17

Natio

nalM

ortg

ag

eP

rofe

ssional.co

mn

Pen

nsylvan

ia Mortgage P

rofessional M

agazine

nJU

LY 2

014PRESORTED STANDARD

U.S. POSTAGE PAIDNMP MEDIA CORP.

NMP MEDIA CORP.1220 WANTAGH AVENUEWANTAGH, NEW YORK 11793

First Guaranty Mortgage Corporation is an FHA Approved Lending Institution, and is not acting on behalf of or at the direction of HUD/FHA or the federal government. First Guaranty Mortgage Corporation Headquarters is located at 1900 Gallows Road, Suite 800, Tysons Corner, VA 22182 (800) 296-2275. Company NMLS# 2917.

FED

ERAL

HOUSING COMMISSION

ER

HUD-9208 (8-83) (HB4115.1)

AP

PR

O

VED LENDING INSTITU

TIO

N

MORTGAGE BANKERS ASSOCIATION

R

Celebrating 25 years of exceptional residential lending services.

Coming Soon...

THE

CHANGE AGENT OF THE MORTGAGE INDUSTRY.

THE

CHANGE AGENT OF THE MORTGAGE INDUSTRY.

Follow us on:

R

Celebrating residential lending services.

Celebrating s of e25 yearsresidential lending services.

of exceptionalresidential lending services.

TIONTGAGE BANKERS ASSOCIAATMOR

Coming Soon...

NOIIOTTI

UUT

TTU

TIIITTTIT

SSTNNSIINGNIDNEENLDEED

VVE

OO

V

RRO

PPR

PPP

AAP

)1).5114BH(3)83-8(800829-DUUDH

RENN

EOO

NIIO

SSISSS

MIIIS

MMIS

MMMOOMCGNISSIUOOU

HHOLAALRRAEER

DDE

EEDF

g Inidned LevorppA AHn Fs an ioitaroproe Cgagtroy Mtnaraut GsriFr tA oHF/DUf Hn ooitcerie dht tr af of olahen bg onitct aos nd ina

s retrauqdaeHn oitaroproCe gagtroMy tnarauGt sriF. tnemnrevog) 20082 (812A 2, Vrr,enros Cnosy, TTy00e 8tiu, Sdaos Rwolla0 G09t 1a

.77.19# 2SLMy NnapmoC

,noitutitsng Ilaredee fh

detacols is .5722-69) 2

Follow us on:

STATE OFFICERSPhone # E-mail

Paul Logan President (800) 295-1020 plogan@franklinamerican.comJim Mahler Jr. President-Elect (717) 299-6801, ext. 27 james.mahler@wellsfargo.comWayne Angelo Vice President (717) 397-7500 wayneangelo@msn.com Tom Constan Secretary (610) 690-7400, ext. 228 tconstan@accruedcapital.comLou Cesare Treasurer (570) 824-7811 lcesare@unitedoneresources.comRose Stancato Immediate Past President (610) 430-6901 rose@firstmortgagehomeloans.comJohn Anthony Board Member (717) 591-3278 janthony@acamortgage.comMichael D’Alonzo, CMC Board Member (215) 657-9600 mjdalonzo@hotmail.comJami Braafhart Board Member (717) 731-9700 jbraafhart@core-ss.comJames Clarke Board Member (724) 453-0335 jclarke@equitylendinggroup.comGeorge Hanzimanolis, CRMS Board Member (570) 620-9561 bnkrs1st@aol.comPaul Krause Board Member (717) 269-4957 pkrause@comcast.netTony Piestrak Board Member (570) 207-6334 tpiestrak@verizon.netWalter Scott Jr. Board Member (215) 669-3273 wscott.afcs@gmail.comBeth Stephans Board Member (610) 977-0662 bstephans@emg-inc.org

REGIONAL LEADERSHIPPaul Krause Central Chapter Governor (717) 269-4957 pkrause@comcast.netTony Piestrak North East Governor (570) 207-6334 tpiestrak@verizon.netWayne Angelo South Central Governor (717) 397-7500 wayneangelo@msn.com Beth Stephans South East Governor (610) 977-0662 bstephans@emg-inc.orgJames Clarke Western Governor (724) 453-0335 jclarke@equitylendinggroup.com

COMMITTEE CHAIRSJim Mahler Jr. By-Laws Committee (717) 299-6801, ext. 27 james.mahler@wellsfargo.comSandy Fisher By-Laws/Ethics Committee (215) 852-5978 sfischer@bluestonecap.comJohn Anthony Communications Committee (717) 591-3278 janthony@acamortgage.comWayne Angelo Community Relations Committee (717) 397-7500 wayneangelo@msn.com Paul Logan Conference Committee (800) 295-1020 plogan@franklinamerican.comMichael D’Alonzo, CMC Education Committee (215) 657-9600 mjdalonzo@hotmail.comPaul Krause Finance Committee (717) 269-4957 pkrause@comcast.netGeorge Hanzimanolis, CRMS Legislative Committee (570) 620-9561 bnkrs1st@aol.comWalter Scott Jr. Membership Committee (215) 669-3273 wscott.afcs@gmail.comJami Braafhart Membership Committee (717) 731-9700 jbraafhart@core-ss.comLou Cesare Nominating Committee (570) 824-7811 lcesare@unitedoneresources.comJohn Anthony Past President’s Council (717) 591-3278 janthony@acamortgage.comLarry Frank, CRMS Past President’s Council (215) 510-9701 laf721@aol.com

PAMB OFFICESarah Schmidt Administrative Assistant (717) 737-2117 -------------------

Pennsylvania Association of Mortgage BrokersP.O. Box 390

Wilkes Barre, PA 18703-0390Web site: www.pamb.org

PA 1

Natio

nalM

ortg

ag

eP

rofe

ssional.co

mn

Pen

nsylvan

ia Mortgage P

rofessional M

agazine

nJU

LY 2

014

PENNSYLVANIA EDITION

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?

Undercove

r Boss: Le

ssons Lea

rned

Major East Texas Mortgage F

raud Scheme: Out of Florida

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

calendar of eventsPAMB

OCTOBER 2014Tuesday-Thursday, October 14-16

Northeast Conference of Mortgage BrokersTrump Taj Mahal Casino Resort

1000 BoardwalkAtlantic City, N.J.

MARCH 2015Sunday-Thursday, March 8-12

32nd Annual Regional Conference of MBAsTrump Taj Mahal Casino Resort

1000 BoardwalkAtlantic City, N.J.

For more information, contact Monica Cedeno by phone at (908) 852-2498, e-mail mcedeno@njamb.org

or visit www.mbanj.com.

Pennsylvania Housing Market Slows in Q2

The statewide housing market saw a small decline in the secondquarter, according to a report released by the PennsylvaniaAssociation of Realtors (PAR). Both home sales and median sales pricefell slightly in the second quarter compared to the second quarter of2013. The report shows 38,701 closed sales in the second quarter,down nearly four percent from last year at the same time, based onmultiple listing systems (MLSs) reporting to PAR. The median salesprice dropped nearly 3 percent to $170,000 compared to the sameperiod in 2013.

Inventory jumped nearly nine percent to 82,013 in Q2, compared to75,515 in Q2 of 2013.

“Many areas had seen a limited inventory in the last several quartersbut I think it’s a positive indication that sellers are putting homes on themarket,” said PAR President Kim Skumanick.

Days on market continued to fall, down a little more than three per-cent in the second quarter to 84 days, compared to the same period in2013.

“We’re seeing some pockets of the state with positive growth, whileothers are a little more lackluster,” Skumanick said. “Many regions areaexperiencing increased activity with homes in the higher than average-price ranges. Interest rates are lower than a year ago, which has helpedthe affordability of homes. We’re continuing to see a somewhat restric-tive mortgage market and with tight credit, it can make it difficult formany buyers.”

PA 2

JULY

20

14 n

Pen

nsy

lvan

ia M

ortg

age

Pro

fess

ional

Mag

azin

en

Natio

nalM

ort

gag

eP

rofe

ssio

nal.c

om

PA3

Natio

nalM

ortg

ag

eP

rofe

ssional.co

mn

Pen

nsylvan

ia Mortgage P

rofessional M

agazine

nJU

LY 2

014

Fortune Title Agency, Inc. INCORPORATED 2000

39 Woodland Road, Roseland, New Jersey 07068

phone ~ ( )- WEB ~ www. .net

Mortgage and Tax

Sale Foreclosures

We back our product 100% and take on the liability for everything we review

Regardless of whether or not we are your Settlement Agent, we can also:

Close with Confidence

Cutting-edge technology for a generations-old industry

Fortune File Tracker

lose with CC

eonfidenclose with C

PA4

JULY

20

14 n

Pen

nsy

lvan

ia M

ortg

age

Pro

fess

ional

Mag

azin

en

Natio

nalM

ort

gag

eP

rofe

ssio

nal.c

om

1

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

Close MORE loans FASTERwith our wholesale division!

You're going to needa bigger pipeline!

Licensed Mortgage Banker NYS Department of Financial Services B50040 • NMLS # 7230 • AL Consumer Credit license #21761 • CO Mortgage Company Registration • CA DBO Finance Lenders Law license # 603K800 • CT Dept of Banking Mortgage Lender license #20372 • FL Dept of Financial Institutions Mortgage Lender license #MLD273 • GA Dept of Banking and Finance Mortgage

Lenders license #39919 • MD Mortgage Lender license • MA Div of Banks and Loan Agencies Mortgage Lender & Mortgage Broker license #MC7230 • NJ Dept of Banking and Insurance Mortgage Lender license #L0046623 • NC Commissioner of Banks Mortgage Lender license #L140365 • PA Dept of Banking Mortgage Lender license #20887 • SC State Board of Financial Institutions • TN Mortgage Lender license #MLS7230 • TN Mortgage license #115610 • TX - SML Mortgage Banker Registration • WA Consumer Loan Company license #CL-7230 - Direct Endorsed FHA Lender

| * The 4 days begin to run upon the receipt of a satisfactory appraisal, title and termite inspection report, property survey, radon test, well water test report,

table oN A T I O N A L M O R T

J U L Y 2 0 1 4 l V O L U

A SPECIAL FOCUS ON “SOCIAL MEDIA”Social Media in Today’s Mortgage Marketing SpaceBy Brent Emler ....................................................................................58

A Hunger for Authenticity in the World of Social MediaBy Cal Haupt ......................................................................................60

Social Media and Regulatory Compliance: How Mortgage Lenders Can Make Room for Both By George Gallinger, CIA, CFE & Roberta Janel, CMB ........................................................................62

Social Media Recruiting: Are You Linked in to Talent?By Chad Jampedro ............................................................................64

Anti-Social Media By Eric Weinstein ................................................65

Blogging for Apps: 10 Tips for a Successful BlogBy Ricardo Cobos ..............................................................................66

Social Media: Compliance Risks of the Emoticon?By Thomas Morgan ............................................................................68

How Do You Video? By Adam P. Smith............................................69

How to Engage Customers and Earn Business Via Social MediaBy Moses Keshishian ..........................................................................70

Five Must-Know Tips to Finding Customers on LinkedInBy Marc Wayshak ..............................................................................72

What You Need to Know About Social Media EtiquetteBy Margaret Page ..............................................................................73

FEATURESRegional Compliance Updates By Laurie Spira ................................8

The Elite Performer: Can I Leave Now? By Andy W. Harris, CRMS ....................................................................8

So You Want Your Own App? By Phil Hall ......................................10

Tightly Guarded Secret to keep Your Past Clients Released ......16

AllRegs.............................................................. www.allregs.com ..........................................................67American Financial Resources ............................ www.afrwholesale.com/wd ......................Inside Back CoverAmerican Pacific Mortgage ................................ www.growwithapm.com ................................................29BetterLoanOfficers.com ...................................... www.betterloanofficers.com ..........................................11Brokers Compliance Group.................................. www.brokerscompliancegroup.com ..................................55CallFurst.com ...................................................... www.callfurst.com ............................................................61Calyx Software .................................................. www.calyxsoftware.com ................................................35Carrington Mortgage Services, LLC ...................... www.carringtonwholesale.com ..............................25 & 68Continental Home Loans, Inc. ............................ www.continentalhomeloans.com ......................................5Document Systems, Inc./DocMagic ...................... www.docmagic.com ................................................7 & 49Easy Mortgage Apps............................................ www.easymortgageapps.com ..........................................48FAMP ................................................................ www.myfamp.org ..........................................................47Fast Forward Stories .......................................... www.fastforwardstories.com ..........................................23First Guaranty Mortgage Corp. ............................ www.fgmc.com ..............................Inside Front Cover & 70Flagstar Bank .................................................... www.flagstar.com/ae ....................................................13Fortune Title Agency .......................................... www.fortunetitle.net ..................................................PA3GraceChurch Intermediaries................................ www.gracechurchintermediaries.com ..............................39Lykken On Lending ............................................ www.lykkenonlending.com ............................................71Matchbox, LLC .................................................. www.matchboxllc.com ..................................................47

V I S I T O U R A

Company Web Site Page

30Top Mortgage ExecutivesSound Off on the State ofthe IndustryBy Tom LaMalfa

42First They Came for thePayday LendersBy Jonathan Foxx

52The 25 Most ConnectedMortgage Professionals of2014

56NMP MortgageProfessional of the Month:Paul Rozo, CEO of PRMGBy Phil Hall

77David vs. Goliath in theWorld of ReverseMortgagesBy Phil Hall

25MOST CONNECTEDMORTGAGE PROFESSIONALS

2014

3

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

f contentsT G A G E P R O F E S S I O N A L

M E 6 l N U M B E R 7

Thinking Outside the Box Can Help Grow Your Referral BaseBy K. Justin Restaino ..........................................................................18

NAMB Perspective ............................................................................20

Lykken on Leadership: Leaders … Who Do You Have in Your Inner

Circle By David Lykken ......................................................................26

Data Privacy is a Lender’s Nightmare and a Consumer’s Biggest Fear By Andrew Liput ..........................................................28

NMP’s Economic Commentary: The Mid-Year Employment Update By Dave Hershman................................................................32

Tales From the Closing Table By Andrew Liput ..............................34

Renting or Buying? By Phil Hall ........................................................36

Mortgage Visuals: Its’ About Time By Matthew Dunn Ph.D. ..........38

Online Reputation & Influence: The Eight Biggest Mistakes Salespeople Make By Rene Rodriguez ............................44

Stop Selling Reverse Mortgages: The Need to Become a True Consultant By Mike Suits ......................................................46

The Payoffs of Being Proactive By Cheryl Marquez........................50

The Long & Short: The Business of Short Sales By Pam Marron....50

HECM Loans: The New Retirement Planning ComponentBy Ralph Rosynek ..............................................................................76

MBA’s Mortgage Action Alliance By Amy Swaney ........................76

What Will the Second Half of 2014 Bring? By Phil Hall ..................78

COLUMNSNew to Market..............................................................................12News Flash: July 2014 ................................................................14Heard on the Street ....................................................................24NMP Resource Registry..............................................................74NMP Calendar of Events ............................................................79

Maverick Funding Corp....................................... www.maverickfunding.com ............................................19Mortgage Bankers Association ............................ www.mbaeducation.org/qm ..........................................37NAPMW ............................................................ www.napmw.org ............................................................3NAWRB ............................................................ www.nawrb.com ............................................................51Paramount Residential Mortgage Group, Inc. ...... www.prmg.net ................................................17, 31 & 43Path2Buy .......................................................... www.path2buy.com ......................................................66PB Financial Group Corp..................................... www.pbfinancialgrp.com ..............................................48Radian Guaranty ................................................ www.radian.biz ............................................................59REMN (Real Estate Mortgage Network) ................ www.remnwholesale.com ......................................40 & 41Reverse Mortgage Solutions, Inc. ........................ www.rmsnav.com ..........................................................65Secure Settlements Inc. ...................................... www.securesettlements.com ..........................................15Simple Nexus .................................................... www.simplenexus.com ..................................................27Streetlinks LLC .................................................. www.streetlinks.com ......................................................33TagQuest .......................................................... www.tagquest.com ........................................................45The Bond Exchange ............................................ www.thebondexchange.com ..........................................32Titan List & Mailing Services, Inc. ........................ www.titanlists.com ..........................................................9United Northern Mortgage Bankers, Ltd. ............ www.unitednorthern.com ........................................1 & 80United Wholesale Mortgage ................................ www.uwm.com ........................................60 & Back Cover

D V E R T I S E R S

Company Web Site Page

Helping You Get Plugged Into Your Business

If you believe in helping to elevate the educational standards of this industry, or assisting in developing the most competent industry work force, then NAPMW is for YOU! NAPMW is a community of mortgage and banking industry professionals across the Country; men and women from all backgrounds have joined NAPMW because they want to excel at what they do. NAPMW membership gives you exclusive access to timely education regarding the regulations affecting your career such as FREE TO MEMBERS webinars on industry updates. To Join NAPMW visit. www.napmw.org or call 1.800.824.3034

YHelping Yo Int

et Plugged ou GYYonessour BusiYYo

et Plugged ness

o fforkk otry winduselodev in istingssa

l standtionaeducau believe inIf yo

NAPMWhen tce, rocot somhe tpingelo

industhis f rds oal standte elevao telping h

ro is ffoNAPMWt tenpemco

ro, tryy,indushe t

cel at wto exnt athey w havundsorgckban anemuntry; Co

try ndus iingnkbaco is a NAPMW

!UYOtry w

they dot hacel at wPMWNAined oe j hav

allmofren mod wn ancrls anafessiooprtry tgromf ty ounimm

ce,

e becausWW all

he tssocre and agtg

tes.updaM MEOTFREE

affectionsulaegrlyemccess to tia

bememNAPMW

cel at wto exnt athey w

rs oebinaRS wBEM seerr carur yongti affec

rdingaegtion rduca eu exclusoes yivrship gbe

.they dot hacel at w

ryn industrs o such as

he trdinge ivu exclus

.

.824.30.80 call 1ro.orgw.napmwww

WMin NAP JooTTo

403.824.3.org

isit.vW

Featured Editorial ContributorsJonathan Foxx

Donald J. Frommeyer,CRMS

Phil Hall

Andy W. Harris, CRMS

Dave Hershman

Tom LaMalfa

Andrew Liput

David Lykken

Pam Marron

Amy Swaney

Editorial ContributorsRicardo Cobos

Matthew Dunn Ph.D.

Brent Emler

George Gallinger, CIA, CFE

Cal Haupt

Chad Jampedro

Roberta Janel, CMB

Moses Keshishian

Cheryl Marquez

Thomas Morgan

Margaret Page

Adam P. Smith

Laurie Spira

K. Justin Restaino

Rene Rodriguez

Ralph Rosynek

Marc Wayshak

Eric Weinstein

Erik Wind

4

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

JULY 2014Volume 6 • Number 7

1220 Wantagh Avenue • Wantagh, NY 11793-2202Phone: (516) 409-5555 • Fax: (516) 409-4600Web site: NationalMortgageProfessional.com

Social media: Friend or foe?This month, our focus is on the continued growth and evolution of social media. Social networks havetaken hold and have transformed so much of what we are involved with on a day-to-day basis. Socialmedia has reshaped how human beings initiate and/or maintain virtually every type of social bond or roleat every level, from company to consumer, employer to employee, co-worker to co-worker, friend tofriend, all down the line.

The complex web of interactions between social networking service users and their online and offline communities,social network developers, corporations, governments and other institutions will continue to require rigorous analysis andregulatory oversight for decades to come.

The power of social mediaThe power of social media can be both positive and negative. The social media landscape is ripe to promote your mes-sage to consumers, but you need to be prepared to deal with the negative side of social media that you have absolutelyno control over occurring. Today, someone, somewhere, is using social media to talk about your brand. And in a singlemoment, that one customer or one employee, can have a significant negative impact. The public plays an active role, aswell, and now customers, prospects, and even competitors, can use any one of the numerous social media outlets to build,maintain, protect–or ruin–your brand. Does that mean we should just give up? Of course, not. But, it does mean you needa strategy.

Start smallSecure the support of compliance and regulatory partners, and set internal controls, a solid framework, training andguidelines before you launch. Infuse your brand promise into the entire strategy so you avoid the maverick posts and youcan checkpoint the message or ads with how the market will perceive it. Proceed with caution and arm yourself with apolicy designed for when things “don’t go exactly as planned.” Prepare yourself and have the process and plan ready forwhen the ride gets bumpy–as it inevitably will in this dynamic environment. The compliance accountability for socialmedia extends throughout every level of your organization, and you are ultimately responsible for the compliance of yourteam members when it comes to their use of social media.

Don’t let negative examples discourage youSocial media is here to stay, and it is a facet of life and business that we need to embrace and harness its enormous poten-tial. How a brand chooses to respond to criticism can make or break their public image in today’s social media-drivenworld. These new channels are valuable tools. Use them to shape conversations and share your story. If you don’t, yourcompetition will, and in due time, you will become as extinct as a dot matrix printer!

Sincerely,

Joel M. Berman, Publisher-CEONMP Media Corp. • joel@nmpmediacorp.com

National Mortgage Professional Magazine is published monthly by NMP Media Corp. • Copyright © 2014 NMP Media Corp.

publisher’s deskFROM THE

STAFF

ADVERTISINGTo receive any information regarding advertising rates, deadlines and requirements, please contactNational Account Executive Beverly Koondel at (516) 409-5555, ext. 316 or e-mail beverlyk@nmp-mediacorp.com.

ARTICLE SUBMISSIONS/PRESS RELEASESTo submit any material, including articles and press releases, please contact Editor-in-Chief Eric C. Peckat (516) 409-5555, ext. 312 or e-mail ericp@nmpmediacorp.com. The deadline for submissions is thefirst of the month prior to the target issue.

SUBSCRIPTIONSTo receive subscription information, please call (516) 409-5555, ext. 301; e-mail orders@nmpmedia-corp.com or visit www.nationalmortgageprofessional.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 Magazine are the responsibility of theauthors alone and do not imply the opinion or endorsement of NMP Media Corp., or the officers or mem-bers of National Association of Mortgage Brokers and its State Affiliates (NAMB), National Association ofProfessional Mortgage Women (NAPMW), National Consumer Reporting Association (NCRA) and/or otherstate mortgage trade associations.

Participation in NAMB, NAPMW, NCRA, and/or other state mortgage trade associations events, activ-ities and/or publications is available on a non-discriminatory basis and does not reflect the endorsementof the product and/or services by NMP Media Corp., NAMB, NAPMW, NCRA, and other state mortgagetrade associations.

National Mortgage Professional Magazine, NAMB, NAPMW, NCRA, and/or other state mortgagetrade associations do not make any misrepresentations or warranties concerning the regulatory and/orcompliance aspects of advertisers, products or services and/or the editorial content contained in NMPMedia Corp. publications. National Mortgage Professional Magazine and NMP Media Corp. reserve theright to edit, reject and/or postpone the publication of any articles, information or data.

Eric C. PeckEditor-in-Chief

(516) 409-5555, ext. 312ericp@nmpmediacorp.com

Joey ArendtArt Director

(516) 409-5555, ext. 307joeya@nmpmediacorp.com

Scott KoondelOperations Manager

(516) 409-5555, ext. 324scottk@nmpmediacorp.com

Richard ZytaSocial Media Ambassador

(516) 409-5555richardz@nmpmediacorp.com

Joel M. BermanPublisher - CEO

(516) 409-5555, ext. 310joel@nmpmediacorp.com

Beverly BolnickNational Sales Manager

(516) 409-5555, ext. 316beverlyk@nmpmediacorp.com

Phil HallManaging Editor

(516) 409-5555, ext. 312philh@nmpmediacorp.com

Robert Peter OttoneExecutive Editor

(516) 409-5555, ext. 314robertpo@nmpmediacorp.com

Francine MillerAdvertising Coordinator

(516) 409-5555, ext. 301francinem@nmpmediacorp.com

NATIONAL MORTGAGE PROFESSIONAL MAGAZINE’S

E D I T O R I A L C O N T R I B U T O R S

5

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

National PresidentChristine Pollard(607) 226-1046president@napmw.org

President-ElectKelly Hendricks(314) 398-6840preselect@napmw.org

Vice President–Central RegionJudy Alderson (918) 250-9080, ext. 300

Vice President–Eastern RegionCathy Kantrowitz (845) 463-3011easternregion@napmw.org

Vice President–Northwestern RegionWilliam “Bill” Sanderson, CME, CMI (360) 713-9264

Vice President–Western RegionAnna Mackovska (323) 321-2222westernregion@napmw.org

SecretaryCynthia Nutter(360) 258-2206natsecretary@napmw.org

TreasurerKimberly Rozell, CME (607) 229-5008 nattreasurer@napmw.org

ParliamentarianDawn Adams, GML, CMI(607) 329-4622 dawnvadams@live.com

6

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

NAMBThe Association of

Mortgage Professionals2701 West 15th Street, Suite 536 l Plano, TX 75075

Phone: (972) 758-1151 l Fax: (530) 484-2906Web site: www.namb.org

OFFICERSDonald J. Frommeyer, CRMS (t/e 2014)—PresidentMSI, III200 Medical Drive, Suite D l Carmel, IN 46032Phone: (317) 575-4355 l Fax: (317) 575-4360E-mail: dfrommeyer@amtrust.net

John Councilman, CMC, CRMS (t/e 2014)President-ElectAMC Mortgage Corporation10136 Avalon Lake Circle l Fort Myers, FL 33913Phone: (239) 267-2400 l E-mail: jlc@amcmortgage.com

Rocke Andrews, CMC, CRMS (t/e 2014)—Vice PresidentLending Arizona LLC1996 North Kolb l Tucson, AZ 85715Phone: (520) 886-7283 l Fax: (520) 731-3388E-mail: randrews@lendingarizona.net

Kay A. Cleland, CMC, CRMS (t/e 2014)—SecretaryKC Mortgage LLC2041 North Highway 83, Unit C l P.O. Box 783Franktown, CO 80116Phone: (720) 670-0124 l Cell: (720) 670-0124E-mail: kay@kcmortgagecolorado.com

Andy W. Harris, CRMS (t/e 2014)—TreasurerVantage Mortgage Group Inc15962 SW Boones Ferry Road, Suite 100 l Lake Oswego, OR 97035Direct: (503) 496-0431, ext. 302 l Cell: (503) 880-2427E-mail: aharris@vantagemortgagegroup.com

Jim Pair, CMC (t/e 2014)—Immediate Past PresidentMortgage America Corpus Christi Inc.22800 Bulverde Road, Apt. 1402 l San Antonio, TX 78261Phone: (361) 774-7314 l E-mail: jlpair@aol.com

DIRECTORSFred Kreger, CMC (t/e2016)American Family Funding28368 Constellation Road, Ste. 398 l Santa Clarita, CA 91350Phone: (661) 505-4311 l E-mail: fred.kreger@affloans.com

Linda McCoy, CRMS (t/e 2016)Mortgage Team 1 Inc.6336 Piccadilly Square Drive l Mobile, AL 36609Phone: (251) 650-0805 l Fax: (251) 650-0808E-mail: linda@mortgageteam1.com

John Stevens, CRMS (t/e 2014)ENG Lending11650 South State Street, Suite 350 l Draper, UT 84020Phone: (801) 477-7111 l Fax: (866) 442-9937E-mail: jstevens@englending.com

Valerie Saunders (t/e 2015)RE Financial Services13033 West Lindburgh Avenue l Tampa, FL 33626Phone: (866) 992-0785 l Fax: (866) 992-1024E-mail: valsaun@gmail.com

Rick Bettencourt, CRMS (t/e 2014)Mortgage Network300 Rosewood Drive l Danvers, MA 01923Phone: (978) 777-7500 l Fax: (855) 447-4350 E-mail: rbettencourt@mortgagenetwork.com

Olga Kucerak, CRMS (t/e 2016)Crown Lending328 West Mistletoe l San Antonio, TX 78212Phone: (210) 828-3384 l Fax: (210) 828-3332E-mail: olga@crownlending.com

NAMB 2013-2014 Board of Directors

Maureen DevinePresident(413) 736-4511mdevine@strategicinfo.com

Mike BrownVice President/Treasurer(801) 925-6691, ext. 3777mike.brown@ncogroup.com

Daphne LargeEx-Officio(901) 259-5105daphnel@datafacts.com

Nancy Fedich Conference Committee Chair (908) 813-8555, ext. 3010nancy@cisinfo.net

Julie WinkEducation Committee Liaison(901) 259-5105 julie@datafacts.com

Tom Conwell Legislative Committee Liaison(800) 445-4922, ext. 1010tconwell@credittechnologies.com

Renee Erickson Membership & Elections Chair(866) 932-2715renee.erickson@acranet.com

William Bower Resident Screening Committee Liaison(888) 316-4242wbower@cicreports.com

Judy Ryan Strategic Alliance Committee Chair(410) 747-9551judy.ryan@creditplus.com

Sharon BieszkDirector(262) 542-1700sbieszk@wititle.com

Mary CampbellDirector(701) 239-9977mary@advantagecreditbureau.com

Dean WangsgardDirector(801) 487-8781dean@nacmint.com

Terry Clemans Executive Director(630) 539-1525tclemans@ncrainc.org

Jan GerberOffice Manager & Member Services(630) 539-1525jgerber@ncrainc.org

National Association of Professional Mortgage WomenP.O. Box 451718 l Garland, TX 75045

Phone: (800) 827-3034Web site: www.napmw.org

2014-2015 NAPMW National Board of Directors

National Consumer Reporting Association701 East Irving Park Road, Suite 306 l Roselle, IL 60172

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

2013-2014 Board of Directors & Staff

7

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

8

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

elite performerT H E

By Andy W. Harris,CRMS

Vacation … this word isGreek to most self-employed entrepreneurs.

Why? Because no matter where you goor what you do, it is nearly impossiblefor those of us that rely on convertingnew business to disconnect from work. I find myself typing this article whilegetting ready to leave town for a week with the family, but could not seemto avoid the stress in preparation to leave the office for several days. We arecalled to rest and relax and I know how important it is to take a break, butit always seems so hard to leave. If you’re planning on taking longer vaca-tions with the family this summer, hopefully these few references can help.

There will never be a “good” timeWaiting for the right time to take a vacation will never happen and you could waitforever. You just need to plan and commit to it. Things will always be busy andit’s important to delegate, communicate with customers, plan, and make time totake a break.

Unplug, but know you can plug inWith today’s technology, we are fortunate to have access to remotely log-inand handle items that require attention and be available easily for fast com-munication. This can be a blessing and a curse. When on vacation, takeadvantage of the vacation and enjoy yourself. Knowing that you can accessin case of an emergency should help you relax. Try to unplug and only log-in or answer your phone in the case of an emergency or immediate customerneed.

Plan for fun and then don’t plan at allHaving fun on vacation is a requirement of course, but make time for absolutelynothing. Relaxing can be the best part of your vacation and leave the schedule atwork.

Everything will be fineThings will continue to move along while you’re gone and the world will not end.When you come back, your desk will still be there and likely your keyboard andphone will be untouched. No need to panic.

When you return from your vacation, have a planand to-do list as wellDon’t get overwhelmed and just organize the most important tasks to the leastimportant, and pretty soon you’ll be able to dial in the best way to plan and pre-pare vacations in the future to eliminate stress.

Andy W. Harris, CRMS is president and owner of Lake Oswego, Ore.-based VantageMortgage Group Inc. and 2010-2011 president of the Oregon Association of MortgageProfessionals. He may be reached by phone at (877) 496-0431, e-mail aharris@van-tagemortgagegroup.com or visit www.vantagemortgagegroup.com.

Can I Leave Now?

SPONSORED ED ITORIAL

By Laurie Spira

An Update to the Maryland Housing Counseling NoticeThe recent implementation of the Dodd-Frank Act home-ownership counseling notice requirements has promptedthe Maryland Department of Housing and Community De-

velopment to review its requirement for providing a state-specific noticeregarding homeownership counseling. Maryland Commercial Law §12-1303 requires lenders to provide an Important Notice Regarding HousingCounseling on all first lien, closed-end loans secured by owner-occupiedproperty in Maryland. Additionally, Maryland Commercial Law 12-409.1(d)(2) requires that a homeownership counseling notice be providedon all Secondary Mortgage Loans that are Maryland Covered Loans.

After review, the Department advised that a lender who satisfies thenotice requirements of the federal Real Estate Settlement ProceduresAct (RESPA) and its implementing regulations (12 CFR §1026.20) is alsoin compliance with Maryland Commercial Law §12-1303 and its relatedregulations (COMAR 05.19.01), as long as the RESPA notice includes oris accompanied by a statement in substantially the same form as thefollowing:

“When applying for a mortgage loan or line of credit, we recommend youreceive homebuyer education or housing counseling.”

Because the Maryland model notice is no longer required, lenders maydiscontinue its use. However, keep in mind that the disclosure referencedabove would have to be provided to the borrower.

Late Fees and Prepayment Penalty Threshold UpdateEffective July 1, 2014, loans made under the consumer credit codes in In-diana, Minnesota, Oklahoma and South Carolina will be subject to an in-crease in their respective late fee dollar amount.

Please note the following changes:

l The Indiana late fee dollar amount is currently $18 and will change to$18.50;

l The Oklahoma late fee dollar amount is currently $24 and will changeto $24.50; and

l For South Carolina, the maximum late fee dollar amount is currently$17.50 and will change to $18, and the minimum late fee dollaramount is currently $7 and will change to $7.20.

l The Minnesota late fee dollar amount, which is currently at $7.80, willnot increase, according to the Consumer Credit Code Adjustments Webpage of the Minnesota Department of Commerce, Banking & FinanceDivision.

In addition to changes to its minimum and maximum late fee dollaramounts, note that South Carolina’s prepayment penalty prohibition forfirst-lien loans is increasing from “$240,000 or less” to “$255,000 or less.”Finally, Indiana’s “High-Cost Home Loan” dollar amount threshold will re-main the same at $44,000.

Laurie Spira is chief compliance officer with Torrance, Calif.-based DocMagicInc. She may be reached by phone at (800) 649-1362, ext. 6446 or e-maillaurie@docmagic.com.

Regional ComplianceUpdates

�

“Isn’t it amazinghow much stuff we get

done the day beforevacation?”

—Zig Ziglar

9

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

By Phil Hall

Nowadays, it seems likethere is an app for everypossible activity andinterest—which makes

sense, considering the obsessive naturethat many people devote to theirmobile devices.

“Take a look around you next timeyou are at the airport, in line at a coffeeshop or out to dinner with the family,”said Michael Kelleher, co-founder andexecutive vice president of Swampscott,Mass.-based EasyMortgageApps. “Tellme, how many people you see usingtheir mobile devices? Simply put, ourworld is in the midst of paradigm shift.For the first time, more people areaccessing the Internet via their mobiledevice than their desktop.”

But creating mobile apps for thesake of creating mobile apps makes lit-tle sense, especially in the mortgagespace. When Mat Ishbia, president andCEO of Troy, Mich.-based United ShoreFinancial Services (USFS), wanted tooffer an app for the brokers working

with his company’s United WholesaleMortgage (UWM) subsidiary, he insistedthat it serve a practical purpose.

“We wanted to make sure had thebenefits and usefulness for them,” saidIshbia. “We are not marketing it as ‘Hey,we have an app!’”

And that is the primary challenge fortoday’s mortgage industry-related apps:Creating a user-friendly high-tech solu-tion that serves an important businessrole.

However, it is important to stressthat apps are not a replacement forother communications channels.

“Clients want to be communicatedwith by the medium that speaks mostclearly to them,” said Jeff Miller, directorof systems integration at DirectorsMortgage, headquartered in LakeOswego, Ore. “Some would prefer aphone call, while others prefer a packageof papers in the mail, and others wantbadge alerts and text messages. A goodmortgage company will never try to com-municate via only one channel, but makethem all excellent and allow the client tochoose what works best for them.”

Planet of the appsThe evolution of the app-related tech-nology is relatively recent. EricRobichaud, CEO of 401 Consulting, aWoonsocket, R.I.-based developer ofapps and Web sites, noted that the pastfour to five years have seen a dramaticimprovement in this area.

“In 2010, an iPhone with 3G dataconnection was abysmally slow,”Robichaud said. “But fast-forward to2014, where 90 percent of your connec-tivity is over WiFi at blazingly fastspeeds, and the other 10 percent is overhigh-speed LTE networks, and speed isless of an issue. In 2009, there werethings you just couldn’t do over the Webon a smartphone. But today, nearly allof that has vanished because of awealth of great new technologies—between HTML5 and advanced jqueryand Javascript code libraries, there’svery little you can’t do over the Web.”

Within the mortgage space, appdevelopment is aimed at the distinctivecommunications needs of real estateprofessionals. When UWM launched itsapp for brokers in February, it queried

its clients to determine what functionswould be necessary for the app to bewidely used. As a result of these conver-sations, UWM’s mobile app can allowbrokers to access rates, managepipelines, view borrower and loandetails, check the real-time status oftransactions, receive alerts, manageconditions and lock loans.

“No other wholesale leaders can dothat,” said Ishbia. “We wanted to makeour app interactive.”

When Columbia, Md.-based IndiSoftLLC was planning the creation of itsapps, it also queried potential users onwhich functions would be desired andwhich would be impractical.

“For an app to be good, we need toknow what practicality the app willhave in the users’ hands,” said SanjeevDahiwadkar, president and CEO ofIndiSoft. “If there is no benefit, it won’tbe used. There was no way that a per-son would use a smartphone and lookat compliance papers. For the mobileplatform on our valuation module,however, users are able to capture pho-tos of property, make notes and obser-

So You Want Your OwnApp?

vations, and enter data while in field.This helps speed up the process ofdoing work.”

“A superior app offers connectivityand loan transparency complimentedby a technology which offers an auto-mated solution to integrate directlywith either a company’s loan origina-tion or CRM software,” said Kelleher.“The resulting superior app offers real-time updates in a mobile format com-plete with automated push notifica-tions updating all relevant parties whenthere is a change to loan status. Ourloan ecosystem is truly unique engag-ing the borrower, real estate broker,loan officer and title agent.”

Before you get startedFor mortgage companies that wanttheir own app, a thorny questioninvolves whether to create the app in-house or to outsource the project. ForDirectors Mortgage’s Miller, the answerdepends on a variety of circumstances.

“The advantages of developing anapp in-house allows you to make whatyou want and how you want it,” Millersaid. “Control of design and functional-ity is within your realm and not handedover to an out-of-the-box product thatjust has your logo and colors. You willnot stand out from the crowd with anapp that looks like everyone else’s.”

But on the other hand, Miller con-tinued, was the question of whetherthe company has the right team inplace to create this type of a product.

“The trouble with in-house designand build-out is you need the expertiseto do it,” he Miller. “And to staff for thiskind of skill is expensive. So, the realityis most mortgage shops cannot affordto do this well. The best third-party towork with is one who has proven expe-rience and can deliver the product, canmake changes easily and customize thesoftware and app to meet the needs ofindividual customers, yet at the sametime support it moving forward.”

Robichaud pointed out that this typeof project is not for companies that pre-fer to accomplish endeavors quicklyand cheaply.

“There are significant costs to devel-oping native apps,” Robichaud said.“First, most people don’t realize thateach smartphone platform—iPhone,Windows Phone, Android, Blackberry—uses a different set of technologies, pro-gramming languages and developmenttools. Developing native apps oftenmeans re-coding the same app multipletimes from scratch for each distinctplatform. Making updates is neitherfast nor trivial.”

Robichaud added that app develop-ment will also require a marketingpush to raise awareness of the app’sexistence.

“Above and beyond all of this, consid-er too that an app must be downloadedand installed,” Robichaud said. “Somortgage companies have the addedhurdle of getting customers andprospects to proactively go and down-load an app, which in turn assumesthey’re setup already and able to do so.”

But despite the omnipresence ofmobile devices, it appears that manyare intentionally avoiding mobile-basedactivities relating to the financial servic-es world. Earlier this year, a survey con-ducted on behalf of the Deloitte Centerfor Financial Services found that 61 per-cent of consumers that do not regularlyuse mobile devices for the financialneeds cited security reasons as the mainreason for doing business offline. Oneout of five survey respondents claimedthat the risk of identity theft was greaterwhen conducting mobile transactions,while more than one-third expressed nofaith the security of WiFi and mobilenetworks.

And this fear may not be without rea-son. In June, the Russian-based

Kasperksy Lab warned that U.S. con-sumers faced the threat of a new mal-ware called Svpeng that targetedmobile banking apps and then lockedthe mobile device—the malware willnot unlock the device unless the userforks over a ransom.

“To boost adoption and set the stagefor more ambitious applications, com-panies will likely have to take tangiblesteps to reassure consumers about thesecurity of their mobile financial trans-actions,” said Jim Eckenrode, executivedirector of the Deloitte Center forFinancial Services.”

Finally, there is another optionwhen it comes to app development:Consider a Web-based app instead of anative app.

11

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

“A good, solid, responsive Web siteor Web-based app will fill the need per-fectly,” said Robichaud. “A Web-basedapp will scale to any resolution andwork across all smartphone devices.This approach bypasses all the device-dependency issues entirely—it is aseasy as hitting a Web site and does notrequire traversing any hurdles akin todownloading and installing a softwareapp. And security is relegated to theserver side, where admins already areexperienced, and already have thingslocked-down.”

Phil Hall is managing editor of NationalMortgage Professional Magazine. Hemay be reached by e-mail atphilh@nmpmediacorp.com.

12

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

Credit Plus Integrates TheWork Number DatabaseInto Tech Platform

Credit Plus has announced that it has inte-grated direct access to The Work Numberdatabase into its technology platform. TheWork Number is a solution offeredthrough Equifax Workforce Solutions, abusiness unit of Equifax Inc., and is thelargest collection of payroll records con-tributed directly from employers.

