm and convincingconfidence. He assembled what he calledhis “White Team,” which was quicklydubbed the “Tiger Team” by the press.They quickly went to work on setting con-straints for consumption of the space-craft’s consumables (oxygen, electricityand water) and carefully managed threecourse-correcting “burns” that altered thetrajectory that allowed the astronauts tosuccessfully return home. Because of hiscalm and amazingly confident leadership,Kranz, his team, as well as the astronauts,received the Presidential Medal ofFreedom for their heroic roles during thiscrisis. If you haven’t read Kranz’s book,Failure is Not an Option, I would encour-age you to do so. It chronicles the life andevents of this great leader.

Here are six key characteristics of confi-dent leaders … and the good news is thatthese six characteristics can be learned. Inother words, confidence is a choice!

1. AmbitionConfident leaders are ambitious. Theyrefuse to merely “exist” or “survive.”They see themselves as able to over-come undesirable or unacceptable cir-cumstances.

2. Goal-orientedConfident leaders seek to challengethemselves by setting and achievinggoals that they set for themselves andthose who are in their influence. They

are not necessarily competitive with oth-ers, but push and challenge themselves.

3. Good communicatorsConfident leaders communicate usinggood eye contact. They know how toask for what they want and to hearadvice and counsel. It is less importantfor them to be right than to be effec-tive. They listen more than they speak!

4. Care about peopleThose who are confident leaders havea good inner self-image from nourish-ing relationships instead of toxic rela-tionships. They have learned to detachfrom relationships which do not allowthem to be authentic.

5. Good listenersConfident leaders draw people in bygenuinely listening to people. Theysubtly exude their confidence in a waythat attracts people to them.

6. Having a confident“can-do” attitudeThis has to genuinely come from theheart and a positive attitude in times ofdifficulty. I like what tennis player StanSmith said, “Experience tells you what todo; confidence allows you to do it.” Butas it relates to leadership, Rosabeth MossKanter really brought it in to focus whenshe said, “Self-confidence is not the realsecret of leadership. The more essentialingredient is confidence in other people.Leadership involves motivating others totheir finest efforts and channeling thoseefforts in a coherent direction. Leadersmust believe that they can count onother people to come through.”

As I close out this month’s article, Iwant to share this poem that was given

By David Lykken

How Confident Are You?

“Leadership involves motivatingothers to their finest efforts and

channeling those efforts in acoherent direction. Leaders must

believe that they can count onother people to come through.”


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A True Neighborhood Hero“I remember waking up to news that the World Trade Center Twin Towerswere attacked and watching in horror as the first, then second Tower plungedto the ground. News coverage continued and I was shocked to learn thatAmerica was attacked by terrorists. I found my American flag, went out tomy mailbox and attached it so that it flew freely. Shortly after, a veteran walk-ing down the road stopped by my flag, stood at attention and saluted it, thencontinued down the street. I knew at that time my life would change. I hadbeen a mortgage loan officer for more than 11 years, but wanted to do moreto serve my country as our soldiers were lining up by the hundreds to enlistin the defense of our country. Most of my family had served throughout theyears and I wanted to help where I could.” —Rachel Donovan, Legacy Mortgage, Albuquerque N.M.

From mortgages to budget training and credit counseling, Rachel Donovanfrom Legacy Mortgage in Albuquerque, N.M. has since helped about 3,000servicemen and servicewomen over a 22-year lending career. Working atKirtland Air Force Base, she has helped military borrowers all over theworld. One of her most gratifying loans was for a woman who had missedsome house payments and was afraid to tell her husband.

“After a few months passed,” said Rachel, “she became afraid to openher mail so she didn’t. One night during dinner, their doorbell rang. It wasa man who told the husband that he was the new owner of the house andthey had 30 days to buy the house from him or they would have to get out.”

The husband was shocked. Desperately needing to refinance, theystarted calling lenders and Realtors for help. One of them advised callingRachel, saying, “If she cannot do it, it can’t be done.”

Rachel called the man who had purchased the house from the bank.“I was disgusted with what he was charging them to buy it back,” she

said, “making in excess of $10,000 for holding the loan for 30 days.”Not sure she’d be able to refinance, Rachel was eventually able to build

a profile and loan package that made sense for the lender and allowed themto approve the loan.

“That lady was so grateful, she sent me a Christmas card with picturesof her little girls and wrote, ‘These are the girls that didn’t lose their homebecause of you, I will always be thankful.’”

Volunteering with the JROTC at the local high schools led Rachel tojoin the local chapter of the Blue Star Moms, an organization that providessupport for moms and their children serving in the military. Helping onefamily at a time is what it’s all about.

Rachel Donovan, NMLS #368845Mortgage Loan ConsultantCertified USA Cares Lender

6725 Academy Road NEAlbuquerque, NM 87109

Direct: 505-858-3825Mobile: 505-328-4792 • Fax: 505-938-5892E-mail: [email protected] online: www.legacymortgagenm.com/rdonovan

Are you a “Mortgage Hero” or know of anyone who might be? We

want to hear from you if you’ve completed the FREE Military

Family Housing Education Course as Mortgage Heroes deserve

to be recognized for their outstanding service to America’s ser-

vicemen and servicewomen. Please send a short bio to MFHE Pro-

gram Manager Beverly Frase at [email protected].

Your turnNational Mortgage Professional Magazineinvites its readers to submit any infor-mation, events, passages, promotions,personal or professional occurrencesthat seem appropriate and/or otherpertinent data to the attention of:

Heard on theStreet/Mortgage

Professionals to Watchcolumn

Phone #: (516) 409-5555E-mail:

[email protected]

Note: Submissions sent via e-mail are pre-ferred. The deadline for submissions is the1st of the month prior to the target issue.

� REO Allegiance has announced thehiring of Brian Daily as vice presi-dent of business development.

� New Millennium Title Group hasannounced the appointment ofDavid Wilson as senior vice presi-dent of national sales.

� Stephen M. Renna has been namedchief executive officer of the CREFinance Council.

� Scott Chase has been named a partnerwith Absolute Mortgage Banking.

� Jim Gross has been promoted to theposition of vice president of financialaccounting and public policy for theMortgage Bankers Association (MBA).MBA has also announced the hiring ofThomas T. Kim as vice president ofcommercial regulatory policy.


lykken on leadership continued from page 21

to me when I was a young man by myfather who passed away last year. Hewas very successful and a great rolemodel and mentor. He read the follow-ing poem in his wallet and read it tohimself almost every day …

You Can, If You Think You Can!If you think you are beaten, you are,If you think you dare not, you don’t.If you like to win, but you think you can’t,It is almost certain you won’t.If you think you’ll lose, you’re lost,For out in the world we find,Success begins with a fellow’s will.It’s all in the state of mind.If you think you are outclassed, you are,You’ve got to think high to rise,You’ve got to be sure of yourself beforeYou can ever win a prize.Life’s battles don’t always goTo the stronger or faster man.But soon or late the man who wins,Is the man who thinks he can.

The “confidence” we see in greatleaders is birthed in a strong belief thatcomes from a deep-in-the-heart know-ing that they can and will succeed, andknow how to inspire the same in oth-ers! Today, more than ever, you want tomake sure that you are following aleader or leaders that operate in this

kind of confidence, and then, hopeful-ly, you yourself will aspire to become astrong leader.

I hope this month’s article is helpful.Next month, I’ll be writing about thefourth characteristic of leadership …strong leaders are charismatic. I wel-come your thoughts and feedback viae-mail or a message post on a newLinkedIn discussion “Group” that I cre-ated called “Mortgage Leaders.” I wouldbe honored if you would join this groupand share your thoughts on leadership.

David Lykken is president of mortgagestrategies and managing partner withMortgage Banking Solutions. He hasmore than 35 years of industry experi-ence and has garnered a national repu-tation, and has become a frequent gueston FOX Business News with Neil Cavuto,Stuart Varney, Liz Claman and DaveAsman with additional guest appear-ances on the CBS Evening News,Bloomberg TV and radio. He may bereached by phone at (512) 977-9900, ext.101 or e-mail [email protected].

To listen to author DavidLykken’s online radio show,“Lykken on Lending,” log on

to www.lykkenonlending.com.

SAVE THE DATE

2011 Mortgage Leader Cruise

Sets Sail Oct 13th-17th

Visit MortgageLeaderCruise.com for details.

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www.windvestcorp.com


broker, or anyone brokering loans,sets the same lender-paid margin witheach investor. I know that many arenot doing this, but it is my personalopinion that you may have an uphillbattle should an audit expose favor tothe higher-paying lenders. I will beinterested to see what future changesoccur as it pertains to how employersand wholesalers are allowing the orig-inating party to control the rate sheetsfor compensation. Depending on thedetails, this could potentially be a vio-lation of the rule, even if compensa-tion is fixed for a period of time.

On the topic of steering, I want tomake something very clear that every-one seems to disregard … if you havethe ability to save your client on rateor costs for an identical product andprogram, but choose not to do so foryour own financial gain (such as usinga warehouse line over-brokering), thisis steering. If you don’t agree with that,clearly discuss it with your borrowersand see how they feel about it. I justwitnessed (after getting involved andcreating competition) a re-issued GoodFaith Estimate (GFE) within days frominitial GFE by an originator going fromusing a warehouse line to brokeringwith no changes in the market or theirborrower’s credit profile. The differentwas $6,000 out of pocket for the samerate and program due to exposing thecredit in Block 2 rather than a costwith hidden service release premium(SRP). Keep in mind, he was still mak-ing a significantly fair compensationwhen brokering. This steering has goneon for way too long under both chan-nels, but change is here.

Competition can avoid and exposethis behavior, but this type of steeringwill be very difficult going forward asthe Fed intended. The LO employed bythe creditor will have an extremely dif-ficult time brokering in general if at allgiven their compensation agreementcannot increase or decrease. Whenbrokering, the creditor is an originatorunder the rule. In order for outsidelenders not to compete with theirwarehouse lines on price, they willneed to price them out by setting highlender-paid margins or cutting themoff entirely. If the company falls shorton the required reserves needed tooffer Federal Housing Administration(FHA) loans, however, they will beforced to broker which makes thingsextremely difficult. These factors canbe a disadvantage to the LO employedby a creditor. To help alleviate theseissues, the creditor must get as many“niche” products as possible undertheir banking channels while also stay-ing competitively priced.

Lender-paid vs. consumer-paidThe issue on consumer-paid optionswhen commissioning an employee

came up early on in the process of deci-phering the new compensation rules. Itsat quiet for a while, and then was rein-troduced weeks before the rule wentlive and concerns were confirmed bythe Federal Reserve Board. The goodnews is that mortgage brokers don’tneed the consumer-paid option. Saywhat? I repeat, the mortgage brokercan thrive without the consumer-paidoption. Yes, it’s still available to the bro-ker owner, but it’s truly not a necessaryoption if you’ve set up your systemsproperly and understand how this thingworks.

There are challenges and issues withthe compensation rule under all chan-nels, but nothing we cannot adapt to aswe have with all other recent regula-tion. In this case, things have beenblown way out of proportion. With theexception of the inability to providebroker credits to the consumer at clos-ing, lender-paid is an excellent option.It provides more consumer-friendly ratesheets with the ability to offer no-costloans, as well as an optional discountbuy down. Call it origination points ordiscount points, if the borrower choos-es to take on these costs you get thesame net interest rate. It makes no dif-ference at all, and I personally preferthis method over consumer-paid anyday of the week. It’s consistent, it’sclean and it simply works.

I have found that the benefits of YSPsto cover origination services for the bor-

rower (directly or indirectly with lenderpaid) are significant after pricing andlocking several loans under this model.Paying any kind of points typically makesno financial sense in most casesunder the wholesale pricingmodel. Lender-paid simpli-fies this by taking care ofthe brokers’ agreed com-pensation and startingeach loan at a “0 points”PAR interest rate to theconsumer. They still havefull flexibility and a widearray of products and pricingto choose from, giving an advan-tage to both parties if the margin is setfair and if it’s clearly understood. I’m notsaying there are no kinks that need to beironed out, but I am saying that thosequestioning the new broker model aremisinformed. The biggest challenge willbe to those setting their margins too highor those who have a difficult platformand/or higher overhead to operate theirchannel competitively and effectivelyunder the rule.

Interest rates and pricingAs indicated earlier, the interest ratesyou offer your client will be dictated byyour compensation plan and youremployer’s overhead. Some will begreedier than others and some will bemore generous than others. It’s truly amatter of finding balance and it’s notan easy task for the employer or broker-owner or the LO working under them. Itwill take some periods of testing andfluctuations to determine where mostwill find this balance. It’s important tokeep an eye on the marketplace, as wellas the big retail banks to make surethey don’t try to buy the market whenvolume goes down since they’re payingtheir employees less and have the abil-ity to do so.

I anticipate we’ll see many employ-ers again start working with and train-ing originators on selling higher ratesafter these rate sheet adjustments.

While rate is not everything, it can be iflost premiums equate to others offeringsignificantly lower adjusted originationcharges with equal or higher levels of

service, organization and expe-rience. Keep in mind, these

performance traits arerequired to succeed inour now volume-basedindustry. Since we allcarry the same pro-grams, I feel that fair

pricing and terms cer-tainly do matter, along

with the expected perform-ance. The importance lies on

consumer education and the under-standing of loan disclosures. Ultimately,the consumer will dictate the balancebetween service and pricing and whothey choose and refer as a serviceprovider.

Lenders exiting thewholesale marketplaceIt’s amusing when you see everyonefreak out and the mass media that fol-lows when a lender exits the wholesalelending business. Why? Because fear isgood press during these times ofchange and many times special inter-ests are at play. Listen, these lendersare leaving wholesale either throughgreed with now-controlled retail com-pensation and revenue potential orpoor operational and pricing systemsthat simply did not make them a com-petitive entity in wholesale. Theselenders would have left wholesaleregardless of these rules at some pointor another which I am sure we’ll con-tinue to see when volume drops as withany channel. Change is not new to us inthe wholesale lending channel and weare a resilient group of people.

As noted before, the wholesale lendingchannel is the most cost-effective and effi-cient way for a creditor to bring productsto market. When it comes to concerns on

“The primary issue I’ve seen withoperating the Fed’s rule is that

owners are not thinking like LOsand LOs are not thinking like

owners.”

THECFPB


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By Stewart Hunter and Jim McMahan

There is a huge opportunity to thrive in today’s mortgage marketplace—despiteall the new regulations. It requires firms to embrace the entrepreneurial spirit pres-ent in their people, fostering idea generation and then incubating and developingthose ideas until they’re ready to deploy. When that spirit flows from the com-pany’s team into the marketplace and then back into the firm, enormous lifts willresult in the company’s loan origination volume.

When I say ideas, I am not referring to gimmicks, but rather innovations that havea profound effect on the marketplace and ultimately create more relationships thattranslate into more loans. At Benchmark, loan originators are sharing their innova-tive ideas with their home offices, and the home office is listening, developing theideas, delivering them out to their originators, and then supporting them.

