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

Colorado Association of Mortgage Professionals 302 Elati Street • Denver, CO 80223 Phone #: (303) 991-2240 • Fax #: (720) 946-1801 Web site:



Ronnie Ray, CRMS


(720) 306-3213


Laura Leavy


(720) 936-1477

Kelley Hamilton

Vice President

(303) 549-0891

Heidi Martin


(303) 668-3546

Jayne Bail


(970) 217-6330

Kay Cleland, CRMS, CMC, CFS

Immediate Past President

(720) 670-0124

Jenny Gilbreath


(303) 947-5930

Dennis Cline


(720) 389-0027

Cindy Magnuson


(303) 250-4221

Merritt Noel


(720) 936-2339

Jim Crowder

Communications/Public (303) 817-3308 Relations Committee


Adrienne Randol

Education Committee

(303) 720-9450

Rod Cameron

Ethics Committee

(303) 919-8199


Heidi Martin

Finance Committee

(303) 668-3546

Doug Braden

Government Affairs Committee

(970) 689-0877

Mark Koch

Technology Committee (303) 517-7173

CO 1 O


NAMB/WEST 2011 Loan Originator Conference Friday-Monday, December 3-5 MGM Grand Las Vegas 3799 Las Vegas Boulevard South • Las Vegas

New in 2011! CO 2

Attendees of the 2011 NAMB/WEST Conference will receive a Passport for the Exhibit Hall on Sunday, Dec. 4. Passports will need to be validated by each exhibitor in order to be eligible for drawings. The grand prize drawing, a trip to Hawaii, will be held at the conclusion of the conference on Monday, Dec. 5. Attendees must be present to win. As a bonus, attendees who book their hotel with the group rate before Wednesday, Nov. 9 will receive an extra Passport.

Agenda at a glance




(Subject to change)

Saturday, December 3

Monday, December 5

10:000 a.m.-5:000 p.m...........Registration n Open

8:000 a.m.-4:000 p.m.............Registration n Open

10:000 a.m.-Noon ................Committeee Meetings 8:300 a.m.-10:300 a.m...........NMLS—Reversee Mortgagee (Twoo Hours) Some or all of the following NAMB Committees could meet during these times … ad- Reverse Mortgage course to be instructed by David Luna of Mortgage Educators. ditional details will be posted at a later date: The Government Affairs Committee, Membership Committee, Ethics Committee, By-Laws and Education Committee, Com- 10:300 a.m.-10:455 a.m.........Break munications Committee and the Finance Committee. 10:455 a.m.-12:455 p.m.........NMLS—Ethicss (22 Hours) 1:000 p.m.-4:000 p.m.............NAMB B Delegatee Councill Meeting Ethics course to be instructed by David Luna of Mortgage Educators. 4:000 p.m.-6:000 p.m.............Networkingg Event

12:455 p.m.-2:000 p.m...........Networkingg Lunch

Sunday, December 4

n From m Suee Woodardd & Jim m McMahan, 2:000 p.m.-3:000 p.m.............Presentation Mortgagee Successs Source

8:000 a.m.-6:300 p.m.............Registration n Open 8:300 a.m.-9:300 a.m.............NMLS—FHAA (Onee Hour) FHA course to be instructed by David Luna of Mortgage Educators. 9:300 a.m.-9:455 a.m.............Break w (Threee Hours) 9:455 a.m.-12:455 p.m...........NMLS—Federall Law Federal Law course to be instructed by David Luna of Mortgage Educators. 12:455 p.m.-2:000 p.m...........Networkingg Lunch n & Networkingg Reception 2:000 p.m.-6:000 p.m.............Expoo Halll Open

3:000 p.m.-3:155 p.m.............Break n From m Suee Woodardd & Jim m McMahan, 3:155 p.m.-4:155 p.m.............Presentation Mortgagee Successs Sourcee (continued) 4:155 p.m.-4:300 p.m.............Grandd Prizee Drawingg forr a Tripp too Hawaii B Boardd Meeting 4:300 p.m.-6:300 p.m.............NAMB

Conference fees Description

Early fees (on or before 11/09/11)

Regular fees (11/10/11 or later)

Member Registration Fee Access to all conference events. You must be an NAMB member in good standing by Friday, Nov. 18 to obtain the member rates. If you are not a member in good standing by this date you will be charged additional fees upon arrival to the conference. To check the status of your membership, go to



Non-Member Registration Fee Access to all conference events.