“We are pleased to be leading theindustry in offering this time-saving con-nection. With a simple click of the button,lenders will find it easier to verify employ-ment and income so they can feel confi-dent in their lending decisions,” statedGreg Holmes, national director of Salesand Marketing at Credit Plus.

Credit Plus became a certified resellerof The Work Number in 2013 and itsdirect connection went live in May of2014. The Work Number database hous-es more than 57 million current employ-ment records contributed from morethan 3,400 employers nationwide. Onlyan applicant’s full name and SocialSecurity number are required to accessinformation through the Credit Plusdirect connection to The Work Number.If an applicant is not included in TheWork Number database, a manual verifi-cation can be ordered through the sys-tem as well.

“Employment and income verifica-tion plays a critical role in originatingquality loans. It is also essential thatproper documentation be validated andrevealed quickly and accurately,” saidEquifax Senior Vice President MichaelKuentz. “Integrating Credit Plus technol-ogy with The Work Number databasedelivers maximum efficiency across theentire lending industry.”

Landmark Network’sAppraisal Services Addedto ReverseVision’s LOS

ReverseVision Inc. has announced theaddition of Landmark Network’sappraisal services to ReverseVision’s

Reverse Loan Origination System (RLOS)platform, RV Exchange (RVX).

RVX offers a library of tightly integrat-ed services that help streamline the lend-ing process. The addition of LandmarkNetwork’s appraisal service enablesReverseVision users to order an appraisalwith the click of a button.

“Being able to order an appraisalfrom us, and then have the status andresults automatically feedback intoReverseVision is a powerful tool for ourclients,” said Erik Richard, chief executiveofficer of Landmark Network. “Users willbe able to spend more time focusing oncore tasks and less time tracking theirappraisal submissions.”

The integrated appraisal service alsostores both the final appraisal and theappraisal invoice within RVX (attacheddirectly to the loan).

“Landmark is one of the most widelyused appraisal services in the reversemortgage space, and our clients will real-ly benefit from this one-click integra-tion,” said President and CEO ofReverseVision John Button. “Faster work-flow with fewer errors—an excellentbenefit to our customers.”

Quandis Announces NewServicemember Search forthe Prevention ofForeclosure

Quandis Inc. has announced that it hasrolled out a new feature within its existingmilitary search service that identifies mul-tiple name variations of borrowers whichcould have active duty status in the U.S.military. If in default but on active duty,certain rules prohibit foreclosure. Thiscomprehensive search reduces the risk ofmissing a name and potentially failing tocomply with the Servicemembers CivilRelief Act (SCRA) of 2003.

In order to comply with the SCRA,organizations must take various measuresbefore beginning foreclosure proceedingson active duty military personnel. Non-compliance with the SCRA can result in

steep fines, lawsuits and the potential torescind foreclosure transactions.

“There is a serious need to identifyand search name permutations thatreside in the Department of Defense’sdatabase,” stated Greg Kent, VP of dataservices at Quandis. “Often, the personsearching for active military membersmust guess name variations, which sig-nificantly increases the chance to missnames. Our comprehensive searchcapability eliminates using this manualprocess, thus saving time, reducingcosts, and mitigating compliance risk.”

Quandis’ military search service iscurrently in use by foreclosure attor-neys, servicers, lenders, banks and thirdparty outsource providers. Once initiat-ed, the search service delivers an officialmilitary status report from theDepartment of Defense within 24 hours.

Quandis’ military search service canintegrate with servicing platforms, attor-ney case management systems (CMS)and third party applications. In addi-tion, client workflows can be customconfigured for their unique processesand procedures using business rules.

Comergence’s RealmPlatform Now FeaturingDocument Library

Comergence has enhanced its Realmplatform to include a DocumentLibrary, designed to enable a documentto be filed once but be used by anylender a third-party originator, TPO,designates. Comergence maintains aDocument Library with more than onemillion documents. On average, alender requires 30 documents, of which50 percent are redundant among alllenders—and that means TPOs spendhours uploading the same documents.Realm is the standard in the mortgageindustry for third-party-originator solu-tions, providing advanced, automatedcompliance monitoring and surveil-lance solutions.

“Third-party originators upload their

documents one time to the library andall the lenders with whom they do busi-ness will have access to them,” said GregSchroeder, president of Comergence.“We reduced the amount of timerequired to gather and submit docu-ments and this upgrade does a great jobof eliminating redundant work that TPOsfound painful.”

The aim was to eliminate having toupload the same documents to everylender a TPO does business with and thisupgrade achieves that objective. “Wefocus attention on anything we can do toreduce the time our users spend usingthe system, because that ensures theyhave more time to work with borrow-ers—to answer questions and make thelending experience easier for them,” saidSchroeder. “We spend a great amount oftime listening to lenders and to TPOs andthey both expressed an interest in thisupgrade, so as a result, we built it.”

ClosingCorp Launches New Estimated ClosingCost Tool

ClosingCorp has launched a pilot for itsnew Seller Net Sheet, a tool leveragingClosingCorp’s proprietary databasedesigned to inform sellers of their esti-mated closing proceeds. With a few inputfields, the Seller Net Sheet instantly cal-culates a seller’s net proceeds for anyproperty in the nation. The solution isavailable for title companies and otherInternet content providers to help theirreal estate clients confidently explain thepotential closing proceeds to the seller.

The ClosingCorp Seller Net Sheet isunique to the industry as it uses actualrates, not averages, and gives users theability to create and compare up to threedifferent transaction scenarios and viewthem side by side. Aggregate fees andcosts are then used to calculate the netamount a seller can expect to receive atthe end of the transaction.

“Consumers who are selling theirproperty want a better way to under-

continued on page 18

13

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

EWSFLASH l JULY 2014 l NMP NEWSFLASH l JULY 2014 l NMP NEWSFLASH l J

14

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

MBA: Originators Lose a Reported $194 on Each Loan in Q1

Independent mort-gage banks andmortgage sub-sidiaries of char-tered banks report-ed a net loss of $194

on each loan they originated in the firstquarter of 2014, down from a reported$150 in profit per loan in the fourthquarter of 2013, the Mortgage BankersAssociation (MBA) reported in itsQuarterly Mortgage BankersPerformance Report.

“The significant overall productionvolume decline in the first quarter hurtmortgage bankers,” said Marina Walsh,MBA’s vice president of IndustryAnalysis. “Purchase volume did not pick-up, while refinancing volume droppedand costs continued to rise. Given theseconditions, companies that managed tobreak even in the first quarter shouldconsider that a reasonable outcome.”

Other key findings of MBA’s QuarterlyMortgage Bankers Performance Reportare:l In basis points, the average produc-

tion loss was 8.31 basis points in thefirst quarter of 2014, compared to anaverage net production profit of 8.72basis points in the fourth quarter of2013. This marks the sixth consecu-tive quarter that production incomehas decreased.

l Average production volume was$274 million per company in the firstquarter of 2014, down from $367million per company in the fourthquarter of 2013. The volume bycount per company averaged 1,238loans in the first quarter, down from1,641 in the fourth quarter of 2013.

l The purchase share of total origina-tions, by dollar volume, was relative-ly flat at 68 percent in the first quar-ter of 2014. For the mortgage indus-try as a whole, MBA estimates thepurchase share at 51 percent in thefirst quarter of 2014, from 47 percentin the fourth quarter of 2013.

l Secondary marketing incomeincreased to 277 basis points in thefirst quarter, compared to 248 basispoints in the fourth quarter of 2013.

l Total loan production expenses–com-missions, compensation, occupancy,equipment, and other productionexpenses and corporate allocations–increased to $8,025 per loan in thefirst quarter, up from $6,959 in thefourth quarter of 2013. First quarter2014 production expenses were thehighest recorded in any quarter sincethe Performance Report was createdin the third quarter of 2008.

l Personnel expenses averaged $5,048per loan in the first quarter, up from$4,385 per loan in the fourth quarterof 2013.

l The “net cost to originate” was $6,253per loan in the first quarter, up from$5,171 per loan in the fourth quarterof 2013. The “net cost to originate”includes all production operatingexpenses and commissions, minus allfee income, but excluding secondarymarketing gains, capitalized servicing,servicing released premiums, andwarehouse interest spread.

l Productivity was 1.7 loans originatedper production employee per monthin the first quarter, down from 2 loansin the fourth quarter of 2013.

l Including all business lines, 54 per-cent of the firms in the study postedpre-tax net financial profits in the firstquarter of 2014, down from 58 per-cent in fourth quarter of 2013, and 94percent in the first quarter of 2013.

Q1 Cash Home PurchasesDown Year-Over-Year

The portion ofhome purchasesmade with allcash fell in thefirst quartercompared to a

year ago in a majority of metro areasnationwide, as investor-driven activityfades and more traditional buyers re-enter the market, according to a Zillowanalysis. Homes priced in the lowest-third of all homes available are mostattractive to cash buyers.

The share of cash buyers fell year-

over-year in 102 of the 126 total metroareas analyzed by Zillow. Among the top30 largest metros, the share of cash buy-ers was highest in the first quarter inMiami (64.9 percent), Tampa (57.1 per-cent) and Cleveland (54.2 percent). Largemetros with the lowest share of all-cashsales in the first quarter were VirginiaBeach (17.4 percent), Denver (22.4 per-cent) and Portland (22.9 percent).

Zillow also examined the share ofcash sales made in the bottom, middleand top one-third of home values, andthe portion of sales made by individualbuyers and business buyers in each mar-ket. In 27 of the top 30 metros, morethan one third of all sales of the lowest-priced homes were made with cash. Inthree of the top 30 metros—Tampa,Detroit and Miami—more than 80 per-cent of all sales in the lowest price brack-et were cash deals.

“Even as the share of all-cash salesfalls in many areas, it’s pretty clear thatcash is still king, especially at the lowerend of the market,” said Zillow ChiefEconomist Dr. Stan Humphries. “It canbe difficult for more traditional buyersto compete with cash offers, especiallyin a tight inventory environment andamong cash-strapped first-time buyersmost likely to seek lower-priced proper-ties. Housing is much more than aninvestment for most buyers, and it’sheartening to see more buyers armedwith traditional financing begin toenter the market. This is a critical stepon the way back to a more normal, bal-anced housing market.”

Individual, non-business buyerswere more likely to buy bottom-tierhomes with cash in the first quarter—in 20 out of the top 30 metros, the por-tion of sales that were all cash in thebottom tier was more than double thatin top-tier homes. Business buyers, onaverage, were more likely to pay allcash in home purchases than individualbuyers. In 11 of the top 30 metros,more than 90 percent of homes pur-chased by business buyers in the bot-tom price tier were all cash.

HUD and FHA ChannelingResources to Preservationof the American Dream

Federal Housing Administration (FHA)Commissioner Carol Galante and U.S.Department of Treasury Secretary Jacob J.Lew announced the ObamaAdministration’s efforts to continue help-ing struggling homeowners avoid foreclo-sure, increase access to affordable rentaloptions and expand access to credit forborrowers.

In remarks at the Making HomeAffordable (MHA) Fifth AnniversarySummit, Secretary Jacob Lew specificallyunveiled a new financing partnershipbetween the Treasury Department andHUD aimed at supporting FHA’s multi-family mortgage risk-sharing program. Inaddition, Secretary Lew announced anextension of the MHA program for atleast one year and a new effort to helpjumpstart the Private Label Securities(PLS) market. Before speaking at theSummit, Secretary Lew met with home-owners and housing counselors at theGreater Washington Urban League, anon-profit organization that providesdirect services and advocacy to morethan 65,000 individuals each year.

With the new HUD-Treasury partner-ship, the Federal Financing Bank (FFB)will use its authority to finance FHA-insured mortgages that support the con-struction and preservation of rentalhousing. The first partnership with theNew York City Housing DevelopmentCorporation will help restore affordablerental housing damaged by SuperstormSandy in Far Rockaway, Queens.

“Families have been especially hardhit during the rental housing crisis.Demand is soaring and prices are climb-ing,” said Galante, Federal HousingAdministration Commissioner andAssistant Secretary for Housing, U.S.Department of Housing and UrbanDevelopment. “To help the many hardworking families who cannot find afford-able rental housing, we are partneringwith the Treasury Department, to broad-en our efforts to create and preserve safe,

15

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

decent and affordable rental housing byallowing more Housing Finance Agenciesaccess to the capital they need to build ormaintain affordable multifamily apart-ment buildings.”

In addition to the new HUD-Treasurypartnership, Secretary Lew announcedthat the Administration would beextending MHA at least until Dec. 31,2016, to allow the Administration to con-tinue assisting homeowners facing fore-closure and those whose homes areunderwater. To date, the MHA programhas provided relief to homeownersacross the country, including more than1.3 million homeowners who have per-manently modified their mortgages, sav-ing a median of $540 a month in mort-gage payments. The TreasuryDepartment’s housing assistance pro-grams have also become a model for thebroader housing sector, setting a newstandard for the mortgage industry onhow to restructure loans and help home-owners. More than five million home-owners have been helped by privatelenders who have, in many cases, used asimilar framework to the one created byMHA’s Home Affordable ModificationProgram.

MBA and Operation HOPEEnter Into StrategicAlliance

The MortgageBankers Asso-ciation (MBA)and Opera-

tion HOPE (HOPE) announced that theyhave entered into a strategic alliancedesigned to foster open communicationand mutual understanding of issuesrelated to sustainable residential mort-gage lending. The announcement wasmade at MBA’s Strategic Markets andDiversity Summit in Washington, D.C.,where HOPE’s Chairman and ChiefExecutive Officer John Hope Bryant deliv-ered special remarks.

“This strategic partnership with theMortgage Bankers Association enhancesthe reach, capability, and credibility ofour national plan to become the nation’sfirst private banker to the poor andstruggling middle class. Together, we canhelp more renters become homeowners,and struggling homeowners keep theirhomes during this economic recovery,”said Chairman Bryant.

Under the terms of the agreement,MBA will provide HOPE opportunities toengage with MBA members through avariety of means, including by providingspeaking opportunities at MBA events.MBA will facilitate synergies betweenHOPE and EverFi, an MBA partner thatprovides online financial literacy trainingto both adults and students and will alsoprovide support to Operation HOPE’sProject 5117.

In turn, Operation HOPE will seekopportunities for MBA’s president andCEO to speak with HOPE’s Founder andCEO to advance the two organizations’common interest in promoting sustain-able homeownership, provide literatureand information on HOPE’s projects atMBA conferences and events and link to

MBA’s Home Loan Learning Center fromthe Operation HOPE Web site.

“Operation HOPE is a leading name ineconomic empowerment and financial lit-eracy among the working poor, the under-served and the struggling middle class,”said MBA’s President and CEO David H.Stevens. “MBA and its members are excit-ed to work with HOPE to promote respon-sible, sustainable homeownership to com-munities across the country.”

OCC Reports Q1Improvement in MortgagePerformance

The performance offirst-lien mortgages serv-iced by large nationaland federal savings

banks improved in the first quarter of2014, according to a report released bythe Office of the Comptroller of theCurrency (OCC).

The OCC Mortgage Metrics Report, FirstQuarter 2014 showed 93.1 percent ofmortgages were current and performingat the end of the quarter, compared with91.8 percent at the end of the previousquarter and 90.2 percent a year earlier.The percentage of mortgages that were30 to 59 days past due decreased 19.8percent from a year earlier to 2.1 percentof the portfolio, the lowest level since theOCC began reporting mortgage perform-ance in 2008. Seriously delinquent mort-gages—60 or more days past due or heldby bankrupt borrowers whose paymentsare 30 days or more past due—decreased

to 3.1 percent compared with four per-cent a year earlier. The percentage ofmortgages that were seriously delin-quent decreased 22.4 percent from ayear earlier and is the lowest level sinceJune 2008.

At the end of the first quarter of 2014,the number of mortgages in the processof foreclosure fell to 432,832, a decreaseof 52.3 percent from a year earlier. Thepercentage of mortgages that were in theprocess of foreclosure at the end of thefirst quarter of 2014 was 1.8 percent, thelowest level since September 2008.Servicers initiated 90,852 new foreclo-sures during the quarter, a decrease of49.1 percent from a year earlier. The

continued on page 16

16

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

number of completed foreclosures alsodecreased 33.9 percent to 56,185, com-pared to a year ago. Factors contributingto the decline in foreclosure activityinclude improved economic conditions,foreclosure prevention assistance, andtransfer of loans to servicers not includedin this report.

Servicers implemented 237,133 homeretention actions (modifications, trial-period plans, and shorter-term paymentplans) in the quarter compared with71,678 home forfeiture actions (complet-ed foreclosures, short sales, and deed-in-lieu-of-foreclosure actions). The numberof home retention actions implementedby servicers decreased 32.1 percent froma year earlier. Almost 91 percent of mod-ifications in the first quarter of 2014reduced monthly principal and interestpayments, and 58.6 percent of modifica-tions reduced payments by 20 percent ormore. Modifications reduced paymentsby $292 per month on average, whilemodifications made under the HomeAffordable Modification Programreduced monthly payments by an aver-age of $312.

Servicers implemented 3,460,476modifications from Jan. 1, 2008, throughDec. 31, 2013. Of these modifications, 60percent were active at the end of the firstquarter of 2014 and 40 percent had exit-ed the portfolios of the reporting institu-tions, through payment in full, involun-tary liquidation—completed foreclosure,short sale or deed-in-lieu of foreclo-sures—or transfer to a non-reporting ser-vicer. Of the 2,071,078 modifications thatwere active at the end of the first quarterof 2014, 69.9 percent were current andperforming at quarter end, 23.9 percentwere delinquent, and 6.1 percent were inthe process of foreclosure.

GSEs Complete Nearly 3.2 Million ForeclosurePrevention ActionsThrough Q1

Fannie Mae andFreddie Mac havecompleted nearly3.2 million foreclo-sure prevention

actions since the start of the conservator-ships in 2008, with approximately 88,800actions occurring in the first quarter.These measures have helped more than2.6 million borrowers stay in theirhomes, including 1.6 million whoreceived permanent loan modifications.

These actions are detailed in theFederal Housing Finance Agency’s quarter-ly Foreclosure Prevention Report, whichdetails activities by state in an online, inter-active Borrower Assistance Map for FannieMae and Freddie Mac mortgages.

Also noted in the report:l Forty-two percent of all permanent

loan modifications helped to reducehomeowners’ monthly payments bymore than 30 percent in the firstquarter.

l Approximately 27 percent of borrow-ers who received permanent loanmodifications in the first quarter hadportions of their mortgage balanceforborne.

l Approximately 14,900 short sales anddeeds-in-lieu were completed in thefirst quarter, bringing the total tomore than 566,800 since the start ofthe conservatorships.

l Third-party sales and foreclosuresales fell slightly to 47,300 while fore-closure starts decreased 25 percent inthe first quarter.

l While the total number of troubledborrowers continued to decline, 31percent of these borrowers remaineddeeply delinquent at the end of thefirst quarter. Florida, New York andNew Jersey have the highest numberof deeply delinquent loans (365-plusdays).

Loan Production DownAmong Indie MortgageBankers

Richey May hasreleased itsfirst quarter2014 TrendReport forIndependent

Mortgage Bankers, which found thatloan production among independentmortgage bankers continued to declinein the first quarter of 2014, falling 18 per-cent since the fourth quarter of 2013.Purchase volume decreased for the thirdconsecutive quarter, dropping 13.7 per-cent. Margins increased by 28 basispoints—the result of an 11-basis pointdecrease in origination fees, and a 39-basis point increase in secondary gains.

“Independent mortgage bankers aretaking less in origination fees, but aremaking more from gains on sale into thesecondary market,” said Kenneth Richey,managing partner of Richey May.

Each quarter, Richey May uses RicheyMay Select, benchmarking technologyspecifically for independent mortgagebankers used to analyze data submittedby independent mortgage bankers acrossthe U.S., and compile a report of thequarter’s outstanding trends. The reporthighlights key performance indicators,such as overall volume and volume bytransaction type, margins, operatingcosts, labor output, and more. The dataused in the report includes much of thesame information that its confidentiallender participants provide to the GSEseach quarter via the Mortgage Bankers’Financial Reporting Form (MBFRF).

“This suggests that lenders areresponding to the QM fee cap,” Richeyexplained, speaking of the QualifiedMortgage rules that impose a three per-cent limit on the amount a lender cancharge in origination fees. “Rather thanearning on the front end, they’re increas-

continued on page 25SPONSORED ED ITORIAL

Your clients are only ready for your services every five to seven years.That’s a long time to stay in touch with them. Making sure you are at thetop of their minds when the time comes for another purchase or a refi-nance can be difficult. There’s a new highly-guarded way of finding outexactly when they are in the market. It’s available to every licensed mort-gage professional nationwide. Keeping your clients where they belong …with you!

We all spend a lot of time and money staying in front of past clients bysending birthday cards, holiday cards and calling them throughout theyear. There’s nothing worse than finding out they recently purchased anew home, refinanced their mortgage or consolidated their debt into theirmortgage with someone else. The truth is, if your last contact wasn’twithin a few weeks of their buying decision, they might go with someoneelse. There are a lot of people out there fighting for the referrals and someof them are willing to go to great lengths to acquire the client.

There’s a new solution that will make sure this doesn’t happen to you.You can now be notified when your past clients are currently out shoppingfor a mortgage. The credit agencies have offered this program for a littlemore than a year to the larger banks, but it hasn’t been available to bro-kers or small mortgage lenders, but now has been released to all mortgagebrokers and lenders nationwide. This means you won’t have to pay thosehefty contract fees with the credit bureaus. You can literally get an e-mailnotification every time one of your past clients is in the market. You’llspend less money and have a much higher retention rate.

Lenders that combine this program with their online lead tracking sys-tems now have an automated system for getting in touch with their pastclients when they are in the market! Buying time frames change, but nowwhen you know your clients are shopping, you will always be there tohelp. After all, as a past client of yours, isn’t it your job to make sure theyalways get the best terms available regardless of their situation?

TagQuest Customer SpotlightEach month, we like to talk with our clients and see how their campaignsare going. Here’s what we heard recently from Jason L, one of our mort-gage professionals in Utah:

l Program: Mortgage Insightsl One-thousand past clients being monitoredl Ten matched clients per monthl Three to five applications upfrontl One to two more applications over the next two months

Highlights of the campaign that worked …“This allows us to capture business we otherwise would have lost.”

Highlights of the campaign that could appeal to other mortgage pro-fessionals …“We are spending a lot less money and less time following up and stillmaintaining relationships and keeping the business.”

Medford, Ore.-based TagQuest is a full-service marketing firm created specif-ically for the ever-changing business world. TagQuest assists companies withtheir direct marketing, advertising and branding needs, and knows what ittakes to generate quality customers and, most importantly, how to retainthose customers for years to come. TagQuest brings forth a unique opportu-nity to utilize our experience and expertise in varying consumer sales andmarketing environments. For more information, call (866) 376-5540 or visitTagquest.com.

Tightly Guarded Secretto Keep Your Past Clients Released

�

VIEW OUR MOST RECENT WEBINAR ON YOUTUBEOnline readers please click on the link below,

readers of the print edition, please copy the link and paste it into your browser.

http://www.youtube.com/watch?v=coBEsmEVOgo

nmp news flashcontinued from page 15

17

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

18

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

SPONSORED ED ITORIAL

By K. Justin Restaino

A referral base is mandatory in order to survive the mort-gage business cycle. Most loan originators think of network-ing with real estate agents, financial advisors and theircommunity when building a referral network. While they

are great ways to acquire new referrals, direct mail may be the most ef-fective way of quickly building a referral base on a grand scale.

Typically, you build a good rapport with the borrower, and due to thetrust and confidence they place in you, they will refer their friends whenthey express a need for your services. Now think of direct mail leads as“pre-qualified referrals.” With a targeted direct mail campaign, you notonly build a pipeline of deals, you also open the door for every lead thatresponds to become an ambassador for your business.

Take, for example, a direct mail campaign of 5,000 pieces that gener-ates 50 inbound leads. While most will close at least 10 loans, what hap-pens with the other 40 that didn’t convert? Are they worthless? Theseconsumers expressed an interest in your company, so this is your chanceto make a lasting impression that could double your inbound leads. Bysimply incorporating a request to refer two friends, those 40 inquiriescould easily double to 80 new prospects. Consumers typically keep com-pany of the same demographic, so if you’re using pre-screened data onyour mailing campaigns, the likelihood of the new referrals being similarto the original borrower is considerably high. Think of the possibilitieswith more direct mail pieces in circulation. The numbers are exponential.

It’s common for originators to forget about the borrower once theirloan has closed. As time goes on and the loan is sold off to other servicers,many borrowers forget about their original loan officer when their needto refinance or the opportunity for a purchase occurs. This holds truewhen it comes to referral business. If the borrower doesn’t remember you,who are they going to recommend their friends to? Instead, they turn tothe current company that sends their monthly mortgage statement. Tooffset this potential loss of business, mailing your customers at a mini-mum of a bi-monthly cycle will keep you fresh in their minds. Simple let-ters of new company advancements, milestones or events will keep youin the forefront of their minds so that when their needs arise, or that oftheir friends, they immediately think of you.

To maximize the effort, request referrals and offer incentives for refer-ring friends in each newsletter. Remember … closed loans require assetmanagement. These borrowers can be as valuable to you after they haveclosed their loan as they were the day you first spoke.

Relying on a real estate agent to refer your business shouldn’t be youronly option to generate more referral business. Setting a plan in placenow with some simple strategies will build momentum and create a thriv-ing referral business.

With this ever-changing industry, having multiple options to build yourbusiness is a necessity and will keep you ahead of your competition.

K. Justin Restaino is vice president of Titan List & Mailing Services Inc. Formore than 13 years, he has led Titan’s Mortgage Division, helping lendersof all capacities grow their businesses utilizing targeted direct mail. With aspecialized focus in refinance and purchase markets, Restaino has the insightfor proper data and mail application for success. He may be reached byphone at (800) 544-8060, ext. 204 or e-mail justin@titanlists.com.

Thinking Outside the Box Can HelpGrow Your Referral Base

�

stand potential proceeds, and realestate professionals across the nationface the challenge of accurately answer-ing this question on a daily basis,” saidBrian Benson, CEO of ClosingCorp. “Wewanted to give title companies a power-ful way to forge a deeper relationshipwith real estate agents who typicallyturn to them for help generating theseaccurate estimates.”

The User Profile Management tool ofthe Seller Net Sheet enables users to setspecific default settings that appear onall client-provided net sheets, such ascontact information and commission val-ues. Through this tool, users also candefine and set costs for any real estateservice category, such as home inspec-tion, pest inspection, natural hazard dis-closures, home warranty or any customercategory chosen.

LenderLive AnnouncesNew Suite of Home EquityServices

LenderLive Network Inc. has announcedthat it has developed a suite of servicesand product offerings for banks and cred-it unions that are re-entering or expand-ing their home equity lending.LenderLive expects that the demand forhome equity products will continue toincrease as home prices strengthen andlow first mortgage rates make refinanc-ing less attractive for millions of homeowners. But at the same time, the rulesfor home equity lending have becomemore complex and the process for under-writing these loans has gotten moreexpensive, the company said.

The new LenderLive suite of homeequity options includes:l Private-label origination of both

closed-end and home equity lines ofcredit.

l Compliance and document manage-ment services through LenderLive’sGuardianDoc’s unit, which has histor-ically been the industry leader in sec-ond mortgage documents.

l Private-label servicing of closed-endsecond liens.

l Nationwide settlement services andthird-party vendor single point-of-contact (SPOC) oversight and productmanagement with an integrated pric-ing calculator for all third-party ven-dor costs.“Current demographics and economic

trends all favor the return of home equi-ty lending,” said Rick Seehausen, chiefexecutive officer of LenderLive. “Morethan 20 million homeowners now havefirst mortgage rates below 4.5 percent,according to CoreLogic. When thesehomeowners need more space for grow-ing families or want to tap the equity intheir homes, home improvement may bemore attractive than buying bigger

homes at higher interest rates, and homeequity loans may be more advantageousthan refinancing. These customers willexpect a quick decision on their applica-tions and a no-cost transaction which willcreate challenges for lenders.”

Mortgage Returns AddsPost-Closing Survey toTRUE CRM Solution

Mortgage Returns has introduced a post-close survey product as a part of its TRUECRM solution. The automated surveyfunction allows lenders to track servicelevels for customers and real estateagents. Once delivered after the close ofloan, the surveys measure the satisfac-tion of users and agents, while identify-ing key areas for growth. The surveys aredeployed through a six-step email mar-keting campaign, and the results areaccessed through the Mortgage ReturnsCRM system.

Mortgage Returns has designed thispost-close survey as a product to provideloan officers with the ability to track andimprove their service for both users andreal estate agents. The new addition toTRUE CRM will allow loan officers to gainsignificant insight and feedback abouttheir performance and customer service,while providing a benchmark result tocompare with competitors.

“The post-close surveys will allowlenders to gain insight into the servicelevels they provide and will help improvethe relationships between loan officers,borrowers and agents,” said Jim Blatt,CEO of Mortgage Returns. “As with theone-to-one marketing strategies provid-ed in our TRUE CRM system, the surveyswill provide relevant feedback to loanofficers to improve performance and cre-ate loyal users in the long term.”

FICS ImplementsQuestSoft’s ComplianceEAGLE

Financial In-dustry Compu-ter Systems Inc.(FICS) has an-nounced its lat-

est interface implementation to LagunaHills, Calif.-based QuestSoft’sCompliance EAGLE. With ComplianceEAGLE’s proactive loan compliancetools and capabilities, the interface willallow FICS’ Loan Producer customers tofurther enhance business practices andcompliance efficiency.

Compliance EAGLE is a review solutiondesigned to automate the mortgagelending compliance process through asingle platform, providing lenders thatutilize Loan Producer with increased

new to marketcontinued from page 12

continued on page 47

19

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

RealQUAL

The Move thatPuts Buyers to

the front of the

Competition

Just One MoreReason to Choose

Maverick Funding Corp.as Your Lender of Choice.

With the pre-application starting in underwriting, Yourclosing time will be drastically reduced. RealQualis designed to make sure sellers know that a buyeris truly qualified to purchase their property.

Just in Time for the Spring Purchase Market, Maverick Funding Introduces...

Real Answers, Real Fast, backed byReal Underwriting!

Maverick Funding Corp. NMLS#7706, Executive Offices, 9 Entin Road, Suite 200, Parsippany, NJ 07054. Toll Free 888-616-6866. Licensed by the California Department of Corporations under the California Residential Mortgage Lending Act, License #4131048. Licensed by the California Department of Corporations under the California Finance Lenders Law, License #603H799. Illinois Residential Mortgage Licensee, License #MB.6760891, Massachusetts Lender License #ML3257; Michigan 1st Mortgage Broker/Lender/Servicer Registrant #FR0018028; Licensed by the New Hampshire Banking Department; Licensed by the NJ Department of Banking and Insurance; Licensed by the Pennsylvania Department of Banking; Rhode Island Licensed Lender; Licensed by the Virginia State Corporation Commission, License #MC5352; Oregon Mortgage Lending License ML-4961; Licensed Lender SC; Texas Mortgage Banker Registration; Washington Consumer Loan License #CL7706, Licensed Wisconsin Mortgage Banker, also Licensed in AL, CO, CT, DC, DE, FL, GA, IN, KY, ME, MD, MN, NC, OH, TN, VT, WV. Equal Housing Lender. www.nmlsconsumeraccess.org

Get the Peace of Mind that YourLoan will Close On Time, Everytime,

and it’s FREE.Learn more about our RealQual Program

Corporate Headquarters: 9 Entin Rd., Parsippany NJ, 07054 www.MaverickFunding.com

866.574.FUND

Puts Buyers tohe Move thatT

Puts Buyers tohe Move that

Competition

the front Puts Buyers to

Competitionof the

the front Puts Buyers to

R

R

and it’Loan will

et the Peace of Mind that G

s FREE.and it’Close On TTiLoan will

et the Peace of Mind that

s FREE.Everytime, imeTi

ourYYoet the Peace of Mind that

,Everytime

20

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

Now as we turn the springinto hot July, we need tostart looking ahead forour business outlook overthe next six months. Ihope some of you are

making plans for how you will be get-ting business in the door until nextspring. Planning these months have tobe a large part of your thinking eachday and you must have the vision tomake sure you are cashing loans andproviding for your family’s needs inthese coming months.

I think you need to start looking forconferences in your states and see whattraining classes are being offered. As youknow, half of my life is spent travelingaround to NAMB state affiliates, attend-ing these seminars and seeing all of you,but I also sit through the presentationseach day, both before I speak and after.

I really learn from what these loan origi-nators are doing to make their produc-tion better. So get out there and find outwhat your peers are doing to improveand enhance their production andattend these conferences.

I was in New Orleans in the begin-ning of July at the Ultimate MortgageExpo and had a chance to talk withsome of the originators on hand at theevent. They were all very appreciative ofwhat I have done as president of NAMBand thanked me for coming out to theirstates. I must tell you that it is truly myhonor to be out there representing you,the membership of NAMB, everywhere Igo. This has really been a journey oflove, and I cannot express to you thethrill it gives me to know that you careabout our association. I would love todo this job forever. It is such a joy tomeet all of you and hear about your tri-

als and tribulations of being in themortgage business. The only thing thatI ask is that you go out and ask others tobe members and get this membershipin the 15,000-member range. When Itook over, we had a little over 2,000members. My goal was to get it to over15,000. I still do not understand whyyou would not want to be involved inyour trade association and be kept up-to-date on what is going on in theindustry. For a very, very modest $50,you get insight into your job, yourindustry and what is going on in theworld. So a big thank you to all of ourpaying members. And to those who arenot a member of NAMB, I have to askyou a really tough question: Why aren’tyou a member?

In a recent NAMB Monday MorningMessenger, I mentioned a new programfor NAMB members that you really needto get involved in calledwww.BetterLoanOfficers.com. I reallythink that this will be another greatprogram for originators to get behinddue to the number of reviews that peo-

ple are looking for when they searchthe Web looking for a mortgage. Now,they can go and search for a very com-petent originator at the same time. Visitwww.BetterLoanOfficers.com to seewhat it is all about.

As we move towards September andNAMB National in Las Vegas, don’t wasteany time to register and get your room.Rooms are definitely filling up fast. Lastyear, we had over 1,500 on hand inVegas for NAMB National. The roomsthis year at our host hotel, the Luxor, are$115 on Friday and Saturday, and $50on Sunday and Monday. We have nothad rates this low in a number of years,so book your rooms and book your flightto come out to the 40th anniversaryparty of NAMB, Sept. 13-15 in Las Vegas.You won’t want to be left out.

Sincerely,

Donald J. Frommeyer, CRMSNAMB Presidentpresident@namb.orgwww.joinnamb.com

The President’s Corner: July 2014

N A M B P E R S P E C T I V E

By JohnCouncilman, CMC,CRMS

I have heard some NAMBmembers say that since

most of the legislation and regulationhas been on the federal side in the pastfew years, that we no longer need stateaffiliates. It is true that we have faced atime of unparalleled amounts of newregulation, from the Dodd-Frank Act, theConsumer Financial Protection Bureau(CFPB) and other federal agencies.Fortunately, we can still make a livingthanks to NAMB and several other tradeassociations. Even many of the largestbanks and their top management didnot make it through the crisis.

The good news is, if you are readingthis, you are still in the business. Youhave survived. It is time to think abouthow we can improve some of these reg-ulations and make our services betterand easier for both us and our con-sumers. This is why we need strongstate chapters.

You may be thinking, “That is why weneed a strong NAMB … not state chap-ters.” Yes, we do need a strong NAMB,but that only exists if we have strongstate chapters across the nation. Unlikemany trade associations, NAMB is a “bot-tom-up,” association, rather than a “top-down” organization. That means thateverything at the top of NAMB comesfrom its support system of state chapters.

All of NAMB’s board and top leadership isselected by states through theNominating Committee. NAMB’s bylawsare controlled by the states through theBylaws Committee. Individual membersthen vote on all leaders and changes tothe association’s bylaws. If you want tochange something about NAMB, yourstate leadership can propose the change.How do these changes come about? Whoselects the Nominating and BylawsCommittee members? State affiliatemembers do just that at our DelegateCouncil Meetings.

Due to constriction in the industry,many state chapters have been unableto participate in Delegate Council asfully as they would like to. NAMBresponded to that need by proposingfour Delegate Council Meetings, two ofwhich will be held by teleconference,and the other two as live meetings atNAMB’s national conferences in LasVegas and Washington, D.C. Delegatesshould be able to attend all teleconfer-ences and at least one, if not both, ofthe in-person meetings. So far, the tele-conference concept has been incrediblywell-received. Every active state has reg-istered for the first NAMB DelegateCouncil Teleconference on July 18.

There are many more reasons whywe need strong state associations. Theleaders of NAMB all come from statechapter leadership. State delegates getto know current NAMB leadership andother delegates. As these state leaders

become involved in Delegate Counciland become active on NAMB’s commit-tees, they are identified by others asqualified to be national leaders. To be anational leader, it takes more than justspeaking ability. Leaders are chosen byhow well they have managed theirstates, their ability to understand issuesand their industry knowledge and expe-rience, which is demonstrated by hold-ing a Certified Residential MortgageSpecialist (CRMS) or Certified MortgageConsultant (CMC) designation.

State regulators are still the primaryregulators of non-bank mortgage compa-nies and originators. You are state-licensed if you do not work for a bank.Your audits will generally be from stateregulators. Don’t think they have gone tosleep. Rather, we are finding they arebecoming much tougher, enforcing newfederal laws, as well as some new statelaws. State regulators are armed withnew tools and computerized data thatcan cause an unprepared business agreat deal of trouble. Without a goodstate association that shares its experi-ences, you will go into these audits blind.State associations offer training, legaladvisors and experienced individualswho can help you through the complexworld of mortgage lending. Many stateshave lobbyists who promote good legisla-tion at the state level and often preventbad legislation and regulations. I remem-ber the days when my home state had nostate association. We had some really badlegislation passed that still haunts thatstate today. I learned how to deal withlegislators and regulators throughinvolvement in with my state association.I learned how a board operates and howto run a committee.

Here is the sad part … nearly one-third of the states have no associationnow. Those states have no representa-tion at Delegate Council and have nosay in national events. There is no rep-resentation before the state legislatureor regulators in those states. We canblame it on finances, but that isn’t thereal reason. You can run an associationon a few dollars. I know it’s possible asI have done it. The real reason is thatno one is stepping up to restart or cre-ate an affiliate of NAMB in these states.Some states with nearly 100 NAMBmembers have no active state affiliate.You can step up and be the person tostart that state chapter. You don’t needa fancy office and an executive director.You can start with nothing, but a desireto bring people together to make thingsbetter. NAMB will help you. We havepeople with a wealth of knowledge atyour disposal. We can guide youthrough the legal and financial pitfallsof the process, and even show you howto have meetings and conventions. Thisis how leaders are made. They see aneed and rise to the occasion. Whatthey lack in leadership skills can bedeveloped over time.

Take the challenge. You can repre-sent your state on the NAMB DelegateCouncil and be a national leader. Riseup and be a person who has a vision foryour state association. It will be wellworth your time.

John Councilman, CMC, CRMS of AMCMortgage Corporation in Ft. Myers, Fla. ispresident-elect of NAMB—The Associationof Mortgage Professionals. He may bereached by phone at (239) 267-2400 or e-mail jlc@amcmortgage.com.

Do We Still Need State chapters?

By Richard M.Bettencourt Jr.,CRMS, CMHS

Well, I don’t know aboutyour market, but where I

am north of Boston, it’s been a crazycouple of months! It’s amazing howquickly we see the ebbs and flows ofthe real estate market. It seems likeonly yesterday it was mid-February,and we never thought summer wascoming, as we were waiting for thethermometer to heat up and prayingthe home sales would follow! Then,all of a sudden, BAM! It felt like wewent from no one buying at all to 40people at a Sunday Open House,multiple offers, highest and bestoffer by 6:00 p.m. Monday evening,and an offer accepted on Tuesdaymorning. As a mortgage and realestate professional, we are definitelyseeing quite an eclectic array of mar-ket conditions. I’m not sure aboutthe other regions of the country, buthere in various geographic locationsof New England, it’s a bit over-whelming.

As far as NAMB’s GovernmentAffairs goes, it’s never really slowthen fast, and fast then slow … it’salways steady. There’s always some-thing we’re working on, but quiteoften, much of what we’re doing iskept “close to the chest” so we don’tinadvertently “tip a hand” or “shoot

ourselves in the foot.” So, unfortu-nately, the last two months havebeen a time where we’ve seen verylittle public information we couldpass along. So, what have we beendoing?

Let’s start with the ConsumerFinancial Protection Bureau (CFPB).About two months ago, the CFPBmade a request for comments on twoproposals that would amend certainprovisions within the QualifiedMortgage (QM) §1026.43(e)(2), specifi-cally §1026.43(e)(2)(vi)(B) which per-tains to total monthly debt ratios and§1026.43(e)(3)(iii) which is the pointsand fees limits. The idea is to allowthose provisions to contain “cures”which when used in a limited man-ner, would allow mortgages originat-ed under the QM definition to remaina QM loan when inadvertent calcula-tions (points and fees/DTI calcula-tions) were made during the origina-tion process which would otherwisemake those loans fall outside of theQM guidelines. Confused yet?