Despite the difficult regulatory environment, it is not a violation to brainstorm,develop new ideas and bring them to fruition. Neither is it a violation to work with re-ferral partners. In fact, it makes good business sense to educate referral partners—tothink of them as “idea partners” and work together on the best ways, for example, tocommunicate with clients—through co-marketing, blogging, Facebook pages, videoor webcasts. The aim is to generate ideas, and then have a dedicated team in the homeoffice that can develop those ideas to ensure that they meet the needs of users.

At Benchmark we have created a special department to gather those ideas, addmore to them and then redistribute the finished products or tools back into thehands of our sales teams.

Here’s how it works: Mastermind groups gather up our mortgage professionals from different regions

that have the goal of increasing the size of their businesses. These groups then worktogether to capitalize on social media and develop other innovative techniques suchas video business cards or Facebook applications to reach out to past company clientsand referral partners. They work on creating more effective ways of co-marketing anddelivering a targeted sales message into the market place. In short, they dedicate them-selves to finding innovative ways to maintain communication and relationships.

Believe it or not, the approach really works!Once an idea is suggested, the team brainstorms to improve the idea, deter-

mines exactly how headquarters will support it, and then determines the best waysto distribute the finished idea out to business partners. This ensures that the newideas do not remain the private reserve of a think tank, but rather they find theirway out into the marketplace.

Cooperation is built into this approach because every member of the master-mind group recognizes that performance requires flexibility and an open mind;one that embraces new ways of doing things that is capable of impacting the mar-ketplace in a positive manner. They realize this, but they will also tell you that thismethod his highly creative and a lot of fun.

The aim of all of this is to get originators and branches to share ideas with theirhome offices, where they can then be developed and supported. One of our fa-vorite tools for this process is video. We strive to make it easy for creative branch-based personnel to create a short video and forward it through the Internet to thehome office. Once the video is received, it is edited and completed for use by theloan originator, branch partner or mastermind group.

To really serve a marketplace and to be considered an entrepreneur requires firmsto develop their own creative formats for generating ideas, gathering feedback andthen implementing good ideas. The aim is to ensure buy-in from the company andto create a process for bringing these ideas to market. More importantly, this approachhas the added benefit that the creative work will be a part of the culture of the busi-ness on a daily basis. Innovation cannot be delegated to part-time status, or worse,given to someone that is not passionate about developing a new idea.

Firms that understand how to apply these techniques of entrepreneurship inpursuit of innovation have a competitive advantage over companies that are sittingback, content to do business as they always have.

Jim McMahan is president and Stewart Hunter is founding partner and core values offi-cer for Dallas-based Benchmark Mortgage. You can find them both online atwww.iambenchmark.info.

Keepingg thee EntrepreneurialSpiritt Alive


compliance, it’s irrelevant in our existinglending climate and the loans currentlyproduced and quality control (QC) meas-ures in place on both ends. It’s very easyfor a lender to expose and weed out badmortgage brokers or bad loans.Regarding loan quality, if thenumber two wholesalelender is at approximate-ly $27 billion funded in2010 with more than90 percent brokeredbusiness with just overa two percent defaultrate doesn’t tell peoplesomething about brokerquality, I’m not sure what will.The Federal Reserve rule on com-pensation is no different than reformingthe Real Estate Settlement Procedures Act(RESPA) in the eyes of a wholesale lender… this will soon just be another changewe’ll look back on.

Non-depository lendersand brokers workingtogetherThese new rules will all take time tooperate efficiently just as all the otherchanges we’ve recently faced as anindustry. Attention now should beplaced on compliance, but also on thefuture of our industry. The ConsumerFinancial Protection Bureau (CFPB)takes over on July 21st of this year. I ampersonally optimistic for the bureauand the potential for a better under-standing of our industry at the streetlevel to the consumer as it pertains tonon-depository lending. As the first fed-eral non-depository regulatory agency,we can expect to be getting more atten-tion. I truly feel, from my experienceswith them, that their intention is to reg-ulate fairly as well as protect competi-tion for the benefit of the consumer.

As a successful LO and exclusive mort-gage broker working under the whole-sale channel, I can personally tell youthat these compensation changes do notput us at a competitive disadvantage. Ifanything, I feel that it continues to putus at a competitive advantage withgreater flexibility and pricing. There arepros and cons to every lending channeland LOs just need to understand, with-out influence, what is best for them.Again, unless someone is exclusively bro-kering loans or has in the last two yearsor less, it’s nearly impossible to knowhow these rules truly affect the mortgagebroker. Our channel will once againgrow when awareness spreads.

I support all non-depositories that runa good business … banker or broker. Ihave great friends and colleagues whowork in the correspondent channels andthis in no way is a poke to that model

which is a good model. This is, how-ever, a poke to those that ques-

tion or clearly do not under-stand exclusive wholesaleoriginations. Non-deposi-tory mortgage lendingmust be protected at allcosts for competition andaccountability to the big

banks and it should be arequired option for the con-

sumer with all the increases incosts and regulation. I personally rely

on the man upstairs to expose good andevil, but my unrelenting passion for ourindustry and those who do right by theirclients cannot be denied. For those whofeel the mortgage broker or wholesalelending channel is not a continued forcein the industry and deny what or who weare, I’m waiting in the cage of debate andthe gloves are off.

What’s next?� The final definition of a qualified resi-

dential mortgage (QRM) and details onexemptions as it pertains to five per-cent retention. Agencies allegedly willbe exempt, but if this is not confirmeddown to the primary market creditorthan this is a huge game-changer.

� New disclosures and structure underthe CFPB.

� The future of Fannie Mae andFreddie Mac. How can the privatesector grow under all of these regu-lations? How can the governmentslowly dissolve these agencies in ourcurrent housing market? When arethese risk-based price adjustmentsgoing to get under control and actu-ally apply to the risks?

� With all of the unknowns and muchmore … get ready for a wild ride!

I believe there is more opportunity fora mortgage professional right now thanthere has ever been to thrive in theircareer. I also believe that there is a sig-nificant opportunity in the wholesaleorigination channel for any LO. We arebeginning to see new lenders entering orre-entering the wholesale channel to alsotake advantage of these new opportuni-ties. Be aware, be positive and be drivenby the things in life that actually matter.

Andy W. Harris, CRMS is president andowner of Lake Oswego, Ore.-based VantageMortgage Group Inc. and 2010-2011 presi-dent of the Oregon Association of MortgageProfessionals. He may be reached by phoneat (877) 496-0431 or e-mail [email protected] or visitAndyHarrisMortgage.com.

“Keep in mind that we are in atransaction-based industry

without the benefits of passive orresidual revenue. This forces

businesses to revise policies whenvolume is up or down.”

LOCOMP

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For months, loans originators (LOs) havelived under the threatening cloud of theFederal Reserve Board’s LO compensationrule. For months, everyone tried to figureout what the real implications were. Wasthe yield spread premium (YSP) actuallybanned? Was direct borrower payment toa mortgages broker a way out from theregulation? All the while, the FederalReserve was curiously silent, puttingnothing in writing. That is until theNational Association of Mortgage Brokers(NAMB) and the National Association ofIndependent Housing Professionals(NAIHP) both filed suits to stop the regu-lations.

Then, the Fed finally decided to gopublic with a Webinar to answer ques-tions on their LO compensation rule just afew weeks before the April 1st implemen-tation date. Even after the Webinar, con-fusion reigned—right up until hoursbefore the April 1st implementation date.Just hours before April Fools Day, aFederal Judge granted a stay of executionfor few days so that a hearing could beheld, and just a few days later, the staylifted.

While thousands of LOs held candle-light vigils across the nation, prayingfor a miracle, the truth is that the resultof the hearing may not have matteredthat much. Why? The best result theindustry could have hoped for is adelay until the new Consumer FinancialProtection Bureau (CFPB) issued theirown rules which will pretty much mir-ror those which were issued by theFederal Reserve Board because theiragency must follow the provisions ofthe Dodd-Frank Act. The only hope ofavoiding this scenario would beCongressional action voiding the Dodd-Frank Act or the specific compensationprovisions of the Act.

First, where do we stand with regardto the provisions of the regulations? Ingeneral, here is what I have gatheredfrom the many different Webinars andconsultations:

� No payment based upon the “terms”of the loan, aside from loanamount, is allowed. Translation …no overages and the provision does

not allow an LO or broker to cuttheir quote to a borrower by cuttingtheir commission.

� While the YSP is supposedly banned aspayment for compensation, the truthis that the YSP can be used by a bor-rower for closing costs and a LO’s orbroker’s compensation is part of theclosing costs paid by a borrower. If theinterpretation was taken “literally,”then a “no closing cost” loan wouldnot be possible. The Federal ReserveBoard’s intention was not to disallow“no closing cost” loans.

� Though it appeared that direct brokercompensation was an option to allowan LO to circumvent the restrictions ofthe rule with regard to getting paid onthe terms of the loan, this direct bro-ker compensation does not allow forpaying a “commission” to the loanofficer working for a broker. In thesesituations, the loan officer must bepaid salary or hourly.

� “Point banks” used by lenders manyyears ago in lieu of overages, are notallowed. However, I suspect you willsee an “informal practice” of pricingdiscretion for more profitable loanofficers. See Eric Hollman’s perspec-tive later within this article.

Confusing? It is even more confusingbecause each wholesale lender seemsto have their own interpretation of therules. Since the Fed has put nothing inwriting, what I have gleaned may notbe any more accurate than what a par-ticular wholesale lender indicates.

The real question is: What is the realeffect of these rules with regard to LOcompensation, the industry, as well asthe secondary markets? Here is my inter-pretation of the broader implications.

1. Originators will still be able tomake a good living in this industryThey will not be able to survive using abusiness model that depends uponmaking a “killing” on one or two loansper month. LOs will need a consistentvolume of loans and this volume will

LO Compensation and the Markets

certainly be possible because of thesmaller population of loan officerswithin the industry. The industry willalso experience increased volumes asthe real estate market recovers.

2. Yes, the real estate market will recoverPeople will be purchasing homes 30years from now and they will needfinancing. And there will be more peo-ple purchasing more homes as our pop-ulation expands. As of right now, we arenot building enough homes to housethe needs of this expanding population.

3. The need for mortgage brokers andsmaller lenders will not diminishThe dominant banks are likely to inter-pret the LO compensation rules conserv-atively. The bigger they become, themore public and regulatory scrutiny theywill be under. Smaller lenders and bro-kers will have more flexibility to changeas new interpretations and different sce-narios come up. Right now, because dif-ferent lenders are interpreting the rulesdifferently, brokers can shop compensa-tion terms, as well as rates. As these dif-ferences may diminish over time, com-petition will cause interesting variances.

4. LOs will need to keep up with themarkets more ferventlyWhile they cannot gain from “raisingthe rate,” they also cannot take a loss ifthey offer a lower rate than what is pub-lished. This is a major contention of theNAMB and NAIHP lawsuits. The ruleswere supposed to protect consumers,but how are consumers protected if theLO cannot give them a lower quote?

Eric Holloman of RateLink gives usthis perspective:

In the past, LOs who under-quoted the mar-ket would simply have the underage takenfrom their pay. That is no longer the case. Ifa loan officer closes a loan at a loss, thecompany is required, by law, to pay a fullcommission and eat the marketing loss. Onething is for sure, LOs who get caught offguard by unscheduled price changes are ingreat danger of losing their jobs. You can beassured a company will not be willing topay commissions and take marketing lossesfrom a specific mortgage loan originatorvery long.

In essence, LOs who keep up with themarkets will be in a position to give thebest quotes to their prospects. It will

not be about trying to make moremoney per loan, but doing more loansat a fair price. Again, volume will be thename of the game and price will be afactor. The more volatile the markets,the trickier this game will become.

Great service will still be important. Intoday’s environment, having a loan offi-cer who understands how to get a dealthrough the system is essential.Underwriters are looking at loans withmicroscopes. This part of the job hasbecome more difficult than ever. Thenew rules proposed by the CFPB withregard to qualified loans will make surethat the old ways of loose credit will notbe returning. Any loan which is not guar-anteed by the government with less than20 percent down and outside the pre-scribed ratios will carry an even higherrate if this latest proposal is finalized.

Again, market data will play animportant factor. Risk-based premiumswill become even more pronouncedunder this scenario. I imagine a prospectshopping will become even more con-fused because the quotes they receivewill bear little resemblance to reality.Keeping up with rate changes will beimperative because a competitor willleave you behind if the market is improv-ing during the day and you are not awareof what is coming next. Knowing whenlenders will change their rates evenbefore the lenders change will be a veryimportant factor in the new world.

Dave Hershman is a leading author forthe mortgage industry, with eight booksand several hundred articles to his cred-it. He is also a top industry speaker. Ifyou would like to stay ahead of what ishappening in the markets, visitwww.ratelink.originationpro.com for afree trial. Dave’s NewsletterProMarketing System can be found atwww.webinars.originationpro.com andhe may be contacted by e-mail [email protected].

“The dominant banks are likely tointerpret the LO compensationrules conservatively. The bigger

they become, the more public andregulatory scrutiny they will beunder. Smaller lenders and bro-kers will have more flexibility to

change as new interpretations anddifferent scenarios come up.”

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mental in enhancing the borrower’s cred-it profile. Either way, we are helping torescue customers that the Realtor mightotherwise lose.

AccessibilityWe know how important availability is toRealtors and this is something that I con-tinually stress. Because agents frequentlywork evenings and weekends, Realtorsappreciate LOs who can adapt to theirschedules. I make sure that myself or anassistant return calls and provide neces-sary support whenever they need it. We’reable to write and deliver pre-approval let-ters in a short time-frame, which is signif-icant advantage for those who have inter-ested buyers on a Saturday or Sunday.

Our agent partners know this sameavailability exists when I’m away fromthe office for a day or longer on vacationor business travel. If I’m not in the officeor immediately accessible, they canreach my experienced assistant who isthen able to handle critical situations.Should the need arise, I also work with asenior loan officer who can provideadvanced support during my absence.The fact that I am available 24/7 can bea major factor in an agent’s decision touse me.

Realtors also are impressed that wedon’t ignore them during busy refi-nance periods. Throughout my career, Ihave focused on purchase business. Ihave always been careful to pay atten-tion to agents during hectic refi mar-kets, when other originators seem toobusy to return calls or offer other sup-port. Agents know that I have their bestinterests in mind at all times. Of course,I don’t avoid refi business, but rather,have an assistant who coordinates themajority of this activity.

I monitor my strategic partner rela-tionships on an ongoing basis, alwayslooking for new opportunities toenhance them. I never assume thatbecause we have worked together inthe past, real estate agents will auto-matically give me their future business.I continue to make an effort to deservetheir trust and referrals.