Well, it’s not as confusing as itsounds. But NAMB does have con-cerns with both of these proposals,and in our comment letter to theCFPB dated July 7, we asked the CFPBto communicate with industry profes-sionals actively engaged in the under-writing of residential real estatemortgages so the Bureau may under-stand the complex and intricate

process of underwriting. Let’s look atan example! We all know that thelikelihood of two underwriters com-ing up with the same income for thesame borrower is about as feasible aslighting hitting the same place twice.So, what happens to a QM loan that issold on the secondary market with aDTI ratio of 42.5 percent and duringa post-consummation audit thatcould be performed by the endinvestor (lender, Fannie Mae, FreddieMac, etc.), the DTI comes in at 44.5percent because of a difference inincome calculation. The CFPB is pro-posing that there is a “cure” provi-sion under §1026.43(e)(2)(vi)(B). Okay… but how do we cure a DTI calcula-tion after the loan has been closed,sold to an end investor and perhapssold on the secondary market? I don’tknow about you, but I can think ofonly two ways to reduce DTI. The firstis a Principal Loan Reduction to anamount that would provide a 43.00percent DTI. Yeah … that’s bad! Thesecond would be to eliminate a bor-rower’s monthly liability debt so theDTI’s are now 43.00 percent. Umm,I’m not sure which is a worse idea!There have been some trade groupsthat have suggested a “cushion,” butwe don’t feel at this time it’s prudentto just “throw” out a buffer number.We need research and need industryprofessionals supplying data, opin-ions and statistical data to help pro-vide the sort of answers we and theCFPB are looking for.

The CFPB is only looking for com-ments and input from the mortgageindustry and based on their request,are in no position at this time to acton these proposals. Let’s call it SOULSEARCHING! NAMB is on top of these

issues, and we will be monitoring thesituation very closely. We realize thiswould have a significant impact onmany industry professionals. As thecountry’s only non-profit trade asso-ciation truly advocating for everyconsumer, mortgage professionaland small business, we will updateyou the minute we hear from theBureau.

What else is going on? We are hop-ing to have a meeting with the CFPBin the near future to continue ourdialogue on the ongoing disparitymortgage brokers are subjected toon a daily basis. We are encouragedby the CFPB’s previous use of theirexemption authority and rule-mak-ing abilities, and are hopeful that wecan convince them that a mortgagebroker is, without a doubt, the mostcost-effective means for a consumerto obtain a mortgage. The CFPB hasalways been open to our suggestions,requests for meetings, and we areexcited to continue working withthem in the future.

Well, that about sums it up for thisarticle. I would like to mention thatwe are only two months away fromNAMB National and his year is goingto be our biggest Conference yet! Whynot invest some money in yourselfand attend this amazing Conferencewith your peers! I would love to seeeach of you in Vegas!

Richard M. Bettencourt Jr., CRMS, CMHSof Danvers, Mass.-based MortgageNetwork is Government AffairsCommittee Chair of NAMB—TheAssociation of Mortgage Professionals.He may be reached by phone at (978)777-7500 or e-mail rbettencourt@mort-gagenetwork.com.

NAMB Government AffairsUpdate: All Quiet on the“Eastern Front” ... or Is It?

21

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

N A M B P E R S P E C T I V E

By Rocke Andrews,CMC, CRMS

NAMB recently partneredwith some educationproviders that will allow

association members discounts onclasses. In addition to our NMLS educa-tion providers Mortgageeducators.comand Mortgageeducation.com, we nowhave access to Lorman Education thathas recent legal and sales Webinarsavailable. The July and August scheduleis as follows:l July 23—New Technology and the

Fair Debt Collections Practices Act

l July 24—Understanding the Basicsof Bankruptcy and BankruptcyTerminology

l July 29—How to Draft a CreditMemorandum

l July 30—Vicarious Liability inCollections

l August 6—Defending FDCPA ClaimsBased On Collection Letters

l August 12—The Impact of theHomeowner’s Flood InsuranceAffordability Act of 2014 onMortgage Lending and Servicing

l August 14—The Fundamentals ofSBA Lending: Documenting, Closingand Funding the SBA Loan

These Webinars do not have creditfor NMLS continuing education, butwill count towards renewing theCertified Residential MortgageSpecialist (CRMS) and CertifiedMortgage Consultant (CMC) certifica-tions if they are industry-specific.

In addition to our industry-specificWebinars, Lorman also has updatedWebinars on sales, operations, IT, mar-keting, management, customer serviceand many more. Please visit the NAMBEducation Members Only Web page andclick on the banner for “Lorman” toreceive the member discount, as well asa list of Webinars. Your discount will be

applied at the check out stage.For NMLS continuing or pre-licensing

education, visit Mortgageeducators.comor Mortgageeducation.com on the sameWeb page. You can get individualstate pre-licensing requirementsfrom them as well.

NAMB also has 20-Hour Pre-Licensingand Eight-Hour Continuing Educationclassroom materials available to thestates to utilize if they have instructors topresent. Contact me by e-mail at ran-drews@lendingarizona.net if you areinterested. Several states are using themas membership enhancements.

Rocke Andrews, CMC, CRMS of LendingArizona LLC in Tucson, Ariz. is vice presi-dent of NAMB—The Association ofMortgage Professionals. He may bereached by phone at (520) 886-7283 or e-mail randrews@lendingarizona.net.

NAMB Education Committee Update: New Online Education Choices

22

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

By John H.P.Hudson, CRMS

Last year, the Govern-ment Affairs team atNAMB conducted a survey

of mortgage professionals to determinethe amount closing cost credits givenback to consumers at closing. The dataoverwhelmingly showed that in 2012,mortgage brokerages gave millions ofdollars to consumers to help cover clos-ing costs. In fact, the 164 mortgage bro-ker shops that responded to the NAMBsurvey provided more than $69 millionback to consumers. Our estimates arethat mortgage brokers gave in excess of$2 billion in closing cost credits in 2012.

Our data helped the mortgage indus-

try get some very positive press and turnsome heads in Washington, D.C. The bro-kerage community was given somemuch needed good press in the main-stream press (search for Ken Harney’s10/11/13 article in The Washington Poston “Closing-cost credits”). In addition,regulators and lawmakers had a new-found interest in how mortgage brokersare good for the consumer.

So, here we are today … asking foryour help to keep the momentumNAMB has to make subtle improve-ments to the regulations. We are askingfor your help to gather data from mort-gage brokers’ 2013 fundings.

Please visit www.surveymonk-ey.com/s/Brokercredits and fill out thebrief five-question survey.

It is extremely important that weget the mortgage credit to consumerinformation so that we can present itto our regulators per their request.What we are looking for is the follow-ing information:1. TOTAL number of loans closed in

2013. 2. TOTAL dollar volume of your loans. 3. TOTAL amount of mortgage rebates

that you gave to the customer tohelp pay their closing costs. Thisamount will be the sheet price ofthe loan, minus your lender com-pensation, minus any hits. Thiswould be the net amount that youwould have given back to the cus-tomer to help pay fees and reduceclosing costs.

Your personal information will bekept confidential. We won’t tell theConsumer Financial Protection Bureau(CFPB) who you are. But we do want toshow them the truth about credits toconsumers and the service that mort-gage brokers provide.

We have open lines of communica-tion with our regulators and will con-tinue to work with them to improvethe state of housing to do what is bestfor the consumer and small businessmortgage professionals.

Just remember, it does not matterif you are a mortgage broker or amortgage banker, NAMB is here foryou … the mortgage professional.

John H.P. Hudson, CRMS of PremierNationwide Lending in FlowerMound, Texas is NAMBCommunications Committee Chair.He may be reached by phone at (817)247-4766 or e-mail jhudson@pnlend-ing.com.

NAMB Communications Committee Update:2013 Mortgage Survey: Rebates to Consumers

N A M B P E R S P E C T I V E

By Fred Kreger, CMC

The mortgage industry asa whole has received atremendous amount ofbad press, black eyes and

heavy government regulation over thelast couple of years. Yet, when you drilldown to the true core of a loan origina-tor’s mission, you will find that it is toact in the best interest of his or herclient. Loan officers will consult and actin the client’s best interest to the best oftheir abilities given the tools at their dis-posal. Even in California, we have a fidu-ciary responsibility to all of our clients asBureau of Real Estate (BRE) licensees.

So, how did we rid our industry of thisbad rap? One option is to point fingers atthe other person, the bankers, WallStreet or government. However, at theend of the day, we all must ask ourselves… what I am doing to restore theintegrity of my business and the mort-gage lending industry?

I think we all need to ask ourselvesevery day, “Is this decision in the bestinterest of my client?” The answershould always be “Yes.” I recently read agreat list of “Rules of Running YourBusiness From This Point Forward” fromDoug Smith. Consider adopting theserules:

1. I will always offer a borrower com-plete disclosure of a mortgage pro-gram’s benefits and drawbacks.

2. I will never ask an appraiser to exag-gerate a home’s value to make a dealwork.

3. I will only recommend loan productsthat make sense for the borrower.

4. I will never succumb to a real estateagent’s pressure to alter facts orignore my better judgment just tomake a sale go through.

5. I will always make sure a borrowercan comfortably afford the monthlymortgage payment for the program Iput them in.

6. I will never overextend a borrower’scredit that may place them in jeop-ardy of bankruptcy or foreclosure.

7. I will always make smart decisionswith the borrower’s best interest inmind.

I think we have all done amazing thingsfor our borrowers, our communities andthe industry. Now we need to step up andmake sure that all of our actions neverplace our integrity in jeopardy.

Fred Kreger is branch manager ofAmerican Family Funding, a Division ofAmerican Pacific Mortgage. He is also theimmediate past president for theCalifornia Association of MortgageProfessionals (CAMP) and currently sitson the NAMB Board of Directors andserves NAMB as Government Affairs ViceChairman. He may be reached by e-mailat fred.kreger@affloans.com or call (661)505-4311.

Mortgage Lending Integrity RestorationAre You an NAMB

Lending Integrity Seal ofApproval Holder?

(No additional costs to NAMB members)

How to Apply for your National LendingIntegrity Seal

www.lendingintegrity.orgClick on EARN the Seal

NAMB members ONLY–Log in to the Lending Integrity site with yourNAMB User ID and Password (If you do not know your User ID andPassword, type in your e-mail and click log-in and the system will sendyou a password. If you have any issues, please call (972) 758-1151 or e-mail membership@namb.org).

Lending Integrity RequirementsThe Lending Integrity Seal of Approval is awarded only tomortgage originators who meet specific requirements. Toearn the privilege to display the Seal, mortgage brokers andloan officers must:

l Be an NAMB member

l Meet the requirements of the SAFE Act

l Pass a national criminal background check

l Attend eight hours (or equivalent) of professional development educa-tion each year

l Attend two hours (or equivalent) of ethics training every other year oreach license renewal cycle

l Provide professional references

l Subscribe to NAMB’s Best Business Practices

l Agree to NAMB’s Code of Ethics

l Must be renewed annually

23

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

N A M B P E R S P E C T I V E

I found myself thinkinghow I would like nothingbetter than to see NAMBdouble or even triple itsmembership this year.But how, I asked myself.

This has been on my mind for quite awhile now, and it seem like when I amonto something, an underwriter calls,an appraisal comes in low from anunknown appraiser … you know, thenormal everyday mortgage business wego through on a weekly basic. In today’smarket, this seem to prevent importanttopics from getting the time and focusthey need, like growing NAMB, which isvital for us all to have a larger voicewith Congress.

I was gathering tomatoes at ourfarm’s garden, and I found myself try-ing to decide what to write abouttoday. I had a thought, getting a plantogether for new members to joinNAMB might be a lot like farming. Infarming, you must till the ground, plantthe seeds, fertilize the soil, water fre-quently, and have plenty of sunshinefor the tomatoes grow.

At the farm last year, we got nothingfrom our tomato crop, even though wetook all the steps to produce wonderfulripe tomatoes. We repeated all thesame steps from the previous year andthis year’s tomato crop is truly some ofthe best tomatoes we have ever had.

With NAMB, we are just trying to get agreat crop of new members that will getbetter each season and will help us get tothe next level at NAMB. If we do not till,plant the seeds, fertilize and have consis-tent sunshine by following-up with thenew members, we will not have a goodcrop. They will begin to disappear. Weare wanting to do things right to preventlosing our members like the bugs eatingour tomato crop. We have to till theground by searching everywhere for newmembers. We cannot let the ground orour membership just stand idle. We mustgive all new members our time “value”so they feel good that they joined ourorganization. We must assist them andtheir business by fighting for them andthe concerns and problems they are fac-ing and bring those concerns and prob-lems to Washington, D.C. NAMB mem-bers should consistently reach out to thenew members, fertilizing the soil. Wemust all keep farming so that we canhave a larger, better tasting, crop everyyear. This will allow us to choose the bestseeds to plant for next year’s crop.

If you are reading this article, youcare enough about your profession and

you are the kind of person we are look-ing for to add to our membership. Wehave a lot of good networking opportu-nities available with NAMB. We discuss

our ideas and try to find solutions thatwill help all of our members with anyoriginator-related or mortgage-relatedproblems. Like water and sunshine, we

try to continually feed our members sothat they will become the best that theycan be.

Linda McCoy, CRMS is broker/owner ofMortgage Team 1 Inc. in Mobile, Ala., amember of the NAMB Board of Directorsand serves as NAMB MembershipCommittee Chair for the South EastRegion. She may be reached by phone at(251) 650-0805 or e-mail Linda@mort-gageteam1.com.

A Message From NAMB South East RegionMembership Committee Chair Linda McCoy, CRMS: Farming NAMB

O N T H E

heardstreet

Our Heard on the Street column is a chronicle of events, changes and passages in the lives of the people and companies shaping the mortgage industry.

Global DMS Forms TwoNew Partnerships

Global DMS, a provider of Web-basedcompliant valuation management soft-ware, announced that PrimeLending, anational residential mortgage lender,has successfully implemented theGlobalDMS eTrac valuation platform tocompliantly automate the lender’sentire appraisal process.

“Global DMS’ eTrac platform hasenabled us to streamline the appraisalprocess for all of our staff members,”said Tim Elkins, EVP and CIO ofPrimeLending. “We have our own panelof appraisers, which eTrac allows us toefficiently manage internally. Since theimplementation of eTrac, we have real-ized quicker turn times, greateremployee productivity, workflow effi-ciencies and cost savings.”

eTrac integrates tightly withPrimeLending’s loan origination system(LOS), CoreLogic ChannelMaster. Theintegration automates manual process-es and ensures data consistencythroughout the appraisal process. Fromwithin the LOS, PrimeLending’s userscan seamlessly access eTrac to efficient-ly order and assign appraisals, checkreal-time status, and deliver loans tothe GSEs via the Uniform CollateralData Portal (UCDP) in full complianceand without missing data.

“The ability of our solution to effec-tively handle the type of volume thatPrimeLending produces demonstratesthe scalability of our platform,” saidVladimir Bien-Aime, president and CEOof Global DMS. “eTrac has a seamlessinterface to PrimeLending’sChannelMaster platform, whichstreamlines their unique workflow andoffers them the flexibility to fully con-trol and have transparency over theirin-house appraiser panel.”

Global DMS has also announced apartnership with Collateral that inte-grates various components of their soft-ware valuation solutions. From within

Global DMS’ single-source eTracEnterprise platform, which compliantlyhandles the entire appraisal manage-ment process, users can now accessCollateral Analytics’ products and serv-ices that include its automated valua-tion model (AVM) services, data analyt-ics products and risk managementsolutions.

“There are many factors that mustbe taken into account in order to deter-mine accurate property valuations andreporting in today’s market,” said Bien-Aime. “This new partnership extends toour customer base Collateral Analytics’sophisticated data analysis capabilitiesthat produces precise reports on valua-tions, market analytics and risk scores.”

Collateral Analytics’ AVM service pro-vides highly accurate property valueestimates with supporting data forforecasting and decisioning; its dataanalytics products also report on his-torical and current home price trendsas well as forecast future trends andmarket condition. In addition, thecompany’s risk assessment tool, CA RiskProfiler, determines the probability ofvaluation risk for BPOs and appraisalsbased on the use of numerous datapoints.

PCV Murcor IntegratesWith Calyx on AppraisalCompliance

PCV Murcorhas announcedthat it will

begin offering compliant appraisalsthrough Calyx Software’s Point loanorigination system. Integrating the twosystems enables Calyx Point users toquickly and securely order and trackappraisals from PCV Murcor throughthe existing Calyx Point interface.

“With the MBA’s loan originationvolume projections lowered again andthe operational challenges lenders facein quickly originating quality loans,

every process that can be simplified isvaluable. This integration will furtherenable PCV Murcor to assist lenders bystreamlining the ordering process andhelping assure that the loans being orig-inated have compliant value-certaintyand defensibility,” said Tim Scherf, COOof PCV Murcor. “Calyx is a recognizedand respected leader in loan originationsoftware. Their commitment to main-taining a regulatory-compliant systemmakes this integration an ideal fit for usboth, given PCV Murcor’s commitmentto providing compliant, high-qualityappraisals.”

National MI Partners With BlitzDocs

National Mortgage Insurance Corpora-tion (National MI) is now directly inte-grated with the Xerox Mortgage Services’BlitzDocs intelligent collaborative net-work. The integration provides lenderswith improved efficiency in workingwith National MI through a secure,enhanced document image exchange.

BlitzDocs is delivered as a cloud-based mortgage technology system andenables lenders to e-Ship or transmitdocuments in a paperless format,according to Ken Marlin, vice president,general manager with Xerox. Its elec-tronic loan folder (eFolder) mirrors atraditional loan folder and only includesthe documents both parties agree areneeded, so unnecessary documents areeliminated.

“eFolder increases productivity andaccelerates the loan process whilereducing paper costs and eliminatingshipping fees,” Marlin said.

BlitzDocs’ advanced security settingsenable all industry participants to worktogether on the same set of documentsthroughout the entire loan process tostreamline process efficiencies and pro-

mote accuracy of loan data.“Joining forces with Xerox allows our

lender customers who use BlitzDocs totransmit their documents easily,” saidPete Pannes, executive vice presidentand chief sales officer with National MI.“It’s another option we offer our cus-tomers to transmit loan documentselectronically and securely.”

Black Knight to ServicePortfolios of Two NewClients

Black Knight Financial Services hasannounced that Union Bank & Trust,based in Lincoln, Neb., has signed a five-year contract to service mortgage loansin-house using MSP, Black Knight’s mort-gage and consumer loan servicing plat-form. MSP, a complete, end-to-end sys-tem used by financial institutions tomanage all servicing processes, includ-ing loan boarding, escrow administra-tion, investor reporting and more, offersservicers the ability to meet all mortgageand consumer loan servicing needs forany size portfolio.

The implementation of MSP sup-ports Union Bank & Trust’s expansioninto mortgage servicing, which comple-ments the broad mix of financial servic-es the bank offers to businesses andindividuals.

“MSP offers us the ability to centrallymanage all servicing functions on a sin-gle technology platform and to easilyaccommodate our growing loan portfo-lio,” said Alan Fosler, senior vice presi-dent of Union Bank & Trust. “The pow-erful capabilities of Black Knight’s tech-nology give us the confidence that MSPis the best system to support our bank’sexpansion into loan servicing.”

Black Knight has also announced

continued on page 28

24

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

25

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

continued on page 51

© Copyright 2007-2014 Carrington Mortgage Services, LLC headquartered at 1610 E. Saint Andrew Place, Suite B150, Santa Ana, CA 92705. Toll Free (800)561-4567. NMLS ID 2600. Nationwide Mortgage Licensing System (NMLS) Consumer Access Web Site: www.nmlsconsumeraccess.org. AZ: Mortgage Banker BK-0910745; 2159 McCulloch Blvd 4, Lake Havasu City, AZ 86403. CA: Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act, File No. 413 0904. CO: Check the license status of your mortgage loan originator at http://www.dora.state.co.us/real-estate/index.htm. GA: Georgia Residential Mortgage Licensee 22721. IL: Illinois Residential Mortgage Licensee. MN: This is not an off er to enter into an interest rate lock agreement under Minnesota Law. MO: Residential Mortgage Broker License 09-1746-S. NH: Licensed by the New Hampshire Banking Department. NJ: Licensed by the N.J. Department of Banking and Insurance. NY: Licensed Mortgage Banker—NYS Department of Financial Services. New York Mortgage Banker License B500980/107664. OH: Ohio Mortgage Broker Act Mortgage Banker Exemption MBMB.850208.000 (FHA DE & VA Automatic loans only) OR: Mortgage Lender License ML-4886. PA: Licensed by the Department of Banking. RI: Rhode Island Licensed Lender, Lender License 20112809LL. VA: Licensed by the Virginia State Corporation Commission MC-5382. WA: Consumer Loan License CL-2600. Also licensed in AL, AR, CT, DE, DC, FL, ID, IN, ME, MD, MI, NM, NC, OK, SC, TN, TX, WV and WI. NOTICE: All loans are subject to credit, underwriting, and property approval guidelines. Off ered loan products may vary by state. There is no guarantee that all borrowers will qualify. Restrictions may apply. This is not a commitment to lend. Terms, conditions, and programs are subject to change without notice. This information is for mortgage professionals only and is not intended for distribution to consumers. Carrington Mortgage Services is not acting on behalf of or at the direction of HUD/FHA or any offi ce of the federal government. All rights reserved.

*Carrington will process any qualifying loan from the time a loan fi le is submitted to underwriting to the time it funds within 15 business days of appraisal receipt or the company will apply a closing cost credit of $500 to the loan once the loan closes. In order to receive the closing cost credit, any delay that causes the loan to close more than 15 days after appraisal receipt must be due to Carrington’s independent processes. If the delay is due to the broker, borrower’s or third party’s action or inaction or any other circumstances outside of Carrington’s control, the closing cost off er will be void. This off er excludes some loan programs, such as VA loans, USDA loans, 203K Loans Short Sales, New Construction loans, loans requiring property repairs, inspection, or re-inspection prior to closing, loans requiring condo approvals and fl ips. Off er is subject to revision or cancellation at any time. The appraisal received date is recorded in Pipeline Manager for all qualifying loans. Some loans may require additional information and be returned. Exclusions apply; contact your Account Executive for details.

At Carrington Mortgage Services, we are committed to meeting the fi nancing

needs of those who are underserved throughout America. We have loan programs specifi cally tailored to credit-challenged borrowers, so there’s no need to turn away those borrowers with low FICO scores. We are your government lender of choice with loan programs, service, technology and national support to grow your business today, tomorrow and beyond.

OUR COMMITMENT TO OUR BROKERS IS UNSURPASSED. WE OFFER:

On-Time Closing Promise for FHA loans – 15 Day Clear to Close on qualifying purchase or refi nance loans, or your borrower receives a $500 closing cost credit.* Plus, get a prequalifi cation letter and enjoy our early disclosure service. Submit with no AUS. Restrictions apply.

FICO minimums to 550 on government programs and expanded FHA guidelines that include manufactured housing and use of non-traditional credit.

Expanded Operations Support. Multiple operations centers off ering support across all time zones provides outstanding service and fast turn times.

YOUR GO-TO LENDER FOR THE

TOUGHEST

LOANS

FHA, VA & USDA PROGRAMS

FICOREDUCED TO

550

Growing your business with the right partner has never been easier. Get started today with Carrington Mortgage Services.

www.CarringtonWholesale.com/toughloans

866-453-2400

nmp news flashcontinued from page 16

ing margins on the secondary sale.”Additional findings in the first quarter

2014 trend report include the following:l The principle balance of unfunded

locks increased by 40.5 percent,rebounding to levels last observed inthe 3rd quarter of 2013

l Pre-tax profits improved by 0.25 per-cent, primarily due to increased sec-ondary marketing gains and gainsrelated to bulk sales of servicingrights

l While production continued itsdecline, the rate of decline slowed inthe first quarter of 2014

l Non-loan originator staffing wasreduced by an average of 14 employ-ees, or six percent of all non-loanoriginator staff, since the third quar-ter of 2013

l Per-staff productivity has declined by1.8 units per non-loan originator staffmember, and by 1.6 units per loanoriginator, since 2012

l Lenders cut operating expenses by 13percent, but operating expensesincreased by an average of $234 perloan, the result of higher occupancyand marketing expenses, which roseby $106 and $119 per loan, respec-tivelyServicing revenue contributed 12

basis points to survey participants’ bot-tom lines during the first quarter of2014, up from six basis points for thefourth quarter of 2013. The majority ofservicing revenues resulted from bulksales of servicing portfolios, whichaccounted for 83 percent of all net serv-icing revenues.

Despite continued rising costs, RicheyMay Select survey participants achievednearly break-even pre-tax profits for thefirst quarter of 2014, showing a 25-basispoint improvement over the previousquarter. Lenders generally compensatedfor heightened operating and personnelcosts by increasing loan margins.

FHA Publishes Guidanceon Avoiding HECM

DeceptionThe Federal HousingAdministration (FHA)has published a Mort-gagee Letter reminding

lenders participating in the agency’sHome Equity Conversion Mortgage(HECM) Program to make certain seniorborrowers are fully informed of all theiroptions when applying for reversemortgages. FHA’s Mortgagee Letter alsoreinforces the agency’s prohibitionagainst misleading or deceptive adver-tising and that this prohibition extendsto misleading or deceptive descriptionsof the HECM program.

FHA’s guidance is intended to pro-tect HECM borrowers from misleadingadvertising and presentations thatappear to limit their options ratherthan informing them of the full rangeof available HECM offerings.

“Senior borrowers deserve freedomof choice when considering whether areverse mortgage is appropriate forthem,” said FHA Commissioner CarolGalante. “This guidance is intended tomake sure lenders know we’re keepinga watchful eye on their marketing andadvertising practices that might steerborrowers toward reverse mortgageoptions that limit their available choic-es.”

FHA-approved lenders are requiredto explain in clear, consistent languageall requirements and features of the

HECM program and may not mislead orotherwise cause a senior borrower tobelieve that the HECM product containsany features or limitations that are incon-sistent with FHA’s requirements.

Study Finds MortgageFirms Need to Step UpHMDA ReportingManagement

With heightenedregulatory andmedia focus onHome MortgageDisclosure Act

(HMDA) data, more lenders will findthemselves the subject of fair lendingexams, according to MortgageTrueView, a provider of data-driven

business intelligence services.In a new independent study, the

company found that many lenders areleaving themselves vulnerable to fairlending exams and significant penaltiesby not properly monitoring and manag-ing HMDA reporting. Mortgage compa-nies and banks are not taking fulladvantage of the insights offered inHMDA data, said Mortgage TrueViewPresident and CEO David Moffat.Additionally, Moffat said the company’s2013 HMDA survey showed that manylenders are submitting their data withformatting errors, which could lead tonon-compliance issues with regulators.

HMDA Survey and Case Study,

26

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

leadershipLYKKEN ON

leadership

Leaders:Who Do You Have in Your Inner Circle

By David Lykken

Anyone who hasspent a shortamount of timewith me will know

that I’m a huge proponent of usingsocial media to build connections, bol-ster your professional image, and growyour business. I personally havereceived several clients and referralsfrom using social media, and I havemany colleagues who can offer thesame testimony. I believe that leadersin today’s day and age who want to betaken seriously as professionals willhave the willingness to join those digi-tal conversations and make themselvesknown in their industries. But for lead-ers who really want to be at the top oftheir game, I think there’s somethingeven more important.

A few years ago, Google came outwith Google+, Google’s social network-ing platform that served as an attemptto compete with Facebook for the pre-cious attention of Internet users. Theformat is much like Facebook, with thedifferences being fairly subtle andnuanced. One of these small differ-ences is the way users connect witheach other. Google+ calls its groups ofconnections “Circles.” On Google+, youcan organize your connections into var-ious circles in order to share differentcontent with different groups of peo-ple. You can have a “Friends” circle.You can have a “Colleagues” circle. Youcan have any kind and any amount ofcircles you want. And, yes, you can evenhave an “Inner” circle.

This article is not about social net-working—at least not the kind seen inthis month’s issue so far. It’s not aboutFacebook, Twitter or Google+. It’sabout your real social network—the

people you include in your real-lifeinteractions. Sure, the people you con-nect with online are real people. So, youcould say that they are part of your“real life” social network. But, in thisarticle, I’m not just talking about every-one you know—I’m talking about thosewho are closest to you. I’m talkingabout the people you trust the most.I’m talking about your inner circle.

What is an “inner circle?” I define aninner circle as a group of close-knitindividuals who openly share intimatedetails about their lives, struggles,hopes, dreams, fears, failures, and suc-cesses with one another. These are thepeople with whom you share thethings you wouldn’t even dream ofrevealing on Facebook. These are thedeep relationships that shape andmold who you are as a leader. This“inner circle” of connections can be atremendous source of inspiration andmotivation. It can become the differ-ence you need to break through to per-sonal and professional success. On theother hand, if you aren’t careful aboutwho you let into your inner circle, itcan quickly become the path to per-

sonal and professional defeat.The Bible, which is still my favorite

business book for leaders, tells apoignant story of an inner circle goneawry. In Acts 13, Paul and Barnabasare traveling on their first missionaryjourney from city to city in an attemptto convert people to Christianity. Atone point, they come to a city calledPaphos and are invited to meet withthe governor of the city, who isdescribed as being an “intelligentman” and from what we can tell, a sin-cerely good man.

Here’s how the passage reads:“Afterward they traveled from town totown across the entire island untilfinally they reached Paphos, wherethey met a sorcerer, a false prophetnamed Bar-Jesus also known asElymas. Elymas had attached himselfto the governor, Sergius Paulus, whowas an intelligent man. The governorinvited Barnabas and Saul to visit him,for he was interested in hearing whatPaul had to say. But Elymas, interferedand urged the governor to pay noattention to what Barnabas and Saulsaid. He was trying to keep the gover-

nor from believing.” (Acts 13:6-8)What I want to call attention to is

the contrast between the leader in thisstory and the man who becomes a partof his inner circle. Sergius Paulus is thegovernor of the city of Paphos—a posi-tion which in ancient times I imaginewould have been quite a substantialposition of leadership. We are told lit-tle of Sergius Paulus other than that heis “an intelligent man” and that heallows a negative influence to becomeclose to him. Elymas, represented him-self to be something he wasn’t and“attach himself” to the governor. Thisis a common problem facing goodintelligent leaders today, letting indi-viduals of questionable or bad charac-ter to get into our inner circle and“attach” themselves to us.

Lucky for Sergius Paulus, the apos-tle Paul saw through the Elymas/Bar-Jesus ruse and was stricken blind.When the governor saw this, hebelieved the message brought by theapostle Paul, and the story has a happyending.

Here’s what I want you to see in thisstory and it is something I observe waytoo many well-meaning intelligentleaders today. They let bad influencesinto their inner circle, who you allowto “attach themselves” and disrupt ordistract leaders from seeing the rightpath to take in their business and lives.

Remember “Enron?” Through ques-tionable accounting methods, Enroninflated its own value and robbed bil-lions from unsuspecting investors. Thecompany has become the ultimatesymbol of bad business ethics. Enronhas been used as an example of whatnot to do in countless stories told bybusiness people across the world. Well,guess what? I’m going to add anotherone of those stories to the mix.

“GREAT LEADERS AND PEOPLE

ASPIRING TO BE GREAT

LEADERS NEED TO BE MORE

THOUGHTFUL AND MORE

CIRCUMSPECT ABOUT WHO

THEY ALLOW IN THEIR

INNER CIRCLES.”

27

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

As far as leadership goes, there isironically perhaps no organization inhistory that has done more to raise thestandards for leadership than Enron.And that is precisely because the levelof accountability demanded of EnronCEO Kenneth Lay seemed to haveapproached zero during his tenure.Throughout the investigation intoEnron’s unethical behavior, Lay cameacross as wholly incompetent andnaive as a leader. Regardless of howyou feel about his level of guilt orinnocence, he portrayed himself as agullible victim of things he didn’tknow about—all the way up until hisdeath in 2006. Although we may agreewith the adage, “ignorance is noexcuse,” that seems to be exactly whatKenneth Lay clung to.

But there was another man beinginvestigated right alongside KennethLay—his right-hand man, JeffreySkilling. Contrary to Lay, Skilling nevercame off as gullible or naive. On thecontrary, he came across as devious,merciless, and unsympathetic. Ratherthan deny that he knew about whatwas going on at Enron, Skilling tookcredit for it and then proceeded toargue for its ethical merits. Who wasthe real villain at Enron—Lay orSkilling? As much as we can see, itseems Lay served as more a figure-head. Skilling ran the company andmade all of the everyday decisions. So,when those decisions turned out notto be so good, did we let Kenneth Layoff the hook? No, Jeffrey Skillingdragged Kenneth Lay down with him.

Skilling, I think it’s safe to say, waspart of Lay’s inner circle. Lay trustedSkilling for the multi-billion dollarorganization that was ultimately hisresponsibility. At some point, Laywould have had to reason with himselfthat Skilling either would never havedone the things he did or that he wastoo smart to get caught. Either way, bytaking on Skilling as his right-handman, Lay was opening himself up tobeing taken advantage of as a leader.

Jeffrey Skilling is currently servinghis sentence in prison. Lay, on theother hand, died of a heart attackbefore he had the honor of serving his.But when we think of the legacy ofKenneth Lay, we conjure up images ofnaivety, cowardice, and incompe-tence. These things are the antithesisof a great leader. And we attributethose characteristics to Kenneth Layultimately because he brought thewrong person into his inner circle.

When I get close to people, whetherin business or in life, I try to be extravigilant about the effect they will haveon my ability to be a strong leader. Itis amazing to me how many leadersopen the door to individuals like Bar-Jesus or Jeffrey Skilling. I have come topay special attention to those who feelcompelled to “attach” themselves tome or to leaders to whom I consult. Itsets off warning lights on my “dash-board.”

Who we allow in our lives can bethe biggest determining factor in

whether or not we succeed or fail.While this is true of anyone, it’s espe-cially true of leaders, and it seems thatthe more authority/influence a leaderhas, the more they attract those withulterior motives. This can be a realblind spot and trip up leaders on theirway to success.

Great leaders and people aspiring tobe great leaders need to be morethoughtful and more circumspectabout who they allow in their inner cir-cles. Sure, it’s a good idea to surroundourselves with people different thanus—those with complementary per-sonality styles and skill sets. However,it is imperative that all have as close of

Branded Mobile Apps for Mortgage Professionals

We want to help you get ALL your Realtor®'s purchase business:

• Co-Brand With Unlimited Partners

• Make Clients Happy With Loan Status Notifications

• Give Partners and Clients an Intelligent Calculator

• Make Underwriters Happy With Better-than-fax Document Imaging

• Not only does SimpleNexus help generate purchase business, Compliance Departments love us.

Secure your Realtors® before your competition does.

Looking for Corporate Solutions? We provide app customization and compliance controls.

Go to SimpleNexus.com

ofessionalsMortgage Pr Mobile AdanderB

ofessionalsor pps f Mobile A

ofessionals

ed Pith UnlimitWand -Br• C

e business:chaspurealtorour RALL y

e want to help yW

Mortgage Pr

ofessionals

tnersed P

e business:'s ®ealtorou get e want to help y

olstrone compliancction and omizaapp cust

vide opre olutions? WSe tapororor Cing ffoookL

.ompetition doesour cye orors® beffoealtour Re yecurS

ts lotmene DompliancCchase businesse purtagener

• Not only does SimpleNe

ocumen-than-fax DerettBers Happitwrake Under• M

ortalculat CelligentnIts an tners and Clienare P• Giv

tionsNotificaith LWy ts Happake Clien• M

ed Pith UnlimitWand -Bro• C

ts lo, chase business

xus help

ingmagt Iocumenith Wy ers Happ

ts an

tus taSoanith L

tnersared P

o to SimpleNexus.cG

.olstrone compliancc

o to SimpleNexus.c

ts lotmenepare DompliancC

omo to SimpleNexus.c

.e usvts lo

a value alignment as possible. As thescripture from Amos 3:3 says, “Canany two walk together unless theyagree?”

I have written much on the sevenkey characteristics of great leaders:character, conviction, confidence,charisma, clarity, communicationand compassion. Surely, you shouldstrive to develop these characteristicsin yourself. But of equal importanceis that you look for these same char-acteristics in other people. If youwant to be a successful leader withgreat character and an enduring lega-cy of positive influence, it oftencomes down to building your inner

circle with people who share thatsame goal.

David Lykken is president of mortgagestrategies and managing partner withMortgage Banking Solutions. He has morethan 35 years of industry experience andhas garnered a national reputation, andhas become a frequent guest on FOXBusiness News with Neil Cavuto, StuartVarney, Liz Claman and Dave Asmanwith additional guest appearances onthe CBS Evening News, Bloomberg TVand radio. He may be reached by phoneat (512) 977-9900, ext. 10, or e-maildlykken@mortgagebankingsolutions.comor dlykken@mbs-team.com.

28

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

continued on page 48SPONSORED ED ITORIAL

By Andrew Liput

The Consumer Financial Protection Bureau (CFPB) now hasrule-writing authority and enforcement authority over fi-nancial institutions, with respect to the Graham-Leach-BlileyAct (GLBA), the major federal consumer information privacy

and data security laws.The GLBA requires financial institutions–companies that offer con-

sumers financial products or services like loans, financial or investmentadvice, or insurance–to safeguard sensitive data. Mortgage lenders, mort-gage brokers, credit unions and banks collect personal information fromtheir customers including names, addresses, and phone numbers; bankand credit card account numbers; income and credit histories; assets andtheir location, as well as Social Security Numbers. The name of minor chil-dren, marital status, birthdates and more are also found throughout atypical loan file. GLBA thus requires all lenders to ensure the security andconfidentiality of this type of information. As part of its implementationof the GLBA, the Federal Trade Commission (FTC) has issued the SafeguardsRule, which requires financial institutions under FTC jurisdiction to havemeasures in place to keep customer information secure.

According to the Safeguards Rule, financial institutions must developa written information security plan that describes their program to protectcustomer information. All programs must be appropriate to the financialinstitution's size and complexity, the nature and scope of its activities,and the sensitivity of the customer information at issue. Covered financialinstitutions must:(a) Designate the employee or employees to coordinate the safeguards;(b) Identify and assess the risks to customer information in each relevant

area of the company's operation, and evaluate the effectiveness of cur-rent safeguards for controlling these risks;

(c) Design a safeguards program, and detail the plans to monitor it; and(d) Select appropriate service providers and require them (by contract) to

implement the safeguards.

As the recent electronic data breaches suffered by Target, eBay and in-dustry LOS system provider Ellie Mae demonstrate, when we live in a worldwhere private information is shared, that information is a serious temp-tation for criminals. Mortgage lenders and banks, who have access to somuch personal and financial information of a borrower, must take signif-icant measures to safeguard that data and manage who has access to it.

To meet these compliance expectations, all lenders should expect to:(a) Develop a written data security plan;(b) Designate responsible employees who may access sensitive data;(c) Screen all employees with access upon hire and at least annually thereafter;(d) Evaluate and monitor all third parties with access to sensitive data (in-

cluding IT professionals, janitorial services, credit counselors, settle-ment attorneys, notaries, title agents);

(e) Assess risks to customer data through breaches in security, includingrouge employees; and,

(f) Test and monitor safeguards.

Risk management experts and industry auditors recommend thatlenders, banks, credit unions and brokerage shops conduct annual screen-ings of all employees with access to consumer data, credit reports and fi-nancial information, as well as any third-party vendor who may haveaccess to some or all of the same data. Failure to adopt and enforce ap-propriate measures will eventually result in severe regulatory penaltiesand the potential for civil lawsuits for damages.

Andrew Liput is president and CEO of Secure Settlements Inc., a companyhe founded after nearly 10 years studying the problem of escrow and closingfraud and the uninsured risks associated with mortgage closing profession-als. He may be reached by e-mail at aliput@securesettlements.com.

Data Privacy is a Lender’s Nightmareand a Consumer’s Biggest Fear

�

that Guaranty Bank signed a five-yearcontract to use its MSP platform to serv-ice the bank’s expanding servicing port-folio. Guaranty Bank recently converted25,000 residential mortgage loans ontothe MSP system.

Guaranty Bank’s conversion of its res-idential mortgage loans onto the MSPplatform will offer the mortgage bankermore system functionality, as well asprovide increased support to meet fed-eral regulatory requirements.

“We are pleased Guaranty Bank haschosen Black Knight’s industry-leadingtechnology to meet the evolving needsof its growing business,” said JoeNackashi, CIO and president of BlackKnight’s Servicing and DefaultTechnologies division. “We are commit-ted to providing Guaranty Bank withboth innovative technology and collabo-rative support needed to face compli-ance challenges and growth opportuni-ties ahead.”

AnnieMac ImplementsISGN’s CFPB Risk Module

ISGN Corpora-tion has an-nounced thatAnnieMac HomeMortgage, a

Mount Laurel, N.J.-based residential mort-gage lender, has implemented ISGN’sConsumer Financial Protection Bureau(CFPB) Compliance RiskCheck to evaluaterisk against the CFPB’s requirements.Dozens of new CFPB rules have takeneffect over the past two years and morechanges will continue to be releasedthroughout 2015. ISGN’s RiskCheck is theonly Software-as-a-Service (SaaS), cloud-based risk assessment tool available in themarket today, and is designed specificallyfor lenders and servicers like AnnieMacHome Mortgage that are in need of a cost-effective, efficient risk evaluation solutionto comply with the new and changingCFPB requirements. CFPB ComplianceRiskCheck enables AnnieMac HomeMortgage to utilize a Web-based system toconduct an end-to-end review of its poli-cies and procedures. The platform con-tains a series of approximately 600 ques-tions, which are broken out by three cate-gories: Compliance management, origina-tions, and servicing, and then by area ofrisk.

The cloud-based self-assessment toolprovides several help features includingbest practice sample answers, live compli-ance assistance and links to complianceregulations when completing the answers,which are then analyzed automaticallyusing taxonomy in line with CFPB regula-tory guidelines to calculate the residualrisk. AnnieMac Home Mortgage will beable to generate a detailed report includ-ing compartment risk weightings, trendsand high risk items, which can then beprovided to regulators and to executivemanagement for action plans.

“Failure to comply with the CFPB’s

requirements can lead to severe conse-quences, and as our organization contin-ues to grow, it is imperative that weaddress any risks that could result in non-compliance,” said Joseph Panebianco,CEO of AnnieMac. “Keeping up with thelatest CFPB regulations is challenging, butISGN’s RiskCheck is a practical, reliablesolution that simplifies the compliancemanagement process.”

LoanLogics AnnouncesIntegration With RadianGuaranty

LoanLogics hasannounced that iti s in teg ra t ingpr ice/premium

data from Radian Guaranty Inc. intoone of the mortgage industry’s leadingpricing engine platforms. LoanLogics isintegrating the cost of MI from RadianGuaranty, one of the foremost providersof private mortgage insurance, into thetotal calculation of principal payments,interest and fees from LoanDecisionsproduct eligibility and loan pricingtechnology.

“LoanLogics is dedicated to deliveringcutting-edge technology that providescompetitive advantages to clients andensures that they are compliant with CFPBregulations,” said Brian K. Fitzpatrick, pres-ident and CEO of LoanLogics. “The integra-tion of Radian MI costs into LoanDecisionspricing enables us to enhance our capabil-ities to include mortgage insurance, pro-viding more complete loan paymentdetails for compliant pricing discussionswith borrowers.”

This product integration enhances andsimplifies the MI rate quote, and eventu-ally the ordering process, for bothRadian’s and LoanLogics’ customers,enabling them to instantly receive anaccurate rate quote in real time withinthe LoanDecisions best execution plat-form. The platform delivers accurate,real-time investor pricing and eligibilitydata through an intuitive and compre-hensive interface.

“This is exciting news because it’s onemore way Radian is working to accomplishone of our top priorities—making it easierthan ever to do business with us,” saidBrien McMahon, Radian’s chief franchiseofficer. “Partnering with a well-regardedleader like LoanLogics will simplify how MIis ordered for many of our customers, andwe’re proud to deliver that.”

Mortech Joins Forces With INTEGRA SoftwareSystems

Mortech has announced a new integra-tion with INTEGRA Software Systems,developers of Destiny loan originationsoftware (LOS). A new streamlined setup

heard on the streetcontinued from page 24

29

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

NMLS #1850

We are American Pacific Mortgage - One of the most established, strategic and strong companies in the Western United States. We are nimble in our day-to-day operations and fanatical about the level of service and support we provide to make our producers look good. We provide them with the ability to focus on creating the opportunity of homeownership for their customers.

GrowWithAPM.com 866.625.9352

Ready to lead the pack?Branch Management and Originatoropportunities available.

OUR ORIGINATORS

ARE

EORSTAAT

GIN

S

G

CKAPAGIN

CKG

!etmark

e in a ta

30

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

This is the 12th time since2008 that the MortgageBankers Association (MBA)Conference Survey Report &Scorecard survey of seniormortgage banking execu-

tives has been conducted and distrib-uted. It is completed twice annually, atthe MBA’s National Secondary MarketConference in May and at the MBA’sAnnual Convention in October.

The purpose of the survey is to cap-ture some basic data and gather theopinions, attitudes, values and expecta-tions of senior executives on many ofthe key issues, topics and concerns dis-cussed and debated across andthroughout the mortgage industry. Thesurvey is funded by Tom Millon, chiefexecutive officer of the Capital MarketsCooperative. The author serves as amoney market economist for theCooperative on a consulting basis.

For this year’s Secondary marketingConference, I arranged 26 meetingsand completed 26 surveys. The sur-veyed group consisted of five mortgagecompany presidents, six executive vicepresidents, 10 senior vice presidentsand five vice presidents. Exclusive ofthe presidents, all of those surveyedwork in capital markets, operations orproduction. Fifteen of those surveyedare with top 50 firms (ranked by 2013origination volume), nine are withfirms in the top 20, and three are withfirms ranked within the top five. Theremaining 11 executives are with firmsranging from $400 million to $5 billionbased on 2013 production volume. Theexecs represent 12 banks, 10 independ-ent mortgage companies, two home-builder-owned firms, and one eachcredit union, thrift and realtor-ownedfirm. One of the firms is Internet-based.

Eleven of the firms originate onlythrough retail, while the other 15 pro-duces in at least two channels. Six of the25 separate firms originate in retail,correspondent and broker wholesale. Itis a representative group and was struc-tured to be so.

The 75-question questionnaire wasdrafted several weeks before theSecondary Marketing Conference, betatested, and run past several industryexecutives for comprehensiveness andclarity. Except for the beta test group,all surveys were completed face-to-faceduring meetings at the Conference.About 45 minutes is reserved for eachsurvey. The project’s objective is torecord the responses to the questions,compile the information, prepare areport of the results, and distribute it tothose surveyed and other interestedparties.

By design, the survey group consistsalmost solely of industry friends andbusiness associates. All are industry vet-erans. Almost all have been part of thissurvey since its beginning. Some arepolled at this Conference and also at theAnnual Convention in October. Most ofthose surveyed are close industry con-tacts who have helped keep meapprised of intra-industry trends anddevelopments over the course of years.Most have been colleagues for decades.Only three of those surveyed werepolled for the first time.

Given who is being polled, nothought was ever given to even suggestthat the survey findings reflect the atti-tudes or opinions of a broad cross-sec-tion of the U.S. population. To the con-trary, since it wasn’t a random survey,there is nothing scientific about theresults that would necessarily apply out-side the mortgage banking industry and

at a specific point in time. That beingsaid, I believe the findings well repre-sent the ideas, attitudes and expecta-tions of the broader industry.

Although some of the questions aretime-specific and appear on these sur-veys only once or twice, many othersare included in each and every survey.This polling process provides a set ofresponses over time. An analysis of thislongitudinal data shows patterns andtrends along with new developments inthe business and industry. For example,the reduced demand by the govern-ment-sponsored enterprises (GSEs) forthe repurchase of loans is reflected inthe vast improvement noted in this sur-vey and the last, as compared to thefindings of the surveys in 2010 throughthe first half of 2013.

Past survey results have been thebasis for several recent articles in tradepublications. The objective of these arti-cles is to bring senior execs into thepublic discussion of key issues and top-ics without drama, and despite theoften-controversial nature of the under-lying subjects.

This report’s author finds the infor-mation collected to be relevant, inter-esting, insightful, informative andinstructive for policymakers at a mostchallenging time for the Congress, theFederal Reserve, industry regulators,the GSEs and the ObamaAdministration.

With that preface, it’s off to the ques-tions, with the understanding that whatfollows is intended as only a skin-deepreview of the responses, not an analysisof them.

l Question #1 asked those surveyedwhat the interest rate on the 30-yearfixed-rate mortgage would be at

year’s end. The group averageweighted in at 4.75 percent. Therange of expectations was from3.875 percent to 5.5 percent, butmost responses were clustered closeto today’s rate level.

l Question #2 wanted to know howmuch residential origination vol-ume they expected this year. Thegroup average, which is not weight-ed by volume in any of the answerscited herein, is $1.1 trillion. Theresponse range was from $850 bil-lion to $1.4 trillion.

l Question #3 asked how much theirfirm’s production was down year-to-date, compared to the same periodlast year. The response range wasfrom no decline to down 80 percent,with the average down 37 percent.

l Question #4 wanted to knowwhether their firm’s volume in 2014would be up, down or sideways. Ofthe 25 answering the question, 18said down, two said up, and fiveexpect no change from last year.

l Since the new qualifiedmortgage/ability-to repay (QM/ATR)regulations now rule, those sur-veyed were asked in Question #5what portion of their walk-in busi-ness was non-QM eligible. All of theresponses were single-digit num-bers, many were under two percentand the average was four percent.

l Question #6 wondered how muchrefinance business they were nowdoing. On average, about half of thegroup’s production was refinancedloans. The range was from 15 per-cent to 60 percent, exclusive of thehomebuilder and realtor-ownedfirms.

l Question #7 inquired about thefirm’s FHA volume and whether it

Top Mortgage Executives

Sound Offon the State of the Industry

Results in from MBA Conference Survey Report & Scorecard

B Y T O M L A M A L F A

31

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

continued on page 38

had withered since 2013’sConference. Yes it had, reported 22of the 25 respondents.

l What portion of the firm’s conven-tion production was of loans withLTVs exceeding 80 percent was thesubject of Question #8. The answerwas precisely one-third, with aresponse range of five percent to 70percent.

l Question #9 asked how much oftheir firm’s activity involved jumboand adjustable-rate mortgage (ARM)products. The range was from zeroto 40 percent, with an average of 13percent.

l Is your firm putting ARMs andjumbo into portfolio, askedQuestion #10? The response wasthat eight were doing so while 17were not.

l Question #11 wanted to know iftheir firms were doing more, less orthe same amount of high-DTI lend-ing this year as last. Four of thosesurveyed were doing more, while 10were doing less and 12 reported nochange.

l Were their firms doing more low-FICO lending this year, askedQuestion #12, or was it less or thesame as last year? Here, 10 weredoing more, four were doing lessand 12 recognized no meaningfulchange year-over-year.

l Question #13 wanted to know iftheir FHA market share wouldincrease, decrease or remain thesame in 2014. Eleven of 24 said itwould decrease, eight expect theirFHA share to be flat and five expectit to increase.

l Question #14, which is set against abackdrop of efforts to expand theFHA credit box, questioned whetherdoing so is a good idea. No, said 18,versus eight who felt otherwise.

l Question #15 inquired as towhether the respondents thoughtthat market participants would goalong with any loosening of creditstandards. Yes they would go alongwith loosening reported 18 execs,compared to eight who disagreed.

l Recently, Carrington Mortgageannounced that it was writing FHAsto a 550 FICO score. Question #16wondered how many execs saw thisas a financially sound idea. Onerespondent did, but 25 others dis-agreed.

l Questions #17 and #18 dealt withBasel III and the new internationalcapital framework that is coming.By a count of 17 to nine, respon-dents thought that its enactmentwouldn’t adversely affect theirfirms’ mortgage strategies in thenext five years, and by a 15 to 10count didn’t think that Basel wouldlimit their options for selling servic-ing.

l Are appraised values still a majorconcern, asked Question #19? Theyaren’t a major concern replied 18 of26.

l Questions #20 and #21 askedabout house prices, specifically if

they’d increase again this year, andby how much. The response rangewas from two percent to 12 percent,with a group average of up five per-cent in 2014.

l Question #22 asked by how mucheach expected the mortgage indus-try to shrink in size, both in numbersof operating firms and in the size ofthe workforce. The average was 14percent smaller, but only threerespondents thought the shrinkagewould be under 10 percent.

l With the government prodding andthe mortgage insurance (MI) indus-try well capitalized and aggressive,Question #23 wanted to know if theexecs planned to do more or lesshigh-LTV lending this year. They will

do more, said 12 execs, compared toone whose firm will be doing less.However, the majority, 13, will orig-inate more or less the same amountthis year as last.

l The mortgage insurance companieshave all introduced new MasterPolicies. Question #24 asked if theywere an improvement. In one of thevery few queries to capture a unani-mous vote, 23 of the 23 who feltthey could answer the question said,yes, they’re an improvement.

l After being devastated in the finan-cial crisis, mortgage brokers havemade a modest comeback over thepast two years. Will they grow theirmarket share over the next severalyears, asked Question #25? In the

survey’s only tie, 13 respondentstook each side of the question.

l Questions #26 and #27 inquiredabout profitability at their firms. Ofthe 24 who responded, only oneindicated that profits were higherthis year than last. And by howmuch were they down? They are offby an average of 7.4 on the less-to-more scale of 1-10. The range wasfrom 4-9 on the 10-point scale.

l Questions #28 through #31 want-ed to know about mortgage servic-ing rights (MSRs): Retaining versusselling them; who was buying them;whether current MSR prices wereattractive; and at what multiples

By Dave Hershman

There were plentyof fireworks dur-ing the July 4thweekend but the

day before the holiday started, thegovernment provided their own fire-works with the release of a strongjobs report for the month of June.Most analysts were expecting adecent gain in jobs at just over200,000 and for the unemploymentto remain steady at 6.3 percent. The

numbers were stronger than expect-ed, especially when considering thefact that the previous months of jobsgains were revised upwards.

In June, the economy added288,000 jobs which is robust by any-one’s standards. The unemploymentrate dipped to 6.1 percent and thedecrease cannot be attributed to peo-ple leaving the workforce as the laborparticipation rate stayed steady.Though these numbers are subject torevision in later months, the fact thatADP released a similar number for

private payroll growth the day beforejust confirmed the fact that the jobmarket is indeed heating up. Whatdoes that mean?

This is just what the doctor orderedfor the economy. More jobs shouldtranslate into higher levels of con-sumer spending and especially spend-ing on big ticket items such as cars,furniture and houses. A strongerhousing market and automobileindustry should create more jobs andthe virtuous cycle will be created.

The strong employment data were

all that was needed for the stock mar-ket to continue its assault on therecord books. Both the Dow and theS&P hit record territory with the Dowcrossing the 17,000 mark after therelease of the report on July 3.Meanwhile, the S&P inched closer tothe 2,000 threshold. The good newswas accompanied by a bump in long-term interest rates, which was notunexpected.

If job creation continues at thispace, we should expect a pickup ininterest rates in response. On the pos-itive side of the ledger, the growth inhome prices which has slowed some-what should continue. We know wehave said this before—the combina-tion of low rates and low housingprices will not last forever. While thestock market has been strong, rateshave remained low. However, thisnews might just be the beginning ofthe end of the nation’s sale onmoney. There are always risks such asnatural disasters and world conflicts.The hurricane season has started, andIraq and Ukraine have been focalpoints. But if another disaster such asthe cold, hard winter of 2013-2014does not hit, the jobs market couldcontinue to lead the way in 2014.

Dave Hershman is a top author in themortgage industry with seven bookspublished. He is also the founder of theOriginationPro Marketing System, andcurrently the director of branch sup-port for McLean Mortgage. He may bereached by e-mail at dave@hershman-group.com or visit www.origination-pro.com.JU

LY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

economic commentaryN A T I O N A L M O R T G A G E P R O F E S S I O N A L M A G A Z I N E ’ S

T H E M I D - Y E A R E M P L O Y M E N T U P D A T E

We have them! Do you?Because we bond thousands of mort-

gage companies across the countrywe use our buying power andleveraged competition among

multiple surety companies to offerunderwriting parameters andlower rates that other bond

agencies only wish they had.

Don’t wait for your bond’s expiration.

Trade in your overpriced bond fora new bond – And start savingmoney today!

33

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

© StreetLinks, LLC

By Andrew Liput

The mortgage closing transaction is the single largestfinancial transaction in the lives of most consumers,and it is also the riskiest stage of the mortgageprocess for lenders. While the vast majority of

lawyers and notaries and title agents are experienced, ethicaland diligent professionals, for a few the role of closing agent istoo tempting a lure for selfish criminal intent. This monthly col-umn addresses the good, the bad and the ugly …

Top industry news … housing market is still flatHopes for improvement in home sales to rev up the mortgagemarket have not materialized, as inventory remains scarce acrossthe country. In addition, after posting strong growth in April,housing starts fell in May. With the exception of the South, whereland is more readily available at affordable prices, every regionsaw a decline in homebuilding. The multifamily market is also inthe dumps according to reported figures. Many lenders saw anincrease in closed loan volume in March and April and saw a sil-ver lining, but now it is creeping back down. This see-sawingeffect is causing havoc in operations as management cannotdecide whether to lay off employees or hire new ones. Add to thisthe sharply rising cost of compliance and quality control (QC)platform maintenance, and the effect is continued consolidationand strategic alliances to share costs and gain capital for growth.

You can’t make this stuff up!l In Kansas, the senior vice president of a bank pleaded guilty

to conspiring to make false statements on a loan applicationfor an $850,000 mortgage. He pleaded guilty to one count ofconspiracy to make false statements on a loan applicationand will be sentenced this month. What’s that saying about awolf guarding the hen house?

l An Alabama lawyer was sentenced to five years and 11months in prison for his role in an investment fraud schemethrough which he submitted a fraudulent $908,000 loanapplication and took more than $2.8 million from 12investors spending the funds on a lavish home, private jets,championship football trips and island vacations. Living thehigh life can get expensive, so what’s a lawyer to do?

l A Colorado attorney has been sentenced for stealing in excessof $300,000 from his law firm’s clients by pilfering the firm’strust account. He transferred the funds to his personal check-ing account with his wife and used the money for personalexpenses. Lawyers never commit fraud do they?

l A California title company employee pleaded guilty to threecounts of wire fraud in connection with a mortgage fraudscheme. The defendant admitted that he had prepared fraud-ulent HUD-1 Settlement Statements, which not only falsifiedthe purchase prices, but the true source of downpayments.Those pesky HUD-1s are so darn confusing.

Regulatory updates …Fair lending and equal opportunities for women-owned andminority-owned vendor firms appear to be the two hot topicareas for regulators these days. Many lenders are reporting veryaggressive fair lending audits by state regulators and the focusappears to be orchestrated by the Consumer Financial ProtectionBureau (CFPB) in Washington, D.C. Issues regarding loan deci-sions, origination practices, marketing and advertising tactics,and employee training in the area of bias and discriminationhave been at the forefront of audit questions. The MortgageBankers Association (MBA), anticipating movement in the area ofequal opportunity vendor opportunities, has created a task forceto study the issue and eventually issue a report on how banksand lenders can ensure that they are not discriminating when

T A L E S F R O M T H E C L O S I N G T A B L E

35

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

800.362.2599sales@calyxsoftware.comwww.calyxsoftware.com

Count on CalyxCompliant • Efficient • Reliable • Affordable

For more than 20 years, the preferred loan

origination platform

withQM

(A-t-R)A-t-R)((AQMwith

oC lyxan Ct oun lyx

e phtor moF

t • EnalipmoC

n ad loerereffere pen 20 yahe tro

e • Albaliet • Rneciffit • E

lyx

n s, rae

elbadroffffoe • A

inigroe p

roffotaln piotaine p

mr

wwwsales@calyxsoftware.com

.calyxsoftware.comwsales@calyxsoftware.com

800.362.2599

choosing third-party service providers.

On the lighter side …The mortgage loan originator had apuzzled expression on her face as shelooked at the elderly looking gentle-man sitting in front of her and notedthat his driver’s license indicated hewas not all that old. As she stared athim in disbelief, he suddenly said,“Look at me. I’m old and worn out.You’d never believe that I used to livethe life of Riley. I wintered on theRiviera, had a boat, four fine cars,dated the most beautiful women,bought tailored clothes and ate in all

the best restaurants around the world.”The MLO asked, “What happened?”

The man answered, “One day Rileyreported his credit cards missing!”

Andrew Liput has been a corporate, realestate and banking attorney for morethan 25 years. He is the founder, chiefexecutive officer and president of SecureSettlements Inc., the first data intelli-gence and risk analytics firm to offer spe-cialized vendor management servicesaddressing settlement agent risk to mort-gage lenders and banks nationwide. Hecan be reached by e-mail ataliput@securesettlements.com.

Valuation Expo Brings Three Days of Educationand Networking to Vegas

Mark Linné , MAI, SRA, CRE, CAE, CDEI, FRICS CEO and chief analytics officer for ValueScapeAnalytics Inc.; Bill King, SVP of valuation solutions for Platinum Data Solutions; John Brenan,director of research and technical issues for Appraisal Foundation; Brian L. Trotier, EVP andchief operating officer for NDC (moderator); and Ken DeFeo, vice president of residentialappraisal services for Union Bank during the Alternative Valuations Session at the 2014Valuation Expo in Las Vegas

By Erik Wind

It’s never easy to decide to stop your day-to-day work for a few daysand inconvenience yourself by traveling across the country to attendan industry conference. But those very decisions that can make thedifference between continuing with your day-to-day, or having an

opportunity to look into the future and see how the industry is changing—before it can change you. That’s what happened recently in Las Vegas at the2014 Valuation Expo, as hundreds of appraisers from across the country madethat decision.

Unlike other real estate sectors, there are not many national conferencesspecifically for the appraisal industry. This can be advantageous, since theValuation Expo offers the opportunity to listen to and meet dozens of thoughtleaders from major lending institutions, appraisal management companies(AMCs), software/data companies and government agencies, all under the sameroof.

In addition to the opportunity to connect with key reps from the appraisalindustry, the Expo featured important relevant topics, such as alternative valua-tions (AVMs, appraiser-assisted AVMs, BPOs and others), and how the appraisalbusiness is moving from forms and data collecting, and more into data analysisand interpretation.

On top of all of this, attendees had the chance to earn up to 21 hours of CE cred-its. Where else would you rather get your CE than in Las Vegas? The Valuation Expois organized and presented each year by the Alterra Group. If you are a real estateappraiser, you should strongly consider the Valuation Expo in 2015.

Erik Wind is a special correspondent for National Mortgage Professional Magazine.He may be reached by phone at (516) 663-0790.

36

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

By Phil Hall

Take a casual glancethrough the real estate-related articles in the cur-rent mainstream media

and you will find a surplus amount ofheadlines that pose a challenge: Shouldpeople buy a home or should they optto rent? If you put your faith in themainstream media, the renting-versus-buying question could be as complex asa Zen Koan.

For Tom Ward, however, the mediais not only asking the wrong question,but it is giving out information that isfull of errors.

“I’m a Baby Boomer,” said Ward,founder and CEO of Path2Buy LLC,based in Vernon Hills, Ill. “I can remem-ber in the film ‘All the President’s Men’when they couldn’t publish an itemunless they had a second source. Today,however, everybody is an expert—youcan put out a YouTube video and beconsidered an expert. The problem isthat nobody is verifying what is beingput out.”

John Walsh, president of Milford,Conn.-based Total Mortgage Services,agreed with Ward’s concerns.

“I think that the media industry hasblown up how tough the mortgageindustry is, which scared a lot of people

off,” said Walsh. “People become fright-ened and think, ‘Oh, forget that mort-gage stuff … I’ll rent for a while.’”

At face value, the arguments in favorof renting are not supported by num-bers. According to data released byTrulia, homeownership was less expen-sive than renting on both a nationalscale and in all of the 100 largest met-ropolitan areas. Granted, the gapbetween buying and renting variedbetween markets—homeownershipwas five percent cheaper than rentingin Honolulu and 66 percent cheaperthan renting in Detroit—but, ultimate-ly, there is no statistical evidence tosupport renting as being more finan-

cially prudent than homebuying.Logan Mohtashami, Irvine, Calif.-

based senior loan manager at AMCLending Group and a financial bloggerat LoganMohtashami.com, acknowl-edged that while the current environ-ment might encourage renters to crossover into homeownership, the questionof economic feasibility is still a stum-bling block for many people.

“The entry to buy a house is low forfirst time homebuyers,” Mohtashamisaid. “Rates are low, downpaymentsrequirements are low—some programshave 0.5 percent for downpayment.There are plenty of loans to be given.But in this economic cycle, it is not easy

Renting or Buying?Oh, Come On, You Know the Right Answer!

10 Cities Where Buying Is a Good Bet

# U.S. Metro How Much Cheaper is Buying Than Renting?

1 Detroit, MI 66%

2 Gary, IN 61%

3 Birmingham, AL 58%

4 Toldeo, OH 58%

5 Kansas City, MO-KS 58%

6 Cleveland, OH 56%

7 Dayton, OH 56%

8 Memphis, TN-MS-AR 56%

9) Grand Rapids, MI 55%

10 St. Louis, MO-IL 54%

10 Cities Where Buying Is a Close Call

# U.S. Metro How Much Cheaper is Buying Than Renting?

1 Honolulu, HI 5%

2 San Jose, CA 9%

3 San Francisco, CA 13%

4 Orange County, CA 21%

5 New York, NY-NJ 22%

6 Oakland, CA 24%

7 Los Angeles, CA 24%

8 Ventura County, CA 27%

9 Albany, NY 27%

37

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

MBA COMPLIANCE ESSENTIALSSM

ATR�/�QM in 90 Minutes

Don’t get caught unprepared.

MBAEDUCATION.ORG/QM14020

R�/�QTAAT

n 9M iR�/�Q

0 Mn 9

setuni

t get’noD

ff otag sndinel

oisaccl oareves

o yh dcuw moH

arpernp uthgua c

.elus rihn t

s tsessl aliy weht tahs tno

ifilaut Quobw aonu koo y

dear

norf fe ogdelwone khs t

Fe Ch? Tsegagtrod Meifi

egagtroe mnil-tn

nd oettas saB hPF

liO

udlcn iseruteaF

ntasredny ulluf

r aoe fkta-tusm

R�/�QTAAw ee nhT

t getnoD

:eud

d une atangiiro ow tod h

rwredn, usrecffin oaol llr a

r fesruob Cee WluM RR�/�Q

arpernp uthgua c

td bL

ee nhn tihtie wtirwrednd u

ednee lnil-tnord fns areti

se EcnailpmoA CBm Mor

.dear

.stnemeruiqeM rw Qe

o l tennosrer pe

s a , islaitness

2 (:lesa SpuorG

lesa SlaudivdinI

es a cedulcnI•

etelomp cot

xorpps aekaT•

enlinO•

nda) tsaE8 (682-75) 5202

cele, s2226-39) 7008 (:les

noitelpmof ce otacifitre

s etuni0 my 9letamix

steW (2092-75 5)220 (nd

n 3oitpt oc

ginicr ppuorG•

eecanilompc

gtroy md beL•

)st

elbaliav ag

strepx e

e gag

t y aadot tt ieG

MBAEDUCA00241

.mq//qgro.noaticudeabm

ORG.TIONMBAEDUCA

QM/ORG

for young Americans to buy.”Indeed, economic factors have com-

plicated the process. Dr. Anthony B.Sanders, Distinguished Professor ofFinance in the School of Managementat George Mason University in Fairfax,Va., pointed to the Social SecurityAdministration’s wage statistics for2012, which found the “raw” averagewage was $42,498.21 while the medianwage was $27,519.10. Yet, Sandersadded, the median existing home priceis $201,700, creating a price-to-incomeratio of 7.33 percent.

Sanders also noted that in his mar-ket–the Washington, D.C., area, one ofthe nation’s most expensive housingmarkets–many members of the workforce have to commute from as far asWest Virginia and Pennsylvania becausethey cannot afford to buy local housing.

“We have literally fried the middleclass between damage done by thehousing bubble’s bursting and restric-tive government policies–Obamacaretaxes, EPA mandates, FICA, outsourcingof jobs, etc,” said Dr. Sanders. “Andwith the Fed driving up home priceswith their low rate policies – making itcheaper for investors to borrow andbuy–the middle class is dead in thewater.”

Still, it might appear that too manypeople that are hesitant about buyingare genuinely unaware of what isrequired of them. Ward noted that onmany occasions, loan officers thatparticipate in his company’s coachingprogram find themselves with con-sumers that have been misled byincorrect information relating to thebasic requirements for mortgageapplications.

“Twenty-two percent of the time, theloan officers meet with customers forthe first time and determine that thecustomers had the ability to buy rightthere, but did the customers did notknow it,” Ward said. “They were tryingto save 20 percent for a downpaymentor get their FICO score to 580.”

For many mortgage professionals,the renting-versus-buying challenge iseasily dismissed with proactive anduser-friendly education. A number ofcompanies are using information toolsthat confirm the financial evidencesupporting homeownership.

“We provide our broker clients witha rent-versus-buy grid,” said Mat Ishbia,president and CEO of Troy, Mich.-basedUnited Shore Financial Services. “If arenter has a $1,500 to $2,000 rent pay-ment, our grid shows them for that pay-ment, they can buy a $280,000 house.That’s a big thing–people didn’t realizethat price for rentals are rising and thatit is now more expensive than buying.”

Heidi Frigano, executive vice pres-ident of marketing and businessdevelopment at Levittown, N.Y.-based United Northern MortgageBankers Ltd., created an educationDVD that stressed the importance offinancial counseling to ensure themortgage transaction process is with-out problems.

“We explain that this is not just

about making your next mortgage pay-ment, but also having extra money togo out to a movie or repair somethingthat broke down,” said Frigano.

Frigano stated that her efforts con-centrate on what she called “responsi-ble homeownership” while working toovercome the agitation that some peo-ple might carry.

“If someone can get into a housethey can afford, there should be nofear,” Frigano said. “We stress that peo-ple should buy a house responsibly andnot something they cannot afford.”

Susanne Livingston, co-owner/brokerat San Diego-based ResidentialWholesale Mortgage Inc., often workswith insurance agents to educate the

rental community on the benefits ofhomeownership. She believed that thisconcentrated effort is paying off.

“Most people are at the point ofunderstanding interest rates are at 40-year lows and property values areactually on the rise,” Livingston said.“There is more pressure on people topurchase now if they can. After all,there is nowhere for interest rates togo but up.”

Ishbia observed that much of thetumult resulting from the housing crisisis finally being laid to rest.

“People saw a lot of friends and fam-ily members that owned a $250,000house and could not sell it for$150,000,” Ishbia said. “Now, people

are more comfortable that if they buy ahouse for $150,000, they can sell it infive to six years for $160,000 and not$120,000.”

And Total Mortgage Services’ Walshobserved that despite media machina-tions and economic hiccups, homeown-ership is in no danger of losing itsappeal.

“At the end of the day, people wantto own their own house,” Walsh said. “Ithink that the ultimate goal of home-ownership is still here.”

Phil Hall is managing editor of NationalMortgage Professional Magazine. Hemay be reached by e-mail atphilh@nmpmediacorp.com.

38

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

SPONSORED ED ITORIAL

By Matthew Dunn Ph.D.

Have you noticed that the proportion of visual, infographicand video content is increasing? Visual business content isexploding, but it’s not just more decoration. Visual commu-nication, in graphics and videos, are increasingly put to use

to convey complex ideas of all kinds. I think it’s actually a matter of ne-cessity, forced by increased complexity, information overload and lack oftime.

In 2010, Eric Schmidt of Google noted that we now create as much in-formation in two days as we’d created in total up to the year 2003. Wecan search much of the two-plus million billion gigabytes (zettabytes) ofthat information, but then we spend less than a minute on the averageWeb page. We cannot read everything we should, and apparently we don’treally try, judging from Web visit durations.

This has everything to do with visuals, because as it turns out, weprocess and comprehend visuals far faster than text. According to For-rester:

l People process visuals 60,000 times faster than textl One visual or video frame conveys as much as three pages of textl One minute of video conveys as much information as 1.8 million words

Well-designed visual media can make complex subjects and relation-ships more clear and faster, and often better, than words alone.

From an outsider’s perspective, it’s a bit shocking to see how deeplythe mortgage world swims in details—oceans of numbers, seas of wordsand nothing firmer than archaic Excel charts in sight.

I’d suggest thinking of your design department and media vendorsmore strategically (it worked for Apple). If that infographic or video seemsexpensive, think in terms of a 60,000-times return on attention. Your cus-tomers and employees don’t have more time … the more meaning in aminute the better.

Matthew Dunn Ph.D. is CEO of Fast Forward Stories, a video content servicefor the mortgage and real estate industries. He may be reached by phone at(888) 618-9088 or e-mail matthew@fastforwardstories.com.

Mortgage Visuals: It’s About Time

�

VIDEO CONTENT SERVICE

they found selling and or buyingthem attractive. First, servicing willbe retained by 13, sold by seven,and another four will be both buyersand sellers of MSRs this year. Elevenrespondents are currently purchas-ing MSRs, but 14 others aren’t.Concerning prices, 19 of 23 said thatcurrent prices are attractive.Multiples of at least 3.5-times theservicing fee is the bottom end ofthe attractive range, according tothose surveyed.

l Question #32 asked if the execs’firms were doing more mandatorybusiness this year than last. Yes said15, while seven said no and fourothers reported no change in theirmandatory business.

l Questions #33 and #34 addressedagency buyback demands, howthey’ve changed since last October’sMBA Annual Convention, and howlarge a problem this issue is today.Sixteen execs said that repurchasedemands were down, compared tofour who reported an increase, andfive who acknowledge no change. Asto how large a problem it is, theaverage score was 3.2 on a 10-pointscale. The range of answers was onethrough nine. To those who havenot reviewed one of these reportsbefore, this is the lowest everrecorded and compares to averagescores of eight plus in recent years.

l Are consumer attitudes towardhomeownership different todaythan before 2008, asked Question#35? They‘re absolutely differenttoday, said 25 of the 26 respondentsanswering the query.

l Question #36 wondered if the execsfelt that efforts to modify loans havein any way hurt the mortgage mar-ket. Fourteen replied that thoseefforts haven’t hurt the market, but11 others saw it differently.

l Question #37 wanted to know if theunderwriting and documentationrequirements of the GSEs were toostringent. Underwriting isn’t tootight said 15, but 11 others said theywere too tight.

l As for overly strict doc requirements,Question #38 showed 18 of the 25respondents agreed they were tootough on mortgagors.

l The same question was asked aboutunderwriting standards at the FHAin Question #39. Here, 18 of thosesurveyed indicated they weren’t tootight, compared to eight who dis-agreed.

l Question #40 asked it the GSEs’loan limits should gradually berolled back. No reported 17 com-pared to seven who thought theyshould be lowered.

l Question #41 wanted to know howone-sided their dealings were withFannie Mae. On the 1-10 scale, thegroup’s average was a 7.3. Twenty

gave it a six or higher, compared toone who ranked it below a five.

l The Johnson-Crapo Bill on housingfinance reform was the subject ofQuestions #42 and #43. Respon-dents were queried about its passageeither this year or next. In a secondunanimous vote, those surveyed saidnot in 2014, and only two of 23thought passage more likely in 2015.

l At what level of production capacityis your firm operating, Question#44 inquired? The range of answerswas from 60-100 percent, with anaverage operating capacity of 79percent. Only three said they wereoperating at 100 percent, comparedto nine who reported a rate under80 percent.

l Question #45 asked if the firmsdealt with one or another mortgagecooperative. Sixteen execs providedan affirmative compared to 10 whodid not belong to one or another.Private securitizations are off to aslow start this year.

l Question #46 wondered if theythought the pace would pick up inthe months ahead. Activity willincrease said 15, while 10 othersremain skeptical of an accelerationof private issuance.

l In Question #47, respondents wereasked if they thought an expansionof the Home Affordable RefinanceProgram (HARP) would provide eco-nomic and societal benefits. No said14, but the vote was close, as anoth-er 11 thought such an initiativewould be beneficial.

l Compliance was the focus ofQuestions #48 though #51. Sinceenactment of the Dodd-Frank Act,those surveyed said that compliancecosts have increased by an averageof 250 percent. The range was from25 percent to 350 percent. Theyadded that, on average, compliancenow consumes 21 percent of operat-ing costs; compliance has increasedorigination expenses to the borrow-er by 35 percent; and in dollarterms, compliance has added anaverage of $939 to the cost of amortgage loan.

l Questions #52 through #53 want-ed to know if those polled thoughtthe recovery in housing was losingmomentum, and if yes, how muchforward momentum was the mar-ket faltering. Yes said 21 respon-dents to a loss of steam, while fourothers begged to differ. As for howmuch, the question racked up a 5.1on the one to 10 point scale. Therange of responses was from two toseven.

l Questions #54 through #63inquired about regulators and reg-ulations. More specifically,Question 54 asked if it was possible

top mortgage executives sound offcontinued from page 31

continued on page 44

39

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

Addressing the needs of banks and mortgage lenders for better closing agent fraud protection

Why be exposed to losses from closing agent fraud and negligence? Attorneys andother professionals who handle residential mortgage transactions are not covered forall losses by a CPL, but NOW there is an option. Real insurance, designed for you, tomeet your needs.

Working in conjunction with Secure Settlements Inc.(SSI), the leader in counterparty risk management solu-tions, certain syndicates of Lloyd’s of London® are now

offering an affordable insurance program on SSI Low Risk Agents. Lenders must besubscribers to the SSI ClosingGuard™ program to qualify for the insurance.

Visit www.securesettlements.com

l Covers You & Borrowerl Covers Investors & WH Banksl Covers Fraudl Covers Theftl Covers Willful Blindnessl Covers Manipulationl Covers Failure to Recordl Covers Document Errorsl Covers Collusionl Covers Loss Mit/Repurchase Costsl Costs Less Than $50.00**Available in most states; call for exact price by state

Please call for more information:GRACECHURCH INTERMEDIARIES LLCP.O. Box 2908, New Britain, CT 06050-9998

Phone: 888-502-1331Roland Pike, Managerroland.pike@gracechurchintermediaries.comNY DFS License No.: BR-1181384

40

JULY

20

14

nP

ennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

41

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

42

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

By Jonathan Foxx

First they came for thepayday lenders, and I didnot speak out—Because I was not a pay-day lender.

Then they came for the auto financecompanies, and I did not speak out—Because I was not an auto finance com-pany.Then they came for the banks, and I didnot speak out—Because I was not a bank.Then they came for me—and there wasno one left to speak for me.1

On July 18, 2014 a new Rule goesinto effect, promulgated by theConsumer Financial Protection Bureau(CFPB). The Rule will be effectuated inaccordance with a notice published inthe Federal Register on June 18, 2014,2

which announced that the Bureau hadadopted its interim final rule on theTemporary Cease-and-Desist Order(TCDO) without change. Under the Rule,the CFPB will be empowered to issueTCDOs, pursuant to Section 1053(c) ofthe Dodd-Frank Act (“Dodd-Frank”).3

The provision authorizes a TCDO in aCease-and-Desist proceeding broughtunder Section 10534 against a coveredperson or service provider.5 Let’s beclear: A TCDO becomes effective uponservice on the regulated entity, its exec-utive officer, director or an entity-affili-ated party, and unless set aside, limitedor suspended by a court in proceedings(viz., judicial review), it remains ineffect and enforceable, pending thecompletion of the proceedings or untilthe Bureau dismisses the charges speci-fied in the notice or until superseded byanother Cease-and Desist Order.

For the most part, the TCDO is issuedwhere the Bureau believes that circum-stances may cause insolvency or signifi-cant dissipation of assets or earnings ofthe subject entity, or is likely to weakenthe condition of that entity prior to the

completion of the proceedings.Additionally, it is issued where theBureau requires a regulated entity orentity-affiliated party to cease anddesist from any violation or practicestated in a notice of charges. The TCDOmay require that the regulated entity orentity-affiliated party take affirmativeaction to prevent or remedy any antici-pated insolvency, dissipation, condi-tion, or prejudice pending completionof proceedings.

As to the judicial review component,a regulated entity, executive officer,director or entity-affiliated party thathas been served with a TCDO may applyto the United States District Court inwhich the residence or principal officeor place of business of the entity islocated, or the United States DistrictCourt for the District of Columbia, foran injunction setting aside, limiting, orsuspending the enforcement, opera-tion, or effectiveness of such order,within 10 calendar days after such serv-ice or the judicial review will be auto-matically be waived. The injunction,therefore, may set aside, limit, or sus-pend the enforcement, operation, oreffectiveness of the TCDO pending thecompletion of the administrative pro-ceedings pursuant to the notice ofcharges served upon the entity, execu-tive officer, director, or entity-affiliatedparty. Jurisdiction is given to the courtto issue such injunction.6 However, ifthe matter is litigated, the court’spurview occurs after proceedings areconcluded in the Bureau’s administra-tive hearing, which is held before ahearing examiner, with discovery andrules of evidence that are subject to theBureau’s permission, and with a right ofappeal therefrom only to the Bureau’sDirector. This means that, in such cir-cumstances, it is only after the Directorissues the final decision that a judicialreview may be undertaken.

The Bureau has had the authority toissue cease and desist orders to coveredpersons. A covered person may appeal a

cease and desist order with the Bureauand in federal appellate court. But,where the violation is likely to cause thecovered entity to be insolvent or other-wise prejudice the interests of con-sumers before the completion of acease and desist proceeding, theBureau will be authorized to issue exparte TCDOs.7 These TCDOs can beappealed in federal district court, andthey are appealed on an expedited timeframe.8 The ex parte issuance of a TCDOis a critical feature of this authority,insofar as ex parte means the legal mat-ter is brought by one person in theabsence of and without representationor notification of other parties. In otherwords, it invokes a judicial proceeding,hearing or order granted on the requestof and for the benefit of only one party.