Stephen A. Marrs is vice president ofsales for Gold Star Financial Group inAnn Arbor, Mich. He may be reached byphone at (866) 249-2192 or [email protected].

Expanding Realtor RelationshipsBy Stephen A. Marrs

A key part of my success as a loan orig-inator (LO) has been the developmentof strategic partnerships with Realtors.Of course, it has taken years to estab-lish this valuable niche, but the result isevident. Approximately 95 percent ofmy annual business is referral-based,primarily from real estate agents.

Our overall focus on Realtor rela-tionships highlights three main areas:

� Education;� Value-added support;

and� Accessibility.

While the specific strate-gies aren’t necessarily new,they are effective becausewe are consistent in theirapplication and becausemany of our competitorsdon’t go out of their way tocreate long-term associa-tions with agents.

EducationIt’s no secret that realestate agents are hungryfor information, especiallyin the current, more chal-lenging marketplace. Theywant to be informed ofthe latest developments inreal estate finance andhow specific loan pro-grams can help their bor-rowers, thereby leading tomore home sales. One of our most effec-tive strategies has been quarterly educa-tion seminars in Realtor’s offices. Wemake sure these programs highlight rel-evant topics that will help them be moresuccessful. For example, condos are a bigmarket in our area, so one of our pre-sentations features a comprehensivereview of guideline changes for condopurchases. We also organize mini-semi-nars for smaller groups of agents at a cof-fee shop or other convenient location.

A special benefit of these presenta-tions is that it affords me anotherchance to be on-site and ask the pri-mary agent for introductions to others

in the office. These are strong endorse-ments that often lead to new associa-tions with agents with whom wehaven’t worked before. It seems so sim-ple, but gaining entry to these addi-tional agents has helped furtherexpand my referral-based business.

In addition, we send weekly e-mailupdates that help agents better understandnew loan programs, guideline changes andother hot topics. When the Federal HousingAdministration (FHA) increased its monthly

mortgage insurance premi-ums, we were able to pro-vide them with advancenotice of the upcomingchanges and how they mightimpact their clients. Our e-bulletins usually include sce-narios of actual borrower sit-uations, such as how a spe-cific loan program can offercustomers more purchasingpower. One of our objec-tives is to prompt theRealtors to ask questionsafter reading one of thesee-mail updates, offeringanother opportunity todemonstrate our expertise.

When appropriate, wealso extend this education-al approach to the agents’borrowers. For instance, Iwill suggest to Realtors thatwe can contact their buyerswho are currently lookingfor homes to see if we can

answer any of their questions regardingloan amounts, qualifying and otherissues. We will do this even though anoth-er lender already may have pre-approvedthem. Even if these discussions do notresult in new clients for us, we have fur-ther shown our commitment to helpingagents grow their business.

Value-added supportAs we developed mutually beneficial rela-tionships with Realtors, we saw the oppor-tunity to offer other support that helpedset us apart from the competition. A goodexample of this is our coaching of selectagents in the preparation of their pur-

chase contracts. We review the contract toidentify possible issues, such as addition-al buyer costs, seller credits, etc. We thensuggest language that can minimize legalissues or other potential problem areasand ensure that any concerns are identi-fied as early as possible. For example, withsome condo purchases, we suggest thatthe purchase agreement include a condochecklist contingency, which speeds upreceipt of the information necessary toapprove the loan. The seller is responsiblefor providing the information from theHomeowners Association or their man-agement company. This may save theborrower money since they won’t have topay for the information and it can alsopinpoint issues resulting in a loan denial,prior to the borrower paying for anappraisal. Experienced agents are notnecessarily interested in this coaching, butnewer ones have told us that our pro-active approach is beneficial; saving timefor them and their borrowers.

Our telemarketing leads assistancehas been especially popular. Many ofour agents have a group of “C” leads,those prospects who aren’t quite readyto go house hunting. I explain that wewill stay in contact with these long-termprospects on the agent’s behalf. Wemeet with the agents to develop anoverall plan, which includes periodiccalls or e-mails to their prospects. Wewant to answer questions about home-ownership, financing, credit scoring andanything else that will establish rapportwith these future homeowners. Whenthey are ready to purchase or want toknow specific information about thearea or a particular home, we advise theRealtor who then follows up with them.Of course, this isn’t an overnightprocess; it can take weeks and monthsbefore a “C” lead becomes an “A” or “B”prospect. We give agents weekly phonereports and have regular status meet-ings to make sure that everyone is onthe same page.

In addition, some of those “not readyto buy yet” prospects have credit chal-lenges and we are able to further assistagents by preparing their future clients forhomeownership. Sometimes it is an easyfix, as we suggest basic tactics to help bor-rowers improve their credit situation. Inother instances, it may take a moreinvolved approach, in which case ourCredit Repair Division might be instru-

“Because agents fre-quently work evenings

and weekends,Realtors appreciate

LOs who can adapt totheir schedules. I

make sure that myselfor an assistant returncalls and provide nec-essary support when-

ever they need it.”

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Social Media: More Than Just a Buzzword

I am sure everyone in the mortgageindustry is just about fed up withchange … the changing guidelines,changing regulatory environment, andthe drastic change inincome. One change thathas occurred is a changefor the better. For thoseof us who accept it, it willnot only survive throughwhat I have just men-tioned, but it will alsohelp in achieving thereinvention and stabiliza-tion of their businesswith new tools and thesame relationship-build-ing fundamentals thathave made this industrygreat.

I will admit, it hasbeen tough to get excitedabout the mortgageindustry on a day-to-daybasis. We all have ourdays where doubt, frus-tration and anger cloudour minds. I will admitthat the peaks and val-leys in this industry havebecome more of a valleythan a peak, but there isa new dawn on the horizon and itbrings back feelings of excitementabout the possibilities of what our busi-ness can achieve, not only by creatingnew opportunities to attract clients, butservicing existing relationships andclients better. Rarely do these twoobjectives align so perfectly.

The terms “social media” or “socialnetworking” are not just the buzzwordsof the year; they are the way you will dobusiness for the rest of your career.They represent a plan, and most peopleI speak to these days are without a clearplan.

Here is the good news: If you havebeen successful in this industry andhave survived to this point, you arealready proficient building and main-taining relationships. Now you havenew tools to bring these abilities onlineand build a community that “likes” youand what you have to offer.

Like it or not, your past client mailingdatabase is dead! You have either already

refinanced qualifying customers to histori-cally low rates and they are not going to beback in the market any time soon. The rest

do not qualify and havestopped opening the directmail you send. By the way,they are all checking theirFacebook pages each dayfor relevant content andcool stuff people are doingor offering. That database isalive with every statusupdate. Mailing to 15,000will be less effective thathaving 150 people “Like”your page, read your Twitterupdates or watch yourvideo on You Tube. The flatfact is that consumers wanta more intimate relation-ship with the companiesthey do business with.They want to know youand see transparency inyour business offerings.There has never been abetter way to achieve allof these objectives thanthe use of social mediatools. The Internet is hugeand getting “bigger.” It isthe tool used by most

every consumer to set a frame of refer-ence and find out if they are getting agood deal or not.

Social media outlets are tools withinthe tool. You can earn the trust andbusiness of the consumer by buildingand maintaining a relationship withtransparency.

The bad news is … it can go theother way as well. Social media willhold you accountable. If you do abad job or do not properly deliver,your customer has a powerful outletto tell the world about the experi-ence. This is more powerful thanthe old understanding of “Word ofMouth,” as this can be a wide openmouth that never stops telling thetruth. That accountability and trans-parency should be welcomed intoyour business.

As I have mentioned before, youhave navigated through the changes inthe industry and have built relation-ships to this point … you are ready for

this! If you have not already started,then by all means get started! If youhave started, then take it to the nextlevel. If you think social media andsocial networking are buzzwords orfads, you may want to update your planto operate in this decade.

I had an opportunity to watch GaryVaynerchuk present his new book, TheThank You Economy. Gary’s booktouches on the power of the Internetand how social media can propel yourbusiness. Watching Gary present wasfabulous, he is a “real” guy that built amultimillion dollar business by givingaway information and has become asocial media guru and widely respect-

ed for his innovation. A great excerptfrom the presentation was:

Question: “What is the ROI of social media?”Gary’s response: “What is the ROI of yourmother?”

Interesting response, that is howimportant this is to your business! Be anoriginator … originate a loan a day or arelationship a day, both are equally asimportant to your business.

Chad Jampedro is managing vice presidentof GSF Mortgage Corporation. He may bereached by phone at (262) 901-1444 or e-mail [email protected].

By Chad Jampedro

“The terms ‘socialmedia’ or ‘social net-working’ are not justthe buzzwords of the

year; they are the wayyou will do businessfor the rest of yourcareer. They repre-

sent a plan, and mostpeople I speak to

these days are with-out a clear plan.”

It is how you will do business for the rest of your career

especially if you haven’t made a connec-tion with your followers. Why? Becausewithout a connection, it’s unlikely themessages you send out will even end upat the top of your followers’ news feeds.Which means, your message will beburied under all of the other messagessent by all of the other friends that per-

son is following. Better tobe actively engaged withfewer followers that youknow are receiving yourmessage, than to have alarge following that isn’teven seeing your post-ings. Didn’t your motherever tell you, it’s notabout quantity of friends,it’s about quality?

Start with astrategyMaking social media worktakes a commitment—just like every other mar-keting project you’ve evertaken on. This commit-ment doesn’t mean youhave to spend all day post-ing on Facebook or tweet-ing on Twitter, however.What it means is this:

� Help people find you online: Listyour Facebook, Twitter, andLinkedIn URLs right alongside yourWeb site URL on your literature andbusiness cards. Put signage and rackcards in your lobby highlightingyour online locations and the type of

Building Business RelationshipsVia Social Media

You’ve probably read plenty of articlesabout social media, about how it helpsmortgage companies connect with cus-tomers, about how a good marketing plantoday includes a social media plan, abouthow some company quadrupled its salesjust by using social media, and about howyou’d better get involved or get leftbehind … far behind.

So, after standing on theshore a while, you dove inand set up a Facebook page,maybe even set up a Twitteraccount or a blog. You post-ed messages steadily for awhile, got some followersand a comment or two,posted a few more mes-sages, got a few more fol-lowers, got busy, couldn’tthink of anything to writeabout, didn’t see the valuein the time you were devot-ing online, and before long,months had passed sinceyou last put out a message.

That, or you’re stillstanding on the shore.

Either way, you aren’tgetting the bang out ofsocial media that youcould be getting. Allbecause you just aren’t sure how tomake it work. Well, here are some ideasthat should help get your social mediaparty started.

It’s not all about numbers of followersOf course you want followers … butracking up numbers for the sake of num-bers doesn’t guarantee you anything—

By John Seroka

“Social media is nota straight-laced busi-

ness meeting … it’speople connecting

with people. It’s waymore low-key than aformal news release

or a productannouncement.”


If you’ve made it into the 21st Century,you’ve probably heard of a thing calledFacebook. And if you’ve heard of Facebook,then you’re probably also familiar withTwitter and maybe even a handful of othersocial media platforms. Somany of us devote our timeto outbound marketing suchas e-mails, flyers, phonecalls, visits, etc., that we neg-lect the most common ofmodern modes of inboundmarketing—Internet mediaplatforms. Your colleaguesare on Facebook; your com-petitors are on Facebook;your fiends are onFacebook; and your clientsare on Facebook. Youshould be, too.

I chose Facebook andTwitter to focus onbecause they are the mosttalked about platforms inbusiness social media and easily themost visible. Both of them boast boom-ing membership numbers and so muchhas already been written about the suc-cesses of companies using them for cul-tivating customer relationships andnew business. And if you’re not alreadyusing social media, perhaps this mightconvince you to explore your options:

� According to investopedia.com,Facebook was the most visited sitein 2010, easily toppling Google forthe spot.

� At 18 million searches per monthlast year, Twitter was beginning toreduce the lead Google had with 88million searches per month.

But it’s not just about garnering asmany Twitter followers or Facebook fansas you can. It’s about putting out infor-mation that your customers and poten-

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information customers can expect toreceive if they follow you (markettrends, rate information, the chanceto provide feedback about suchthings as customer service and more).

� Loosen up: Social media is not astraight-laced business meeting …it’s people connecting with people.It’s way more low-key than a formalnews release or a product announce-ment. It’s conversational and casual.Once you have pulled off your tie,though, don’t put on a lampshade—there are boundaries! This isn’t real-ly a party with your best friends eventhough, once in a while, it might feelthat way. If you’re not quite surewhat I mean, go to the social mediasites of several companies you like,in different fields, and take note ofthe tone and content of their post-ings. Emulate companies and peoplewho have been doing it for a while.

� Provide information of value: Ifyou’re going to put something outthere, make sure it is relevant, timely,helps your followers solve their prob-lems, provides tips to increase sales,announces an event of interest tothem … you get the idea. Figure outwhat information your followerswould find valuable and provide it tothem. Offer links to articles of interest.Search YouTube for relevant videosthat discuss anything from, “How toChoose the Right Real Estate Agent,”“Choosing the Right Mortgage,” to thelatest industry news for consumers,prospects or business partners. Then,provide a link via Twitter or uploadthe video to your Facebook page. Yourgoal is to be a trusted and valuedsource, providing information thatyour followers will want to pass alongto their friends and building the kindof relationship that makes you theperson they call when they are readyto get a mortgage.

� Get your followers engaged: Withsocial media, you want to accom-plish more than simply pushing amessage at your followers … youwant them talking back to you.Remember, there are real peoplebehind those pictures, so make aneffort to engage. Here is an example:When you post an announcement ofan upcoming event, finish it up witha question, such as, “Are you plan-ning to attend?” This simple ques-tion encourages followers to postreplies or simply click the “Like” but-ton. Either way, you are now engag-ing in a two-way conversation.You can even use a Facebook poll toask a question, find out what is on

your followers’ minds, or ask how youcan make your content more useful tothem. Hold a Tweet chat with cus-tomers to get input on a business-relat-ed decision. Invite followers to intro-duce themselves. Upload pictures ofcompleted events so people who didn’tattend can see what they missed andset aside time for the next one. Run acontest that gives a prize to the personwho gets the most people to follow youon Facebook, Twitter or LinkedIn. Justbe careful when running contests notto violate the Real Estate SettlementProcedures Act (RESPA), which pro-hibits awarding prize packages inexchange for a person’s business.

� Comment back: When your follow-ers comment on your blog or post,be sure to respond with a thank youand/or an additional comment ofyour own. This will let them knowyou are listening and will encouragefurther discussion.

� Don’t talk too much: Attentionspans are short—some say 10 sec.short—and there’s a lot of competi-tion. Craft your message to say whatit needs to say and be done.

� Help worthy causes: At key timesthroughout the year, set a fundraisinggoal and raise money for a worthycause. Not only will you help organi-zations and people who need it, butyou may also generate some publicityfor your company when you reachyour goal. You can launch such a pro-gram with a combination of Facebookposts, Tweets and e-mails.