Under the Fifth Amendment to theU.S. Constitution, “No person shall …be deprived of life, liberty or property,without due process of law.” A bedrockfeature of due process is fair notice toparties who may be affected by legalproceedings. Though ex parte wouldappear to violate the Constitution, theoperative justification of ex parte is thatissuing it is based on the propositionthat irreparable harm to one or more ofthe parties would happen if it were notissued. The Bureau’s position would bethat its ex parte TCDO would be usuallyreserved for urgent matters whererequiring notice would, among otherthings, subject the consumer toirreparable harm. Ex parte matters areconsidered to be urgent in nature andare usually temporary orders (like arestraining order or temporary custody)pending a formal hearing or an emer-gency request for a continuance.9

Permit me to translate the foregoing:The Bureau is now being empowered toshut down businesses, unilaterally, onthe basis of an allegation, at any time itwishes to do so, by issuing a TCDO. Putplainly, this procedure could force acovered entity to close operationsentirely until permission is granted to

re-commence operations pursuant toan administrative hearing or the hold-ing of a judicial review or the Bureau’sDirector lifting the TCDO. It is unlikelythat many covered entities have theways and means to resist this TCDOthrough litigation. So the power to issuethe TCDO, in this instance, could beviewed as the power to destroy.10

Specifically, Section 1053(c)(3) ofDodd-Frank authorizes the issuance ofa TCDO, where facts pertain to theBureau’s findings. In this procedure,the books and records of the coveredentity are presumably deficient in away that prevents the Bureau fromdetermining the financial condition ofthe entity. Or, the findings of theBureau are sufficiently substantive thatit seeks to prevent transactions thatmaterially affect an entity’s financialcondition. When the Bureau hasreached this conclusion, the TCDO man-dates that the entity cease and desistfrom any alleged activity or practice tocause the deficiencies of the books andrecords. Since the activity and practiceare the process by which the deficien-cies are allegedly caused, the entity isput into the position of shutting itselfdown, until such time as the causes ofthe deficiencies have been remedied tothe satisfaction of the Bureau, unlessotherwise adjudicated.

In the Interim Final Rule, the Bureauclaimed that “The Rules themselves donot impose significant costs upon cov-ered persons, but, consistent with sec-tion 1053, provide a straightforwardand efficient process for the issuance ofa temporary cease-and-desist order,and a direct route to judicial review.”11

This statement surely confutes thefinancial burden imposed on coveredentities that must respond to the TCDOby shutting down their operations. TheBureau further claims that “The Ruleshave no unique impact on insureddepository institutions or insured creditunions with $10 billion or less in assetsdescribed in section 1026(a) of the

First TheyCame forthe PaydayLenders

43

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

Dodd-Frank Act, nor do they have aunique impact on rural consumers.”12

Most non-banks in the United Statesmight disagree with the “no uniqueimpact” effect on their operations, if andwhen they receive a TCDO issued by theBureau–and, surely, small depositoryinstitutions and credit unions wouldprobably find the added burden ofadministrative and litigation expenses tobe quite concerning. The Bureau’sresponse to the burden of these costs isthe following: “The manner and extentto which these provisions apply to arulemaking of this kind, which establish-es Bureau procedures and imposes nostandards of conduct, is unclear.”13

The TCDO is accompanied by a noticeof charges that must describe the basisfor its issuance, including the allegedviolations and the harm that is likely toresult without the issuance of an order,and the act or acts the entity is to take orrefrain from taking. Since the TCDO iseffective and enforceable upon service,the effect on the entity is immediate,pervasive, and possibly devastating.

There are only two ways to respond tothe TCDO: (1) the entity must prove tothe Bureau that it has ceased any activi-ty or practice which gave rise, whether inwhole or in part, to the incomplete orinaccurate state of the books orrecords;14 or, (2) the entity must conductaffirmative action to restore such booksor records to a complete and accuratestate, until the completion of the adju-dication proceeding.

The Bureau’s TCDO wields enormouspower. It may be the power to protectthe consumer and remedy loan origina-tion operations that are not in compli-ance with the applicable law, or it maybe the power to destroy the loan origi-nation operations. Hopefully, it will beused sparingly and with considerableevidence in support of that use. TheRoman poet Juvenal wrote in his Satires,“Quis custodiet ipsos custodies”, whichliterally means “Who will guard theguards themselves?” Perhaps all coveredentities should realize fully that eachand every covered entity, whatever itsfinancial purpose, must stand guardover the guards themselves and sharethe responsibility to ensure that boththe consumer and the service providerare adequately protected.

Jonathan Foxx is president and manag-ing director of Lenders ComplianceGroup and Brokers Compliance Group,mortgage risk management firms devot-ed to providing regulatory complianceadvice and counsel to the mortgageindustry. He may be contacted at (516)442-3456, by e-mail at jfoxx@lender-scompliancegroup.com, or visitwww.LendersComplianceGroup.com orwww.BrokersComplianceGroup.com.

Footnotes1-“First they came for the Socialists, and I did notspeak out—Because I was not a Socialist.Then they came for the Trade Unionists, and I didnot speak out—Because I was not a Trade Unionist.Then they came for the Jews, and I did not speakout—

Because I was not a Jew.Then they came for me—and there was no oneleft to speak for me.”Note that this is the actual poem, written byMartin Niemöller (1892–1984), who wrote aboutthe cowardice of German intellectuals followingthe Nazis’ rise to power and the subsequent purg-ing of their chosen targets, group after group(Source: Wikipedia).

2-Federal Register, Vol. 79, No. 117, Wednesday,June 18, 2014, Rules and Regulation, pp. 34622-34623.

3-Dodd-Frank Wall Street Reform and ConsumerProtection Act of 2010 (Dodd-Frank Act).

4-On June 29, 2012, the Bureau published thefinal Rules of Practice for AdjudicationProceedings. That final rule, however, does notapply to the issuance of a temporary cease-and-desist order (TCDO) pursuant to section 1053(c) ofthe Dodd-Frank Act.

5-Rules and Regulations, Federal Register, Vol.78, No. 187, Thursday, September 26, 2013, pp59163-59165. Rules of Practice for Issuance ofTemporary Cease-and-Desist Orders (Rules),which govern the issuance of orders pursuant tosection 1053(c) of the Dodd-Frank Act, 12 U.S.C.5563(c). See also 77 FR 39058, 39060 (June 29,2012).

6-Section 1053(c)(2) of the Dodd-Frank Act (12U.S.C. 5563(c)(2)).

7-Ex parte, which in Latin means “for one party,”may also describe contact with a person repre-sented by an attorney, outside the presence of theattorney.

8-Special Report, A Working Summary of theConsumer Financial Protection Act of 2010 (Title Xof the Dodd-Frank Wall Street Reform andConsumer Protection Act), Hackett, Esq., RichardP. and Frank H. Bishop Jr., Esq., page 5.

9-Source: Legal Dictionary, Law.com.

10-A similar power to destroy is the taxing power;appeals are possible, litigation is possible, but aperson or entity usually does not have the finan-cial means to pursue its own rights under the law,by means of such appeals and litigation.

11-Op. cit. 5.

12-Ibid.

13-Op. cit. 5, Footnote 6.

14-Op. cit. 5, § 1081.502(b)(2) Judicial review,duration: “With respect to a temporary cease-and-desist order issued pursuant to 1081.501(b)only, the Bureau determines by examination orotherwise that the books and records are accurateand reflect the financial condition of the respon-dent, and the Director or his or her designeeissues an order terminating, limiting, or suspend-ing the temporary cease-and-desist order.”

44

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

SPONSORED ED ITORIAL

By Rene Rodriguez

As a consultant, over the last 15 years I have consistently seensalespeople make these mistakes to hurt their business.

1. Using marketing as a cop-out to sellingMarketing and selling are both absolutely necessary to build a

successful business, but very different. Struggling salespeople tend to prefermarketing because of the simple fact that it reduces the amount of rejectionthey need to face. Marketing, in its simplest explanation, attracts prospectsto call us, while selling forces us to find people to call on and to risk rejectionon a daily basis.

2. A lack of defined job descriptionsAsk 100 salespeople what their job is, and I would bet that all 100 would saysomething like “to close deals” or “to help my clients.” The challenge withseeing the job as “selling homes” is that getting a client into or out of a homeis a “result,” but not a “job.”

3. Confusing activity with productivity (results)This is a result of bullet point number two. If people don’t know what theirjob truly is, then they are no different than a feather in the wind, blowing inwhatever direction the “winds of opportunity” decide to blow.

4. No structured, sequenced sales systemNot having a predefined, step-by-step process to take prospects from initialmeeting to close, salespeople can find themselves wasting only their time,but even worse, their clients’ time.

5. No “canned” presentation of valueI have seen many people go into sales calls without a prepared presentation,resulting in saying something different at every sales call. Every successfulsalesperson you know has perfected their scripting and presentation. And thetrue “sales professional” can deliver their presentation on a napkin just as ef-fectively as using a PowerPoint presentation.

6. No training in the fundamentals of sellingThis was the first thing I noticed years ago. In many industries, either becauseof a very favorable market or because of a great marketing department, therewas no great need for sales skills. Business was so abundant that anyone couldmake a great income. This reality is amplified during every refi boom.

7. Ashamed to be identified as salespeoplePeople who are ashamed to be salespeople don’t engage in the habits of suc-cessful salespeople such as closing, driving commitment, countering objec-tions, prospecting, etc. Our industry, unfortunately, is full of “order takers”NOT “sales professionals.” An “order taker” is someone who “facilitates a trans-action that would have happened anyway.”

8. They ignore their online reputationAs powerful as referrals are, they are no match against a negative online review.Eighty-five percent of people check online reviews before making a purchase.Make sure you take control of your online reputation, before someone else does!

BetterLoanOfficers.com is the easiest and most robust review managementsystem that is solely dedicated to the mortgage industry. Get your account today!

Rene Rodriguez is founder and CEO of BetterLoanOfficers.com, a powerful andeasy-to-use online loan officer review management system. Loan officers cancollect, manage and promote their reviews in order to build trust, secure morereferral relationships and close more deals. He has been named to NationalMortgage Professional Magazine’s “40 Under 40 Most Influential Mortgage Pro-fessionals” for five consecutive years.

�The Eight Biggest MistakesSalespeople Make

Online Reputation& Influence

to comply with disparate impactrules and not originate too manyweak and risky loans. No we can-not, replied 16 of those surveyed,as another nine stated that youcould “if you were prudent.”

l Question #55 asked if the CFPBhas brought clarity to the loan orig-inator compensation issue. No ithasn’t, said 18 execs, compared tosix who thought it had broughtclarity to the issue.

l As for the qualified mortgage (QM)issue, 16 of 26 respondents indicat-ed in Question #56 that clarity hasbeen provided on the QM issue.

l Question #57 wondered how big achange the new RESPA/TILA inte-grated disclosures are for theindustry. On the 10-point scale, theaverage response elicited a 7.6.Twelve execs ranked it an eight orbetter on the one through 10 scale.

l Questions #58 and #59 asked howdifficult and how expensive it wasto implement QM. The group’saverages were 7.1 and 7.3 respec-tively on the scale of one to 10.Eighteen ranked the difficulty aseven or higher, while 15 rankedthe implementation cost at sevenor better.

l Has QM tightened credit, askedQuestion #60, and by how muchasked Question #61. It has tight-ened access to credit said 18 of 25of those surveyed. As for how muchit has tightened, the average was a5.8 on a 10-point scale. Sevenranked the tightness at five or less.

l Question #62 inquired about theappetites their firms had for non-QM lending. The average responsewas a three out of 10, and 15respondents gave it a three or less.

l Question #63 asked, if the out-come was determined on the basisof a cost-benefit analysis, did theexecs think that consumers bene-fited from the advent of the CFPB.Only one respondent in 25 felt con-sumers benefited from the newregulator when costs were meas-ured against benefits.

l Question #64 wondered if theexecs thought that housing afford-ability was waning. Indeed it is, as20 said it was while only five saidnot.

l Should the world of pre-2008 lend-ing be restored, Question #65asked? One of 24 responses calledfor such a restoration.

l Question #66 asked the executivesto assess Federal Housing FinanceAgency (FHFA) Director Mel Watt’sfirst four months in office.Exclusively on the strength of hispresentation a week prior to con-ducting this survey, he earned a 5.4on the 10-point scale.

l Questions #67 through #69 want-ed to know about the execs andGSE reform, specifically how much

attention were they personallywere paying to the topic and if theyexpected a broad business restruc-turing in the next one year and fiveyear timeframes. The group aver-age was 7.2 on the issue of person-al monitoring of the debate andproposed legislation. A dozenrespondents score the question aneight or more. As for when, cer-tainly not in the next year said 25,but in the longer period, 22 of 26expect a restructuring of the mort-gage industry and business.

l Question #70 wondered abouthow attractive respondentsthought the mortgage bankingbusiness would be in the yearsimmediately ahead. The answer tothe question garnered a 6.3 of 10,with seven ranking it an eight orbetter versus three who graded theanswer a three or less.

l How would they grade Fannie Maeand Freddie Mac on their perform-ances the past year was the goal ofQuestions #71 and #72. Bothearned Cs. And, is your firm losingbusiness to Fannie Mae, askedQuestion #73? Sixteen indicatedthey were not, compared to ninewho indicated they were.

l Question #74 wondered if theexecs were familiar with the term“demographic cliff.” More thanhalf the execs recognized the termto mean the drop in the size of thepost-boomer population.

l And finally, Question #75inquired about the fall electionand which party would have con-trol of the Senate after November.By better than two to one, theRepublicans are expected to winthe Senate.

In summary, 75 questions andanswers from some of the most impor-tant voices in the industry. For now,that’s the most current take on aseries of wide-ranging issues affectinghousing and mortgage finance from afairly representative cross-section ofindustry executives. I want to againthank all of those who participated inthis survey. Their time, wisdom andcandor are much appreciated.

Tom LaMalfa is a 34-year veteran mort-gage-market analyst and researcher. Hehas done pioneering work in the areas ofsecondary markets, wholesale mortgagebanking, mortgage brokerages, financialbenchmarking and GSE reform. Tom con-tinues since 1977 to co-author an old-fashioned mail newsletter, The HolmMortgage Finance Report. In the after-math of the financial crisis, his focus ison Washington, D.C. and the regulatoryburden it is imposing on consumers andlenders. His 21-year old research firm,TSl Consulting, does survey research. Hemay be reached by e-mail at tom.lamal-fa@gmail.com.

top mortgage executives sound offcontinued from page 38

45

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

46

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

By Mike Suits

Reverse mortgages shouldnever be sold! What?Before you start to think Iam one of those anti-

reverse mortgage zealots who believespeople must be protected from theirshadows, please hear me out.

What I am saying is that reversemortgages are beneficial, yet sophisti-cated, financial products that requirecareful evaluation and utilization andshould be properly matched with con-sumers to ensure an appropriate fit.They cannot, much like other sophisti-cated financial products, simply be soldbased on emotion and perceived need.If you are “selling” reverse mortgagesplease find another career—you arenot helping our industry or consumers.

A home is both an asset and a liabil-ity. As we have learned over the pastseveral years, homes are an asset thatcan fall or rise in value. This makes ahome an investment that involves risk.The terms of a home’s financing have a

direct bearing on the level of riskinvolved for each borrower. The bottomline is that all home purchases andmortgages, either forward or reverse,require careful evaluation to ensure thebenefits and the risks are sufficientlyconsidered for each borrower. Thismeans mortgage originators must beconsultants rather than salespeople.

Reverse mortgages are more com-plex than forward mortgages in terms oftheir financial planning impact, as theyoccur at a far more vulnerable period inlife. They are effective tools for financ-ing primarily non-housing relatedneeds. These facts make reverse mort-gage origination worthy of specialattention and care by those workingwith consumers. What should this spe-cial attention and care look like?

No need to reinvent the wheelOriginators of reverse mortgages do notneed to develop a responsible processfor working with customers fromscratch. They need to look no further

than to those professionals that workwith sophisticated financial productsand vulnerable consumers all thetime—Certified Financial Planners(CFPs). The CFP is a highly respectedprofessional designation that requiresextensive education and testing to setapart those who provide counsel toclients regarding comprehensive finan-cial matters. I do not mean to suggestthat reverse mortgage originators musthave the same training and expertise,but rather that we can learn from the“financial planning process” asdescribed by the owner of the CFP®mark, the Certified Financial PlannerBoard of Standards.

The financial planning process isconducted in an orderly progressionand consists of the following stages:

l Setting goalsl Gathering relevant informationl Analyzing datal Making recommendationsl Implementing a planl Monitoring the plan

If your process for working with aprospective reverse mortgage borrowerresembles this—congratulations, youare on the right track! If not, then it isimportant you begin rebuilding yourprocess right away.

Some of the consumers we workwith on a reverse mortgage loan willhave other financial advisors to helpwith many aspects of the financial plan-ning process. Others will not. This lackof guidance from an outside financialplanning professional does not let thereverse mortgage originator off thehook—you are a professional too!According to the National ReverseMortgage Lending Association’s Pledgeto Reverse Mortgage Borrowers, “Your(the borrower’s) best interests are ourprimary consideration.” Only by guid-ing a prospective borrower through acomprehensive educational and deci-sion-making process have we soughtthe borrower’s best interests and metour professional obligations.

As we consider a customer’s bestinterests it is imperative that reversemortgage originators keep two facts inmind:

1. We are not qualified to give financial adviceWe should be experts in the productswe offer and understand the cir-cumstances in which they are mosteffectively utilized. We can help cal-culate costs and benefits, andexplain product provisions. Yet weare not qualified to interpretwhether a reverse mortgage may ormay not be in the customer’s bestinterest. If your customer needsthat type of advice, say so and beprepared to offer a referral.

2. We are not the decision-makerOur job is to educate and make clearall features, requirements, costs andalternatives. The decisions, however,are the customer’s to make. The sig-nificance of a reverse mortgage istoo great to either unburden thecustomer of their obligation to fullyevaluate the decision, or to pressurea customer to make what we believeto be the best decision. From themoment you begin to work with aprospective customer, impress uponthem that you are here to help themmake the right decision for them.

Stop selling reverse mortgages andstart consulting. The result will haveyou well-positioned to be the dominantprovider in your market as the demo-graphic wave propels reverse mortgagelending for the next two decades.

Mike Suits is the Reverse MortgageDivision manager for 360 MortgageGroup LLC. The Reverse MortgageDivision, which is currently licensed forreverse mortgage loans in 35 states andthe District of Columbia, has three pro-duction channels including, a growingretail branch network as well as whole-sale and inside-direct sales channels. Hemay be reached by phone at (512) 418-6011 or e-mail msuits@360mtg.com.

Stop SellingReverse Mortgages:The Need to Becomea True Consultant

47

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

new to marketcontinued from page 18

speed, data integrity, and rule engines toaide in full compliance. In order to con-stantly maintain optimal complianceprocesses, Compliance EAGLE updates willbe automatically applied through thecloud when new regulatory guidelines areintroduced to the mortgage industry.

As a result of the interface implementa-tion, Loan Producer users gain access toCompliance EAGLE’s automated compli-ance rule sets, such as Ability-to-Repay/Qualified Mortgage (ATR/QM), Truthin Lending Act (TILA), Home MortgageDisclosure Act (HMDA), Home Ownershipand Equity Protection Act (HOEPA), RealEstate Settlement Procedures Act (RESPA),Office of Foreign Assets Control (OFAC),Social Security Number (SSN) checks, andmuch more. In addition, QuestSoft statesthat the Compliance EAGLE software alsoverifies and complies with federal, state,local consumer and high cost tests.

“The regulatory environment does notleave room for error, making automatedcompliance a key factor in reducing risk,simplifying the submission process andsuccessfully meeting all necessary federal,state or local regulations,” said LeonardRyan, president of QuestSoft. “The LoanProducer and Compliance EAGLE integra-tion helps alleviate the stress of compli-ance and keeping up with constant regu-latory changes, by providing users pristinedata integrity to comply with the latestregulatory updates, secondary marketguidelines and all applicable laws.”

FICS’ Loan Producer provides end-to-end residential loan origination, docu-ment preparation, processing, tracking,underwriting, closing, funding, secondarymarketing and post-closing automation.As a result, lenders utilizing Loan Producerrealize a significant reduction in errors, aswell as an increase in productivity andincome.

Equifax’s The WorkNumber Now OfferingEmployment and IncomeVerifications

Equifax Inc. has announced thatMeridianLink is now offering employ-ment and income verifications throughThe Work Number for customers using itsMortgage Credit Link Platform (MCL). TheWork Number is a proprietary databaseowned by Equifax Workforce Solutions, abusiness unit of Equifax Inc.

As a centralized, Web-based mortgagecredit reporting system, MCL integratesits customer’s credit systems with theirclient’s loan origination systems, provid-ing the seamless transmission, validationand interpretation of data betweenapplications and organizations. By opti-mizing Equifax Verifications Services’ fullrange of tools, and leveraging The WorkNumber database of more than 241 mil-lion employer-direct payroll records.

“MeridianLink is excited to have this

integration as an enhancement to our cur-rent platform,” said Jason Domazet, busi-ness development manager forMeridianLink. “We continue to strive toprovide our clients integrations that are anefficient means to order products from acentralized platform for our end users.”

NTC Makes PropertyReports Available Online

Nationwide Title Clearing Inc. (NTC) isnow making property reports availablethrough an online system in order to helpthe industry deal with an increasingnumber of title defects.

“Title defects have become a majorcause for concern within the real estatemarket,” said Nationwide Title ClearingCEO John Hillman. “Whether title defectscause wrongful foreclosures, as someclaim, or stagnation of what would other-wise be a smooth transition of assets with-in the secondary market, these problemscost both the industry and homeownersmoney and time.”

The key to reducing the risk of buybackor inability to foreclose lies in accurateproperty records, Hillman said. Ensuringthat the records are accurate requires easyaccess to property reports. NTC has nowcreated a simple, fast, step-by-step processof securing these reports.

NTC obtains data from multiple sourcesduring its process—and most importantly,the counties—and includes automationcoupled with human verification—a prac-tice that has given NTC the ability to suc-cessfully service most of the largest lendersin the U.S. under the most crucial and nowheavily audited compliance regulations.

NTC officials say their process producesaccurate results for what the report wasintended, even recognizing a report’sfinancial impact if a client is ordering toomany fields and additional documentsthat may not be of use to the end user. NTCattributes its success to having a full under-standing of the end result that its clientsneed, and then customizing a propertyreport with the correct data sets included.

“Our property report services are basedon research conducted from actual landrecords and are accessible for any residen-tial property nationwide,” Hillman said.

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 a newprogram, to the attention of:

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

E-mail: newsroom@nmpmediacorp.com

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

48

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

Stated Business Purpose Loanson Residential Properties• Refinances up to 65% LTV, min loan amount

50K to 5 million• Purchases up to 70% min. loan amount

50K to 5 million• Loan term, 6 months, 3 year, 5 year, interest only

or fully amortized available• Programs with no PP available• Rates from 8.50% and up depending on LTV term

and prepayment penalty• We have 2nd position loans available for n/o/o and

investment properties up to 55%-60% CLTV• 5-7 days closing available

Apartments and units(5+ residential units)• Up to 70% on refinance and purchases• Stated but verified rental income of property• Loan terms: 1 year, 3 year, 5 year, 7 year

and 10 year; fixed IO or fully amortized• Rates from 8.00% and up• Programs with no PP available depending

on LTV, term and prepayment penalty• We have 2nd position loans available

for our commercial products up to 60% CLTV

• 5-7 days closing available

877-700-3703 Office866-318-4471 Direct Fax

www.pbfinancialgrp.com • e-mail scenarios to: info@pbfinancialgrp.comPB Financial Group Corp. NMLS #357614/PB Financial Group Corp BRE #01522495

Disclosures: per FDIC Regulations Section 6500 Part 226, Subpart C, 226.24. The amount of each payment that will apply over the term ofthe loan is based on simple annual interest applied to the unpaid balance. Loans range from 1 day to 60 months, are interest only and in-clude a balloon payment due at term. Finance charges apply. Payments do not include amounts per property taxes or insurance premiums.This is not a commitment to lend. Rates and points are subject to change without notice. NMLS #357614

Commercial (industrial, retail, church,mixed-use, gas station, auto related,manufacturing, etc.)• Up to 55% on refinances• Up to 60%-65% on purchases• Term 1 to 5 years

Land loan (max LTV 35%, refinance, 50% purchase) call for details

We are California’s Premier Direct Private Money and BridgeLender

What differentiates Easy MortgageApps LLC from everyone else?

• Open LOS and CRM Integration for full automation

• Native Mobile App versus HTML5

• Private Label

• TrustE Certified 

• Editable Format to match look and feel

• Three user interfaces

• Push notification technology

• Document Upload

Resolve to attract more realtor partners in 2014

Register today for a demo @http://easymortgageapps.com/signup

Call Easy Mortgage Apps today so you can start off 2014 with a bang!Contact Michael @ 888-987-6842 ext 700

The only native app offering seamless intergration with your LOS!Enhance the experience for your borrowers and realtors.

Your company name here branded with your company logo and colors!

continued on page 57

heard on the streetcontinued from page 28

process now allows any user of INTEGRA’sDestiny platform to access Mortech’sMarksman functionality, including theproduct and pricing engine, and second-ary marketing services.

“The integration with INTEGRA givesMortech the ability to reach a larger cus-tomer base via the Marksman productand pricing eligibility engine,” said DougForal, general manager at Mortech. “Thenew process will also make it significantlyeasier for an INTEGRA Destiny user toaccess the power of the Marksman suiteto streamline their mortgage lendingoperations.”

INTEGRA 3-in-1 Destiny is an enter-prise-level LOS. In the past, integrating anoutside product pricing and eligibilityengine with a platform such as INTEGRA’sDestiny was handled manually on a case-by-case basis. The new integration makessetup seamless and allows pricing data tobe exported directly from Marksman intothe INTEGRA LOS without the user leavingMarksman. Lenders will receive full rate-spread information, including detailedinformation necessary for qualified mort-gage and other compliance checks, witheasy access to Marksman’s Lock-in Profeature to lock the interest rate.

“Closing more loans in less time andwith lower costs requires an LOS withcomprehensive functionality,” said JerryPratt, president, INTEGRA SoftwareSystems. “Today’s lenders are looking fora single software system to handle all oftheir loan origination needs. That onlyworks when you include best-of-breedfunctionality from partners like Mortech.In a complex lending environment, INTE-GRA is committed to bringing the bestsoftware tools to our customers, as we’vebeen doing since 1996.”

Churchill ContinuesExpansion With Two NewBranches

Churchill Mort-gage is expandingits nationwidepresence andopening two new

branches in Phoenix and Columbia, Md.The lender is a leader in the mortgageindustry providing conventional, FHA,VA and USDA residential mortgagesacross 33 states.

Debbie Schmidt will manage thePhoenix branch with 13 years of mort-gage industry experience. A licensedRealtor, she previously served as an orig-inator for LendSmart in Phoenix, whereshe was a member of the company’s TopTeam for Most Fundings in 2013.

Churchill also welcomes MaryLangdon, John Owens, Stephen Rustand Andrew Schmidt as home loan spe-cialists, who bring nearly 50 years ofcombined mortgage expertise. In addi-tion, Churchill adds Steve Engen andDeborah Reeter as processors and SarahHagar as a home loan consultant andtransaction coordinator. In addition toPhoenix, the branch will serve borrow-

ers in the surrounding cities, includingAvondale, Chandler, Goodyear, Mesa,Scottsdale and Tempe.

Kraig Spence will lead Churchill’sColumbia branch. Previously, Spenceserved as a home loan specialist for thelender’s Herndon, Va. branch, where hewas inducted into the company’sPresident’s Club in 2013. Prior toChurchill, he was a retail branch manag-er for Newday USA, where he generatedmore than $13 million in annual revenueand was recognized as Loan Officer of theYear in 2003 and 2011. In addition,Spence was a six-time inductee into thePresident’s Club at Newday USA and hasbeen a member of the Virginia BankersAssociation for nearly 15 years.

Churchill also welcomes Lisa Germanand Katherine Wilson as processingteam leaders, bringing over 30 years ofcombined mortgage expertise. Thebranch will serve borrowers inColumbia and the greater Baltimore-Washington, D.C. metropolitan area.

Mortgage Professionals to Watch

l Norcom Mortgage has announced thepromotion of Cale Ferland to whole-sale branch production manager.

l Katya Magee has joined MortgageNetwork Inc. as a loan officer in thecompany’s Longmeadow, Mass.branch office.

l Envoy Mortgage has named KeithFrachiseur to the new post ofregional vice president for thePacific Northwest territory.

l eLEND/AFR continues the expan-sion of its leadership team with theappointment of Brian L. Pair ascorporate fulfillment/operationsmanagement.

l Maverick Funding Corporation hasnamed reverse mortgage origina-tion expert Cecilia Delgado aswholesale account executive for its

FER

LAN

DM

AG

EE

FRA

CH

ISE

UR

49

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

Changes Ahead for Fannie Mae DU Version 9.1

By Pam Marron

Confusion has existed for lenders since Nov. 16, 2013, when theFannie Mae “fix” to correct the “Foreclosure Code” placed on apast short sale came out on Desktop Underwriter (DU) Version 9.1.Lenders were unable to go into the Fannie Mae system to make

the fix unless Fannie Mae saw a conflict on their end and provided verbiage onthe findings that allowed the lender to go in and make a fix.

Per Fannie Mae technical support, changes occurring in the Fannie Mae DUsystem on the weekend of Aug. 16 should enable lenders to make the fix direct-ly in Desktop Underwriter (DU)/(DO) when the lender sees inaccurate informa-tion on Fannie Mae findings.

Inaccurate foreclosure informationWhen DU identifies a foreclosure on a credit report tradeline and that informa-tion is inaccurate, the lender may instruct DU to disregard the foreclosure infor-mation on the credit report. This can be done by entering “Confirmed CR FCIncorrect” in the Explanation field for Question C in the Declarations Section ofthe online loan application and resubmitting the loan case file to DU. When DUsees this indication, the foreclosure information on the credit report tradelinewill not be used in the eligibility assessment.

Foreclosures due to extenuating circumstancesWhen DU identifies a foreclosure on a credit report tradeline and the fore-closure was due to extenuating circumstances, the lender may instruct DU todisregard the foreclosure information on the credit report when the lenderconfirms that the mortgage loan meets the applicable timeframes and eligi-bility requirements for a foreclosure due to extenuating circumstances. Thiscan be done by entering “Confirmed CR FC EC” in the Explanation field forQuestion C in the Declarations Section of the online loan application andresubmitting the loan casefile to DU. When DU sees this indication, the fore-closure information on the credit report tradeline will not be used in the eli-gibility assessment.

DU will issue a message stating that the foreclosure information includedon the account was not used in the eligibility assessment because DU wasinstructed by the user to underwrite the loan casefile without the reportedforeclosure information. The lender must document that the foreclosure wasdue to extenuating circumstances, that the foreclosure was completed threeor more years from the disbursement date of the new loan, and that the loancomplies with all other requirements specific to a foreclosure due to extenu-ating circumstances.

Deed-in-lieu of foreclosure and pre-foreclosure salemessage updatesIn the Fannie Mae Selling Guide,1 dated June 24, 2014, “Preforeclosure or ShortSale Properties” are defined as the same. Additionally, “Deed-in-Lieu ofForeclosure and Pre-Foreclosure Sale” both appear in same line when definingcriteria.

The waiting period requirements for borrowers who have had a previousdeed-in-lieu of foreclosure or pre-foreclosure sale are being updated to nowrequire a four-year waiting period; though a two-year waiting period will bepermitted if the event was due to extenuating circumstances and the loan com-plies with all requirements specific to a deed-in-lieu of foreclosure or a pre-fore-closure sale due to extenuating circumstances, as specified in the Fannie MaeSelling Guide.

Charge-off policy message additionA new policy will apply to mortgage accounts that have been subject to acharge-off that will require a four-year waiting period after the charge-offoccurred before the borrower is eligible for a new loan that would be salable to

50

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

The Long & Short:The Business of Short Sales

SPONSORED ED ITORIAL

By Cheryl Marquez

A few years ago, my husband and I bought a new home. Itwas everything we had dreamed of, right down to the largelot and sizeable backyard. The yard needed a considerableamount of TLC that included clearing a lot of dead and dying

bushes and trees. We spent most of that first year getting the yard intoshape, cutting, hauling and landscaping. The end result was all that wewanted and more.

This week, my husband decided to cut up some of the wood out backthat had been aging, getting it ready for winter. He got out all of his equip-ment: Safety goggles, boots and chainsaw, and got to work. It seemed likehe was outside for a while, and I heard the chainsaw, but was not seeingprogress or neatly cut wood piling up. I peeked outside, and he was clearlyfrustrated, still working on the same large chunk he started on. When Iasked what was wrong, he lamented the poor quality of the chainsaw hebought when we moved in.

“Maybe this chainsaw is too small … it’s taking too long to cut. I shouldhave gotten a larger one with more power,” he said.

I remarked that it would have worked great last year, had we clearedthe whole yard with it and finally I asked him, “Have you sharpened thatsaw since you bought it?”

My husband laughed and realized that he was caught up in his desireto get so much done that he neglected to look after his tools. It’s funnyhow this exactly mirrors Steven Covey’s parable of the woodcutter–a les-son that never grows old.

We know that we need to keep our tools sharp. We know the conse-quences when we don’t stay sharp. We are sometimes proactive and do italong the way. Sometimes we wait. Had my husband sharpened his saw,he likely would not have had a problem cutting the firewood. Being proac-tive would have saved quite a bit of effort.

As we get caught up in our day to day, it’s easy to lose sight of how andwhen we keep our own tools sharpened. We get busy and other prioritiestake over. Continuing education is the sharpener of your tools. It keepsyou on top of the dos and don’ts of originating mortgages, and up-to-dateon the newest regulations and loan products you may not be familiarwith. You will put your knowledge to the test when you experience reallife scenarios during training.

Staying current and compliant will result in a great experience re-warded by referrals, and staying off of the regulator’s radar. We shouldn’tthink of continuing education as a requirement, but should approach con-tinuing education as an opportunity to sharpen our saw.

For more information about AllRegs’ education programs, includingNMLS-approved continuing education courses, visit www.allregs.com orcall (800) 848-4904.

Cheryl Marquez is director of education at AllRegs. She has more than 20years of experience in learning and development as an instructor, instruc-tional designer and manager. She has worked in the financial services in-dustry her entire career, spending time at both HSBC and Capital One priorto joining AllRegs.

The Payoffs ofBeing Proactive

�

51

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

October 27-29th, 2014Awareness. Opportunities. Access.

Accelerating Women in the Housing Economy.

2014 INAUGURALCONFERENCE

Southern California

Fannie Mae. DU will now issue a mes-sage on mortgage accounts with a man-ner of payment of nine specifying thatthe account was identified as beingsubject to a charge-off and that thelender must confirm the accuracy. Ifthe mortgage account was subject to acharge-off, the lender must documentthat the event was completed four ormore years from the disbursementdate of the new loan. The event maybe completed two or more years fromthe disbursement date of the newloan when the lender confirms thatthe mortgage loan meets the applica-ble timeframes and eligibility require-ments for a charge-off due to extenu-ating circumstances.

Previous significantderogatory eventsWhen DU identifies a bankruptcy, fore-closure, deed-in-lieu of foreclosure,pre-foreclosure sale, or mortgagecharge-off, and it is up to the lender todetermine if the waiting period hasbeen met, DU will instruct the lenderthat the waiting period is measuredfrom the disbursement date of the newloan, not the credit report date.

On loan casefiles where DU measuresthe waiting period and uses that infor-mation in the eligibility assessment, thecredit report date will continue to be

used as DU does not know the disburse-ment date of the new loan. For loan case-files that will have met the waiting periodrequirement based on disbursementdate, but not credit report date, thelender may pull a new report after thewaiting period has elapsed in order toreceive an Eligible Recommendation.

Stay tuned. The success of thesechanges will be apparent when it isknown how well this works in theautomated system rather than a man-ual underwrite. Note that different cri-teria2 exists for loan applications takenon or after Aug. 16, 2014 and loanapplications taken before Aug. 16,2014. Please read complete release forall information.

Pam Marron is senior loan officer withInnovative Mortgage Services Inc. She maybe reached by phone at (727) 375-8986 ore-mail pmarron@tampabay.rr.com.

Footnotes1-Fannie Mae Selling Guide, Part B, Originationthrough Closing/Subpart 2, Eligibility/Chapter 1,Mortgage Eligibility, Loan Purpose (www.fan-niemae.com/content/guide/sel062414.pdf).

2-Desktop Originator/Desktop UnderwriterRelease Notes, DU Version 9.1 AugustUpdate/June 17, 2014 (www.fanniemae.com/con-tent/ re lease_notes/du-do-re lease-notes -08162014.pdf).

Volume II: 2013 HMDA Data Insightsdetails Mortgage TrueView’s findingsbased on 2013 HMDA date collectedfrom nearly 400 of the country’slenders, including seven of the top 10lenders and 15 of the top 20 lenders.

Among the key findings:l 2013 regulatory risk indicators

show a 13 percent year-over-yearincrease in loan denial rates

l Denial rates for white applicantsincreased from 17 percent to 21percent, while denial rates fornon-white applicants increasedfrom 23 percent to 28 percent

l Denial rates for Hispanicsincreased from 25 percent to 30percent. Denial rates for non-Hispanics increased from 18 per-cent to 21 percent

l Denial rates for female applicantsincreased from 21 percent to 26percent. Denial rates for malesincreased from 17 percent to 21percentFor its survey, Mortgage TrueView

requested the 2013 public loanapplication register (LAR) filings fromthe top 1,160 mortgage originatorsin the country. Notably, MortgageTrueView found that a sizable num-ber of the 388 respondents had criti-cal errors in their filings, including

missing data fields, incomplete datafields, incomplete records and incor-rect data formats.

“Regulators have made it clear thatlenders face significant fines andpenalties for non-compliance withHMDA reporting requirements,”Moffat said. “Our survey shows thatproblems with the way the data isreported could raise that risk. Westrongly recommend that lenders’ sen-ior management get more involved inmonitoring and managing HMDAreporting, as well as other regulatoryreporting requirements.”

Your turnNational Mortgage ProfessionalMagazine invites you to submit anyinformation on regulatory changes, leg-islative updates, human interest storiesor any other newsworthy items pertain-ing to the mortgage industry to theattention of:

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

E-mail:newsroom@nmpmediacorp.com

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

nmp news flashcontinued from page 25

52

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

Jennifer BrabsonFacebook: www.facebook.com/jennifermbrabsonLinkedIn: www.linkedin.com/in/jenniferbrabsonSlideShare: www.slideshare.net/jenniferbrabson Twitter: @jenniferbrabson

As a thought leader and influencer in social media and digital mar-keting, Jennifer Brabson, marketing director at Village Mortgage inConnecticut, Massachusetts and Rhode Island, brings an extensivebackground and approach to social media, digital marketing, socialmedia training, development of best practices, and event and tra-ditional marketing to the mortgage industry. Jennifer, who has only

been in the mortgage and finance industry since September 2013 when she start-ed at Village, has been instrumental in the rebuild and transformation of theVillage Mortgage brand.

Ivan ChoiFacebook: www.facebook.com/connivanLinkedIn: www.linkedin.com/profile/view?id=3922449

With 17 years as a retail mortgage banking executive, Ivan Choi hasmade a difference for communities across the U.S., most notably viaa multi-billion dollar financing initiative during the foreclosuredownturn. As an industry leader, Ivan currently serves as chairmanof the Asian Real Estate Association of America (AREAA), boardmember of the National Association of Realtors (NAR), and is a con-

tributor for the Mortgage Bankers Association (MBA).

Jody CollupFacebook: www.facebook.com/jody.collupLinkedIn: www.linkedin.com/in/jodycollupTwitter: @JodyCollup

Jody Collup is currently vice president of marketing for Global DMS,where she oversees the entire marketing process. Previously, sheserved as marketing director for Calyx Software. Jody is a well-respected mortgage marketing executive who has developed anextensive, high-impact network of industry professionals using avariety of social media outlets and marketing mediums.

Richard S. DonineLinkedIn (Public Profile): www.linkedin.com/pub/richard-s-donine/5/718/642LinkedIn (FGMC Page): www.linkedin.com/company/first-guaranty-mortgage-corp

Richard S. Donine brings First Guaranty Mortgage Corporation (FGMC)more than 16 years of mortgage banking marketing experience.Richard provides a unique combination of marketing knowledge, expe-rience and leadership skills, having built successful marketing depart-ments from the ground up for three nationally recognized lenders, twoof which were NYSE publicly traded REITs. He received his bachelor’s of

science degree–business administration from the University of Southern California.

Adam FinkelsteinBlog: www.lendersunited.com/mortgage-business-blogFacebook: www.facebook.com/LendersUnitedGoogle+: google.com/+LendersunitedLinkedIn: www.linkedin.com/in/adamfinkelsteinTwitter: @LendersUnited

Adam Finkelstein has become one of the most respected, trusted andwell-known mortgage industry professionals in the last 15 years throughorigination as a mortgage broker, transitioning to directing, managingand supervising the retail branch division of a mortgage company. Sincethen Adam founded Lenders United-The Premier Mortgage RecruitingFirm. Lenders United represents some of the leading mortgage lenders

and banks throughout the country expanding their retail mortgage divisions, andassisting branch managers and loan originators with finding a new bank to call home.

Rick FloydBlog: www.ChasingExcellenceBlog.comFacebook: www.facebook.com/RickFloydREMNLinkedIn: www.linkedin.com/in/RickFloydREMNTwitter: @Rick_Floyd

As partner and executive vice president at HomeBridge FinancialServices, Rick Floyd brings more than 20 years of leadership to thenational lender’s sales, marketing, training and operations teams. Afootball fanatic and former scholastic coach, Rick utilizes thephilosophies he learned on the field in motivating and empoweringhis HomeBridge teams to chase excellence in both their profession-

al and personal lives.

25MOST CONNECTEDMORTGAGE PROFESSIONALS

2014

53

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

Allen FriedmanLinkedIn: www.linkedin.com/in/asfriedman

With more than 25 years in the mortgage industry, Allen Friedmanhas maintained key positions in operations and sales management,including his current position as the Western regional sales man-ager at iServe Residential Lending. His focus is always upon build-ing solid relationships, including open and meaningful communi-cation, timely follow-up, and dynamic customer service. Allen has

a juris doctorate degree, and in his spare time, enjoys spending as manymoments as possible with his wife and two children.