� Don’t be polarizing: It should gowithout saying, but I’ll say it any-way—don’t publicize support forpolitical parties or candidates, stateyour religious views or discuss topicsabout which people have strongly-held beliefs. It won’t help your busi-ness to get into an online skirmishwith someone—a skirmish that isthen read by all of your followers.

Get social and createsome influenceAccording to Arbitron/Edison Research,51 percent of people over the age of 12are using Facebook in 2011. That’s 43percent higher than it was just threeyears earlier. Clearly, social media isnot a fad—it’s a trend, and a rapidlygrowing one at that.

Now think about how that piece ofinformation relates to your business.How many of those people may need amortgage now or in the not-so-distantfuture? How many have the potential tobe your customer in five years? If you

want to connect with the people whoare going to need your services, socialmedia is where you’ll find them. Yes, itcan be scary at first. Any new under-taking is. But if you dive in with a strat-egy to guide you—and let yourselfhave some fun along the way—you’lldiscover the water is just fine.

John Seroka is vice president of Seroka, afull-service branding, advertising, market-ing and public relations firm that serves anationwide client base. He may be reachedby phone at (866) 379-0400 or [email protected]. You also can connectwith him at linkedin.com/in/johnseroka,twitter.com/johnseroka or on Facebook.

tial customers need, while providing per-sonal, meaningful dialogue. It’s the per-sonal interaction that can make the dif-ference in building and maintainingmodern long-term client relationships. If

you’ve been in the busi-ness for any length oftime, you know that build-ing and maintain personalrelationships are impor-tant for a successful enter-prise.

Historically, these rela-tionships have been devel-oped over time, throughface-to-face networking andold fashioned leg work. Soalthough modern methodsthrough the Internet canprove to be more effectivewith less effort, these tech-niques, your “old school”marketing tools, still havetheir place in the mortgage

industry. Use your loan origination system(LOS) for your database and to distributeyour marketing materials, but truly consid-er the value of modern digital marketing.

What is a Tweet worth?When Twitter first made it onto themainstream business radar, its useful-ness was still in question. After all, inmarketing we’re taught to tell a story,and 140 characters—often abbreviatedinto text-speak—does not make a story.So what exactly is Twitter good for—other than perhaps to find out what yourfavorite celebrity ate for breakfast thismorning?

The beauty of Twitter is that it canserve as your “sound bite.” It’s micro-advertising that you can use to generateinterest for your target audience.Combine a great “headline” with a linkto your Web site, blog or Facebook pageand you have free, effective, inbound

Internet Connections … It’s NotWhat You Think!

By BJ Bounds

“Facebook can helplure potential clients,

but your own Website can seal the deal.”

Building business relationships through social media

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marketing. Simply put, your customersfind you with little effort of your own.

There have been many studies andpresentations explaining the importanceof post times and content for Tweets.Recommendations vary tremendouslyand much of it is common sense. Itwould behoove you to Tweet multipletimes a day. You won’t be visible to allpeople at all times, but a blitz-typeattack can get you on the page.

Don’t make the mistake of postingthe same message 20 times a day. If youhave something new on your Web site,by all means post the link multipletimes. However, change your messag-ing. Besides alienating your followers,you will be violating Twitter rules andthis could get you kicked off. Your con-tent can naturally follow the trends ofthe industry. Post what is important toyou; often it is also important to yourfollowers, whether it be clients or col-leagues. Helpful tips, links to great sitesother than yours, opinions, fun trivia—it’s all up for grabs. Make it personal.

Facebook fan: Friend of foe?Facebook has morphed beyond theteenager-dominated social networkingsite. Growth in users of social media showsa trend toward a more mature base. In2010, Flowtown reported that the averageage of Facebook users is 38. To get in onthis momentum, consider creating a busi-ness page to use separately from your per-sonal page (if you have one). The mostobvious difference is that a personal pageallows you to have “Friends” while a busi-ness page only allows “Fans.”

Setting up your page this way is alsomore appealing to individual Facebookusers because if even if they “Like” youand can see your posts, you cannot seetheirs. Their personal Facebook pageremains personal. While there aren’t toomany options design-wise withFacebook, having a business page foryour company can serve several purpos-es, three of which I’ll talk about here.

First, if yours is a very low-tech com-pany with not much interest in main-taining a business Web site, a Facebookpage can serve as the face for your com-pany. However, since with Facebookyou are attempting to cater to the mass-es who are more technically-minded, Istrongly suggest you also maintain yourWeb site, for if nothing else, to takeonline mortgage applications whichappeal to so many of us. Facebook canhelp lure potential clients, but your ownWeb site can seal the deal.

Second, your Facebook page is aprime place to showcase your personali-ty to potential clients. Here, too, youshould make it personal; most peoplewould rather buy from a person than acompany. Granted, your personality

might not mesh with everybody, but weall want to know who we’re doing busi-ness with. This is your opportunity toprovide fans with things you are doingbesides the typical 9-5 grind. Are youinvolved in your community? Did yourcompany have a food drive or participatein some other charitable event? Theseare things that help you become morepersonable and more approachable.

Third, use Facebook for a modifiedversion of its original purpose—net-working. Networking is so important inthe mortgage industry. In person, onthe phone, even online, networkingcan help you develop the industry rela-tionships and subsequent referrals youneed to be successful. Find colleaguesand vendors who are on Facebook and“Like” them. Seek out the pages oftrade organizations where you can par-ticipate in meaningful dialogue to offerand receive guidance. Facebook canbecome your new Google.

And the rest …Do you remember the theme song to“Gilligan’s Island?” It originally closedwith “… and the rest, here on Gilligan’sIsle.” But it was later changed withproper billing of a couple of belovedcharacters, “the professor and MaryAnn, here on Gilligan’s Isle.” Likewise,LinkedIn deserves equal billing in thesocial media arena. But as a profes-sional networking site that hasremained true to its original purpose,LinkedIn hasn’t experienced the atten-tion as the other morphing tools haveand it hasn’t t quite branched out func-tionally. It’s a great tool for profession-als, and I encourage you to check it out.

If you’re just starting out in socialmedia, you first need to figure out howmuch time you’re willing to devote toyour endeavors. A few minutes, severaltimes a day is all you need, especially ifyou can post from your Smartphone. Ifyou plan ahead for your basic posts orTweets, implementation is a piece ofcake. You can save your other posts forfun things, links to other news or Websites or words of encouragement.

Choosing your social media platformis not a decision to be made lightly.There are really strong cases for bothFacebook and Twitter, and yesLinkedIn, too, and using them togethermay be the best overall choice. Thereare simple plug-ins and applicationsyou can use to link your posts from oneplatform to the other to greatly increaseefficiency. Check out sites like HootSuitefor an easy-to-use social media dash-board and explore the applicationswithin your chosen platforms.

If you take nothing else from this arti-cle, take this: No matter what platformyou choose, make it personal. Let your

personality shine. In almost no otheraccepted business setting, can you makesuch a concerted effort at being person-able than in social media? It is importantto be polite, considerate, and by allmeans, check your grammar. Like tradi-tional outbound marketing, cultivatingrelationships is essential. Remember that“Fans” and “Followers” are people, too sohave fun and enjoy the interaction.

B.J. Bounds is senior marketing communi-cations specialist for Calyx Software. Inaddition to media relations and copywrit-ing, BJ is a contributing author to theCalyx Software blog, CalyxCorner. She hasmore than 10 years of experience in salesand corporate marketing with a focus ontechnology that spans several industries.She may be reached by phone at (800)362-2599 or visit www.calyxsoftware.com.

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The first step for loan officers is to createa personal and professional profile on eachKey Target to determine and establishcommon ground. This empowers a loanofficer with the ability to deliver a valueproposition that speaks to the Key Target’sneeds and wants. Successful loan officersunderstand that the most productive rela-

tionships are formed overtime and require morethan just an initial meet-ing. Investing the time togrow those relationshipsmore often translates tocoveted repeat business.

The industry is in des-perate need of core salesbasics of building and cul-tivating relationships togain or maintain marketshare. Many lenders areexpressing concern thattheir loan officers are noteffectively building rela-tionships. They understandthat loan officers makingthe occasional phone callfrom their desk are noteffectively prospecting. Themost successful loan offi-cers are in the market on a

regular basis, presenting a compelling valueproposition and delivering on his/her statedpromise to each source.

Developing common ground with aKey Target can provide an added advan-tage to a loan officer’s success. A trueunderstanding of what is important toeach Key Target, his or her values andhow he or she operates individually posi-tions the loan officer more as a businesspartner which leads to greater loyalty.

How to maintain relationships with keysourcesIt is very rare that someone wouldagree to marry a stranger. Similarly,

A Roadmap for BuildingRelationships With Key Sources

According to the U.S. Department ofCommerce, new home purchasesdeclined 16.9 percent in February to a250,000 annual pace, the lowest levelssince December of 2003. With feweropportunities to close loans, loan officersneed to maximize each and every leadthey encounter. While loan officersshould be focused on build-ing and maintaining rap-port with referral sourcesthroughout the year, themarket shift has made solidrelationships more impor-tant today than ever before.

What we are seeing now isthat some loan officers haveeither lost the competitiveedge that they once had ornever truly learned the criti-cal skills of establishing andmaintaining a network of keyrelationships. In response,lenders today are focusingmore attention andresources on getting theirloan officers committed tothe fundamentals of effectiverelationship-building withpotential Realtors, builders,financial planners, CPAs,stockbrokers, insurance agents and otherkey referral sources.

So how does a loan officer build rela-tionships with key referral sources? First,they must identify the individual rela-tionships that they need to build andthen determine how best to cultivateeach different type of relationship. Forexample, establishing and maintaining aworking relationship with a Key Target,defined as someone who sends a pre-determined number of referrals permonth, will require more work than arelationship with a source that sendsalong sporadic leads. Determining whatkind of marketing is appropriate for eachrelationship type is also crucial.

By Casey Cunningham

“Arming the borrowerwith knowledge anddelivering on time ina convenient mannerwill create fond mem-ories of the mortgageprocess and lead togreater referrals.”

loan officers must woo their sourcesbefore winning their business. Here aresome guidelines for cultivating long-lasting relationships with Key Targets:

1. Do business with people you enjoyThis will make life much more enjoy-able. There is a considerable time com-mitment involved in growing theserelationships. Chances are, loan officerswill be significantly more enthusiasticabout the pursuit and relationshipdevelopment if they are pursuing apotential friend. Create a list of quali-fied Key Targets that you enjoy.

2. Be persistentPersistence is crucial when it comes tofollowing-up with Key Targets. Expectthat every target already has a relation-ship with a loan officer and that theyprobably do not have a compelling rea-son to replace them. Persistence willclearly set the loan officer apart from hisor her competition and is the one areain which most loan officers tend to beweakest.

3. Spend quality timeThe more time a loan officer devotes toface-to-face interaction, the greater thelikelihood is of winning their business.The more time a Key Target spendswith a loan officer, the more likely theywill be to refer their business. It allowsthe Key Target to get to know the loanofficer .and deepen the relationship.Why is more business done on the golfcourse? Four uninterrupted hourstogether! To be out prospecting dailyhas never been more important!

4. Share valuable informationEach Key Target is unique and should beapproached based on their business struc-ture, needs and wants. A loan officer mustproperly interview a Key Target in order todetermine the effective approach in pre-senting a value proposition that is mean-ingful and impactful. Create a profession-al presentation that demonstrates a pow-erful value proposition.

5. It is personal!To distinguish themselves, loan officersmust relate to their sources on a person-al level as well as a business level. Find anexcuse to reach out and do somethingfun like inviting sources to a sportingevent or concert. Meeting after work fordrinks or inviting their family to a holidaycookout is another means in which loanofficers can establish a close relationshipwith sources. It is times and events likethese where relationships are solidified.

Loan officers must pursue their KeyTargets with the same passion and

enthusiasm they would pursue anymeaningful relationship. Below areseveral questions loan officers shouldconsider in pursuit of building theirreferral sources:

� What kind of value are you bringingto your Key Targets?

� What is your plan to follow-up withyour Key Targets each week?

� In what ways do you need to bemore persistent?

� How much personal information doyou know about your Key Targets?

� Do you have a compelling valueproposition that clearly differenti-ates you from the competition?

New relationship opportunitiesAny successful relationship is comprisedof a certain amount of give and take,and a loan officer’s relationship withhis/her referral sources is no different.Communicating proactively and consis-tently ensures that the loan officerremains “top of mind” with each source.

Equally as important, loan officersmust educate borrowers on loans andprograms that best fit their needs.Borrowers potentially represent thegreatest referral source of all, and inthe current market, loan officers needto manage expectations the right way.Whether it is declining values, lowresponse time on underwriting, addi-tional underwriting requirements … itis imperative that the loan officerinform the borrower as soon as impor-tant facts arise in a transaction andupdate them accordingly as termschange. Arming the borrower withknowledge and delivering on time in aconvenient manner will create fondmemories of the mortgage process andlead to greater referrals.

As the Dodd-Frank Act continues totransform the way loan officers have tra-ditionally conducted business, returningto the fundamentals of relationship-building will deliver new growth oppor-tunities for loan officers who have beenstruggling to remain afloat over the pastfew years. With the promise of a newcrop of potential homebuyers surfacingover the next year, how will loan officersseize this opportunity? As the industrycalls for greater transparency through-out the lending process, loan officersthat have been trained to deliver excep-tional service and effectively prospectwill prevail.

Casey Cunningham is president of XINNIX, aprovider of mortgage sales and leadershipdevelopment programs. She can be reachedby phone at (678) 325-3501 or [email protected].

SAVE THE DATE2011 Mortgage Leader Cruise

Sets Sail Oct 13th-17th

Visit MortgageLeaderCruise.com for details.

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media is where you build relationshipswith customer and prospects, not whereyou start them. If you begin a socialmedia campaign with lead generation asthe goal, you will be disappointed.

To generate more leadsfor your mortgage business,begin with a targeted post-card campaign. Direct mailhad always been a staple forthe mortgage industry, andfor good reason—it works!Postcards are a reliable wayto increase the number ofleads coming into yourbusiness.

The first thing to con-sider for your postcardcampaign is the list youwill mail to. This willdepend on who your bestclients are. You will wantto either compile or pur-chase a list of theseprospects so you can pro-mote to them with yourdirect mail campaign.Examples of lists you canpurchase are:

� Late payment lists: Individuals whoare 30, 60 or 90 days late on theirmortgage payments.

� Reverse mortgage lists: People overthe age of 65 with a loan-to-value(LTV) ratio of 50 percent or less.

� Simple refinance lists: People withan LTV of 80 percent or less with aninterest rate at least one percenthigher than the current rate.