Frank Garay & Brian StevensWeb site: www.thenationalrealestatepost.com

Frank Garay and Brian Stevens are the hosts of theextremely popular online show, The National RealEstate Post. Frank and Brian made the Inman 100 in2010, a list of the top 100 most influential people inthe real estate industry, along with several othernotable achievements. Their mortgage and real estate

commentary video blog has had 50 million-plus views in under five years.

Amy GoldsteinFacebook: www.facebook.com/amygoldstein12Twitter: @Amybmic

Amy has been with BMIC Mortgage Inc. for 15 years as a licensedoriginator in Maryland; Washington, D.C. and Virginia. Amy usessocial media to keep clientele up to speed with the ever changingmortgage market.

John H.P. HudsonFacebook: www.facebook.com/PremierHudsonLinkedIn: www.linkedin.com/in/johnhphudsonTwitter: @premier_hudsonYouTube: www.youtube.com/user/premierhudson

John H.P. Hudson serves mortgage professionals as retail andwholesale production manager for Premier Nationwide Lendingand will continue his industry advocacy by serving on the Board ofDirectors for NAMB—The Association of Mortgage Professionals. “Idon’t care if you are a mortgage broker or a mortgage banker … Ifyou are in this industry, you are a mortgage professional,” says

Hudson. “Part of my job is to help mortgage professionals encourage, engage andeducate themselves and others about what they do. Social media has helped meeducate thousands of mortgage professionals on industry issues affecting themand why they need to participate with their trade groups.”

Mat IshbiaBlog: www.thebrokerlife.com Facebook: www.facebook.com/UnitedWholesaleMortgageLinkedIn: www.linkedin.com/pub/mat-ishbia/14/9a/a8aTwitter: @UWMeasy

Considered an advocate for brokers and an innovative leader in thewholesale market, Mat Ishbia unveiled a blog, The Broker Life, toconnect originators with helpful information and tips in a forumthat allows them to share best practices. With his commitment toenhance broker communications, Ishbia and United WholesaleMortgage (UWM) also recently created a mobile app that has

proved to be a great success among their clients.

Joshua JonesFacebook: www.facebook.com/JoshuaJonesMMILinkedIn: www.linkedin.com/in/joshuamjonesTwitter: @jjmortgage

Joshua Jones is a branch manager and senior loan officer forMortgage Master’s Park Ridge Office in the Greater Chicago Area,with 10 years of experience in mortgage banking and account man-agement with regional and national mortgage lenders. As a mem-ber of the Mortgage Master team, Josh offers a “big picture” way ofthinking to provide his clients with a vision and attainable goals

over monthly or yearly periods. He serves his clients in a way that goes beyondone transaction and carries over into a lifelong partnership.

Angie LeeFacebook: www.facebook.com/nycangieleeLinkedIn: www.linkedin.com/in/nycangielee

Angie Lee is a senior vice president of corporate communicationsfor MCS Mortgage Bankers Inc. Angie has had the privilege of serv-ing as president of the Asian Real Estate Association of America(AREAA), Metro New York Chapter and the Co-chair of the 2014AREAA Global & Luxury Summit. Her true passion is connectingpeople together through a wide range of projects, educational and

outreach programs.

Mark MadsenGoogle+: plus.google.com/+MarkMadsen1Google Mortgage Network: plus.google.com/communities/111167855085138616592

Mark Madsen manages a network of 38,000-plus locally optimizedmortgage and real estate niche Web sites for Best Rate Referrals,and he runs one of the largest mortgage professional networks onGoogle+ with over 1,000 members. Mark’s lending career started in1999 as a Las Vegas originator and he was an early adopter ofsearch engine marketing, mortgage blogging and social media

back when MySpace was cool and “The Facebook” was only available for Harvardstudents.

Khai McBrideFacebook: facebook.com/khaimcbridepageLinkedIn: linkedin.com/in/khaimcbrideTwitter: @khaimcbride

Khai McBride’s business and coaching skills are recognized by com-panies nationwide and he is regularly invited to speak at top indus-try events. A master of mindset, performance, influence and data-base marketing, his ideas are always fresh and creative, but moreimportantly, effective in today’s market.

Cody MilesBlog: mortgagedashboard.com/lender-blogLinkedIn: www.linkedin.com/in/codymiles512Twitter: @MtgDashboard

Cody Miles is the inbound marketing director atMortgageDashboard, a cloud-based finance technology companydedicated to designing quality cloud-based mortgage softwaresolutions. Cody is responsible for the inbound marketing activitiesas SEO of MortgageDashboard, specializing in on- and off-pageoptimization, as well as content creation and data visualization.

Bubba MillsFacebook: https://www.facebook.com/bubba.mills.3LinkedIn: http://www.linkedin.com/pub/bubba-%22eric%22-mills/10/508/8b7Twitter: @BubbaMills1

Bubba Mills has been in the real estate, mortgage and servicingindustry since 1988. He specializes in community branding andcommunity stabilization. Bubba is a member of the NationalSpeakers Association, Advisory Board Member for Equator and is aspeaker for National Association of Hispanic Real EstateProfessionals (NAHREP), Asian Real Estate Association of America

(AREAA) and the Five Star Institute. He is a trainer, inspirational speaker, coachand consultant. Bubba has raised millions of dollars for national non-profit com-panies and local non-profits and churches over his lengthy career.

Eric MitchellFacebook: www.facebook.com/ericmitchell0513LinkedIn: www.linkedin.com/profile/view?id=2598334

Eric Mitchell is helping to revolutionize the mortgage industry withreal estate agent and sales training events. Having the world’sgreatest mentors has allowed Eric to bring cutting edge informa-tion to sales professionals that truly change how loan officers andreal estate agents work together as a team.

2 5 M O S T C O N N E C T E D M O R T G A G E P R O F E S S I O N A L S

54

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

Lewis PoretzFacebook: www.facebook.com/lewisporetzLinkedIn: www.linkedin.com/in/lewisporetzTwitter: @lewisporetzWeb site: www.socialyo.com

An early adopter of social media and long-time mortgage industryvet, Lewis Poretz has a reach of 8,000 Linkedin connections andmore than 9,200 Twitter followers. Poretz founded the popularLinkedin Groups “Social Media Basics” and “Mortgage BranchNews,” is an active LinkedIn Publisher, a “Rainmaker” onactiverain.com and a past contributor to the Zillow MortgagesUnzipped blog. Poretz leverages his broad industry reach and mar-

keting skills recruiting mortgage branches and loan officers for a growing lend-ing platform. He founded SocialYo, a digital marketing firm that helps brandsand individuals understand how to identify their audience, engage effectively inthe social streams and maximize efficiency using cutting edge tools and technol-ogy including CRM, pipeline management and e-mail marketing.

Rene RodriguezFacebook: www.facebook.com/betterloanofficersTwitter: @BetterLO

Rene Rodriguez is founder and chief executive officer ofBetterLoanOfficers.com, the most powerful and easy-to-use onlineloan officer review management system dedicated to the mortgageindustry. Loan officers can collect, manage and promote theirreviews in order to build trust, secure more referral relationshipsand close more deals.

Gerald SantoroFacebook: www.facebook.com/NJLoanManLinkedIn: www.linkedin.com/in/geraldsantoroTwitter: @njloanman

Gerald Santoro began his career as a loan officer with a local bro-ker in Middletown, N.J. in the early 1990s. Gerald is currently amortgage banker with Peoples Bank, an FDIC-insured direct lender,offering in-house processing and underwriting, licensed to origi-nate conventional, jumbo, FHA, VA, USDA, Home Possible,HomePath, HARP and reverse mortgage loans in all 50 States.

Adam SteinFacebook: www.facebook.com/LoanTekLinkedIn: www.linkedin.com/in/adamlsteinTwitter: @LoanTekOnline

Adam Stein currently serves as chief executive officer of LoanTekInc. Under his direction, LoanTek’s pricing engine has grown toprice and deliver over one million consumer facing offers everyday. These offers result in efficiencies, cost savings, funded loansand a significant return-on-investment (ROI).

John G. StevensFacebook: www.facebook.com/JohnGStevensUtah?ref=hlLinkedIn: www.linkedin.com/in/johnglenstevensTwitter: @JohnGlenStevens

John G. Stevens is the Utah area manager for the Bank of Englandd/b/a ENG Lending. He is the married to his best friend, MindyMcClure Stevens, and the proud father of three beautiful children.He is active as past president of the Utah Association of MortgageProfessionals (UAMP), as well as a director on the Board forNAMB—The Association of Mortgage Professionals. He has served

as president of his Rotary Club, chair of both the Pleasant Grove City and UtahCounty Planning Commissions, and is active in many volunteer organizations.

Jeff TaylorFacebook: www.facebook.com/pages/Digital-Risk/454111754657290LinkedIn: www.linkedin.com/pub/jeffrey-c-taylor/54/a/258Twitter: @DigitalRiskCo

As a managing partner, Jeff Taylor controls all of Digital Risk’s sales,marketing and governmental initiatives, managing all of the com-pany’s high level client relationships. In addition to his workingtitle, Jeff continues to play an integral role in the development ofunique data and process solutions to help better overall industrypractices, including exclusive data sources for lenders to make bet-

ter loans, and forensic review and loss mitigation solutions to help investorsmanage their portfolios.

Carl WhiteFacebook: www.facebook.com/MortgageMarketingAnimalsFacebook: www.facebook.com/MasterMindRetreatLinkedIn: www.linkedin.com/in/marketinganimals

Carl White began as a loan officer in October of 2000, and withineight months of opening the doors at Family First Mortgage, hebecame the top producing branch out of 336 branches nationwide.Carl now trains some of the top producing loan officers across thenation, using his “paint by numbers” approach. In 2013, Carl washonored to receive the coveted “Marketer of the Year” from one of

the most prestigious group of online marketers, Digital Marketing. He also hasthe largest Fan Page for loan officers that exists within Facebook.

2 5 M O S T C O N N E C T E D M O R T G A G E P R O F E S S I O N A L S

25MOST CONNECTEDMORTGAGE PROFESSIONALS

2014

NMP Daily is the mortgage industry's sourcefor news, insights, trends and tips.It keeps subscribers informed of the regulatory and legislative updates, latest industry happenings and breaking news about the mortgage technologies and services.

W W W . N A T I O N A L M O R T G A G E P R O F E S S I O N A L . C O M

55

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

56

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

Paul RozoChief Executive Officer

of Paramount Residential Mortgage Group (PRMG)B Y P H I L H A L L

NMP MORTGAGE PROFESS IONAL

“AT PRMG, WE FOSTER A CULTURE OF

SUPPORT AND ENCOURAGEMENT. WE LIKE

TO PLACE PEOPLE IN A JOB CAPACITY THAT

COMPLIMENTS THEIR SKILL-SETS AND

STRENGTHS AND ALLOWS FOR PERSONAL

GROWTH AND ADVANCEMENT.”

Back in September 2001, asmall mortgage companywas started in California byPaul Rozo and RobertHolliday. Its beginnings weremore than a little humble–athree-person staff kept the

office running and the company’sfuture initially seemed a little uncer-tain, considering that the country wascoming out of a recession and tum-bling into a new era of economicuncertainty.

Today, the Corona, Calif.-basedParamount Residential MortgageGroup Inc. (PRMG) is one of thenation’s most prominent independentmortgage lenders. As CEO, Paul Rozohas guided PRMG through a marketthat has seen more than its share oftumult, while carefully growing thebusiness to achieve a presence in over44 states. PRMG co-founder Hollidaycurrently serves as the firm’s chiefoperating officer.

A primary reason for PRMG’s successcan be found in the clear and to-the-point mission statement that the com-pany has been operating under since itopened: “Our vision is to be partnerswith the origination team in producinga high-quality product by maintaining

a spirit of cooperation, appreciationand understanding. To act in a fair andtimely manner, while exceeding cus-tomer expectations without jeopardiz-ing the integrity of our company.” Thisstraightforward, cogent language ispersonified in Rozo’s approach to hiswork and his vision for the mortgageindustry.

How did you get into the mortgageworld? Was this the mortgage profes-sion a career that you wanted to getinto?Rozo: No, it was not! My childhoodaspiration was to become an orthopedicsurgeon, with a strong focus on sportsmedicine. Unfortunately, my firstorganic chemistry class during my sec-

ond year of pre-med at U.C. Davisopened my eyes that I was not cut outfor that career path. However, as aresult, my focus shifted to business andfinance and the goal of pursuing acareer in real estate.

What was the inspiration behindstarting PRMG?Rozo: I started in this industry as anoriginator, working the streets for pur-chase business. Here is a typical story: Icame in not knowing much aboutloans, and was essentially handed busi-ness cards and told to hit the streets.Within seven years of starting in theindustry, I had worked my way upthrough the ranks to become a manag-ing partner for a successful mortgage

broker that we transitioned into a mort-gage banker.

After five years of this partnershipand 12 years of being in the business onmultiple levels, I knew exactly what Iwanted and it was becoming increas-ingly evident that my vision and ideasdid not fully align with that of my for-mer company. In September of 2001,PRMG was born from a vision of creat-ing a company with a unique culturethat speaks to and supports the origi-nators and top operational staff,thereby creating a proverbial “FantasyIsland” for top producers and mort-gage professionals. Hence, the genesisof PRMG’s slogan: “Built by originatorsfor originators.”

When you began PRMG, you had athree-person staff. Now you have 600people in more than 40 offices. Whatdid it take to get you from Point A toPoint B?Rozo: By not losing focus, remainingconsistent and relatively conservativeduring both the high times and lowtimes, not taking unnecessary risks, andmost importantly, reinvesting everycent made back into our company andinto our people. This has proved overtime to keep us on track while building

57

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

57

a stable and healthy company thatwould survive the long haul.

In the years that you’ve been in busi-ness, what have been PRMG’s greatesttriumphs and greatest challenges?Rozo: The greatest challenge, nodoubt, was remaining in the businessthrough the mortgage crisis of 2006through 2009, when more than 70percent of our competitors and otherindustry professionals failed and/orexited the space. PRMG managed tostay our course and remain in thegame.

Ironically, I consider this same timeas our greatest triumph because it wasduring this time that we leveraged ourstaying power to attract and retain thetop talent that was displaced duringthe meltdown and grow our platformnationwide.

On your Web site, PRMG takes pridein its “corporate culture.” What isspecial about this culture and howhas it helped your company grow?Rozo: You will hear all the time if youask any employee what PRMG means orrepresents to them, they will inevitablyanswer “Family.” At PRMG, we foster aculture of support and encouragement.We like to place people in a job capaci-ty that compliments their skill-sets andstrengths, thereby allowing personalgrowth and advancement, whilerewarding them well financially.

What do you see as the states of theretail and wholesale lending marketstoday? Rozo: I feel there is plenty of opportu-

OF THE MONTH

“… PRMG WAS

BORN FROM A

VISION OF CREATING

A COMPANY WITH A

UNIQUE CULTURE

THAT SPEAKS TO

AND SUPPORTS THE

ORIGINATORS AND

TOP OPERATIONAL

STAFF, THEREBY

CREATING A

PROVERBIAL

‘FANTASY ISLAND’

FOR TOP

PRODUCERS.”

nity for all channels to thrive in thismarket–retail, wholesale and corre-spondent–and PRMG is a supporterand advocate of all three.

If a new college graduate asked aboutcareer opportunities in the mortgageworld, how would you encouragethem to join the industry? Rozo: Quite frankly, I would encour-age them to seek opportunities in ourindustry because of the excitementand buzz and the multiple opportuni-ties and career paths available withinour industry.

At PRMG, we employ many peoplewith diverse skill sets and educationalbackgrounds–attorneys, CPAs, account-ants, management, marketing, adver-tising and sales–which, of course, hasunlimited earning potential. Eventhose without the above specific skillset acquired by a degree have oppor-tunities to work within the operationteam.

Today, we’re seeing many caseswhere underwriters are exceeding asix-figure annual income. To that end,we have created our own internshipprogram, PRMG University, wherebywe work hand-in-hand with studentsenrolled at local universities to teachthem the ropes by cycling themthrough the various departments forseveral weeks at a time–from second-ary marketing to accounting to post-closing to human resources to under-writing/operations to sales. By doingso, it enables them (and us) to betterdetermine their skill set based ontheir strengths and interests, whileteaching them how the mortgagebusiness banking model works from“cradle to grave”. All students whomake it through the intern and passan exam for each area/departmentwill be guaranteed employment atPRMG upon graduation from a four-year university if meeting our mini-mum GPA requirement, based on thespecific department we mutuallydeem the best fit while trying tomatch their career path.

On a personal note, how do youspend your leisure time? Rozo: As a person who believes in thevalue treating your body like a tem-ple, I ritualistically work out everymorning to prepare myself both men-tally and physically for my work day. Ifind time to decompress when out ofthe office on the ocean, cruising onmy Sportfisher “Houdini” with familyand friends at the islands off theCalifornia coast.

Phil Hall is senior editor of NationalMortgage Professional Magazine. Hemay be reached by e-mail atphilh@nmpmediacorp.com.

heard on the streetcontinued from page 48

Reverse Mortgage Network in thewestern region.

l FormFree Holdings Corporation hasappointed John Sheppard companypresident and chief operating officer.

l V.I.P. Mortgage Inc. brought onDuncan Hsia as the firm’s new salesmanager.

l HomeBridge Financial Services Inc.continues to grow across the countrywith a new branch location in theNorthern California city of Stockton tobe led by Christin Blair, a 30-yearmortgage industry veteran.

l MSI Reverse has named DavidCesaro to the position of vice presi-dent of reverse mortgage lending.

l Carrington Title Services LLC hasadded three title industry veterans toits management team: Vice Presidentof Title and Settlement Services CraigMarshall, Vice President of LegalCompliance Jack Kozak, and Managerof Curative Services Lesa Wachter.

l LoanLogics has hired Leah Fox as sen-ior vice president of customer success.

l Prospect Mortgage LLC and itsgrowth capital partner, SterlingPartners, have announced theappointment of Michael J. Williamsas Prospect’s new CEO.

l Fay Servicing has launched an REOdivision and has selected GlennBrooks as senior vice president tolead the new business unit.

l Greystone has announced that TimStevens has joined the company as asenior originator.

l Gloria Betancourt has joined thenational sales team at LandmarkNetwork.

l GSF Mortgage has named Gino Gregorybranch manager of GSF’s Pittsburgh,Penn. office, and has also announcedthe addition of David Pelesh as branchmanager in the firm’s San Diego, Calif.branch. Kelly Oatsvall has been namedbranch manager in the GSF’s newSarasota, Fla. branch. Kevin Fuell hasjoined GSF as North Carolina branchmanager, overseeing the firm’s newestaddition in Greenville, N.C.

l Envoy Mortgage has announced thatits president, Patrick Walden, hasbeen named president and CEO.

l The Mortgage Bankers Association(MBA), the parent corporation of the

Mortgage Industry StandardsMaintenance Organization (MISMO),has appointed Peter Carroll to theMISMO board of directors.

l Stonegate Mortgage has announcedthat Lisa Rogers has been appointedto the newly created role of executivevice president of third-party origina-tion, to lead a consolidated TPOstrategic business unit which willinclude the company’s wholesale andcorrespondent channels.

l The STRATMOR Group has hiredTommy J. Finnegan III, an industryveteran with over 30 years of mort-gage banking experience, as seniorassociate.

l Mortgage Guaranty InsuranceCorporation (MGIC) has announcedthe addition of William ToddPittman as managing director forMGIC’s Southeast Sales Region andGeoffrey Cooper as director of cus-tomer solutions.

l Gateway Mortgage Group hasannounced the opening of a newbranch in Austin, Texas to be led byJohn Roach. Gateway has also openeda new branch in San Antonio, as StefenBrooks joins Gateway as branch man-ager for the new San Antonio.

l LRES has announced that Ann Songhas been named vice president ofREO asset management.

l American National MortgageAcceptance Corporation (AnnieMac)has announced the addition of twomortgage veterans to the company,Jason Fallon and Jenel Poole.

l Jackson Martin has joined Austin-basedcommercial real estate services firm TheStone Group as vice president.

l Mortgage Returns has selected KimGoldstone as the company’s new direc-tor of marketing where she will super-vise the marketing team and overseeall corporate communications.

l Luxury Mortgage Corporation hasannounced that it has hired three newmortgage loan originators for itsGarden City, N.Y. branch location, asThomas Lupski and Thomas Kennedyhave joined the firm as mortgage loanoriginators, and Denise Hartmann as aloan processor.

Your turnNational Mortgage Professional Magazineinvites its readers to submit any informa-tion, events, passages, promotions, per-sonal or professional occurrences thatseem appropriate and/or other pertinentdata to the attention of:

Heard on the Street/MortgageProfessionals to Watch column

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

newsroom@nmpmediacorp.com

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

HS

IAS

HE

PP

AR

D

58

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

By Brent Emler

I’m sure you’ve noticed that the socialmedia craze is not going anywhere. Infact, the use of social media for com-municating with friends, family, busi-ness contacts and even potential clientsis steadily on the rise. With Facebook,Twitter, Google+, LinkedIn and severalother social media forums, it can be anoverwhelming prospect to fully developa strong, profitable web presence.

With more options on the table, themore difficult it is to decide which oneswould serve you and your business thevery best. How does one quantify thesuccess of their use of social media?Which forums have the highest likeli-hood of helping you establish a strongbusiness network and result inincreased profits?

I recently sat down with the presi-dent of Social Eyes Marketing (a compa-ny specializing in social media and SEOmanagement for business entities) andtook some time to ask these questionsas they relate specifically to mortgagemarketing. Some incredibly usefulinformation emerged.

Through this conversation, I was

able to make the determination thatthere are two main social media outletsthat are more effective in the mortgagemarketing space than others. Facebookand LinkedIn are proving to be themost effective social media tools formortgage professionals. That is certain-ly not to say that there isn’t value inTwitter, Google+, and other popularforums, but the real returns are beingseen with the studied, routine use ofFacebook and LinkedIn.

Facebook really started out as a wayto connect with friends and family, butin recent years, has become very busi-ness-friendly. The community of busi-nesses who use Facebook to advertiseand connect with their customer base israpidly growing. It’s important, howev-er, to remember that communicationon Facebook is best received whenlight-hearted, humorous or informa-tional. Direct and “in-your-face” adver-tising is not as well-received. Here aresome tips to garner the most attentionwith your Facebook presence:l Keep your posts short. Studies have

shown that the response rate is 20

percent higher when posts are 80characters or less.

l Do your posting in the late morningand late afternoon.

l Include images to ensure higherengagement.

l Infuse your message with humor.Humor is “shared” more than almostany other type of communication.

l Did you know that you can scheduleyour Facebook posts as a business?Eliminate some of the day-to-daypressure by planning ahead andscheduling your posts.

l Don’t forget to respond! Make surethat you are regularly responding tocomments and shares. Peopledeserve to be acknowledged, and itis certain to create satisfaction foryour contacts.

l Inspire participation in the form ofcompetition or polls. People love toshare their opinions and if there is avaluable offering, people love tocompete for a prize.

I recently personally experienced thepower of competition when a colleagueof mine entered a Facebook challengeto win an entire year’s worth of profes-sional photography for her family. Thecontest involved an elaborate riddle.Our entire team jumped into the gameto help our co-worker solve the riddleand participated daily for severalweeks. As a result, the photographergained significant visibility and popu-larity. The next time I need a profes-sional photographer, I can guaranteeyou I’ll not be Googling photographersand know exactly who I will be calling.

This principle is true for any marketniche … make it fun and keep it simple!

Among the various social networks,LinkedIn can be one of the most usefulwhen it comes to fostering a referralnetwork. The reason for that is becauseLinkedIn has a high concentration ofbusiness decision-makers. There isnothing at all wrong with using othersocial networks, however, the trickypart is managing to go beyond connect-ing with family members and schoolpals in order to strategically build a net-work of people who are potentialclients.

Here are some tips for making con-nections on LinkedIn that can take yourreferral network to a whole new level:l Be subtle and friendly, not a bull-

horn. Look at self-promotion as 20percent of your communication andthe other 80 percent should bevalue-add content, humor and ask-ing questions to inspire input.

l Take the time to genuinely get toknow people.

l Compliment others often.l Send personal invites. Sending a per-

sonal invitation always makes a bet-ter impression than generic requeststo connect. Since an invite is your firstcommunication on LinkedIn, it isimportant to make a good firstimpression by writing a personalrequest for connection. Here’s anexample of a simple, yet effectiveconnection request: Dear Jim, Inoticed we’re in the same real estategroup! I’m in the process of buildingconnections with principled realestate agents and would appreciatethe opportunity to connect with you.

l Be sure to fill out all current andpast work experiences. Why?Because you never know who mightbe looking for you. It could be a co-worker from an old job or an oldclassmate. If you list all of yourplaces of employment and educa-tional institutions, you create amuch bigger net for capturingsearches. Besides, those connectionscould be the perfect connections topeople you’ve been trying to meet.

l Optimize your profile: One easy wayis to update your profile picture.LinkedIn views this kind of updateas “freshness,” and it can help yourranking when others are searchingfor someone like you.

l Let your headline work for you. Beclear and compelling, and be sure totell people who you are and howyou help them in your headline.Headlines that communicate thesepoints are often what gets a person’sattention when they search the site.People should be able to read yourheadline and know exactly what youoffer and why they should get intouch with you.

“Among the various social networks, LinkedIncan be one of the most useful when it comes tofostering a referral network.”

Social Media in Today’s Mortgage Marketing Space

59

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

l Join targeted groups. Joining a target-ed group is perhaps the most effectiveway to connect with like-minded pro-fessionals who are equally seriousabout using LinkedIn to form businessconnections. Participating in thesegroups enables you to share yourknowledge as well as the opportunityto learn from other members of thegroup. Update your status often andconsistently. If you are looking tobuild your network of Realtors andyou’re in Florida, do a search that says“Realtor Florida” or if you’d like toconnect with beginner real estateinvestors and hear what they’re talk-ing about, search “Real EstateInvestor.” These two groups have10,274 and 51,306 members, respec-tively. Think about that. That’s 60,000individuals who you want to talk to.Get in those groups and start having

conversations. Start connecting withother members. Remember though,you wouldn’t walk into a conversationat a cocktail party and start pitchingyour products so don’t do it in yourgroups.

l When you log into LinkedIn, payattention to who shows up in yourhome feed. It is likely that you willfrequently see the same few people.These individuals are getting morevisibility because they are moreactive, and you can do the same ifyou commit to staying active on thenetwork. This is a simple but power-ful way to build influence with yournetwork connections.

l Be persistent about building connec-tions. Send an invitation to connectto at least one new person per dayand always be on the lookout forconnection opportunities. 

l Start or participate in LinkedIn GroupDiscussions at least three times a week.

l What you share on LinkedIn matters.It is what will define you as a trustedauthority not only within your indus-try, but with your target markets aswell. The key here is to share news,articles or insights that will be relevantto your connections. Keep in mindthat when you put something outthere that is share-worthy it creates acascade effect. Members of yourextended network see it and share it,which means you increase your visibil-ity significantly because now you havegained exposure to their connections.

Just like expanding any social mediacircle, building a referral network onLinkedIn won’t happen overnight.However, it’s well worth spending sometime and effort in order to tap into

radian.biz | 877.723.4261

One of the benefits of having a passion for what we do is that our service solutions aren’t just functional - they’re actually fun. Which means our clients don’t just get innovative programs, streamlined MI products and transparent pricing -- they get a partner they like doing business with.

For us, being the number one choice of mortgage professionals isn’t just something we hope for. It’s why we get up in the morning.

It’s in our DNA.

MI so easy, it’s fun.

LinkedIn’s network of 150 million mem-bers worldwide. As LinkedIn continues todevelop and add new features, it isimportant to keep up with LinkedIn net-working strategies in order to keep yourreferral network growing. Become a stu-dent of the craft.

As technology continues to evolveand provide us with access and infor-mation, we must lead the next genera-tion of successful loan originators byevolving our marketing strategies inorder to maintain a trend of success. Itis up to each of us to inspire, teach andthen require that strategies with provensuccess be adopted and maintained.

Brent Emler is director of sales and mar-keting at Velma.com, a customizablemarketing software provider exclusive tothe mortgage industry. He may bereached by e-mail at brent@velma.com.

60

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

By Cal Haupt

As a young child when you were sent off onthe bus on your first day of school, chal-lenged to meet new friends or joined a clubto expand your social life, you probably feltapprehensive. Feeling stressed and anx-ious, you were most likely told by your par-ents not to worry and to just “be yourself.”

“Be yourself” is a phrase that is quitepossibly the most commonly used phrase

in the history of advice and yet, even asadults, we sometimes don’t follow thenumber of one piece of advice that hasthe profound ability to set us apart fromthe rest and help us establish our trueauthenticity. Our hunger for authenticityguides us in every age and aspect of ourlife. It drives our explorations, relation-ships, commitments, self-image, goals

and our future. So, if authenticity is whatwe strive for as people, why should busi-nesses be any different?

Businesses today have the uniqueadvantage of social media–an ideal plat-form to publicly proclaim who they are asa business, what they stand for and howthey’re different from the rest and, in turn,align with others i.e. consumers, employ-ees and potential recruits who are drawnto and value who we they and what theyhave to offer. And while some level of anx-iety is always present when we’re ventur-ing into new territory, when it comes tosocial media, it’s all about being yourself.

Originate, don’t imitateAn important step to build relationshipswith consumers, clients and employees inthe world of social media is to establishyour brand by identifying what makes youdifferent. Because mortgage companiesoffer similar types of services, it’s especial-ly important to establish differentiators.Identify something that sets your compa-ny apart from others and matters in yourmarket. Perhaps it’s the impeccable serv-ice you provide, your firm’s combinedexpertise, a unique loan originationprocess or the spirited culture of your firm.Perhaps you want to identify how yourfirm offers specialized orientation to edu-cate and ease anxieties for first-timehomebuyers or how your firm providesservice to the investor market. If you don’thave a specific differentiator, it’s time toidentify one. Whatever it is, make it yourown and promote it via social media.Above all, be original.

Humanize your approachIt’s understandable that developing anonline presence can be intimidating, espe-cially in the mortgage industry.Compliance regulations call for carefulconsideration of anything posted online.However, just because you’re regulateddoesn’t mean you can’t engage. In fact,you should. As more people continue todiscuss the mortgage industry through avariety of online platforms, it’s vital thatwe recognize the necessity of listening toand participating in these online conver-sations. Establish the necessary proce-dures and guidelines to avoid potentialrisks and get in on the conversation. When

posting on Facebook or tweeting onTwitter, make sure you humanize yourapproach. Automation has become fartoo common. This is an opportunity foryour talk to, engage with and learn fromyour followers. Customize your responsesand offer pertinent information your fol-lowers need and want. People trust peo-ple. Use this opportunity to present yourfirm as a person rather than a computerand allow the online community a chanceto get to know you.

The big pictureIf you’re not using images to share yourstory online you may be missing out.According to recent statistics Pinterest isthe fastest growing social network todayand Instagram has now grown to 40 mil-lion users worldwide. Perhaps it’s becausemost people, 65-85 percent, considerthemselves visual learners and furtherstudies have found that our brains processpictures 60,000 times faster than text.Plain and simple, image-centric socialmedia has become a powerful force in theonline sphere. Through the use of imagesmortgage companies can share their story,engage with consumers, target specificaudiences and bring life to its people,products and services. Photos also increasethe likelihood of receiving shares andretweets on social media. And, the contin-ued prolific use of smartphones will onlyfurther escalate this game-changer in theonline community.

Embrace the culture of your firmAllow your clients a bird’s-eye view intoyour organization and give potentialrecruits a snapshot of life on the inside bydigitally showcasing your firm’s culture.People connect with people, so use thisopportunity to showcase the individualityof your company’s character and culture.Showcase your employees, the internalevents and activities within the firm or thepublic gatherings held to express yourappreciation to clients. Equally importantis to pay close attention to what is writtenabout your company online. Use yoursocial media platforms to deflect negativecomments and correct problems or gapsin service. Remember, social media isnever a one-way conversation.

“When establishing a social media strategy, acquiringfans and followers is only half the strategy, the otherhalf is educating them.”

A Hunger for Authenticity in the World of Social Media

61

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

Educate and shareWhen establishing a social media strategy,acquiring fans and followers is only halfthe strategy, the other half is educatingthem. You’re an expert in your field soshare that expertise. Educating and shar-ing consistent, industry relevant, usefulinformation with your fans and followerswill turn those occasional page viewersinto long-term followers and payingclients. The mortgage industry is at a par-ticular advantage here with so much ever-changing information to share. Let’s faceit … purchasing a home is one of largestpurchases your client will make in theirlives, and according to Pew ResearchCenter (2013), one in three Americans gettheir news via Facebook. Use your socialmedia platforms to provide industrynews, trends and statistics, homebuyingtips and loan options. In addition to pro-viding your fans and followers with news,generate news as well. Write your own

opinions about the latest bills that areimpacting the housing market, a greenrenovation investment or how tostrengthen relationships with real estateagents. Monitor social media to choosetopics that are already being discussed inonline conversations, write a timely blogand promote it via your own socialmedia channels.

Here is a quick SEO tip: If you are writ-ing blogs for multiple sites, that’s great,but make sure you vary your content orsummarize your post and provide a link tothe original blog to avoid duplicate con-tent, which will negatively affect your SEO.

Keep ‘em coming backNow that you’ve created a loyal following,it’s important to create content that willkeep them coming back. Educating andsharing information with your fans andfollowers is one important aspect, but it’salso a great idea to lighten it up a bit and

The Obsession WithSocial Media

According to 2014 social media sta-tistics, social media is a digital assetthat continues to grow every year.l There are now more than 1.15

billion Facebook usersl Today, there are more than

one billion Google+ enabledaccounts

l Twitter has more than 550 mil-lion registered users

provide them with a weekly or monthlyregular post they look can forward to.Perhaps host a poll and ask your fans andfollowers questions about the housingindustry to gain better insight, develop a“Mortgage Word of the Week” with a defi-nition to enlighten viewers, post warm-hearted community news to show thesofter side of your business or enlist theideas of your online community to deter-mine what type of posts they’d like to see.Take the time to create interesting, engag-ing content that matters to your audience.

Striving to reveal the true authenticityof your firm won’t happen overnight. It’s aprocess that involves accepting not onlyyour firm’s greatest attributes and offer-ings, but also your shortcomings andweaknesses. And while many businessesfear the unknown and a possible negativeoutcome that may arise from engaging insocial media, it’s these human qualities ofthe online conversation that allows you to

be yourself, unique and valuable to yourfans and followers.

Cal Haupt founded Southeast Mortgagein 1993, currently serving as the compa-ny’s chief executive officer. He may bereached by e-mail at cal.haupt@south-eastmortgage.com.

By George Gallinger, CIA, CFE & Roberta Janel, CMB

It is undeniable: Social media hascaused a seismic shift in the wayhumans communicate. Many business-es—especially retailers—realized thepotential of the medium early on andhave successfully leveraged it toincrease customer engagement andultimately boost their bottom lines. Formortgage companies, having a pres-ence on social media platforms canserve as a catalyst for larger volumes ofleads, faster conversion rates, and ulti-mately, more business. However, theinherently freewheeling nature ofsocial media has caused many mort-gage lenders to question how they canbalance regulatory compliance andsocial media in order take advantage ofthe many benefits of this communica-tion vehicle.

Regardless of whether a company isalready immersed in social media or isbeginning to test the social mediawaters, it is important to take a stepback and evaluate whether the organi-zation is fully prepared to mitigate thepotential compliance risks posed by theuse of social media as a tool for mar-keting and business development. Byfirst understanding the inseparablerelationship between enterprise use ofsocial media and regulatory compli-ance and then asking the right ques-tions, a company will be able to lay asolid foundation that fosters compli-ance while taking advantage of thebenefits that come along with the useof social media.

The relationship betweensocial media usage andregulatory complianceThere are a number of laws that applydirectly to mortgage lenders which,without proper social media riskmanagement and mitigation, can

serve as grounds for regulatory non-compliance.

For example, to be in compliancewith Fair Lending Laws and the EqualCredit Opportunity Act (ECOA), allcommunication between financialentities and consumers must not solic-it, collect or discriminate based oninformation related to a consumer’srace, color, religion, national origin orgender. However, since many socialmedia platforms already collect andpresent this information, lendersshould protect themselves from FairLending Law and ECOA non-compli-ance risks accordingly. This can beaccomplished by establishing and doc-umenting compliance training pro-grams for their loan officers throughwhich they are made aware of thepotential consequences of inappropri-ate and unsanctioned practicesincluding, but not limited to, the mis-use of consumer information.

Another example that illustratesthe relation between social media andcompliance is the Real EstateSettlement Procedures Act (RESPA).Section 8(a) of RESPA prohibits theacceptance of fees, kickbacks or“things of value” for the referral of set-tlement business. Section 8(b) pro-hibits the acceptance of portions,splits, or percentages of charges forreal estate settlement services. Theseprohibitions apply to all applicationstaken electronically, including thosetaken via social media. An example ofa RESPA violation would be a referral-based “contest” or “raffle” hostedonline or on a social network where aloan officer’s clients send him/herreferrals in exchange for an opportu-nity to win “things of value” or “kick-backs.” Employees involved in salesmay be tempted to engage in these

activities to boost leads, not realizingthe potential compliance risks atwhich they are placing themselves andtheir employers. Again, mortgagecompanies can mitigate exposure tothese risks by continuously monitoringtheir salespeople’s activities on socialmedia and requiring their salespeopleto attend periodic training on thecompanies’ social media policies.

A final example of legislation thatmay result in conflict between socialmedia and regulatory compliance isthe Gramm-Leach-Bliley Act (GLBA),also known as the Financial ServicesModernization Act of 1999. The GLBAestablishes requirements related tothe privacy and security of consumerinformation and can be contextuallyconstrued to mean that financial insti-tutions are likely to face repercussionsif they appear to be treating consumerinformation carelessly or are less thantransparent regarding the disclosureof privacy policies that apply to one ormore of the social media sites beingused. The risks associated with thisexample can be realized through acommon practice—outsourcing socialmedia management to a third-partyservice provider. Third-party non-com-pliant practices can range from a lackof consumer disclosure in relation toprivacy policies to “careless” manage-ment of consumer information oreven a potentially weak informationtechnology (IT) infrastructure thatleaves vital company data and creden-tials vulnerable to misuse or theft. Inthese instances, lenders may be heldliable for ensuing “foul play” ormishaps on behalf of the contractorand can, therefore, suffer the ramifi-cations of GLBA non-compliance. Thisrisk can be mitigated by conductingthorough due diligence prior to thecontracting of these services and con-tinuous monitoring of the third-partyprovider thereafter.

These are just a few examples illus-trating how improper use of socialmedia can reflect on a mortgage com-pany’s compliance standing. The goodnews is that many mortgage compa-nies already have existing complianceprograms that, with some modifica-

tion and additional training, can besuccessfully expanded to address therisks posed by social media usage.

How should mortgagecompanies assess theirsocial media compliance-readiness?In order to assess their company’s cur-rent level of compliance-readiness inthe context of social media usage andidentify the steps necessary to mitigateinherent compliance risks, mortgagecompanies should ask themselves thefollowing questions:

1. How does the use of social mediasupport and fit into our currentbusiness-level strategies, goals andobjectives? Which controls will wehave to either update or implementin order to sustain a successful andcompliant a social media program?How will these controls be managedand who will be accountable formanaging them?

2. How can we integrate our existingaudit and compliance functionsinto these social media initiativesto ensure ongoing compliancewith internal policies as well asapplicable laws and regulations?How will we execute assurancereviews to monitor continuouscompliance with these policies,laws and regulations?

3. Which controls and/or processesmust be instituted for contentapproval in order to safeguard ourcompany from non-compliancewith consumer protection lawsand regulations?

4. How will we go about implementinga monitoring program to appropri-ately oversee content posted onthese platforms by our companyand/or third-party service providersas well as consumers?

5. Will we be contracting these servicesto a third-party provider? If so, howstringent will our due diligenceprocess be? What contractual lan-

“… the inherently freewheeling nature of social media has causedmany mortgage lenders to question how they can balance regulatorycompliance and social media in order take advantage of the manybenefits of this communication vehicle.”— George Gallinger, CIA, CFE

Social Media and RegulatoryCompliance: How Mortgage Lenders Can Make Room for Both

62

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

“There are a number of laws that apply directly to mortgagelenders which, without proper social media riskmanagement and mitigation, can serve as grounds forregulatory non-compliance.”— Roberta Janel, CMB

guage will we use in order to protectourselves from potential liabilities?How will we continue to monitorour third-party providers?

6. How will we conduct in-house socialmedia training to promote compa-ny-sanctioned and compliant bestpractices? Will both professionaland personal use of social media byemployees be addressed? Will weimplement an employee socialmedia policy “sign-off” control toprotect ourselves from unsanc-tioned, noncompliant practices per-formed by a “rogue” employee?

7. How will we “quantify” the results ofour social media efforts to measurethe program’s effectiveness in achiev-ing originally stated objectives?

The answers to these questions willserve as a basis for developing an effec-tive social media risk management andmitigation program. For best results,the risk management and mitigationprogram should be developed withinput from all functions of the lender’soperational staff including, but not lim-ited to, specialists in compliance andlegal, information technology and secu-rity, human resources and marketing aswell as senior-level management.