For your direct mail piece designs,go with professional, clean-lookingdesigns including the following:

� An image of a home� A success testimonial (if you have one)� The color scheme of your branding� Your company logo� One specific offer� A simple, direct call-to-action

It’s ideal to have repetitive mailings, sodon’t just mail once and stop. The moreprospects who are exposed to your mes-sage, the more likely they are to respond.I always encourage my mortgage clientsto have a campaign that consists of three

Is Building Relationships on Social Media Worth It?

Business owners in the mortgage indus-try, like so many business owners andmarketers from every industry, arestanding at the crossroads of old andnew marketing media and trying todecide what path to take.You know the old strate-gies have worked for you,but you’re concernedthat they may soon bereplaced or that newmedia might offer betterreturns on your invest-ment. Or, maybe you’veeven dabbled in socialmedia but have not seenany results. There are alot of questions sur-rounding social mediafor mortgage businesses,but let’s start by answer-ing the million-dollarquestion …

Should your mortgagecompany be on Facebook,LinkedIn, Twitter andother social media sites?

Yes! There are twocompelling reasons: (1) your clients are;and (2) your prospects are.

In order to grow in any business, youneed to stay in front of your clients andprospects and build relationships withthem—and the mortgage industry is noexception! Social media can help you dothat by connecting you to clients andprospects through a media that is con-sidered more personal and less “mar-ket-y.” The trick is to know how to use itand to have a plan.

In this article, I will outline four stepsto make social media work for you:

1. Generating leads2. How to connect with customers andprospects using social media 3. Planning your social communicationstrategy 4. Engaging and converting

1. Generating leadsThe first goal of marketing is lead gener-ation. Without leads, there is no one toconvert into sales. When it comes to leadgeneration, social media is not yourfriend. The simple fact of it is that social

By Joy Gendusa

“When it comes tolead generation, social

media is not yourfriend. The simple fact

of it is that socialmedia is where youbuild relationshipswith customer and

prospects, not whereyou start them.”

to five cards that get mailed out over settime periods. We call this a campaign,and it’s proven to produce betterresponse than single blast mailings.

2. How to connect withcustomers and prospectsusing social media Once you have a steady stream of newleads flowing into your company, youcan begin your social media campaign.The best use for Facebook and Twitteris to use them to connect with your cur-rent customers and prospects. Here aresome ways in which to do it:

� Send an e-mail asking clients andprospects to join you. Be sure toinclude a benefit of joining (freemortgage advice, a giveaway etc).

� Send a follow-up postcard with thesame info/offer as the e-mail.

� When speaking with new prospectsor clients, ask them if they are usingsocial media. Then, do a search forthem and connect that way.

If you want to make a significantimpact with your social media cam-

paign, you need to put your resourcesinto it. Direct mail and e-mail areproven to increase the visibility of sites.In the overcrowded World Wide Web,it’s nearly impossible to gain tractiononline without outside promotion.

3. Planning your socialcommunication strategy Now that you have gotten your feet wet,it’s time to get to work! It’s important tonote here that while your ultimate goalfor this campaign is to convert moreclients, you need to be aware thatprospects can sense if you are only out fortheir money and it won’t end well for you.

When engaging with clients andprospects via social media, always try toprovide helpful advice and communica-tion—this is the cornerstone of relation-ship building. Examples of this type ofcommunication are: Mortgage updates,news from the industry, testimonials,helpful resources, etc. Once they see thatyou know what you’re talking about andthat you’re not trying to rip them off, theywill be more likely to close.

Two reasons why it is and four ways to do it


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e-mail: [email protected]: www.calyxsoftware.com/products/point/NMLS.asp

Occasionally, you can use your socialmedia presence to advertise specials thatyou are running or limited time offers,etc. But make sure you don’t overdo it oryou will come off as too sales-like anddisconnected. I would say once a monthis an okay standard to live by.

4. Engaging and convertingYou need to have a plan. So many com-panies let social media become a “goodintention.” They “mean to do it,” but theynever seem to get around to it. Make yoursocial media campaign a priority and itwill be one—it’s entirely up to you.

When forming your content, use soft-ware like HootSuite or TweetDeck. Theseprograms allow you to create posts andschedule them ahead of time. This ishelpful because you want to be able torepost your content a couple timesthroughout out the day, since differentpeople will log on at different times. Agood benchmark is to post up to 20 timesa week depending on how much goodcontent you have.

Be sure to ask questions in order toelicit feedback. That way, when peoplereply, you can send them a personalmessage and engage in a conversationwith them about their mortgage.

Here is an example of what yourweekly social media checklist could looklike:

Weekly social mediachecklist� Befriend 10 clients on Facebook� Post five Facebook status updates� Respond to 10 friends’ posts on

Facebook� Post 10 Twitter status updates� Re-Tweet five posts on Twitter� Respond to five posts on Twitter� Network with five companies on

LinkedIn� Respond to 10 questions on LinkedIn

LinkedIn is only really useful inmarketing for B2B companies, so ifyou’re only dealing direct to con-sumers, you can skip it. Facebook andTwitter, on the other hand, are univer-sally effective for B2B and B2C busi-ness relationship building. Whateverstrategy you decide on, make sure youstick to your plan. Keeping a consistentpresence on social media sites is cru-cial to the success of your campaign.

Overall, it is important to rememberthat business always comes down torelationships—the mortgage industryas much as any other. Buying a homeis a big deal and people want to feel alevel of comfort with their lender. Ifused correctly, social media is a greatway to build those relationships, bothwith clients and prospects. Not onlythat, but as you consistently displayyour presence on social media, you arebuilding a reputation for yourselfamong those clients and prospects thatcould lead to more referrals and morereturn business.

So don’t worry about choosingbetween old and new media market-ing strategies—you’ll get the bestresults by beating a path right in themiddle of them. Bring in leads withpostcards and build relationships onsocial media. Integration in your mar-keting yields the best results!

Joy Gendusa is chief executive officer andfounder of PostcardMania. She beganPostcardMania in 1998 with nothing buta phone and a computer and zeroinvestment capital. By 2008, revenuesreached nearly $19 million and the com-pany now employs more than 150 peo-ple, prints four million and mails twomillion postcards each week represent-ing more than 40,000 customers in over350 industries. For more information,call (800) 628-1804, ext. 342 or visitwww.postcardmania.com.

FHA Changes Rules on AdvertisingWith Mortgagee Letter 11-17, the FederalHousing Administration (FHA) continues toput its hammer down on the lending com-munity in a continued effort to purge themarket of unscrupulous lenders that usedeceitful practices to obtain their business.This Mortgagee Letter announced changesto the rules of how lenders and third-partyoriginators (TPOs) are permitted to adver-tise FHA programs with respect to the useof FHA and U.S. Department of Housing &Urban Development (HUD) logos, namesand acronyms.

The primary targets of this policy arethe lenders that run direct marketingcampaigns which advertise FHA loan pro-grams (particularly, the FHA Streamlinecampaigns). Such campaigns have histor-ically used deceptive packaging and lan-guage designed to lead consumers tobelieve that they are doing businessdirectly with the FHA.

This policy is a plus for the consumer,as well as for our industry, as there willno longer be tolerance for these types ofdeceptive advertising methods.

Here are the 10 things you need toknow about these changes set forth byMortgagee Letter 11-17:

1. The effective date of these changesis Sunday, May 15, 2011.

2. The “FHA Approved Lending Institution”(FALI) logo, when used in any advertise-ment, must be placed in a discreet mannerwith a disclaimer that the lender is not act-ing on behalf of HUD, FHA or the federalgovernment.

3. The FALI logo must not be altered inany way.

4. TPOs are prohibited from using theFALI logo.

5. No person, entity, party, company orfirm may use the FHA logo.

6. FHA-approved lenders and TPOs are pro-hibited from using the official HUD seal.

7. Lenders and TPOs may not, throughany advertising, lead the public tobelieve that they are doing businessdirectly with the government.

8. Lenders must retain copies of all ads

for two years from the date the ad is run.

9. All lenders must have a quality con-trol plan which includes a process forthe review of ads produced by TPOs andcorrective actions for violations.

10. Failure to follow these requirementsmay result in sanctions—including civilmonetary penalties—against any violat-ing person, party, company, firm, etc.

This issue of National MortgageProfessional Magazine is dedicated tobuilding relationships. The type of directmarketing that this policy addresses doesnot produce relationships, but rather,transactions … and it is a business modelwhich depends on significant capitalbeing dumped into the marketingmachine. This new FHA policy will forcelenders who have used these advertisingmethods to instead focus on buildinggenuine relationships with consumers.This is a good thing for everyone, includ-ing loan officers.

Having trained loan officers through-out the country over the course of manyyears, I’ve seen firsthand how companiesgain their business and the level of con-tentedness that follows from the modelsthey use. I can tell you that LOs have agreater sense of satisfaction in their lives,and business as a whole are the ones thatobtain their business through relation-ships. The relationships you have anddevelop with your clients, with your realestate agents, with your accounts etc. givemeaning to what you do. Relationshipsare everything! When you have relation-ships, it’s not just about the rate andcosts; it’s about making a difference in thelives of those you serve by helping themachieve their goals. Creating personalconnections with each client you do busi-ness with creates the foundation of yourbusiness; how you maintain those rela-tionships is what builds the structureupon that foundation.

Whether or not you currently havestrong relationships within your businessmodel, there is no better time than thepresent to give serious thought to how youcan develop new relationships andstrengthen existing ones. FHA is a greatniche because of the constant changes,


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(888) [email protected]

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new to market continued from page 20

allows third-party closing agents to viewand manage loan packages fromlenders in one central place. Loan activ-ity is tracked and reported back toBlitzDocs XE, eliminating the need foragents to call and check on packagedeliveries. Thorough auditing tools arebuilt in to record and track the entireprocess.

The new software also includes anoptional print and mail service for bor-rowers. BlitzDocs XE can be configuredto submit loan documents to Xerox’sdelivery center for printing and mailingto borrowers who choose not to com-plete the package electronically. Withthis service, materials are automaticallymailed to the borrower within theappropriate timeframe required by law.This eliminates the need for lenders tomanually check on the completion sta-tus of the documents and builds in anaudit and tracking process.

“We continue to take steps forwardto improve the paperless mortgageprocess for our customers,” said NancyAlley, vice president of product man-agement for Xerox Mortgage Services.“The latest version of BlitzDocs widensthe circle of participants that can worktogether electronically and providesadditional compliance safeguards forlenders.”

PriceMyLoan andComplianceEase Partner onCompliance With New LOCompensation Requirements

PriceMyLoanhas announcedan integration

that enables lenders to use the PriceMyLoanplatform to make automated underwritingand loan pricing decisions, while simultane-ously relying on ComplianceEase to ensureloan-level compliance with thousands offederal and state laws, including policiescovering new loan originator compensationrequirements. The new functionality givesPriceMyLoan customers seamless access toComplianceAnalyzer.

“The combination of our productsultimately helps fulfill the goals wehave set before us: to enable lenders todo more with less,” said Gigi Campbell,national sales director at PriceMyLoan.

ComplianceAnalyzer performs multi-jurisdictional audits on residentialmortgage loans, instantly providingfeedback on Home Ownership andEquity Protection Act (HOEPA Section 32and 35) rules, Truth-in-Lending Act(TILA) provisions, state and municipalhigh-cost/anti-predatory lending lawsand consumer credit regulations. Thesystem also audits against various sec-ondary market investor and govern-ment-sponsored enterprise (GSE) com-pliance guidelines, as well as internallender policies, which include tests cov-ering new loan originator compensa-tion requirements.

The Web-based, real-time system

enables lenders to shift from a tradition-al sampling and manual review processto an automated methodology that ismore effective at identifying potentialissues before they become more serious,and more expensive problems.

“We saw a natural synergy betweenComplianceAnalyzer and PriceMyLoan,”said Jason Roth, senior vice president atComplianceEase. “Both companies pro-vide automated technology screening toexpedite decision making during theloan origination process. With newTruth-in-Lending regulations that

restrict loan originator compensationand forthcoming changes under theDodd-Frank Act, loan pricing and loan-level compliance have become increas-ingly intertwined. ComplianceAnalyzerprovides the same accuracy and effi-ciency for compliance that PriceMyLoancustomers have become accustomed tofor automated underwriting and loanpricing, boosting a lender’s QC and clos-ing processes.”

The integration can seamlesslytransfer a loan from PriceMyLoan toComplianceAnalyzer, which then ana-lyzes the loan information and gener-ates a comprehensive report highlight-ing the loan’s risk level and providesdetails concerning potential violationsor exceptions. ComplianceAnalyzer’s

comprehensive audit reports are deliv-ered to users directly within thePriceMyLoan system.

Mortgage CadenceAnnounces the Launch ofIts Cloud-Based LOS

Mortgage CadenceLLC has announcedthe launch of itc l o u d - b a s e d

Symphony Loan Origination System (LOS),an on-demand origination solution forlenders of any size. The product fillsa current gap within the marketplaceby making available enterprise-levelpower in a pre-configured solution


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• Multiple National Lenders• 580 FICO FHA• 48 Hour Underwriting• VA-USDA-HomePath• 100% Partner Pay Out

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that locks down compliant processesand any lender can implement and putinto production in just a few weeks.

“All but the nation’s largest lendershave had to settle for substandard loanorigination automation for far toolong,” said Chuck Kimball, executivevice president of product experiencefor Mortgage Cadence. “Lenders of allsizes deserve an LOS that offers themall of the compliance support, time-saving features and reliability that thenation’s top-100 lenders have come toexpect. With this offering, we’re givingit to them.”

The Symphony application featurescollaborative process capabilities, real-time data access, a branded Web siteand a redundant infrastructure provid-ing 24/7 availability, security and disas-ter recovery. In addition, all systemupdates and upgrades are providedautomatically for free.

“In over 20 years in this industry—serving as an originator, a branchmanager, a technology executiveinside the mortgage bank and as atechnology vendor—I’ve never seen asystem this robust for anything closeto the price,” said Keith Kemph,Mortgage Cadence executive vice pres-ident for Symphony. “Symphony is thetechnology that will turn the mid-tierlenders of today into the leaders oftomorrow.”

PLATINUMdata LaunchesProperty Value AnalysisOffering

PLATINUMdata Solutions, a provider ofcomprehensive appraisal review andcollateral valuation technologies, haslaunched REALcondition Report, a com-prehensive exterior property valueanalysis based on a physical site visit tothe subject property. Released on Dec. 2,2010, the Interagency Appraisal andEvaluation Guidelines state that collater-al valuations must also address the sub-ject property’s condition for originatedloans of $250,000 or less. For the pastseveral years, many lenders have reliedon automated valuation models(AVMs)—which on their own do notaddress property condition—to valuethis segment of loans. These loansinclude home equity loans, which are agrowing segment in the market.

REALcondition Report is based on anin-person exterior assessment of theproperty. The report identifies factorsthat can affect the property’s condition,including vacancy, “for sale” or “forrent” signs, safety or habitability mat-ters, and other external influences.REALcondition Report also includes ver-ification of the property address and aphoto document of the property, andcan be added to any of the company’s19 objective AVMs.

“Lenders are understandably veryconcerned about compliance, and thenew Interagency Appraisal andEvaluation Guidelines are exacerbatingthat concern,” said Arturo Garcia, chiefoperating officer of PLATINUMdataSolutions. “Our goal in offering theREALcondition Report is to not onlyprovide a way to stay compliant withthis aspect of the guidelines, but alsomake compliance and quality as fast,economical, and easily accessible aspossible. Our clients rely onPLATINUMdata to provide the toolsthat protect them and reduce their risk.The REALcondition Report furtherextends our umbrella of protection.”

BrokerPriceOpinion.comLaunches New PropertyInspection Report

BrokerPriceOpinion.com,a provider of customizedvaluation solutions, hasannounced the launch of

its new Professional Property Inspectionreport, which incorporates detailedhome information from an automatedvaluation model (AVM) together withverification of the physical condition ofthe property and full photo documenta-tion. The Professional Property Inspectionreport is designed to meet the new fed-eral interagency appraisal and valua-tion guidelines, which go into effect onApril 1, the same day the newProfessional Property Inspection reportby BrokerPriceOpinion.com goes onsale, enabling valuation customers tobe compliant with the guidelines.BrokerPriceOpinion.com’s ProfessionalProperty Inspection report provideslenders, servicers and asset managersaffordable and time sensitive informa-tion to meet the demands of the man-agement and disposition of properties.

“The recently published interagencyguidelines require that lenders ascer-tain a property’s current physical con-dition when utilizing AVMs,” said WaltCoats, chief executive officer ofBrokerPriceOpinion.com. “By supple-menting our existing AVMs with exter-nal property condition reports and sub-ject photos, as well as the DNA of thesubject property, we are assistinglenders in achieving compliance withthe new federal requirements whileproviding local market expertise to theresults.”

BrokerPriceOpinion.com’s ProfessionalProperty Inspection reports are conductedby the company’s nationwide network ofmore than 65,000 licensed real estate bro-kers and agents, and appraisers.Additionally, the company’s in-house qual-ity control analysts assist in determining thesubject property’s location and physicalcondition, including details of the proper-ty’s neighborhood and makeup, resulting inan intelligent determination of a property’s


fha insider continued from page 32

which (if you stay on top of them!) facilitateyou becoming a valuable resource of FHAinformation for referral sources. For exam-ple, in our monthly newsletter The FHAOriginator, we provide offices with amonthly marketing piece designed to helpMLOs brand themselves as FHA experts,providing MLOs the information to presentto an office or individual agent.

Take time this month to think abouthow you can develop new businessrelationships, as well as how to rekin-dle old ones. Building just a few morerelationships to your network eachmonth will have a significant impact on

your business, income, and on theoverall level of satisfaction you have inyour business. You just have to decideand take action.

Go FHA!

Jeff Mifsud is founder of Michigan-basedMortgage Seminars LLC, a former FHAunderwriter with 15-plus years of experi-ence originating FHA loans, an FHAexpert for LoanToolbox.com and creatorof The FHA Originator, a monthly FHAnewsletter. Jeff may be reached byphone at (248) 403-8181 or visitwww.MortgageSeminars.com.

Become a NationalMortgageProfessional.com Blogger! It's free and easy. Just head on over to NMPMag.com, register and

follow the link in the upper right hand side of the page to become a blogger on our site today!

Got an opinion? Want to share yourthoughts on the industry?

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203(k) Rehab Loan Program: Foreclosures Present Challenges, OpportunityNMLS and State Testing for Mortgage Professionals

United Northern Mortgage Bankers, Ltd. Corporate NMLS ID# 7230 New York State Dept. - Licensed Mortgage Banker - License #100724 New Jersey Dept. of Banking and Insurance - Mortgage Lender - License #L0046623 Pennsylvania Dept. of Banking - Mortgage Lender - License #20887 Connecticut Dept. of Banking - Mortgage Lender - License #20372 Massachusetts Div. of Banks and Loan Agencies - Mortgage Lender & Mortgage Broker - License #MC5070 North Carolina Commissioner of Banks - Mortgage Lender - License #L140365 South Carolina State Board of Financial Institutions - Supervised Lender - License #S7, 461 Florida Dept. of Financial Institutions - Mortgage Lender - License #ML0700679 Senior Security Home Advantage is a lending area of United Northern Mortgage Bankers, Ltd. Direct FHA Endorsed Lender

Investing in communities

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condition. All reports contain full photodocumentation of the subject properties.The company’s in-house process of compil-ing and crafting the report together with anAVM provides lenders, servicers and assetmanagers with a professional propertyinspection report as a standalone productestablishing the home’s condition.

“Our clients have a better handle on riskwith the Professional Property Inspectionreport,” said Michael Richardson, presidentof BrokerPriceOpinion.com. “We work dili-gently every day to find the true value,quality and condition of the assets wereview, which yields a very accurate valua-tion assessment and helps mitigate anyopportunities for fraud.”

ISGN Launches NewCatapult LOS

ISGN has announcedthe launch of its newCatapult MortgageOrigination System, a

next-generation loan origination tech-nology developed from the continuingevolution of ISGN’s Diamond andMORvision systems. Catapult has repli-cated and enhanced the rich functional-ity of Diamond’s powerful rules engineand fully integrated product and pricingengine. It also integrates the powerfulfunctionality of MORvision, a flexibleand scalable LOS, thereby creating abest-of-breed product designed forDiamond and MORvision users in a pureASP.NET, browser-based system.

The Catapult Mortgage OriginationSystem has been designed to upgradeexisting MORvision users to the newsystem without them having to incurthe expense and time of implementinga new loan origination system. Thedata and customization in a lender’sexisting MORvision system can bemigrated directly into Catapult. ISGN’sMORvision and Diamond systems stillwill be available to lenders and offercontinued customer support.

“Catapult enables lenders to employa loan origination system based on anaffordable variable cost structure,” saidMurali Gomatam, head of technologyproducts at ISGN. “Lenders no longerneed to invest large amounts of capitalupfront, plus annual maintenancecosts, to obtain the powerful function-ality of a superior LOS.”

Catapult will include mobile devicefunctionality enabling access by laptopand notebook computers, smartphones, iPads and other tablets.Lenders and their associates gain flexi-bility and freedom in working with bor-rowers and other customers, and origi-nating loans outside the traditionalhome office without the added expenseof engaging remote connection toolsand services. ISGN anticipates rapidgrowth and acceptance of mobiletablet devices in the mortgage industry.Catapult offers comprehensive func-tionality from point-of-sale to closing

and delivery of loans to the secondarymarket. The system also includes fullintegration with third-party vendorsthough ISGN’s Plug-In Partner Network.

LoanSifter AnnouncesEnhancements to KeepPace With LOCompensation Compliance

LoanSifter has enhanced its productofferings to help lenders maintain

compliance with federal Truth-in-Lending Act (TILA) changes that tookeffect April 1, 2011—while at the sametime, delivering real-time, up-to-the-minute loan pricing with integratedmarketing and secondary tools. Theenhancements to LoanSifter’s productsuite now enables clients to customizeand report on their own loan officercompensation plans, thus providingthem with the tools to better managetheir compliance needs. These com-pensation plan changes flow through-out the entire system, including searchresults, LOS integrations, secondarydesk, management reports, auto-quot-ing, Web site quoting and marketingcampaigns.

“LoanSifter has made the transition

of incorporating loan officer compen-sation into our daily workflow easierthan we could have ever imagined,”said Jeff Young, vice president of sec-ondary at Bloomington, Ill.-basedMortgage Services III. “Having all of theLoanSifter features, which include theability to get price quotes on differentscenarios, robust secondary tools,DataTrac integration along with theability to set up and assign differentloan officer compensation plans, hasgiven us a distinct advantage in themarketplace.”

Prior to the technology update,LoanSifter had ongoing conversationswith the Federal Reserve Board and


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hired a legal firm specializing in mort-gage regulatory changes to ensure allof the company’s solutions were com-pliant with recent and upcoming regu-lations, including anticipated rulesresulting from the Dodd-Frank WallStreet Reform and ConsumerProtection Act. Significant considera-tion was also given to ensure a userinterface that remained intuitive andwas matched with powerful tools todrive loan production.

The updated LoanSifter suite allowsmortgage brokers and loan officers todesign compensation plans that arebroken out clearly in product andpricing search results, but are flexibleenough to meet unique businessneeds.

“The business of originating loans iscomplicated enough without the extraburden of new and constantly changingrules,” said LoanSifter President BruceBacker. “Our goal is to make life easierfor lenders. By continually enhancingour solutions such as eOriginations,OriginatorPLUS and LoanSifter Banker,our customers have a system to helpfacilitate compliance.”

Wipro Gallagher SolutionsLaunches Latest Versionof NetOxygen LOS

Wipro GallagherSolutions (WGS),a provider ofend-to-end loan

origination software and services forfinancial organizations, has announcedthe latest version of its loan originationsystem (LOS), NetOxygen 3.4, whichincludes heightened regulatory compli-ance, as well as enhanced vendor inter-faces and documents/imaging func-tionality.

To comply with recent federal regu-lations, NetOxygen 3.4 includes updat-ed calculations for the UpfrontMortgage Insurance Premium (UFMIP)factor to comply with the FederalHousing Administration’s FHA’s newability to adjust its annual mortgageinsurance premium. The new func-tionality works for all loans in whichthe FHA case is received after theeffective date. In addition, NetOxygennow supports new requirements forthe Good Faith Estimate (GFE) for thestate of New Hampshire by requiringthat all fields and the tradeoff table becompleted before the interest rate forthe loan can be locked.

In terms of improving its vendorecosystem, NetOxygen 3.4 integrat-ed with another leading flood inter-face, which allows users to initiate arequest regarding the subject prop-erty’s proximity to a flood zone.NetOxygen 3.4 also includes a newinterface for providing lenders withinformation helpful for completingthe GFE.

NetOxygen 3.4 also includes

improved document and imagingcapabilities so that users can selectmultiple images from the system andview them as a single PDF file. Theupdated LOS also now generates infor-mation on documents for business andgovernment entity borrowers, asopposed to a person, automating theprocess for taking an application for“non-individuals.”

Solidifi Launches NewAppraisal Quality Product

Solidifi U.S., anappraisal man-agement servic-es provider, has

announced that it has launchedSolidifi iQ 2.0, an upgrade to theSolidifi iQ scorecard that debuted in2009, Version 2.0 equips lenders witha great deal more flexibility in pro-viding transparency and qualitythrough the valuation aspect of loanorigination for the benefit ofinvestors, rating agencies and otherstakeholders in the lending process.Solidifi iQ 2.0 is an objective scorethat provides a view of appraisalquality and completeness based onprofessional standards and industryrequirements.

Credit scores that range from 0-1000and are dynamically weighted basedon the last 10 appraisals an appraisercompletes for Solidifi. Scores are fur-ther segmented by the type of servicean appraiser provides—valuation ordesk review. Solidifi also conducts aquality control program to furtherensure the integrity of appraisals ofthose 10 appraisals.

“Solidifi wants to ensure its cus-tomers are connected to the rightappraiser the first time,” said SolidifiU.S. President Griff Straw, CMB.“That’s why we’ve enhanced ourappraiser transparency strategy toprovide features that allow financialinstitutions to make important deci-sions about the appraisers to whomthey entrust their collateral valua-tions. Our Solidifi iQ 2.0 score andAppraiser Transparency Report arekey to this commitment.”

The Solidifi Appraiser TransparencyReport supplements the iQ scorecardand is aimed at driving appraisalquality and speed. The real timereport compares the performance ofappraisers within a specific marketarea—without violating privacy con-cerns. Comparisons are based onappraisal turn-around time, revisionrate and an appraiser’s Solidifi iQscore. Solidifi then provides a varietyof reports to customers that indicatehow appraisers rank against eachother. From there, customers canmake decisions about the appraiserswith whom they want to work, there-by ensuring they are initially connect-ed to the right appraiser.

for private sector capital in every part of themortgage process, and that private mort-gage insurance (MI) should be part of thesolution. By making loans with MI exemptfrom the Dodd-Frank Act risk retention

requirement, we expand themarket and allow more qual-ified, deserving borrowers topurchase a home. Here aretwo points to consider:

� One-third of homebuyerscurrently put down lessthan 20 percent on theirhomes. Thus, a 20 percentdownpayment require-ment would shut out one-third of potential homebuyers from the housing

market at a time when new home pur-chases are necessary to reduce theunprecedented levels of excess housinginventory. This decrease in demand forhousing would reduce home prices, fur-ther depress the housing market andimpede our nation’s economic recovery.

� Private MI protects borrowers, lendersand investors from the risk of default.Private MI attaches to the loan. When ahomeowner defaults on a home loan, wework closely with the servicer and borrow-er to evaluate a variety of options to keepthe borrower in their home. If we areunable to find a solution, the insurermay pay a specified percentage of theloan value to the lender. When loanswith private MI are included in securi-tized pools, the claims payments flowthrough to the benefit of the investors toreduce their losses.

Radian will be an active participant inthe QRM comment period. The MI indus-try has provided data which shows howloans with MI have lower default ratesthan loans without MI. Radian will con-tinue to work to make the dream ofhomeownership an affordable possibilityfor qualified low-downpayment home-buyers.

Teresa Bryce Bazemore is president of RadianGuaranty. She may be reached by phone at(800) 523-1988 or visit http://www.radian.biz.

We are all managing through one of themost challenging periods in housingfinance history. While the governmentgrapples with the many issues of financialreform, those of us in the industry are try-ing to determine howthese changes will impactour customers and ourbusiness.

The government hasdefined three objectives:

� Supporting the role ofprivate markets as theprimary source of mort-gage credit.

� Returning FHA to its tra-ditional, smaller role asa provider of affordablemortgages.

� Reducing the role of Fannie Mae andFreddie Mac.

Less than two weeks after my presen-tation at the Regional Conference ofMortgage Bankers Associations in AtlanticCity, N.J. on March 16, the Federal DepositInsurance Corporation (FDIC) released theproposed definition of a QualifiedResidential Mortgage (QRM) as required bythe Dodd-Frank Wall Street Reform andConsumer Protection Act, a key compo-nent of housing finance reform. A com-ment period on the proposed definition isnow underway, with a June 10 deadline.

Under the proposal, lenders are requiredto hold five percent of the risk of a loanunless it is considered a QRM. While the ini-tial proposal recommends a 20 percentdownpayment, it is important to note thatthe proposal also exempts loans guaranteedby the government-sponsored enterprises(GSEs) from the risk retention requirementwhile the GSEs are in conservatorship. Whilethis will allow the opportunity for privatemortgage insurers to continue providingcredit enhancement on loans to qualified,low-downpayment borrowers, we believethat private mortgage insurance should bea specific exception to risk retention given itslong history of reducing the risk of loss to thelender and investors in mortgage-backedsecurities (MBS).