The bottom lineCompanies across all industries arerealizing the benefits of leveragingsocial media in a manner that sup-ports their strategic objectives andaligns with the efforts being madeacross all facets of their businesses.While it may appear that compa-

nies—particularly financial entities—are risking compliance to somedegree by connecting with customersthrough social media, the upside of acompliant online presence far out-weighs the potential risks.

Simply put, once lenders fully under-stand the relationship between enter-prise social media use and enterpriserisk; have conducted an internal assess-ment by asking themselves the previous-ly recommended questions; and havesought input from across the enterpriseto assist in implementing and monitor-ing social media programs as appropri-ate; they can make huge strides inshielding themselves from non-compli-ance while still being able to take advan-tage of the infinitely-extended market-place the world of social media has tooffer.

George Gallinger, CIA, CFE, is a principalwith CohnReznick Advisory Group andserves as national director of its gov-ernance, risk and compliance prac-tice. George may be reached by phoneat (973) 871-4060 or e-mailgeorge.gallinger@cohnreznick.com.Roberta Janel, CMB, a director withCohnReznick LLP, has more than 25years of experience in the mortgageindustry, specializing in consumerlending and mortgage finance, concen-trating in federal and state compli-ance, enterprise risk management,government-sponsored enterprise(GSE), U.S. Department of Housing &Urban Development (HUD) interactionsand Dodd-Frank Act implementation.Roberta may be reached by phone at(973 ) 871 -4027 o r e -ma i lroberta.janel@cohnreznick.com.

63

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

By Chad Jampedro

Not all that long ago, when mortgagecompanies wanted to find talent, theywould turn to sophisticated recruitingfirms or local newspaper to place a clas-sified ad. Soon, newspaper ads gaveway to vast, online job databases andcumbersome, paper applications —thebane of every HR department (andevery applicant, really—slowly becameoutmoded.

None of the aforementioned recruit-ing methods have become obsolete—indeed, they are still often held as thede rigueur steps in the hiring process—but the options for recruiting talent hasdrastically changed.

Evolving communication tech-nologies, such as the Internet andmobile devices, have put the worldin users’ hands. Naturally, brick-and-mortar businesses trickled onto theWeb to take advantage of the e-mar-ketplace, and in return consumersgained an unprecedented air of con-venience, transparency and access tocompanies, employers and otherleaders.

This has become no truer thanwith the Web’s most vanguard pro-gression: social media. There is nodenying the influence of socialmedia channels such as Facebook,LinkedIn and Twitter. Their sheerreach, immediacy and connectivity isunrivaled by any other communica-tion outlet.

By now it’s become clear that socialmedia—in all of its various forms—isn’t going anywhere. And though itremains a channel with which userscontinue to post an oversupply of catvideos

When it comes to using these plat-forms to build your business from theinside-out, there’s no way to spin it:social media is changing the recruitinggame. Here’s why mortgage firms needto tag in.

Unlocking social potential According to a 2014 study byCalifornia-based recruiting softwarefirm Jobvite, a full 71 percent of theU.S. labor force is on the job market,and more than half of employedworkers are actively seeking, or“open” to a new job.

While the report, “Job SeekerNation” shows that four in 10 ofpotential applicants found jobsthrough personal connections, 20percent were found on online jobboards, and slightly more—about 21percent—landed jobs after first dis-covering the openings via social net-works.

Despite social media being closelytied to teens and Millennials (thosepeople born roughly between 1980and 2000), it’s actually a higher per-centage of Gen Xers who are turningto social networks like Facebook,LinkedIn and Twitter to find jobs, thesurvey reveals (about 62 percent ofrespondents).

Consider that just four years ago,in 2010, job boards accounted forabout one-third (32 percent) ofsecured positions.

“A large group of job seekersbelieve they have a better chance toland a job if they are connected,proactive and prepared,” said DanFinnigan, Jobvite president and CEOin that report. “These are some of thevery qualities employers look forwhen hiring, and social networks areemerging as the meeting ground forlike-minded innovative employersand prospective employees.”

In 2012, the company reportedthat 93 percent of American employ-ers planned to use social media forrecruiting in the future, and about 73percent said they had successfullyhired an applicant using the recruit-

ing process in the past.It’s easy to see why employers are

connecting on social platforms: Socialrecruiting “just works better” than tra-ditional hiring methods, says Jobvite.It not only increases the number ofapplicants in the hiring pipeline (dueto its millions upon millions of users)but also the quality of those who mayrespond.

“Social job seekers are younger,wealthier, more highly educated andmore likely to be employed full-time,”Jobvite noted. And so should you!

Dress to impressSo, how can you leverage socialmedia recruiting in your company?For one, you have to be open andwilling to invest in the practice. Youmust educate yourself about the var-ious social networks, to better under-stand where to target your recruitingefforts.

Social media users are savvy, and ifyou don’t have Social Media 101down, they are likely to skim overyour job opening for a more innova-tive firm.

Additionally, it is important forsocial recruiters to understand thatyou—as in, the employer—mustcome to the process willing to “dressto impress.”

For example, as social networksincreasingly contain more and moreinformation about companies (not tomention are more easily found due tothe advent of social search) applicantsare more likely to judge your compa-ny based on online reviews, the qual-ity of your Web site, the eminence ofyour social pages, and the profiles ofyour current employees and companyleaders—including you.

This includes:

l Having a clear, authentic message:A status update filled with jargon isuseless. Keep your job posting shortand snappy—but informative. It’sall about balance.

l Including high-quality images,videos and graphics: Multimedianot only shows an applicant thatyour company is operating in the

21st Century, it’s a good way tointroduce a potential hire to yourcompany.

l Supplying working links back toyour Web site: There’s not a biggerdetraction than links that don’twork. It looks hasty and unprofes-sional. Do a quick test before mak-ing an official post.

l Making it easy and convenient toapply: Grab essential information,sure, but leave everything else forthe interview later. This saves timefor both parties.

l Providing information pertainingto work culture: Today’s workerswant more than a salary. They wantfeedback, flexibility, volunteeringopportunities, and an overall con-genial environment. Host an annualcookout? Talk about it.

l Addressing opportunities foradvancement: Most workers wantto make an impact in the companythat they are in. You’ll have a leg upif you offer training and supplemen-tary education.

Jobvite reports that 42 percent ofcandidates who have had a bad appli-cant experience would never seekemployment from that companyagain. Yet, 68 percent of candidateswould join a company that created agreat first impression, even if it meanttaking a salary five percent belowtheir lowest offer.

Only time, and a clear strategy, willhelp mortgage companies ensure thatall of these things are in line. In otherwords, as tempting as it may be, don’tleave your social recruiting strategiesup to your marketing intern.

Remember, just as you plan oninterviewing potential candidates,potential applicants are also “inter-viewing” you.

Chad Jampedro is president of GSFMortgage Corporation. With more than20 years of experience, GSF Mortgage hasembraced the next generation of home-owners with its GOGSF brand, continuingits dedication to flexible and transparentlending. He may be reached by phone at(262) 373-0790.

“It’s easy to see why employers are connectingon social platforms: Social recruiting “just worksbetter” than traditional hiring methods …”

Social Media Recruiting:Are You Linked in to Talent?

64

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

65

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

“That is how you use the Internet … it is a tool,not an advertisement.”

By Eric Weinstein

“Well, I finally got done reading theentire Internet the other night. It tookme a while, but I just read the last Webpage.”

My kids think that statement is hilar-ious. There are probably a trillion Webpages.

Now, compare that to a Super Bowlad I saw a few years ago. A startupcompany of three guys builds a Webpage in their garage. Instantly, theorders go from five to 300 to 16,000 to300,000 to over one million in thespan of the TV commercial. Now theyare worried how they are going totake care of all this business. That iswhen the IBM logo displays across thescreen. Mortgage brokers subcon-sciously think that is exactly what isgoing to happen when they launchtheir new Facebook Fan Page or startblogging.

Try Googling the word “Mortgage.”No exaggeration, you literally get 117million hits (type it incorrectly,“Morgage” and you get the exactsame amount of hits). The first threenames that come up are majorlender advertisements. They proba-bly pay what your house is wortheach month to be in that spot. Howmany people do you think will scrolldown to spot 10,045,983 to find yourWeb site?

Face it, your Web site is one grainof sand on an endless beach.

I have been on Facebook, Linked Inand Twitter for years. Occasionally, Iwill post something reminding myfriends what I do for a living. I havenever gotten a deal out of it ever. Onthe other hand, I have never boughtnutritional supplements from a friendbecause she posts it on Facebookeither. I go on those social media net-works to connect with friends.Shopping is not the number one thingon my mind.

Now, I am on several productreview Web sites, and I do admit, I did

get a loan once from Yelp! But, thatthat was one loan over a one-yearperiod. It was not enough to put mydaughter through college, but, hey,every bit helps.

In Star Trek, whenever they runinto a problem, the answer is alwayssomething like, “Captain, we just needto reverse the polarity and invert thetachyon field on the Heisenberg com-pensator.” It sounds impressive, but itis just a bunch of made up words andconcepts. People are always lookingfor a simple solution to a complexproblem. How do I generate moreloans? Start a really good Twitter fol-lowing. That should do it. Case closed.What’s for lunch?

Now don’t get me wrong. I am notsaying DO NOT build all this socialmedia stuff. When I was starting out,if you were not in the Yellow Pages,you were not a real company. Today,if you don’t have a Web site, a FanPage and an iPhone app, you are nota real company. The thing people for-get is that this does not draw traffic… it is just an accommodation to thepublic already searching you out.

Go to Google and type in “EricWeinstein Carteret Mortgage.” Youwill get 441,000 Web sites. I haveNEVER gotten a loan from any of this.Yet, I have a small personal Web sitewhere I drive my borrowers to fill outtheir information on a secure 1003,as I am sure you do. That is how youuse the Internet … it is a tool, not anadvertisement.

Here is a crazy idea. How about get-ting up from your computer, goingoutside and actually talking to somepeople? I know that is not the currentsocial trend, but it seems to work forme.

So, what is the focus of this entirearticle? I have tried blogging, I haveall the required social media para-phernalia and for me, it is only a pre-requisite for being a loan officer. It is

not the end all, be all of my advertis-ing wares. All too often, people fall inwith companies promising total mort-gage success with their expensivesocial media advertising campaigns.There is no magic wand that gets youtons more business. That has just beenmy experience.

Use it as one more arrow in yourquiver. Don’t stop doing what you arecurrently doing or bet the farm onthis fancy technological concept thatyou really don’t fully understand.

As Mr. Spock would say, “It is onlylogical.”

Eric Weinstein worked in banking, on thecommercial real estate side until 1991,when he fell in love with residential lend-ing. In 1995, he started a small mortgagecompany in his basement called CarteretMortgage Corporation, which in 2003,grew to one of the largest mortgage bro-ker companies in the United States.These days, Eric is semi-retired, doingmortgages by referral only. As he likes toput it, “He is either saving people moneyper month or helping them buy a newhome. What a great job!” He may bereached by phone at (703) 505-8692 or e-mail eweinstein4u@gmail.com.

Anti-Social Media

OFFERINGUTIONSOLGEGATMORVERSEREOMPLETECOURY

:OFFERINGVERSE

Email: rmaorther inffoor furF

om.cvmsnaosynek@rrEmail: r281-404-7970osynek alph R Rt:tacontion, cma

NMLS Unique Iden

tners@rparRMSNA

281-404-7970

: 107636tifierNMLS Unique Iden

om.cvmsnatners@rom.cVV.NAAV

By Ricardo Cobos

Why did you start blogging?It is said that necessity is the motherof all invention. For me, blogging wasborn of my own personal necessity.Let’s face it, the mortgage business in2014 is not your father’s business, andfor better or worse, it isn’t even the

business it was just a few years ago.In 2007, I relocated from Northern

Michigan to Raleigh, N.C., seekingmore fertile ground to ply my profes-sion. Little did I know that the condi-tions in Michigan would soon spreadlike a cancer across the country.

Not knowing anyone in Raleigh,

but equipped with 10 years of lendingexperience, I was just like any otherbrand new loan officer. But I had aniche. I would be mobile! To provemy commitment, I invested in abroadband mobile Internet card formy laptop and a passenger’s seat deskfor my car and branded myself “YourOn-Call Lender.” I got in my car andbegan knocking on doors of realestate offices. It wasn’t long before Idiscovered that modern real estateoffices are nearly devoid of realestate agents! The few I could con-nect with, although happy to talk tome, were leaving the business fasterthan I could call them a partner. Withgas prices skyrocketing, I had to finda new way to reach a larger audience.That’s when I began blogging.

How long before your blogging effortspaid off?My early blogging was on a nationalplatform dedicated to connectingreal estate agents, mortgage lendersand home inspectors. Without nam-ing them, let’s say they were aCanadian company whose nameincluded the word “rain.” It wasn’tlong before I was considered a“Rainmaker,” a moniker assigned tobloggers on the platform who werethe most active in their markets.Most of what I blogged about weretopics that were of interest to me andothers in the industry. I soon begangetting a few leads from my efforts,but truth be told, I wasn’t that goodat blogging, therefore, the leads werenot very good or consistent.

What are some of thechallenges to starting a blog? Revenue is essential to all businesses,and Google loved this platform! It con-sistently returned organic searchresults from bloggers which were near-ly always on top of the results page,yet it didn’t cost a dime! The platformsoon realized that with thousands ofbloggers producing unique contentdaily, they could monetize it by charg-ing bloggers for access to Google. They

shut off the platform to Google’s Webcrawlers and created a premiummembership that cost about $50 permonth. Simply put, the content that Ihad created was no longer visible toGoogle or the world without payingfor it. It felt like my intellectual prop-erty was being extorted. I learned avaluable lesson, and never againwould I produce and publish originalcontent for a platform that I didn’town and control the End-User LicenseAgreement (EULA).

After taking a year off from blog-ging, in 2010, I set up a freeWordPress.com blog called “TheRaleigh Mortgage Guy.” It wasn’t hardat all, but the refinance boom wasconsuming most of my time, so I did-n’t do much with it. Instead, I copiedmy content from the other site andposted it there. But nothing hap-pened. Traffic to my blog was practi-cally nonexistent. My blog was useless,and worse yet, it was a waste of mytime.

What is the best adviceyou could give someonestarting a blog?I was about to give up when I stum-bled across a formula that worked.Instead of blogging about topics thatwere of interest to me, I began writ-ing about things that were of nointerest to me whatsoever. That’sabout the time that I posted aboutan obscure pending rules change toUSDA loans, and overnight, my sitetraffic doubled! Sure, it was only 380page views, but it was double! It tookme another four months before Iswallowed my pride and stoppedwriting for me and began writing formy potential clients. Instead of try-ing to be everything to everyone, Ibegan providing answers to specificquestions that had been presented tome. In other words, I stopped writingmarketing pieces and began provid-ing value. That’s when I got seriousabout blogging.

How has blogging helped your business? Leads generated from my blog repre-

“Once your blog is branded to you or yourcompany, it becomes marketing piece and losesmuch of the benefits of having a blog.”

Blogging for Apps: 10 Tips for a Successful Blog

66

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

FREE INSTANT WEBINARnmpwebinar.lifeafterrefi.com

38MINUTESTO MORE

PURCHASEDEALS!

�

�

�

�

sent about 50 percent of my annualclosings. The leads I get from myblog are generally better qualitythan those referred by partners. Butmore important, the sales cycle hasbeen dramatically reduced while theconversion rate is significantly high-er. People calling me from my bloghave already done their due dili-gence. The call is simply what I liketo refer to as a “proof of life” call. Inother words, they just want to makesure that I am The Raleigh MortgageGuy.

10 tips for a successfulmortgage blog1. Start cheap (but not too cheap):

Web developers charge thousandsof dollars to develop a flashy Website with blogging capabilities.The trouble is that you still haveto fill it with content, and to befrank, most are built on the opensource (free) WordPress platformwhich has become the industrystandard. Although you can startwith a free WordPress.com-hostedblog, I recommend usingGoDaddy.com’s Managed Word-Press Hosting. Believe it or not,the $1 per month plan is what Iuse, and unless you plan on hav-ing more than 25,000 monthlyvisitors or more than one Website, this is all you will need to getstarted. Just like WP.com,GoDaddy managed hosting givesyou access to literally hundreds offee templates which are easy toset up and customize. But the pri-mary benefit is that the site is 100percent yours, no ads and youhave access to hundreds of third-party plug-ins, many which arerestricted from on a WP.com.

2. It’s not about you (or your com-pany): Apart from an “About Me”page which should include links toyour social media profiles such asLinkedIn, Facebook and Twitter,your blog shouldn’t be branded.The harsh reality is that your read-ers won’t care one bit about you oryour company until they havedetermined that you can solvetheir problem. In fact, my blogdoesn’t have a picture of me or myname anywhere in the title.Instead, I chose to pack my title

with keywords such as my city andmortgage. Once your blog is brand-ed to you or your company, itbecomes marketing piece and losesmuch of the benefits of having ablog.

3. Be committed (give it a year): It’seasy to throw in the towel when wedon’t see immediate results. Likeany other business practice, consis-tency is the key. For me, I simplytransferred some of the cost ofdriving and marketing to realestate agents to producing contentfor my blog. Initially, I committedat least one hour per day. Today,it’s far less.

4. Where’s your Call to Action?:Someone once said that if yourblog doesn’t have an active leadcapture system, then what youhave is a public library. I ruminat-ed on that statement for monthsbefore I did something about it. Itrequired me to move my blog froma free WP.com site to a self-hostedsite. Once I did, subscribers to myblog surged from a paltry 600 toover 3,300 in just three months.

5. Answer questions instead: I’mlazy, which is why FrequentlyAsked Questions (FAQs) are myfavorite blog posts because theyanswer questions, and let’s face it,we don’t browse Google. Instead,we ask Google questions hoping tofind answers to specific questions.But SAQs (questions that SHOULDbe asked) are an opportunity toshowcase my superior skills. Theseare a super easy source of con-tent. Anytime I find myselfanswering a unique question thatrequired me to check underwrit-ing guidelines, that inquirybecomes the basis for my nextblog post.

6. Keep it brief: Americans have theattention span of a gnat. Threehundred to 500 words are the per-fect length. Breaking longer postsinto multiple parts will allow youto create additional content foryour blog.

7. Reuse and recycle: Content thathas proven popular can be dusted

off and blogged again as a currenttopic.

8. Stop talking about rates: Do wereally need to talk about this?

9. Get local: Talk about your marketand your favorite subdivisions. Ifthere’s something worth notingthat’s happening in your market,blog about it. It won’t take longbefore Google recognizes you as alocal expert. Don’t be surprisedeither when your local mediabegins calling you for content.

10.Give credit where it’s due:Imitation is said to be the sincer-est form of flattery, but when itcomes to intellectual property, ifit hasn’t been cited, it’s called pla-

giarism. Our industry has takenenough body-blows. Failing toproperly cite your work will onlyhurt your reputation so give cred-it where credit is due!

Ricardo Cobos, The Raleigh MortgageGuy, has twice been named amongNational Mortgage ProfessionalMagazine’s Top 25 Most ConnectedMortgage Professionals in America.He has more than 16 years of retaillending experience. In addition tobeing a licensed loan officer, he isalso the director of Internet market-ing and all things digital at AESLending in Cary, N.C., supportingmore than a dozen loan officers. Hemay be reached by phone at (919)526-0183 or e-mail rcobos@aeslend-ing.com.

67

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

68

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

By Thomas Morgan

Corporate concerns with socialmedia may be over-emphasizedwhen you look at the real utility ofsocial media platforms. For a loan

originator, using Facebook or othersocial media platform to try and getbusiness, marketing efforts focusmore on developing name recogni-

tion and improving search engineplacement through search engineoptimization (SEO) efforts than actualcustomer relationship management.Potential applicants do not simplyseek out mortgage lenders on socialmedia sites. However, the appear-ance of a lender or particular loanofficer on a search engine result, par-ticularly at a very specific searchengine result, can result in new busi-ness generation.

The concerns of lenders run fromsimple compliance to privacy, fairlending and reputation risks. So, willloan originators use a social mediasites to divulge corporate informa-tion? Or, could they unintentionallyaccept a loan application withoutproviding the appropriate loan dis-closures in a timely manner? Or,could he or she engaged and prohib-ited types of communication thatmay appear to be a discriminatory orexpose a lender to other potentialcompliance risks?

In fact, the greater risk potentialfor may exist in the area of reputa-tion. For example, in the midst ofthe mortgage crisis, as foreclosureactivity soared, activists accessedlenders through their social media.To this point, lenders enjoyed a cer-tain amount of anonymity.1 But, asthe number of foreclosures escalat-ed, the victims no longer remainedfaceless. Mortgage lenders becamethe enemy and public exposurethrough blogs and social media sitesquickly became a vehicle for thepublic to pile onto. Bank of America,which became a target through itspurchase of the Countrywide pow-der-keg portfolio, had to resort to“bot-like” responses simply to keepup with the volume of communica-tion, further inflaming the anti-mortgage sentiment.

Among the compliance concerns,fair lending issues may take prece-dence as social media vehicles give“testers” wide open, anonymousaccess to originators, in a perfect“matched-pairs” testing environ-ment.2 In this case, disparateimpact—today’s hot button issue—

figures less than a direct correlationto a discriminate act. A loan origina-tor may simply ignore a request froman individual with a racially specificprofile and invite a claim.

By definition, public communica-tion through social media representsa form of advertising. Ensure anymessages have met your require-ments for advertising.

The compliance officer and pro-duction staff must really understandhow social media advances market-ing efforts. Simply, do not use it as abi-directional communication tool,but as a farm for sprouting keywordsand relevant topics.

Content shouldn’t come directlyfrom loan originators, but a streamof suggestions for content to a cen-tral source can achieve this goal.Allowing or requiring content fromemployees (particularly originators)creates an unnecessary burden foremployees to participate in socialmedia and could create more pres-sure on non-compliant activity thannecessary. Even re-posted materialshould be vetted against an advertis-ing checklist.

Perhaps the best solution revolvesaround providing a social media con-tent provider—someone who willprovide pre-approved content topost on social media sites. This canadd to both corporate search engineoptimization benefits, as well asallowing individual loan originatorsto improve their own businessresults.

Thomas Morgan specializes in mortgagequality control plans, lending policiesand procedures. He may be reached byphone at (877) 918-7246 or e-mailthomasmorgan@mortgagemanuals.com.

Footnotes1—Juris, J. S. (2012), Reflections on #OccupyEverywhere: Social media, public space, andemerging logics of aggregation. AmericanEthnologist, 39: 259–279.

2—”All Other Things Being Equal.” A PairedTesting Study of Mortgage Lending Institutions(Executive Summary). Web. 19 June 2014.www.urban.org/publications/1000504.html.

“Among the various social networks, LinkedIncan be one of the most useful when it comes tofostering a referral network.”

Social Media: Compliance Risks of the Emoticon?A social media policy can help manage the risks

JOIN A GROWING TEAM

CONTACT:John Cervantes | RECRUITER John.Cervantes@CarringtonMH.com

949-517-7127

Carrington is expanding nationwide and we need experienced managers and teams to join our organization. WE OFFER:

Great compensation and benefits Operations focused on quality and speed of closing Marketing support and lead generation Licensing and compliance support Agent co-marketing programs Government loan programs from FICO of 550

Carrington Mortgage Services is adding retail branches today.

IT’S TIME TO MAKE YOUR MOVE.

Join our career webinars, posted on Facebook at: www.facebook.com/CarringtonHomeLoanswww.Carringtonhomeloans/CareerWebinar

Loan Officers, Branch Managers and Teams,

© Copyright 2007-2014 Carrington Mortgage Services, LLC headquartered at 1610 E. Saint Andrew Place, Suite B150, Santa Ana, CA 92705. Toll Free (800)561-4567. NMLS ID

2600. Nationwide Mortgage Licensing System (NMLS) Consumer Access Web Site: www.nmlsconsumeraccess.org. AZ: Mortgage Banker BK-0910745; 2159 McCulloch Blvd 4, Lake

Havasu City, AZ 86403. CA: Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act, File No. 413 0904. CO: Check the license status of

your mortgage loan originator at http://www.dora.state.co.us/real-estate/index.htm. GA: Georgia Residential Mortgage Licensee 22721. IL: Illinois Residential Mortgage Licensee.

MN: This is not an offer to enter into an interest rate lock agreement under Minnesota Law. MO: Residential Mortgage Broker License 09-1746-S. NH: Licensed by the New Hampshire

Banking Department. NJ: Licensed by the N.J. Department of Banking and Insurance. NY: Licensed Mortgage Banker—NYS Department of Financial Services. New York Mortgage

Banker License B500980/107664. OH: Ohio Mortgage Broker Act Mortgage Banker Exemption MBMB.850208.000 (FHA DE & VA Automatic loans only) OR: Mortgage Lender License

ML-4886. PA: Licensed by the Department of Banking. RI: Rhode Island Licensed Lender, Lender License 20112809LL. VA: Licensed by the Virginia State Corporation Commission

MC-5382. WA: Consumer Loan License CL-2600. Also licensed in AL, AR, CT, DE, DC, FL, ID, IN, ME, MD, MI, NM, NC, OK, SC, TN, TX, WV and WI. All rights reserved.

Find out more about Carrington today and make the move to expand your business and career.

“…video really makes an impact by lettingpeople get to know you before they everknow you.”

69

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

By Adam P. Smith

So, I am writing this from a plethora ofexperience, both hands-on and thatwitnessed from some of my greatestfriends and colleagues. I have beenvideo blogging to the real estate com-munity for a few years now, and it hasbeen great! Great in the level of fun andentertainment I get from doing it. Greatin the level of response it gets and thecredibility is builds. And great in mak-ing me feel like a celebrity in some rarecases. Okay, well maybe not a celebrity,but you’ll see what I mean.

This all started because I was gettingsome pressure from those aforemen-tioned friends and colleagues to getstarted on video blogging before itbecame a dying technology. Now don’tbe fooled, all of these things we aredoing from a social media standpointare dying technologies. Facebook,Twitter, LinkedIn, etc. have all peaked.Now, I’m not saying they’re dead, and itmay be years or even decades beforethey die out, but make no mistake;they have all peaked and are nowdying. I am excited to see what the nextgreat “social media” platforms will be,though.

In any case, some of these friendsand colleagues are the pioneers of thisvideo blogging stuff. They do videosevery day, on all sorts of subjects,broadcast to a really broad audienceand they do it really well. Well, thenthis should be easy to mimic, right? Notso much. I speak publicly all the time. Iteach classes to real estate agents on apretty frequent basis. I don’t mindbeing in front of the camera, and Idon’t even mind the sound of my ownvoice. This is a rare combination in oursociety, I guess. However, the content iswhat was killing me. What to actuallysay in the videos is the hang up? You’vegot to be kidding me.

I’m not kidding … I could not figureout for the life of me what to say in myvideo blog. I started by making a videoblog series directed at the mortgage

consumer. “What to expect when apply-ing for a loan?” Boring. “What docu-ments you will need to provide youlender.” Snoozer. “How the closing willgo.” Ugh … enough. So, what I reallystruggled with was the video content.Then I had an epiphany, or someonedid for me, anyway. Someone askedwhy I wasn’t doing the video blog con-tent to match the classroom material Ihad been teaching to the real estateagents for years on end already. Thelight bulb went off!

I have been teaching “Zero CostMarketing” and “Contact Managementfor a Repeat and Referral Business” foras long as I could remember. It’s greatmaterial for real estate agents, mort-gage brokers/bankers, insuranceagents, financial planners, and so on…basically anyone with a direct to con-sumer relationship. We have also beendoing classes specifically on socialmedia and even on video blogging, sothis is the material I know.

So, I really hit the gas on these newvideos with all the content I wouldneed, and it really is all the content Ineed, and believe me, there is all thecontent you need if you really thinkabout it. To get started, I took some-thing small right out of the classroommaterial, started with a little camera inmy laptop, shot a video, did someminor editing and up to YouTube itwent. The response was far better thanI expected, so I did another, and anoth-er, and now it’s been a video everyweek for a few years. Before I knew it,there were hundreds, and eventuallythousands, of people subscribing to thevideos via e-mail and watching meevery week. Like a celebrity, right? Well,maybe not yet, but when I am at eventsnow, people do say something alongthe lines of, “Hey! You’re the guy inthose videos every week.” Now that’scelebrity status, isn’t it? I can pretend.

In any case, it has snowballed fromthere. Now we use content from the

classroom material sometimes, butmost of the time, we use good sales-related content from our experiencesover the previous week. A clerk in astore with a great attitude … a server ina restaurant with a bad one … a charityor networking event new event to meetpeople. Whatever the experiences havebeen, we can usually find a way to relateto the idea of building relationships andeventually clients and referral partners.We also went from the laptop camera, toa slightly better Web camera and nowuse a true HD video camera. We still usefree Windows Movie Maker software forall the editing of music, photos, cap-tions, etc. We also still use a freeYouTube Channel to host the videos, sothis has been fun and inexpensive andhas given me some of my own paparazzifollowing me around. I’m sure they’rejust hiding in the bushes.

But why is all of this even of anyimportance whatsoever? Well, we dis-cussed the credibility factor, but youdon’t need video blogging for that. Youcould write articles for trade publica-tions for that, for example. But, we allknow that it takes time and many inter-actions to build a proper referral rela-tionship with someone. We are talkingabout the single greatest investmentsand transactions of people’s lives, afterall. The video blog truncates that timeframe. People get to see you, hear you,learn how you speak, your tone, yourinflection and so on. They even get toknow your wardrobe and maybe seewhat your office or home look like.They get to know you. That makes peo-ple feel like they actually do know you.You might cut that time frame in half byletting people get to know you viavideo. What a great concept!

Now, I’m not suggesting that you do

videos directed at the real estate com-munity or to your clients, or that youfollow what I am doing to the letter, butyou should be doing this in some man-ner. Some of the great ideas we havecome up with in the video bloggingclasses we teach include things likedoing a video of the buyer client mak-ing an offer on a home and sending itto the seller and their agent. That onehas been working really well. I eventhink I heard a tale of a seller’s agenttelling the buyer’s agent that the videowas the reason they chose that offer. Ormaybe making a video of a family that’snot having any luck finding a home tosuit their needs and sending it out toyour circle. Or making a video of aproperty they are going to be listing sothat their clients can have it and sendout in their social media circles. Canyou imagine what a rock star that agentlooks like when all of their clients’friends see how much work they aredoing to help them sell their home?Whatever it is, we just want it to be cre-ative, unique and fun to do with littlecost and great traction.

So, how can video be used to buildrelationships? In about a million differ-ent ways. It can be used with referralpartners, like we do, or with clients andtheir offers or sales, or with clientsregarding their loans … many ways.But there is no doubt, that video reallymakes an impact by letting people getto know you before they ever know you.Cool, right? You better believe it is.

Adam P. Smith is president of TheColorado Real Estate Finance Group Inc.,a commercial and residential real estatefinance firm. He may be reached byphone at (303) 770-2262, ext. 112 or e-mail adam@corefinancegroup.com.

How Do You Video?

www.mortgagenewsnetwork.com

By Moses Keshishian

Unless you’ve been stranded on adesert island for the past decade, youknow that consumer behavior haschanged drastically when it comes toresearching and making purchase deci-sions. In this era of social media, blogs,online reviews, and search engine opti-mization, traditional marketing and

advertising tactics have far less influ-ence on consumers than they once did.

The current digital marketing gameis all about empowering consumers toindependently research products, com-panies, services and reputations toguide them toward a purchase deci-sion. Most importantly, customers des-

perately seek to have their questionsanswered—and their anxiety dimin-ished—before they part with theirhard-earned cash.

Consider how someone might choosean auto mechanic or a restaurant. Inthe past, they might have simply seenan ad in the newspaper or found a list-ing in the phone book, and that wasenough to give the business a try. Now,the first thing consumers do is look atthe company’s website, check out themenu of services, and search for prices.Once they’ve found that informationthey’ll visit the company’s Facebookpage for specials and third party cus-tomer testimonials. After that, theymight do some comparison shopping—reviewing local competitors, theirmenus and prices. Reviews on Yelp orAngie’s List go a long way in terms ofreputation.

If consumers do this level of deep-dive online and social media researchon everyday purchases, it’s pretty safeto assume that they would do all ofthat, and more, when shopping for amortgage loan, a realtor, or other ser-vicer that will be managing one of themost important purchases of their lives.

Make it easy for them to find youWith historically low interest rates nowa thing of the past, refinancings have allbut evaporated. However, with homevalues slowly rising and lenders movingaway from ultra-strict credit underwrit-ing requirements, originations, homeequity loans and reverse mortgagescould begin trending upward.Regardless of what happens, the marketwill remain highly competitive.

Whether you’re a lender, title com-pany, real estate agent or other partici-pant in the mortgage finance industry,you should create a social media andcontent marketing strategy to stay rele-vant and competitive. It’s a key compo-nent to staying ahead of your competi-tors by getting your content, and yourbrand, in front of potential customers.

Prospective borrowers are using, andwill continue to use social media andGoogle to research loan products, inter-est rates, special programs and incen-

tives—and most importantly—a com-pany’s reputation before they evenbegin to make a move. Interestinglyenough, there’s not a whole lot of infor-mation and answers available onlinefrom the people consumers want tohear from directly: Your firm.

Many of the nation’s top lendershave little or no presence on socialmedia representing their consumermortgage lending divisions. And if yousearch the types of questions borrowerswould ask in a Google search, like “Howdo I find a good real estate agent” or“What should I do to find the best mort-gage,” the results come from trademedia, industry associations or blog-gers, not from your company.

The best way to get in the game, andgain the trust of potential borrowers, isto become discovered by creating greatcontent, and distributing that contentthrough your social media channels likeFacebook and Twitter.

Establishing yourself and your company as a trusted authorityA true leader, in any walk of life, issomeone who can engender trust inothers. People seek out transparent andhonest answers to their questionsonline so they’ll know what to expect. Ifconsumers are researching and askingtheir friends for opinions on localrestaurants, it’s because they want toknow they will have a great diningexperience with no surprises when thecheck comes.

It’s important to understand that,according to an article on Google’s ZeroMoment of Truth blog, 70 percent of abuyer’s purchase decision is madebefore they even contact you or yourcompany. Your blog and social mediachannels are your tools to boost con-sumer confidence by having an opendialogue with them.

Ask yourself: “What are my poten-tials clients reading about me and mybusiness when they’re searchingonline?” You should be a part of theconversation no matter what it is theyfind, and you should be answering theirquestions on your website and socialmedia platforms. It’s okay to be proac-

“Whether you’re a lender, title company, realestate agent or other participant in the mortgagefinance industry, you should create a socialmedia and content marketing strategy to stayrelevant and competitive.”

How to Engage Customers and Earn Business Via Social Media

70

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

THE

CHANGE AGENT

OF THE MORTGAGE

INDUSTRY.

THE

CHANGE AGENT

OF THE MORTGAGE

INDUSTRY.

R

Follow us on:

fgmcwholesale.com 888.295.7899 fgmccorrespondent.com 800.296.2275fgmcwarehouse.com 888.637.0102

R

Follow us on:

tive and answer questions they don’teven know to ask.

Consumers get frustrated if they can’tfind answers to simple questions aboutpricing, procedures, and tips on how toget started. If you’re a mortgage profes-sional just getting started on socialmedia, create content about how yourloan processing works. Discuss your pric-ing structure. Provide tips on what toprepare for when they apply and whatthey need to do throughout the life oftheir loan. Share your thoughts aboutthe lending market and signs a borrow-ers should look out for when shoppingfor a loan. Other topics can be very sim-ple, like the best times to buy or sell andhow to monitor lending rates.

If you’re stuck on what you shouldbe writing about, ask your customerservice professionals what questionsthey consistently get asked. Then allyou have to do is convert those ques-tions into blog posts.

You can also ask your own socialmedia audience questions about theirexperiences, and turn the conversationinto blog content. For instance you canask your customers about the best lend-ing experiences they’ve had, and thenfeature a few of the responses youreceived in your article.

Your fans and followers on socialwill be overjoyed to see that you’veused their responses and stories in yourpost and will more than likely shareyour content with their friends andfamily. These kinds of conversationswill earn you loyal repeat customerswho will spread your message by talk-ing about their good experience work-ing with you.

If you produce great content on yourblog, engage with your followers andshow responsiveness on social media—all while establishing yourself as a trust-ed authority—the next time someonedoes a Google search for the questionsyou’ve answered, your blog articles willbecome a top search result. The resultwill be higher traffic flow to your web-site and more business leads.

Getting started onFacebookFacebook is the world’s largest socialnetwork with more than one billionusers. But why is it valuable for a mort-gage company? The platform’s value isin its power to connect people and helpbrands establish a human voice.

You can build an expert connection.

The easiest way to get started is by cre-ating a Facebook business page andsharing your knowledge, insight andexpertise. For the first time ever, themajority of active Facebook users areolder, more affluent, and all potentialclients you want to reach.

You can build a direct connectionwith your customers and an indirectconnection with their entire social net-work of friends and family members,when they like, share, or comment onyour Facebook posts. When Facebookusers engage like this with your posts, itincreases your chances to get discov-ered by their “friends of friends.”

Facebook has broken down barriersby revealing the human side of busi-nesses. It’s allowed businesses to visual-ly share real customer success stories.Facebook has demonstrated how pow-erful one video, one piece of content orone photo can be.

Use the “Social Media 411” postingstrategy throughout the week to helpyou look credible:

l Four posts from sources that youraudience will regard as valuable.

l One post about work accomplish-ments. For example: Share picturesand stories about your staff, shareyour blog posts, or photos andvideos from special events.

l One post for pure entertainmentvalue. Show your audience thatyou’re part of their community.

If you’re past the beginner stage andready for more advanced tips, like learninghow to cross promote your content, twogreat resources are: Social MediaExaminer: www.socialmediaexaminer.comor Content Marketing Institute: www.con-tentmarketinginstitute.com.

Other important tactics and strategiesWe spent a good deal of time discussingFacebook because it has the largestpotential reach, but other networkscannot be ignored.

Twitter is a real-time medium forconnecting with your customers. Whena person tweets a company, they expectan answer in an hour. Being responsiveis incredibly important because thesepublic conversations influence the waypeople view the effectiveness of yourcustomer service.

Like Facebook, Twitter is also a pub-lishing platform for your blog content.

Using relevant hashtags (#) with yourtweets makes your content easier tofind. Another benefit is that you cansee what your competitors are doingand you learn from their successes ormistakes.

Although Yelp isn’t mentioned asoften in this industry as Facebook andTwitter, it’s a platform everyone shouldconsider. Yelp has 60 million registeredusers, more than 20 million reviews post-ed and dominates the social reviewspace. In fact, Yelp reviews are one of thehighest ranked search results on Google.

Yelp helps consumers find the bestbusiness for their needs. If yourapproach to business begins and endswith customer satisfaction, then Yelpshould be an absolute must-have mar-keting tool for your business.

People are going directly to the socialmedia sources that deliver exactly what

they’re looking for. Respond to com-plaints and accolades on Facebookbecause this is where they want toengage with your business on a personallevel. Listen to customer feedback onTwitter and proactively search relevanthashtags to participate in industry con-versations. Create and manage a Yelpprofile because this is where most peoplego to determine a company’s reputation.

No matter where you start on socialmedia, it’s all about customer service.Show your customers you care aboutthem and want to earn their business.

Moses Keshishian is the social media spe-cialist for the National Notary Association.He has expertise in retail banking havingworked for Wells Fargo and ProfessionalBusiness Bank. He may be reached byphone at (818) 739-4079 or by e-mail atmkeshishian@nationalnotary.org.

71

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

By Marc Wayshak

“Social media is a waste of time for smallbusinesses!”

Just the other day, as I sat enjoying alatte at my local Starbucks, I overheardsomeone shouting those words to a col-league. My latte suddenly tasted a lotless sweet.

You see, it wasn’t the first time I’veheard that statement uttered—and I’msure it won’t be the last. The problem isthat it’s completely untrue.

People who refuse to take advantageof the latest tools for business growthhave a right to stagnate, but the win-ners of today’s market must maximizeevery opportunity to find new cus-

tomers. And where are the new cus-tomers? They’re signed on to theirsocial media accounts.

As more and more small businessesare finding out, social media isn’t just forchatty teenagers anymore. Social sitesare now the prime stomping grounds ofthe well-informed, Web-savvy buyer. Theperfect example of this is LinkedIn. Asocial tool with enormous businesspotential, LinkedIn is one social mediaplatform that today’s small businessowners ignore at their own peril.

Imagine for a moment that you’vebeen invited to a party. You find outthat hundreds of your best potential

customers will be there, too, and they’llbe off their guards and willing to talkwith you. Would you accept that partyinvitation? Of course you would!

Now, there may not be an open bar,but LinkedIn is just like that party full ofpotential customers, and it’s raging allthe time. So put your party shoes onand join the social media festivities.Here are five must-know tips to findingcustomers on LinkedIn.

Make sure customers canfind youYour potential customers are usingLinkedIn to find service providersthrough search. When they search foryour category of service or product, doyou show up? Very few LinkedIn usersare optimizing their profiles for the key-words they want to be associated within search. For example, if you’re a com-mercial insurance agent, the term“commercial insurance” should besprinkled throughout your profile andin your job description. Only with theright attention to keyword placementwill your profile show up early in theresults of a LinkedIn search.