While it’s easy to be consumed with theimpact of these changes on our industry,we must continue to befocused on prospectivehomebuyers. Our job isto safely and soundlyenable first-time andlow- to moderate-income buyers to pur-chase homes of theirown. The cost to do thisshould be both afford-able and reasonable.

At Radian Guaranty,we support the govern-ment’s objective thatthere be an explicit role

The Changing Landscape ofHousing Finance

By Teresa Bryce Bazemore

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www.GSFprobranch.com

Blueberry Systems ReleasesEnhanced ConductorIntegration Technology

Blueberry Systems LLC, a provider ofmortgage production solutions to thefinancial services industry, hasenhanced its proprietary Conductortechnology to give mortgage lendersgreater control over their loan data,while increasing efficiency and loweringthe risk of errors and costly buybacks.These enhancements empower lendersto customize how applications integrat-ed to a given system can or cannot beleveraged by a user.

Conductor integrates unrelated soft-ware applications and platforms toyield a single, common user experience.Users can now customize Conductor toestablish which tools are available toloan officers in the production of aloan. For example, loan officers can beprevented from re-ordering a creditreport or automated underwriting find-ings once the production of a loanreaches a certain point, actions that cancreate discrepancies between theunderwriting data and the loan dataseen by the investor. When such dis-crepancies occur, the investor can forcethe lender to buy back the loan at greatexpense.

“Users can now also set up flags thatturn off certain tools when the status ofa loan file reaches a specific threshold

in loan production process,” said LloydBooth, president of Blueberry Systems.“Our primary mission is giving lendersgreater power and control over dataquality and integrity. With ourenhanced Conductor technology, userscan now customize what their thirdparty applications can do, yet in a waythat preserves data quality. The resultis fewer overhead expenses and alower cost-per-loan.”

Conductor technology is a criticalcomponent of Blueberry Systems’ flag-ship technology, RELAY, a highly flexi-ble, fully customizable loan produc-tion platform. Conductor makesRELAY’s use of a universal data modelpossible and allows RELAY to leveragethe technological advantages of a‘best-in-class’ system with the work-flow efficiencies of an ‘end-to-end’ sys-tem. As a result, RELAY offers the high-est data quality standards and repre-sents the next-generation of workflowefficiency.

Wingspan UpgradesInvestor Portal to OfferTransparency forMortgage ServicingStakeholders

Wingspan Portfolio Advisors hasannounced that it is rolling out itsupgraded technology to provideclients with extensive visibility into

Wingspan’s resolution process. Theimproved Web-based Investor Portalprovides each of the stakeholdersaccess to their serviced loansthrough customizable dashboards,providing transparency into every-thing being done by Wingspan toderive value from the defaultingmortgages. The new portal has beendescribed as “a controlled, yet flexi-ble, tool with a results-orientedapproach that brings an entirelynew dimension to special servicing,”said E.J. Kite, senior vice presidentof information management atWingspan Portfolio Advisors. Kitespent 20 years at Freddie Mac devel-oping technology, and three years atFannie Mae as MIS director.

Wingspan specializes in handlingseverely delinquent loans, bringingthem back to performing status, ormanaging foreclosure alternatives toreduce loss severity, including accel-erated short sales. They accomplishthis with high-touch proprietarymethods and technology createdspecifically for the purpose byWingspan’s Information ManagementDepartment and partner technologyfirms.

Investor Portal’s Version 2.0 wasdeveloped internally by Kite andhis team with the assistance ofMiller & Associates, the Plano,Texas-based technology consultingfirm renowned for its rich Internetapplications and robust business

intelligence technology.“Wingspan Portfolio Advisors has

always been about high-touch andhigh-tech,” said Steven Horne,Wingspan’s chief executive officer.“Now we have extended that philos-ophy from the way we deal with bor-rowers to the unprecedented trans-parency available to our servicingclients with the new Investor Portal.These new information capabilitiesempower investors to make criticaldecisions on loans, whether toapprove modification programs orconsider foreclosure alternatives inthis post-robo-signing environment.The platform enables them to trulyunderstand their best and worstcase scenarios with crispness andimmediacy.”

Your turnNational Mortgage Professional Magazineinvites you to submit any informationpromoting new “niche” loan programs,new products or any other announce-ment related to the introduction of anew program, to the attention of:

New to Market columnPhone #: (516) 409-5555

E-mail:[email protected]

Note: Submissions sent via e-mail arepreferred. The deadline for submissionsis the 1st of the month prior to the tar-get issue.

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Appraisal Management Company

We are a premier National Appraisal Company since 1970.We have a complete product line for your entire organization.We guarantee HVCC and FHA regulatory compliance.Let our experience work for you. The way valuations should be.

Coester Appraisal Group7650 Standish Place, Suite 107 • Rockville, MD 20855

www.coesterappraisals.com(888) 485-1999 Ext. 2

Branch Recruitment

Branch Manager

Branch Manager

Freedom Mortgage Corporation, The BEST Branch Solution, Period.

Freedom Mortgage [email protected]

800.220.9498

iServe offers a complete product mix - aggressively priced, withhassle-free service & turntimes. Branching & Loan Officer opportunities available nationwide. For a change, focus on production, quick closes & a good night's sleep!

iServe Residential Lendingwww.iservelending.com

[email protected]

Be in business for yourself, but not by yourself. Join GSF Mortgage'sProfessional Branch Network. Enjoy freedom and stability and reapthe rewards. Signing bonus for Branch Managers, retain 100% ofyour commissions. Absolutely NO files fees, NO splits

GSF Mortgage15430 W Capitol Dr. Brookfield, WI 53005

1-877-494-4448www.gsfprobranch.com

Find out what Guaranteed can do for you. Branch Program for Professionals. It's what we do.

Guaranteed Home Mortgage Company, Inc.108 Corporate Park Drive, Ste 301

White Plains, NY 10604888-329-GHMC • www.joinguaranteed.com

Established in 1993 and headquartered in Waukesha, Wisconsin,Inlanta Mortgage is a multi-state mortgage banking company com-mitted to delivering superior service to our branch clients.For more information, call 262-513-9853 or visit www.inlanta.com.

Inlanta MortgageW229 N1433 Westwood Drive, Suite 103

Waukesha, WI 53186www.inlanta.com • 262-513-9853

United Northern Mortgage Bankers......888-600-8808Limited room available for established Team Leaders andLicensed Mortgage Originators. Become part of an established30-year Mortgage Banker with a proven track record and success.

RealEstateBestJobs.com ....................201-489-0256Currently working with various bankers & federally chartered banks.Seeking established, new branches & Loan Officers Nationally. Weare a top recruiting firm handling all types of mtg positions.

Church Financing

• Church Purchase & Construction • $100,000 to $2,500,00• Church Refinance & Cash Out • Churches all 50 states

• 75% of Appraised Value • 20 Yr. Fixed Rate

CONCORD CHURCH FINANCENATIONWIDE FINANCING FOR CHURCHES

Pre-qualify Online @ www.Concordchurchfinance.com800-926-0399 • Fax: 858-756-8108

Brokers United ........................................877-710-0948Consulting & Branch opportunities. Exclusive opportunities with atop Federally Chartered Bank, Mortgage Banker and/or MortgageBanker/Broker Platform. Email Jeff Flees at [email protected].

Closing Gifts

Increase your Loans,Get the Edge & Generate More Referrals!Offer your clients a 5 Day 4 Night Cruise certificate for Two to Mexico,the Bahamas or the Western Caribbean (up to a $1798.00 value) onlywhen they close a loan with you. Only $159.00 per certificate!!

Cruise4Two-Loan Incentives1-866-541-8077

www.Cruise4Two.com

Compliance Consultants

The first full-service, mortgage risk management firm in the country, specializing exclusively in mortgage compliance.

Pioneers in outsourcing solutions for mortgage compliance.

Our Compliance Team Will:

Leverage your existing employees.Improve your productivity.Collaborate on projects.Make the most of your current technology.Bring innovation to your company.Be a strong cultural fit.Free you to focus on your core competencies.Give you access to world-class expertise.Lower your total operational costs.

LENDERS COMPLIANCE GROUP167 West Hudson Street - Suite 200

Long Beach | NY | 11561 | (516) 442-3456www.LendersComplianceGroup.com

StreetLinks Lender Solutions provides an innovative andcomprehensive suite of valuation services and lending technologysolutions used by lenders and appraisers nationwide to improveeveryday business operations.

StreetLinks industry-leading products include LenderPlus™ full-service appraisal management, LenderX™ lender-executedappraisal management software, BPOs, SCORe™ appraisalvalidation reviews and more. Our commitment to quality andservice, embodied by our partnership approach to clients andappraisers, continues to set us apart as the nation’s premierlending solutions partner. For more information, visitwww.streetlinks.com.

StreetLinks Lender Solutions(800) 778-4920

[email protected]

We help you Meet & Exceed UMDP enforced by the GSE’sWe Improve your evaluation of collateral with “REALviewTM” Appraisals submitted in a MISMO/XML or PDF format.We’ve raised the bar for Appraisal Management Services!

HVCC Appraisal OrderingNational Appraisal Management Center

www.HVCCAppraisalOrdering.com Please call 866-396-6260

Does Advertising in theResource Registry Work?

It just did!

Call 888-409-9770 ext. 4to Register your company.

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Education

North Lake College - Specialized Education In Mortgage Banking.Earn An Associates Degree in Mortgage Banking From the First FullyAccredited Mortgage Banking Degree Program in the U.S. ForInformation About Our 30 Year Program email:[email protected].

North Lake College5001 North MacArthur Blvd, Room T-231-C

Irving, TX 75038(972) 273-3467 • http://www.northlakecollege.edu/

Direct Mail

Direct Mail

• Specializing in Official Snap Packs for Greater Open Rates• Envelope Mailers, Business Reply, Postcards and Much More• Targeted Mortgage Lists with Many Selects• Complete Design, Printing and Mailing Services

Your Complete Mortgage Marketing Solution.Call Us Today!(800) 922-9860

www.envisiondirect.net/catalog/mortgage.htm

Document Preparation

Document Preparation (SaaS)

ProClose provides compliant closing documents and software forResidential Mortgage Lending. Created with closers in mind, we help make a lender’s staff more efficient and supported.

Mortgage Banking Systems - ProClose1360 Beverly Rd. Ste 200, McLean, VA 22101

800-783-2283 · [email protected]

Mortgage Loan Closing Document Preparation & Compliance ServicesFulfillment Services Including Pre-Funding Review & Post-ClosingInterfaces with Leading Loan Origination Software SystemsForeclosure – Loss Mitigation Services

Robertson | Anschutz800-343-7160

[email protected]/info.html

Mortgage Loan Closing Document Preparation & Compliance SoftwareLoan Documents and Compliance – Web-based/SaaS – Easy to UseIntuitive – Secure and Reliable – Integrates with Leading LOSFree Setup and Support – Extensive Compliance Audits

Docs on Demand800-343-7160

[email protected]

Errors and Omissions Insurance

Doc Management

DocVelocity is an end-to-end paperless solution designed tosimplify the loan origination experience. Imagine having all yourdocuments in the loan process as electronic files, all online, frompre-approval to closing. DocVelocity provides: Fast and easy loandelivery to any lender … Automatic doc sorting, naming and filing… Real-time online document sharing for anyone you choose …Friendly and intuitive user interface … No start-up fees, and freetraining and support. DocVelocity addresses importantcompliance issues while giving your office the competitiveadvantage of being paperless. It streamlines all aspects of themortgage process and most important, it does so in one easy-to-use and inexpensive package. DocVelocity is the flagship productof Paperless Office Solutions, Inc., a wholly owned subsidiary ofFlagstar Bancorp. Visit www.docvelocity.com to find out more.

DocVelocitywww.docvelocity.com


Events

“The Expo for Real Estate Professionals"For ongoing Networking Events throughout the year please visitwww.nycnetworkgroup.com.

NYC Real Estate Expo LLCAnthony Kazazis - Director

[email protected] • www.nycrealestateexpo.com646.210.2545 • 914.763.8008

Hard Money/Private Lending

ACC Mortgage, Inc.932 Hungerford Drive #6 • Rockville, MD 20850

240-314-0399 • 240-314-0336 faxWeApproveLoans.com

We are doing traditional subprime lending, fix & flip lending andhard money lending.

CB Malaga Insurance Services LLC......877-245-5887Insurance broker providing errors & omissions (E&O)insurance to mortgage brokers and bankers. All loan types.Available in 22 states. www.CBspecialty.com

Time is running out...are you ready?

Pass the S.A.F.E. Act Test, meet your 20 hours of Pre-licensure,and complete the 8 hours of Continuing Education you need

• The Ultimate Test Prep Kit and Test Prep Boot Camps – Covereverything to pass the S.A.F.E. Act Test — on your first try.

• 20-hour Pre-licensure - Packed with everything to successfullycomplete your pre-licensure requirements.

• Continuing Education - Exciting, NMLS approved courses thatmeet your Continuing Education needs and build your business.

MSS Learning Center(800) 963-1900

www.MortgageSuccessSource.comEmail: [email protected]

Best Rate Referrals ............................................800-811-1402Mortgage marketing company with decades of combined expe-rience providing quality leads, mailers, lists and dialer products. www.bestratereferrals.com & www.mortgageleads.org

Continuing Education

NMLS approved 20 hour Prelicensing EducationNMLS approved Continuing EducationLive Classroom Instruction, Web Delivery and Private EventsThe SAFE-Smart ExamCram, Powerfully Innovative Test Prep

Abacus Mortgage Training and EducationPO Box 780

Summerfield, NC 27358888-341-7767 • www.GetYourEd.com

Contact Management/CRM

LoyaltyExpress, the leading mortgage marketing company in thenation, delivers high-impact marketing that substantially increasesproduction levels. Direct mail, e-mail, and intelligent alerts arecombined to deliver unprecedented results. Learn more today.

LoyaltyExpress877.938.1175

[email protected]

WorkCenter CRM ....................................877.498.6888A CRM & contact management solution designed for mortgageprofessionals. Automated campaigns & LOS synchronization makeWorkCenter an intuitive timesaver for staying in touch with clients.

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Retail Branch

Are you a broker/owner or current branch manager looking toexpand your business into Mortgage Banking with FHA capabilities?Then our PARTNER BRANCH ADVANTAGE© program is perfect foryou. We are offering you all the benefits of partnering with an estab-lished lender while still enjoying your independence. US MortgageCorporation is a nationwide FHA Direct Lender with a 16 year longreputation of excellence.

YOUR SUCCESS IS OUR SUCCESS!

For more information contact THOMAS R. SIRICO, VicePresident of Business Development at (917) 923-1472 or emailat [email protected].

We look forward to sharing our services with you!

(800) LOANS-15www.usmortgage.com

Regulatory/Compliance

Loan Origination Systems

Comergence Compliance Monitoring is the mortgage industry’s onlyComplete broker desk management software and outsource solutionfor TPO management and monitoring. We can supplement lenders in-house management and monitoring resources departments.

Comergence Compliance Monitoring, LLC630 The City Drive South, Suite 205 • Orange, CA 92868

Office: 714-740-9000 www.ComergenceCompliance.com

Loan Incentives

Increase your Loans,Get the Edge & Generate More Referrals!Offer your clients a 5 Day 4 Night Cruise certificate for Two to Mexico,the Bahamas or the Western Caribbean (up to a $1798.00 value) onlywhen they close a loan with you. Only $159.00 per certificate!!

Cruise4Two-Loan Incentives1-866-541-8077

www.Cruise4Two.com

Loan Origination Systems

Calyx Software, the #1 provider of mortgage solutions is dedicatedto offering reliable and affordable software that streamlines, inte-grates and optimizes the loan process. Find out how PointCentralcan streamline your business and create compliant processes today.

Calyx Software 800-362-2599

[email protected] www.calyxsoftware.com

End-to-end LOS system for multi-channel lending.PreQual thru Interim Servicing. Includes all back-office functionality;Underwriting,Secondary Marketing,Post Closing and much moreSaaS, ASP and Client Server delivery options.

Mortgage Builder Software24370 Northwestern Highway, Suite 200

Southfield, MI 48075800-460-5040 • www.mortgagebuilder.com

Loan Management Systems

Xetus ....................................................877-GO-XETUSXetusOne is a powerful, easy-to-use loan management systemthat streamlines loan processing. Our affordable SaaS applicationsare lenders #1 choice for origination, subordination & modification.

42Jumbo

Sign up with the Premier Jumbo Lender

www.ingloans.com877.464.0555, option 2

Move your Jumbos to a better neighborhood. ING Mortgage isyour home for Portfolio loans up to $3,000,000. We offer aggressivepricing and simple guidelines in all 50 states. Big Loans. Low Rates. Great Value.

Leads

Leads

Loanbright helps mortgage companies capture and close morebusiness through its marketing and software tools. An INC. 500awardee, Loanbright has helped thousands of companies since1999 by providing them with well over 3 million qualified sales leads.

Loanbright27902 Meadow Drive, Suite 375

Evergreen,CO 80439866-391-2709 • www.Loanbright.com

Our network attract over one million visitors per month. Our paidlead program as well as our free lender directory will help you con-nect with targeted new consumer traffic from with high-intent con-sumers searching online for the right mortgage lender.

MortgageLoan.comSM

www.mortgageloan.com • 877-390-4750MortgageLoan.com is the largest online directory

for mortgage professionals and a favorite of consumers shopping for mortgage loans.

Reach affluent and creditworthy consumers who are in-market andready to transact. Bankrate is a consumer direct Web site, NOT alead aggregator. Qualified leads for every sized budget, and payonly for performance. No set up fees! No contracts! No risk!

• Reach self directed, highly qualified consumers that are activelysearching for mortgage loans• Geo-targeting – reach the right consumers in the right markets• Our proprietary Advertiser Portal gives you complete controlover your campaigns, budgets, and performance reports.• YOU determine your daily/weekly/monthly budget• Pay only for consumers who click on your listing• NO cancellation fees

Try us risk-free! Call 561-630-1257or visit www.bankrate.com/cpcprogram/ for more details.

Internet’s Leading Consumer Mortgage MarketplaceAttracting over 7 million unique

consumers every monthwww.Bankrate.com • 561-630-1257

AAA Refi Leads.....AAA Refi Leads.....AAA Refi LeadsLearn how I went from failure to success by mailing cheap refiletters from home, closed 71 loans & made $248,954.62 last yr.I’ll show you exactly how I did it. Go to: www.Refi-Leads.NET

Income Verification Services

Advanced Data (800) 537 - 0458

[email protected]

Advanced Data is a leading national provider of data services,streamlining income and employment verification with proprietarysoftware. Clients can submit 4506-T directly through Encompass360.Also ask about our AVM and flood services!

Platinum Credit Services, Inc.................631-299-2084Tax return vertification (4506 tax transcript done in less than24 hours in most cases). Call Lorenzo Pugliano, Presidentand CEO at 631-299-2084.

Mortgage Forms

• HUD Settlement Cost Booklets• CHARM Booklets• Uniform Residential Loan Applications• HUD Case Binders

www.LendingForms.comSame Day Shipping (orders placed prior to 3pm et)

24/7 Secure e-Commerce SiteSave 33-50%

Hard Money/Private Lending

Windvest Corporation ............................877-285-0777Specializing in rehab loans for property investors in So. CA.Up to 60% ARV, 12.99% fixed rate, 3.5-5 points, 1 yr. term.Fast & professional service since '94! Visit windvestcorp.com!

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Wholesale/Residential


Flagstar Wholesale Lending, a division of Flagstar Bank, is one ofthe nation’s largest wholesale and correspondent mortgagelenders, providing the technology, products, service and supportthat independent mortgage brokers, correspondents, and bankersneed in today’s mortgage arena. In the ever-changing environ-ment of mortgage banking, Flagstar takes pride in accommodat-ing the specific needs of each customer. At Flagstar, we under-stand that you need every available advantage to stay ahead ofthe competition. This is why we provide multiple technologyoptions to meet your needs to register, lock, underwrite, close,fund and deliver your loans. Our wholesale website(wholesale.flagstar.com) and the loan processing tool Loantracprovides our customers with the functionality that make it easierand faster to close loans, saving you time and money! Visit whole-sale.flagstar.com to learn more.

Flagstar Wholesale Lendingwww.wholesale.flagstar.com


Wholesale/FHA

Icon Residential, a wholly owned subsidiary of Grand Bank N.A.,is one of the nation’s leading Conforming, Jumbo, FHA and VAwholesale lenders. Our strength, success and longevity isderived from delivering customers service that exceeds ourvalued business partners expectations. With deep industryknowledge, financial stability and innovative technology weprovide the solutions for our business partners to fund loanswhile avoiding risk.

Icon Residential Lenders(888) 247-4207

www.iconwholesale.com

We offer competitive pricing and fast turn-times for FHA, VA,Conventional, and USDA programs without having a retail pres-ence in the industry. We are a wholesale lender with 22 years ofexperience and believe in exceptional service.

Terrace Mortgage4010 W. Boyscout Blvd., Suite 550

Tampa, FL 33607866-934-4631 • www.terracemortgage.com

Wholesale Reverse Mortgages

For Licensed Mortgage Brokers in NY, NJ, CT, PA and FLNo HUD Approval Required – Live Help DeskWill Provide Training at Our Office or Yours48 Hour Underwriting - Get Paid Within 48 Hours of Funding

NATIONWIDE Equities

Nationwide Equities Corporation201-529-1401

www.nwecorp.com

• Arizona • Nevada • Texas • California • New Mexico • Utah• Colorado • Oregon • Washington

88 Kearny Street, 3rd FloorSan Francisco, CA 94108

Phone: (415) 632-5150 • Fax: (925) 226-1938www.bayeq.com

Now Wholesale Lending in:


Title

Intracoastal Abstract Co. Inc.................516-358-0505Privately owned & operated full service title insurance agencyin NY, NJ and FL, with affiliates throughout the US & Canada.Escrow Agent in Florida. www.intracoastalabstract.com.

Wholesale/Correspondent

BankFinancial ..........................................800-894-6900 We have money to lend for apartments, $250M to $2MM, up to75% LTV. We offer competitive rates, fees & terms. We’re com-mitted to helping you and your clients close the deal. Call us.

• Paperless! Quick and Easy!• Top Tier Account Executives• Committed to Wholesale• Operations that Earn Your Business

TMSfunding Wholesale Lending326 W Main Street • Milford, Ct. 06460

888.371.2989 • WWW.TMSFUNDING.COMYour Partner in Success!

Lykken on Lending is a weekly 60-minute show hosted by mortgageveteran of 37 yrs, David Lykken, along with special guest Alice Alvey& Joe Farr as well as featured special guests. Each week we provideour listeners with up-to-the-minute information of what is happening

in mortgage and housing industry.

Sign-on weekly atnmpmag.com/lykkenonlending

Secondary Marketing Consulting

Broker to Banker Services.com ..........(951) 746-3075 We complete your applications for approvalSave the time and hasslecontact: brokertobankerservices.com

Call 888-409-9770 Ext. 4 to

Register Your Company

Register Today!

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MAY 2011Sunday-Wednesday, May 22-25

Texas Mortgage Bankers Association 2011Annual Convention

Hyatt Regency Lost Pines Resort575 Hyatt Lost Pines Road • Lost Pines, TexasFor more information, call (512) 480-8622 or

visit www.texasmba.org.

JUNE 2011Saturday-Sunday, June 4-5

2011 National Association of MortgageBrokers Mid-Year Meeting

Crowne Plaza Valley Forge Hotel260 Mall Boulevard • King of Prussia, Pa.

For more information, call (703) 342-5900 orvisit www.namb.org.

Monday-Wednesday, June 13-15CRE Finance Council 2011 Convention

“On the Road Again”The Waldorf Astoria

301 Park Avenue • New York, N.Y.For more information, call (212) 509-1954 or

visit www.cref.org.

Tuesday-Wednesday, June 14-15Windy City Marketing Summit

Waterford Banquets & Conference Center933 South Riverside

Elmhurst, Ill.For more information, call (630) 916-7720 or

visit www.iamp.biz.

JULY 2011Wednesday-Saturday, July 20-23

Florida Association of Mortgage Professionals2011 Convention“Reel in Success”

Orlando World Center Marriott Resort8701 World Center Drive • Orlando, Fla.

For more information, call (850) 942-6411 orvisit www.famb.org.

AUGUST 2011Thursday-Friday, August 4-5

California Association of MortgageProfessionals Annual Convention

“Scouting Out Success”San Jose Marriott

301 South Market Street • San Jose, Calif.For more information, call (916) 448-8239 or

visit www.ca-amp.org.

SEPTEMBER 2011Thursday, September 8

Iowa Association of Mortgage Brokers 2011Annual Convention & Education

Location to be determinedFor more information, call (515) 210-4675 or

visit www.iowamortgagebrokers.org.

Sunday-Tuesday, September 11-13Mortgage Bankers Association’s Mortgage

Operations Conference 2011Hilton New Orleans Riverside

2 Poydras Street • New Orleans, La.For more information, call (800) 793-6222 or

visit www.mortgagebankers.org.

Tuesday-Thursday, September 13-15Mortgage Bankers Association’s QualityAssurance and Residential Underwriting

Conference 2011Hilton New Orleans Riverside

2 Poydras Street • New Orleans, La.For more information, call (800) 793-6222 or


Thursday, September 152011 Minnesota Mortgage Association

Convention & Exhibitor ShowcaseSheraton Bloomington Hotel, Minneapolis

South7800 Normandale Boulevard

Bloomington, Minn.For more information, call (952) 345-3240 or

visit www.themma.org.

Sunday-Tuesday, September 25-27Mortgage Bankers Association’s Regulatory

Compliance Conference 2011Renaissance Washington DC Downtown

1127 Connecticut Avenue NorthwestWashington, D.C.

For more information, call (800) 793-6222 orvisit www.mortgagebankers.org.

OCTOBER 2011Sunday-Wednesday, October 9-12

Mortgage Bankers Association’s 98th AnnualConvention & ExpoThe Hyatt Regency

151 East Wacker Drive • Chicago, Ill.For more information, call (800) 793-6222 or


Friday, October 14Kentucky Association of Mortgage

Professionals 2011 Annual Convention &Trade Show

Location to be determinedLexington, Ky.

For more information, call (270) 929-2836 orvisit www.kyamp.net.

To submit your entry for inclusion in the National Mortgage ProfessionalCalendar of Events, please e-mail the details of your event, along with

contact information, to [email protected].

Only

$49.95

Plus Postage

& Handling

“Atare Agbamu is one of only a handful of people in the reverse mortgage arena

who possesses a commanding understanding of the reverse mortgage industry.

As an originator, he has hands-on experience educating seniors and their advi-

sors. As author of the “Forward on Reverse” column in The Mortgage Press since

2002, Atare Agbamu communicates nationally with the housing finance commu-

nity, bringing the unique insights and experience of an ardent reverse mortgage

expert into a wider business context.

“This book combines Atare’s keen insights and know-how with extensive re-

search to create a first of its kind resource for the reverse mortgage industry. It offers a comprehen-

sive overview of the industry plus detailed information on marketing and originating reverse mortgages.

“Present and future reverse mortgage professionals and senior advisors will profit from

decades of experience skillfully woven into this book. If you plan to succeed in this industry, this

book is the place to start.”

—Sarah F. Hulbert, President, Senior Financial Corporation and former four-term Co-Chairof NRMLA’s Board of Directors

“When I first began reviewing the contents of this book, I became quite jealous ... Atare Agbamu

has set down an impressive amount of information ... And he delivers it in an easy-to-read,

simple-to-understand style that will make this book essential reading for all reverse mortgage

professionals.”

—from the Foreword by Jim Mahoney, Co-Founder and Former Chairman, Financial FreedomSenior Funding Corporation, and former four-term Co-Chair of NRMLA’s Board of Directors

“The stories [Chapter 15: Profiles in Satisfaction] are the best vehicle to increase understanding and

acceptance of reverse mortgages among us laypeople. They are very compelling ...”

—Therese Cain, Executive Director, Minneapolis/St. Paul Chapter of Little Brothers—Friendsof the Elderly

“This book should be required reading for all new loan consultants originating reverse mortgages

and is recommended for experienced ones as well. This book provides excellent insight and infor-

mation on preparing ahead to provide the service our seniors deserve, to ensure a smooth loan

process and shorten the time to closing. Most of the problems caused in the processing and clos-

ing of reverse mortgages come from inadequate preparation.”

—Deanne Opstad, AVP, Senior Underwriter, Generation Mortgage Company

Think Reverse!Table of Contents

Part I:

The new pillar of retirement security

Part II:

Marketing reverse mortgages: It’s all about education

Part III:

Originating reverse mortgages

Part IV:

Enhancing freedom: The essence of reverse mortgages

Part V:

A new frontier in mortgage lending

NATI

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MORTGAGE PROFESSIONAL

MAGAZINE

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Looking for: TOP PRODUCERSCal l for Detai ls!

T he BEST B ranch Solu t ion, Period.

Nationwide FHA Lender

This information is provided to assist business professionals and is not an advertisement extended to the consumer,as defined by Section 226.2 of Regulation Z. Freedom Mortgage corporate office is located at: 907 Pleasant Valley Ave. Suite 3, Mount Laurel, NJ 08054. Lender NMLS ID: 2767. Licensed by the NJ Department of Banking and Insurance, License #9100861. All Rights Reserved. EOE

www.Fmbranch.com800.220.9498

[email protected]

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