Get introductions fromyour connectionsEver wanted to be introduced to a par-ticular person, but didn’t know whereto start? LinkedIn is your answer. Thesite shows you how you are connect-ed—whether it’s through mutualfriends, colleagues, jobs or other con-nections—to everyone else. You canalso see the names and job titles ofthose who are connected to people inyour network. With just a little research,you can identify who knows the personyou want to meet, and then you can askfor a direct introduction. Remember,the introduction itself doesn’t have tobe through LinkedIn, but it’s always aneffective starting point.

Join the groupDo your customers come from particu-lar industries? Do you look for certaintypes of companies when prospecting?If so, you need to get involved withLinkedIn groups. There are groups forevery kind of industry or interest that

you can imagine. Just search for groupsthat your potential customers would beinvolved in and join the action! Getinvolved by sharing content and infor-mation that you know your customerswant. Answer their questions and con-nect with them.

Advanced searchThink of LinkedIn as the Match.com ofbusiness-to-business connections. Doyou want someone with brown hair,blue eyes and an adventurous personal-ity? In the business world, how aboutall the CIOs at companies with revenuesbetween $80 million and $200 million,located within a 50-mile radius fromyour doorstep? With the “advancedsearch” option on LinkedIn, you canidentify people within a wide array ofparameters. Once you’ve identified whoyour potential customers are, you canoften find great additional informationabout them through Google, Twitter orlist companies.

InMail your top prospectsNow that you’ve done the legwork tofind customers, wouldn’t it be nice tohave a way to contact them directly?You’re in luck! With LinkedIn’s premi-um services, you can send “InMails” tothose higher-level prospects. InMailsare direct e-mails which go right to theindividual’s inbox. Best of all, thesemessages often get rerouted to person-al e-mail addresses, which are morelikely to get a reply.

Now that you have your five must-know tips to finding customers onLinkedIn, it’s action time. Test out just afew tips at a time and get a sense forhow this powerful social business toolcan connect you with customers thatyou’d otherwise never meet.

Marc Wayshak is the author of two bookson sales and leadership, Game PlanSelling and Breaking All Barriers, as wellas a regular contributor forEntrepreneur Magazine and theHuffington Post Business section. Hemay be reached by phone at (617) 203-2171, e-mail info@marcwayshak.com orvisit www. marcwayshak.com.

“Social sites are now the prime stompinggrounds of the well-informed, Web-savvybuyer.”

Five Must-Know Tips to FindingCustomers on LinkedIn

72

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

“What you say CAN and WILL be held againstyou! Your future boss, clients, partners, votersand vendor are watching.”

73

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

By Margaret Page

Like children with a shiny new toy,adults introduced to social media jumpright in and start playing: Posting per-sonal photos to Facebook, acceptingrequests for “friendship” from long-losthigh school pals, and checking intoeverywhere from the coffee shop totheir favorite local eatery. What fun!Suddenly, we were getting an insidelook into the lives of people we hadn’tconnected with in years!

But unlike a new toy, social media did-n’t come with any real instructions. Weunwrapped it, signed up and off we went,sharing our world with … the world. Asmore and more people glommed ontothis new way of communicating, theseeds of chaos were planted.

Rules of engagementWithout guidelines on how to use socialmedia, disaster is just a tweet away.Many people—and companies—havefound this out the hard way.Embarrassing gaffs, impulsive rants andmisguided comments have ensued.

What you post on social media sitesis out there forever. The Internet neverforgets a “selfie” posted after a night onthe town or a tweet about a colleaguecan cause more damage than youthink. It’s dangerous to assume privacysettings protect you. Even if you’velocked down your Facebook page, onceit’s posted to the Web, you can guaran-tee someone who is not directly con-nected to you will find it. All it takes isfor one of your friends to share it withtheir friends. What you say CAN andWILL be held against you! Your futureboss, clients, partners, voters and ven-dor are watching.

A good rule of thumb, whether youare engaging on social media for per-sonal or in business is this: If youwouldn’t say it loudly, in front of yourmother (or boss!), you shouldn’t post itonline—anywhere!

With so many companies supportingBYOD (Bring Your Own Device), it’smore important than ever that a clearsocial media policy is in place foremployees. Your employees are repre-sentatives of your brand, and in busi-ness, perception is everything. To pro-tect yourself from the embarrassmentof a social media faux pas, create a pol-icy that clearly states what you expectfrom your employees when it comes tosocial media use. Set clear boundaries,especially for those who are part ofyour brand building process.

Do I know you?In this world of connectivity, how con-nected are we really? Has the word“connected” lost its meaning? With ourability to connect to anyone, anytime,anywhere through social media, theterm “connected” has been watereddown. Think about how many of thegeneric “I’d like to add you to my pro-fessional network on LinkedIn” invita-tions to connect you receive eachmonth. Very few of them are from peo-ple you have truly “connected” withoutside of social media. It feels a littlelike “the person with the most fans andfollowers” wins. But do they really?

Before there was LinkedIn, youwouldn’t dream of asking a newacquaintance to buy something fromyou just minutes after you met. And,you certainly wouldn’t show up at anetworking event in yesterday’s outfit.Just like offline networking, buildingrelationships online, follows the samebasic etiquette rules.

Here are a few to keep in mind:

l Be professional. On Twitter, don’t bethe egg. Post a professional photo ofyourself on your profile. This holdstrue on all social media sites. A busi-ness colleague should recognize youfrom your online picture. Include

information about yourself. Yoursocial media profiles are the equiva-lent of your business card, so be sureyou keep it updated as your profes-sional information changes. Alwayskeep your basic contact informationupdated and link to your other pro-fessional profiles.

l Introduce yourself. Want people toget a sense for who you are? Postinteresting, value-added content onyour social media accounts toshowcase your professional expert-ise. This is especially true withLinkedIn; when you update yourstatus with useful information,you’re building trust among yournetwork – opening doors for intro-ductions to new connections.

l Be authentic. Just like in real life, noone wants to connect with “that guy.”You know the one: The guy in thesleazy suit who spends his timeschmoozing. One of the biggest mis-takes people make when connectingon LinkedIn or Facebook is not per-sonalizing the message in the invita-tion. Swap out the default messagewith something like “George. I reallyenjoy your blog at xblog.com. Theleadership content you share is sovaluable. I’d like to add you to myprofessional network and get toknow more about your business.”This will let the recipient know how

you found them and why you want toconnect. In turn, they will know thatyou aren’t connection for the sake ofjust adding to their numbers.

l Listen. Building connectionsthrough social media isn’t just aboutpushing out content on this networkor that. If you’re not taking time tolisten and engage with influentialpeople (the ones you are hoping toconnect with), you’re missing anopportunity. Choose a handful ofkey people you want to build a busi-ness relationship with, read whatthey are posting, and where there isan opportunity for you to addvalue—jump in!

Whether you are connecting withpeople in the online world, or at a din-ner party, knowing how to presentyourself in a positive way is the same.Think before you speak translates to“think before you tweet.”

Margaret Page is a recognized etiquetteexpert, speaker and coach, who helpspeople and organizations be more pro-fessional. She is the author of The Powerof Polite, Blueprint for Success andCognito Cards—Wisdom for Dining &Social Etiquette. She is the founder andCEO of Etiquette Page Enterprises. Formore information, visit http://etiquet-tepage.com or call (604) 880-8002.

What You Need to KnowAbout Social Media Etiquette

74

JULY

20

14 n

Nati

onal

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

LOWEST-COST STATE MORTGAGE LICENSE BONDSSupport NAMB in supporting you!

Online surety bond applications, instant underwriting approval, andcredit card payments administered through The Bond Exchange -NAMB's exclusive partner provider for state license surety bonds.

The Bond Exchange is a national surety agency specializing in serv-icing mortgage license bonds for thousands of mortgage profession-als across the country.

Low prices and fantastic service. You really can have them both atthe same time!

The Bond Exchangewww.bondedwithnamb.org

(501) 224-8895

StreetLinks Lender Solutions provides an innovative andcomprehensive suite of valuation and service solutions used bylenders, servicers and appraisers nationwide to improve everydaybusiness operations.

StreetLinks industry-leading products include LenderPlus™ full-service appraisal management, LenderX™ lender-executedappraisal management software and SCORe™ appraisalreviews and a series of valuation analysis tools for services.Our commitment to quality and service, embodied by ourpartnership approach to clients and appraisers, continues toset us apart as the nation’s premier lending solutions partner.For more information, visit www.streetlinks.com.

StreetLinks Lender Solutions(800) 778-4920

www.streetlinks.comsales@streetlinks.com

APPRAISAL MANAGEMENT COMPANY

COMPLIANCE CONSULTANTS

AUDIT/COMPLIANCE/EDUCATION

BONDS & LICENSING

Division of Lenders Compliance Group, BCG is the first and onlymortgage risk management firm in the U.S. devoted to supporting

the unique compliance needs of residential mortgage brokers.

Leveling the Playing Field for Mortgage Brokers

Low Cost Monthly Membership Includes: • Free Weekly Hotline• Access to Subject Matter Experts• Policies and Procedures• Webinars

*Special Pricing*• Quality Control • Exam Readiness • Licensing • Legal Reviews

BROKERS COMPLIANCE GROUP167 West Hudson Street – Suite 200

Long Beach | NY | 11561members@brokerscompliancegroup.com

www.BrokersComplianceGroup.com

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

COMPLIANCE/CONTINUING EDUCATION

AllRegs offers mortgage professionals fast, reliable answers need-ed to conduct their day-to-day business. From research and ref-erence to business intelligence, from education and training toprofessional services, we are your definitive source for mortgageindustry information. With tools for originators like NMLS-approved CE training, regulatory content libraries for compliancestaff, guidelines for underwriters, policy  manuals for operations,and business intelligence for business development – we have youcovered as the leading information provider for the mortgageindustry. If you have a specific need, our professional servicesteam can help with thing like policy, procedure or guideline devel-opment, as well  as custom training or publishing resources.Contact us to learn how we can help you – visit www.allregs.comtoday.

AllRegs—Your Source for Fast, Reliable Answers2600 Eagan Woods Drive, Suite 220

Eagan, MN 55121(800) 848-4904

www.allregs.com

Cost: Only $19.95 per month per physical office locationJeff Mifsud, a former FHA Direct Endorsed Underwriter trained byHUD and an FHA Originator for over 15 years, is publisher of TheFHA Originator, a monthly marketing newsletter which gives you…

• FHA guideline news to keep you updated

• FHA Marketing tips and downloads that are easily customized

• Personal development tips to help you develop your character

• Full access to all previous FHA marketing downloads!

No contracts so sign up today and give yourself the tools to brandyourself as The FHA Expert in your marketplace.

Cost: Only $19.95 per month per physical office location.

Mortgage SeminarsMortgageSeminars.com

248-403-8181

CONTINUING EDUCATION

DIRECT MAIL

Titan List and Mailing Services, Inc. is a direct marketing agencythat offers a complete range of advertising and design services.The firm specializes in data lists (mail/phone), printing, direct mail,graphic and website design as well as internet and SEO market-ing. Starting in 1998, the company has, since then employed high-ly skilled individuals who have considerable experience regardingmarketing trends. The company manages the complete in-housecampaign themselves including Design, Data Lists, Printing,Postage, and Mailing.

Titan List & Mailing Services, Inc.1020 NW 6th St Suite D, Deerfield Beach, FL. 33442

(800) 544-8060www.TitanLists.com

75

Natio

nalM

ortg

ageP

rofe

ssional.co

mn

Natio

nal M

ortg

age P

rofe

ssional M

agazin

en

JULY

20

14

MARKETING

TagQuest is a full service marketing firm created specifically forthe ever changing mortgage business. We have tested and provencampaigns for FHA -VA - HARP - CONVENTIONAL loan types.TagQuest knows what it takes to generate quality leads whetherthrough direct mail marketing, telemarketing, internet leads, datalists, tracking systems, or any combination thereof. TagQuest willbrand your company, prepare targeted marketing campaigns thatgenerate interest in your company, and most importantly, showyou how to turn sales leads into repeat customers.

TagQuestwww.myharpleads.com

TagQuest.com888-717-8980

Creating informative and well- written print and e-newsletters for

mortgage professionals since 1985.

See for yourselfrightsidemarketing.com

800.456.4395

ed their tear I starhe yT“ ender LLthe etdaonomic Upcly EeekkleWWe y business , m

ide Markt Sigh, Rouhank yT. DOUBLEDts and seroduct prellencxour eor yf

e PevtSacific Mora PierrS

er ett and y business

, etingide Mark”.evicts and ser

ersonete Pgagetacific Mor

tivormating infearC-net and een prinwritt

essionoffgage prtmor

ourselfee for ySktsidemarighr

800.456.4395

ell-e and wtivorers ffslettwneew

e 1985.essionals sinc

ourselfom.cetingkke

800.456.4395

MARKETING/NEWSLETTERS

Calyx Software is the leading provider of affordable mortgage solu-tions for banks, credit unions, mortgage bankers and brokers. Wedesign products that enable smooth bi-directional flow of data frombeginning to end.Our solid, yet flexible, LOS gives you:

• Underwriting and secondary marketing• Strong security• Remote access• Ubiquitous productivity with optional mobile apps• Configurable business rules engine for workflow and compliance• Convenient interfaces with over 200 vendors providing PPE, clos-

ing documents, compliance services and more

Lenders can take advantage of Calyx’s fully integrated automatedunderwriting and pricing products to help them determine loan eligi-bility, pricing against investor or FHA guidelines while staying com-pliant in 2014.

Count on Calyx: We’re ready to help you do more800.362.2599

sales@calyxsoftware.comwww.calyxsoftware.com

LOAN ORIGINATION SYSTEMS RECRUITMENT

RETAIL BRANCH

talent for their expanding nationwide footprint.k is gericv, Maavalsvannie Mae approovF

ving obt. Haavy30 states across the countr. is a direct morpk Funding CorericvMaav

. NMLS# 7706prog Cdingunk FicervaavM

ericv.Maavwwww.Visit us at arsippany NJ9 Entin Rd., P

855.422.5917Phone:

g

talent for their expanding nationwide footprint.wing and seeking toprok is g

A andA, USDtained FHA, VVAe lender licensed inagtg. is a direct mor

. NMLS# 7706

.comkFunding, 07054ny NJ,

855.422.5917

WHOLESALE/CORRESPONDENT LENDERS

Contac t : info@afr wholesale.com

888.664.2101AFR Wholesale ranked #1 with the most Sponsor OriginatedFHA 203(k) closed loans.*

Lender NMLS:2826 - 9 Sylvan Way, Parsippany - NJ, 07054 - *See website for details: www.afrwholesale.com

Equal Housing Lender. Equal Opportunity Employer. **No Lender fees by AFR. Third party fees may apply.

FREE PROCESSING - NO LENDER FEES

•Conventional

•USDA

•Manufac tured Housing

•One -Time Close Construc tion

•Freddie Mac Open Access and Fannie Mae DURP

•VA and FHA, FHA 203(k) and 203(h) Rehab loans

•Jumbo loans up to $2,000.000

CLOSE MORE LOANS WITH:

AB071114

**

WHOLESALE LENDERS

REMN has FHA, USDA, 203k, VA and Conventional solutions to fitthe needs of your customers. But, at REMN, our most valuableproduct is our people. The REMN Sales and Operations Teamsgive you - and your loans - the time and attention that youdeserve. Even better, at REMN, same-day approvals are guaran-teed.* You can rely on us to get the little, yet vital, things takencare of on time.

Interested in joining our Wholesale Division? Send your resume to

aerecruiting@remn.com

Real Estate Mortgage Network, Inc.www.remnwholesale.com

866-933-6342

UWM has a full set of mortgage products to meet all of yourlending needs with Conventional, FHA, USDA (RuralDevelopment), VA, Jumbo, HARP 2.0 and DU Refi Plus. WithUWM’s ELITE program, you will receive the most aggressiveconventional rates and pricing in the industry for your eliteborrowers! Discover Lending Made Easy with United WholesaleMortgage!

United Wholesale Mortgage800-981-8898

www.uwm.com

40 UNDER 40The 40 Most InfluentialMortgage Professionals

Under 40

NMP Media Corp.1220 Wantagh Avenue • Wantagh, New York 11793-2202

p 516.409.5555 • f 516.409.4600e advertise@NMPMediaCorp.com

w www.NationalMortgageProfessional.com

coming in december 2014

COMING IN DECEMBER 2014!

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

76

SPONSORED ED ITORIAL

By Ralph Rosynek

Recently, a variety of sources are reporting that more than8,000 Americans turn 62 years of age each day. This numbernears 300,000 as the monthly maturing group of “BabyBoomers” is definitely changing the traditional definition

and profile of senior borrowers.While for many, 62-years-old no longer represents a viable retire-

ment benchmark due to various economic, social, age and financialneeds, loan originators are delivering a more flexible government-in-sured loan program, the Home Equity Conversion Mortgage (HECM), tothe retirement discussions being had at today’s kitchen tables and withother trusted advisors.

A new set of reverse mortgage products?Today’s reverse mortgage program is much different than the original pro-gram which began in 1989. Enhanced HECM features, benefits and op-tions, including lower costs and fees, can greatly assist in retirementplanning strategies.

Basically, borrower eligibility requires all borrowers to be at least 62years of age, occupy the property as their primary residence and have eq-uity available to generate proceeds. Borrowers may extinguish propertyliens and debts through a refinance transaction or consider using theHECM for Purchase program to perhaps downsize or relocate.

FHA insures fixed-rate and adjustable-rate HECM productsFixed rate HECMs are limited to a Single Disbursement Lump Sum pay-ment option at the loan closing with no future draws. Adjustable-rateHECMs provide five flexible payment options, and allows for future draws.Mortgage proceeds are subject to an initial disbursement limit during thefirst 12 month disbursement period, and the amount of funds availableis determined by the age of the youngest borrower. The borrower(s) hasthe ability to change the method of payment at any time throughout lifeof loan if the HECM provides for future draws and funds are available.

Loan not due as long as a borrower(s) occupies the propertyRegardless of the loan balance or the future value of the property, theloan does not become due and payable as long as a borrower(s) occupiesthe property as their primary residence. A HECM requires no monthly loanpayments. However, borrowers are required to keep current and pay allreal estate taxes, insurance premiums and property assessments for theterm of the loan. The property must also be kept in good condition.

While a reverse mortgage is not for all borrowers or a cure for all fi-nancial situations, very positive media coverage and growing support byfinancial planners, realtors and aging in place advocates is appearingdaily. New prospective borrowers can tap into a growing network of re-verse mortgage providers who assist with accessing the product.

Now is the time to look at this growing opportunity to reach more bor-rowers. Your market entry can be very scalable and requires an initialsales commitment to product education. Most importantly, efficient mar-ket entry should be partnered with the strengths of a recognized lendersupport and training program for the guidance and assistance needed toachieve your success.

Ralph Rosynek is senior vice president and director of marketing and com-munications and a seasoned HECM Direct Endorsement Underwriter. For ad-ditional information, he can be reached at rrosynek@rmsnav.com or call(281) 404-7970.

HECM Loans: The New RetirementPlanning Component

�

The outreach done byMortgage Action Alliance(MAA) members is a cru-cial component of theoverall lobbying effortsof the Mortgage

Bankers Association (MBA). Membersof Congress and your local officialsare inundated by competing voicesin Washington, D.C. and in yourState Capital every day. However,the people they really want to hearfrom are you—their constituents.Our elected officials work on ourbehalf, and it is our civic duty asengaged citizens to engage them indiscussions about how the decisionsthey make will affect our well-beingand the well-being of the communi-ties we serve.

MAA is your opportunity to haveyour voice heard. While elected offi-cials are debating policies that willimpact the real estate financialindustry, it is increasingly importantthat they understand what mattersto you and your business. MAA is afree, simple and effective tool toexact legislative and regulatorychanges that will make it easier todo business and better our commu-nities. MAA is also a non-partisansource of information, and the bestway to stay informed about theever-changing political landscapethat our industry must navigateeach day.

In order to make our grassrootslobbying network even stronger,MAA recently established a “grasstop” program, to add another layerof effectiveness to our existingefforts. Our grass tops advocacymodel leverages existing relation-ships between MAA members andelected officials at both the stateand federal level. These relation-ships can be the difference betweengetting a key vote or legislative pushto advance our combined goals forthe real estate financial industry.

Relationships with members ofCongress can span the social gamut.They may be a former co-worker,childhood friend or fellow PTAmember at your child’s school.Other times, grass tops have devel-

oped their relationships by keepingin consistent contact with their elect-ed officials through in-district meet-ings, or through lobbying events likeMBA’s National Advocacy Conference.No relationship is too small orinsignificant. We are looking to capi-talize on these connections to get theattention of key decision makers onthe issues our industry is currentlyfacing. Through engaging our electedofficials at yet another level, grasstops allow us additional opportuni-ties to work with them in order toemploy innovative solutions to bol-ster our industry.

If you would like to identify yourselfas a grass tops contact, simply sign intothe MAA Web portal by visitingwww.mba.org/Advocacy/MortgageActionAlliance. Once you’ve logged in,look to the side bar located on theleft of the screen. Underneath“Mortgage Action Alliance,” click thelink that says “Key Contact Survey.”From there, fill out the informationto let us know about your relation-ships with any of your elected offi-cials. Again, no relationship is toosmall or insignificant. Your voicematters.

Real estate finance industry pro-fessionals who wish to join or learnmore about MAA can do so at,www.mortgageactionalliance.org. Ifyou need assistance accessing thegrass tops survey or have any ques-tions regarding MBA’s grass top advo-cacy program, please contact MBA’sAssistant Director of Political AffairsAnnie Gawkowski at (202) 557-2816or e-mail agawkowski@mba.org.

Amy Swaney, CMB is governmental rela-tions officer and branch manager withScottsdale, Ariz.-based Citywide HomeLoans. Amy is also chair of the MortgageAction Alliance (MAA), a voluntary, non-partisan and free nationwide grassrootslobbying network of real estate financeindustry professionals, affiliated withthe Mortgage Bankers Association(MBA). Amy may be reached by phone at(480) 822-6262, ext. 2164, e-mailamy@amyswaney.com or visithttp://mba.org/Advocacy/MortgageActionAlliance.

MBA’sMortgageActionAlliance

A Message From MAA Chairwoman Amy Swaney

77

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

Few people have made a more vibrantimpact on the reverse mortgage sectorthan Atare E. Agbamu. In his work as abroker, originator, columnist, bookauthor, activist and consultant, Agbamuhas been a champion of the reverse mort-gage product and a tireless advocate forolder consumers the product wasdesigned to support.

Among Agbamu’s achievements is hissuccessful campaign for the repeal ofFederal Housing Administration (FHA)Mortgagee Letter 2008-38 (ML 08-38),which redefined the non-recourse featureof the home equity conversion mortgageor HECM. Whereas the U.S. Department ofHousing and Urban Development (HUD)initially mandated that the borrower orthe borrower’s heirs and estate would notowe more than the home’s value at loantermination. Under ML 08-38, if the bor-rower or the heirs/estate sold a home atloan termination, then all that was owedwas nothing more than home’s marketvalue; but if the property was kept, thefull loan balance must be repaid, even ifit is more than the market value.

In his writings—including his long-running column for The Mortgage Press(the first regular monthly column onreverse mortgages in America’s financialmedia), the forerunner of NationalMortgage Professional Magazine, in hisThinkReverse Blog posts, and in inter-views, Agbamu warned that ML 08-38would create undue hardship for borrow-ers and tie up HUD and lenders in endlesslitigation. In both cases, Agbamu was ontarget.

Three years after Agbamu called for itsrepeal, and in the face of a highly publi-cized lawsuit initiated by AARP on behalfnon-borrowing spouses facing foreclo-sures and displacements upon the deathof their borrowing spouses, HUD rescind-ed ML 08-38 in 2011.

Following the ML 08-38 recall,Agbamu turned his advocacy to a relatedsenior-protection issue in reverse mort-gages: foreclosure and displacement ofnon-borrowing spouses (NBS). WhileAARP Foundation Litigation and theWashington, D.C. law firm of Mehri &

Skalet were fighting HUD in federalcourts, Agbamu was doing the same thingin the media through his blog(www.thinkreverse.com) and in op-eds inthe financial media.

In a January 2013 op-ed in NationalMortgage News, Agbamu framed and pro-posed four options for resolving the NBSproblem. His option four, which called forreworking HECM’s actuarial assumptionsto cover the risk of non-borrowing spous-es for prospective loans, has been adopt-ed and codified by HUD in MortgageeLetter 2014-07 released on April 25, 2014.Effective Aug. 4, every disclosed and certi-fied non-borrowing spouse will be pro-tected from displacement when their bor-rowing spouse dies for the first time in theprogram’s 25-year history.

Because HUD has yet to come up witha satisfactory solution to the plight ofexisting non-borrowing spouses who arefacing foreclosure and displacement andthose who are expecting the same fatewhen their spouses die, Agbamu contin-ues his media campaign through his blogand other channels, calling on HUD toremove obstacles to assignment, the onlyviable solution to the existing NBS cases.

Today, Agbamu’s occupational focus isprimarily in education, but he still hastime to offer consulting services onreverse mortgages and to author hisThinkReverse blog. We spoke with theOakdale, Minn.-based Agbamu about hiscareer in reverse mortgages and histhoughts on the state of the product.

How did you first get involved withreverse mortgages?Agbamu: I came into the mortgage indus-try in 1998 from a 14-year stint in educa-tion in New York City, and I accidentallyran into reverse mortgages around 2001when my boss at People’s ChoiceMortgage asked me to research the prod-uct. Up to that time, I knew nothing aboutreverse mortgages. As I researched reversemortgages, I was fascinated and hooked.

What hooked you so quickly and attractedyou to the reverse product?Agbamu: The counter-intuitive nature of

the product was a draw for me. It is aproduct that seniors can use to get cashwithout having to make monthly repay-ments as with other types of home equityloans, and they can still retain every ves-tige of ownership. It seemed like thegreatest product for seniors who needextra cash to meet their needs.

I’m particularly drawn to seniorsbecause my grandmother had a role inmy upbringing in Nigeria. The Africanadage, “When we honor our elders, wehonor ourselves,” was drummed into myhead early in life. So for me, reverse mort-gages was an opportunity to do good anddo well.

Reverse mortgages have been around formany years, but are still a niche productwithin the mortgage world. In your opin-ion, why haven’t they become more pop-ular?Agbamu: Perhaps, it is the too-good-to-be-true nature of the product. Perhaps,we don’t hear the word “reverse,” we justhear the “mortgage” part. The productalso attracted some unsavory actors inpast who would prey on seniors.Compared to 2001, reverse mortgageshave come a long way in popularity, espe-cially through televisions ads with famousactors and politicians.

Let’s talk about Mortgagee Letter 08-38.What was your reaction when you firstlearned that HUD made this significantchange?Agbamu: It struck a nerve. It made every-one of us in the industry a liar. Here wasa product that came with controls for avulnerable demographic of the public—the product was designed and sold to pro-tect seniors. HUD said from day one thatborrowers and their heirs were not liablefor more than the value of the home atloan termination. Then they changed thatcardinal promise initially without publicnotice. Unconditional non-recourse was,and remains, an integral part of the piece-of-mind promise we make to seniors whotake reverse mortgages. It was a travesty.

But there was no great hue and cry

across the industry over this. Why didyou take the leadership role in arguingagainst ML 08-38?Agbamu: As an advocate for consumers, aproduct champion, and a visible thoughtleader with a communication platform, Iknew deep down that this was where therubber met the road. Silence, in the faceof obvious wrong against the weak by apowerful unit of our federal government,was not an option for me. In the life ofevery person, both professionally andethically, there comes a crossroadsmoment when you have to stand forsomething that is bigger than your ownself-interest. The so called “clarification ofHECM non-recourse,” or ML 08-38, wasthat moment for me. The recall of ML 08-38 and the resulting failure-to-protectlawsuits by non-borrowing spouses havecompletely vindicated the stand I took.And for that, I am grateful to the Authorof all victories!

How did your outspoken actions impactyour work?Agbamu: When you are wrongly per-ceived as a troublemaker, it doesn’t help.There were times when influential busi-nesses and associates would not returnmy calls. No one wanted to offend HUD,and I accepted that. It was a price I knewI had to pay for the stand I took. Like theproverbial city hall, picking a fight with apowerful arm of the federal governmentthat controls your industry is not fun.

What is your role in the reverse mortgageworld today?Agbamu: Today, I am essentially an advo-cate for seniors: They call me, they sende-mails, and share their worries aboutlosing their homes when their borrowingspouses die. I do substitute teaching andsome reverse mortgage consulting workas well. Regulators call me, as do attor-neys in litigation, for advice on the worldof reverse mortgage.

Phil Hall is managing editor of NationalMortgage Professional Magazine. He maybe reached by e-mail at philh@nmpmedi-acorp.com.

David vs. Goliath in theWorld of Reverse Mortgages

“In the life of every person, both professionally

and ethically, there comes a crossroads moment

when you have to stand for something that is

bigger than your own self-interest.”

By Phil Hall

78

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

By Phil Hall

Independent mortgagebanks and mortgage sub-sidiaries of charteredbanks made an average

profit of $1,242 on each loan they orig-inated in 2013, down from $2,199 perloan in 2012, according to the MortgageBankers Association’s (MBA) AnnualMortgage Bankers Performance Report.

“Full-year 2013 net production prof-its were respectable,” said MarinaWalsh, MBA’s vice president of industryanalysis. “In fact, they were the secondhighest recorded since inception of thePerformance Report in 2008.”

However, Walsh noted that last yearsaw a decided split on how the industryoperated.

“Net production profits in the sec-ond half of 2013 were substantiallylower than those in the first half of2013,” said Marina. “While secondarymarketing gains remained relativelystrong throughout the year, per-loanproduction expenses escalated in thesecond half of 2013.”

On June 10, the MBA released datathat found independent mortgagebanks and mortgage subsidiaries ofchartered banks experienced a net lossof $194 on each loan they originated inthe first quarter of 2014, down from areported $150 in profit per loan in thefourth quarter of 2013. In basis points,the average production loss was 8.31basis points in the first quarter of 2014,compared to an average net productionprofit of 8.72 basis points in the fourth

quarter of 2013. This marks the sixthconsecutive quarter that productionincome has decreased.

Furthermore, average productionvolume was $274 million per companyin the first quarter of 2014, down from$367 million per company in the fourthquarter of 2013. The volume by countper company averaged 1,238 loans inthe first quarter, down from 1,641 inthe fourth quarter of 2013.

While this year seemed to get off to arocky start—the MBA did not have sec-ond quarter data ready as this maga-zine went to press—there was cautiousoptimism on how the second half of2014 would compare with the sixmonths that preceded it.

For John Walsh, president of Milford,Conn.-based Total Mortgage Services(TMS), the continued uncertainty on thenational economy will continue to havea profound impact on the housing mar-ket’s ability to regain its stability.

“I don’t think the economy is whereit needs to be,” John said. “I think thehousing market is still not truly recov-ered and I don’t think it can handle fivepercent interest rates.”

Yet Ruth Lee, executive vice presi-dent of sales, marketing and businessdevelopment at Denver-based TitanLenders Corporation, believed that theviability of the housing market can bemeasured in individual locations ratherthan as a solid whole.

“Certain markets still languish behindthe rest,” Lee said. “Certain big marketslike Las Vegas, Denver, D.C. are not onlyheating up, but are getting white hot.”

Lee added that the housing marketsexperiencing stronger activity arereflecting the general health of theirlocal economies.

“It depends on economic develop-ment,” Lee continued. “States thatinvested heavily in tech tend to bestronger. From what I see, manufactur-ing economies are languishing a littlebit softer than the tech ones.”

Nonetheless, Lee does not believethat a new housing bubble will be form-ing in areas that are enjoying verystrong performances.

“I think we’re right-sizing,” Lee said.“We’re not seeing the ridiculous pushwe did before. I think it is very prema-ture to call any types of bubbles.”

But, originators have more than afew distractions to deal with in the sec-ond half of the year.

“Lenders are so focused on compli-ance now that there is not a lot ofinnovation taking place in other partsof the business,” said Brian Benson,CEO of La Jolla, Calif.-basedClosingCorp. “It is hard to get too pos-itive when you are struggling throughcompliance concerns.”

Brian Koss, executive vice presidentof Danvers, Mass.-based MortgageNetwork Inc., pointed out that the firsthalf of 2014 was also disrupted by errat-ic weather patterns that threw manyhousing markets out of kilter.

“The East Coast had one of the worstwinters in a long time, and it delayedthe spring market,” Koss said. “Lastyear, the spring market came to ascreeching halt at Memorial Day. This

year, it was still going through July 4th.”Koss also noted that some origina-

tors are now trying to stay in the gameduring the second half of the year,rather than attempt to draw aheadfrom the competition.

“People continue to sacrifice to keepretained share,” said Koss. “They arenot making money–and that is not along-term business solution. But, if youdon’t have share, you have no chanceof making a profit.”

Alice Sorensen, chief investment offi-cer at Phoenix-based LRES, observedthat a highly profitable Wall Street isamong the brighter lights in the currentfinancial picture, but she warned thatthis could easily change.

“The stock market is doing great,”Sorensen said. “But you know Newton’sLaw of Physics: What goes up mustcome down.”

Sorensen added that in terms oflooking ahead through the remainderof the year, she has heard both pes-simism and optimism.

“I had lunch with an originator andhe said, ‘I never thought I’d be in a con-dition where break even would be con-sidered successful,’” Sorensen recalled.“To me, that’s not what I would call arosy future. However, I am also hearingpeople say, ‘If I don’t buy somethingnow, I won’t have anything to chosefrom.’”

Phil Hall is managing editor of NationalMortgage Professional Magazine. Hemay be reached by e-mail atphilh@nmpmediacorp.com.

What Will The Second Half of 2014 Bring?

First Half of 2013 Second Half of 2013

Net production income 80 basis points 27 basis points

Total loan production expenses $5,743 per loan $6,539 per loan

Firms posting pre-tax financial profits 95% 69%

2013 2012

Total loan expenses $5,948 per loan $5,137 per loan

Personnel expenses $3,910 per loan $3,285 per loan

The "net cost to originate" $4,298 per loan $3,323 per loan

Secondary marketing income 254 basis points 260 basis points

Average production volume $1.75 billion $1.72 billion (7,857 loans) per company (7,699 loans) per company

Source: MBA’s Annual Mortgage Bankers Performance Report

calendar of eventsN A T I O N A L M O R T G A G E P R O F E S S I O N A L

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 newsroom@nmpmediacorp.com.

79

Natio

nalM

ortg

ageP

rofe

ssional.c

om

nP

ennsylva

nia

Mortg

age P

rofe

ssional M

agazin

en

JULY

20

14

* Looking for additional exposure at key industry events?Call 516.409.5555, ext. 4 to discover how to maximize your event coverage.

AUGUST 2014Thursday-Friday, August 7-82014 Louisiana Mortgage LendersAssociation Education Conference

New Orleans Hilton Riverside2 Poydras StreetNew Orleans, La.

For more information, call (225) 590-5722 or visit

www.lmla.com.

Thursday, August 28*Hawaii Association of Mortgage Brokers (HAMB) 2014 Annual

Conference & Trade ShowJapanese Cultural Center of Hawaii

2454 Beretania StreetHonolulu, Hawaii

For more information, call (808) 783-4442 or visit

www.hamb.org.

SEPTEMBER 2014Thursday-Saturday,

September 4-6*Florida Association of Mortgage

Professionals 2014 Convention & TradeShow

Rosen’s Shingle Creek9939 Universal Boulevard

Orlando, Fla.For more information,

call (850) 942-6411 or visitwww.famb.org.

Sunday-Tuesday, September 7-9Mortgage Bankers Association’s (MBA)

Risk Management and QualityAssurance Forum 2014

InterContinental Miami100 Chopin Plaza

Miami, Fla.For more information,

call (800) 793-6222 or visit www.mortgagebankers.org.

Thursday-Friday, September 11–12

Mortgage Bankers Association’s (MBA)Human Resources Symposium 2014

AgendaMortgage Bankers Association

Headquarters1919 M Street NWWashington, D.C.

For more information, call (800) 793-6222 or visit www.mortgagebankers.org.

Saturday-Monday, September 13-15*NAMB National 2014

Luxor Resort and Casino3900 Las Vegas Blvd South

Las VegasFor more information,

call (860) 922-3441, e-mailvvalvo@agilityresourcesgroup.com or visit www.nambnational.com.

Thursday-Saturday, September 18-20*

National Association of ProfessionalMortgage Women (NAPMW) CentralRegion Fall Education Conference

Courtyard by Marriott2 West Reno AvenueOklahoma City, Okla.

For more information, visitwww.napmw.org.

Wednesday, September 242014 Northwest Real Estate Summit

& Mortgage ExpoTulalip Resort & Casino

10200 Quil Ceda BoulevardMarysville, Wash.

For more information, call (206) 484-6442 or visit

www.mywamp.net.

Sunday-Tuesday, September 28-30

Mortgage Bankers Association’s (MBA)Regulatory Compliance Conference 2014

Grand Hyatt1000 H Street NWWashington, D.C.

For more information, call (800) 793-6222 or visit www.mortgagebankers.org.

OCTOBER 2014Tuesday-Thursday,

October 14-16*2014 Northeast Conference

of Mortgage BrokersTrump Taj Mahal Casino Resort

1000 BoardwalkAtlantic City, N.J.

For more information, call (732) 596-1619 or visit

www.mbanj.com.

Wednesday-Saturday, October 15-18

American Land Title Association (ALTA)2014 Annual Convention

The Westin Seattle1900 5th Avenue

Seattle, Wash.For more information,

call (202) 296-3671 or visitwww.alta.org.

Thursday-Friday, October 16-17*Virginia Association of Mortgage Brokers

(VAMB) 26th Annual ConventionHilton Garden Inn Richmond

Innsbrook4050 Cox RoadGlen Allen, Va.

For information, call (804) 285-7557 or visit

www.vamb.org.

Sunday-Wednesday, October 19-22*

MBA’s 101st Annual Convention & Expo

Mandalay Bay Hotel & Casino3950 South Las Vegas Boulevard

Las VegasFor more information,

call (800) 793-6222 or visit www.mortgagebankers.org.

NOVEMBER 2014Wednesday-Friday, November 19-21

Mortgage Bankers Association’s (MBA)Accounting and Financial

Management Conference 2014Westin St. Francis335 Powell Street

San Francisco, Calif.For more information,

call (800) 793-6222 or visit www.mortgagebankers.org.

MARCH 2015Sunday-Thursday, March 8-12*32nd Annual Regional Conference

of MBAsTrump Taj Mahal Casino Resort

1000 BoardwalkAtlantic City, N.J.

For more information, call (732) 596-1619 or visit

www.mbanj.com.

80

JULY

20

14 n

Pennsy

lvania

Mort

gage P

rofe

ssio

nal

Magazi

ne

nN

atio

nalM

ort

gageP

rofe

ssio

nal.c

om

feeling held backby your current employer?

Give us a call!

Licensed Mortgage Banker NYS Department of Financial Services B50040 • NMLS # 7230 • AL Consumer Credit license #21761 • CO Mortgage Company Regis-tration • CA DBO Finance Lenders Law license # 603K800 • CT Dept of Banking Mortgage Lender license #20372 • FL Dept of Financial Institutions Mortgage Lender license #MLD273 • GA Dept of Banking and Finance Mortgage Lenders license #39919 • MD Mortgage Lender license • MA Div of Banks and Loan Agencies Mort-gage Lender & Mortgage Broker license #MC7230 • NJ Dept of Banking and Insurance Mortgage Lender license #L0046623 • NC Commissioner of Banks Mortgage Lender license #L140365 • PA Dept of Banking Mortgage Lender license #20887 • SC State Board of Financial Institutions • TN Mortgage Lender license #MLS7230

• TN Mortgage license #115610 • TX - SML Mortgage Banker Registration • WA Consumer Loan Company license #CL-7230 - Direct Endorsed FHA Lender

is growing and looking forTalented Mortgage Specialists!

visit www.unitednorthern.com/joinus/index.html

or call 800-486-3001 to get started!United Northern Mortgage Bankers Limited, DBAs: Senior Security Home Advantage, Senior Security Advisors 3601 Hempstead Turnpike, Suite 300, Levittown, NY 11756

WHOLESALE DIRECTWHOLESALE DIRECT

877.552.8737www.afrwholesale.com/wd

FREE PROCESSING - NO LENDER FEES

YOU ORIGINATE, WE CLOSE, IT’S THAT SIMPLE.

Lender NMLS 2826. AFR Wholesale, a division of American Financial Resources, Inc. is a nationwide wholesale residential mortgage lender and an approved lending institution. The company is a GNMA issuer, FNMA seller/servicer, FHA Mortgagee, USDA National Lender and VA Automatic Lender. This information is provided to assist business professionals. This is not an advertisement extended to the consumer, as defined by Section 226.2 of Regulation Z. - Equal Housing Lender - Equal Opportunity Employer. Corporate office located at 9 Sylvan Way, Parsippany, NJ 07054. AB020714

FREE PROCESSING -

FREE PROCESSING -

NO LENDER FEESFREE PROCESSING -

NO LENDER FEES

NO LENDER FEES

NO LENDER FEES

OU ORIGYFREE PROCESSING -

IT’SOU ORIG

FREE PROCESSING -

THAIT’SAINNAOU ORIG

FREE PROCESSING -

IMT SAATTE, WAAT

NO LENDER FEESFREE PROCESSING -

PLE.IME CTE, W

NO LENDER FEES

PLE.E, OSLE C

NO LENDER FEES

E, NO LENDER FEES

IT’S

THAIT’S

IMT SAAT

www

PLE.IM

.afrwholesalewww877.552.8737

PLE.

d.com/w.afrwholesale877.552.8737

d