Visit Exhibit Hall Only This is for mortgage originators only.



Cancellation and refund policy: Notice of cancellation must be made in writing (no exceptions) and sent to or faxed to (303) 798-3668. Cancellations received by 5:00 p.m. EST on Wednesday, Nov. 9 will be refunded 50 percent of the registration fee that was paid. Any cancellation received after that date will receive no refund.

Hotel information NAMB/WEST has discounted rates for conference attendees at the MGM Grand Las Vegas, located at 3799 Las Vegas Boulevard South in Las Vegas ( Any attendee who books their reservations under the NAMB Group Rate will be eligible to receive an extra Passport. The extra Passport will increase your chances to win prizes at the conference. Group rates Friday, December 2 ....................$110 Saturday, December 3 ................$110 Sunday, December 4......................$80 Monday, December 5 ....................$80 Room rates are subject to state and local taxes. The group rate will be offered until Wednesday, Nov. 9.


For more information on the NAMB/WEST 2011 Loan Originator Conference, contact Kinsley at (303) 798-3664, e-mail or visit O

Reservations can be made by calling (877) 313-5757 or (702) 891-7777, or visiting In order to secure the NAMB Group Rate, you must identify yourself as part of the National Association of Mortgage Brokers (NAMB) Conference. Check in for the MGM Grand is 3:00 p.m. and check out is at 11:00 a.m. For your convenience, MGM Grand offers room registration at McCarran Airport. There is an Airport Registration Desk located in the south baggage claim area, near the bottom of the escalators descending from the C and D gates, next to carousel #1 and #2. Shuttle service is available from 9:00 a.m.-11:00 p.m. Porterage service is available 9:00 a.m.-5:00 p.m. only.

CO 3


Colorado Association of Mortgage Professionals Membership Application

Applicant Name _________________________________________________________________________________________________________________________ Last




Company Name: ________________________________________________________________________________________________________________________ Job Title: _____________________________________________________________________ Years in Business in Colorado: ________________________________ Street Address: __________________________________________________________________________________________________________________________ City: __________________________________________________________________________ Phone: ____________________________________________________________

State: ________________

Zip: __________________________

Fax: ______________________________________________________________

Email: ____________________________________________________________ NMLS Individual #_________________________Company #__________________

A COAMP member referred me to join the Association: ‰ Yes, please list name: _________________________________________ ‰ Yes ‰ No – Are you licensed with the Colorado Division of Real Estate? Mortgage Broker License # __________________________________ Expiration Date _________________________________ ‰ I am not licensed because: _______________________________________________________________________________ ‰ Yes ‰ No – Are you presently a defendant in a case which, if convicted could lead to a felony conviction or a conviction for a crime in connection with mortgage fraud or predatory lending. ‰ Yes ‰ No – Have you been convicted of any felony in state or federal court in the past 5 years? Please select the individual membership category you are requesting: _____ JOIN _____ RENEW


Professional Member I (Licensed Mortgage Originator). Voting member in COAMP/NAMB, Eligible for Board of Directors Annual Dues: $250

‰ CO 4

‰ ‰ ‰





Professional Member II (Licensed Mortgage Originator under a Professional member I). Voting member in COAMP Annual Dues: $150 (Professional .Member I Sponsor member name (required):_________________________________) Commercial Member (Licensed as or acting as a Commercial Broker). Non-voting member Annual Dues: $250 Affiliate Member (Related within Industry – Wholesale Lender, Bank, Title Company, etc.) Voting member in COAMP Annual Dues: $250 Associate Member (Employees of a current COAMP Professional or Affiliate Member), non-voting member Annual Dues: $150 (Professional or Affiliate Sponsor member name (required) :_________________________________) Professional Corporate Membership (Includes 1 Professional Member or 1 Affiliate Member, the remainder are Professional II Members or Associates, whichever applies) ‰ $1,500 – 10 - 49 Members ‰ $2,000 – 50 - 74 Members ‰ $2,500 – 75+ ‰ $150 for each additional Professional I or Affiliate Member added to a Corporate Membership_______________________________________________________

I HEREBY APPLY FOR COAMP/NAMB MEMBERSHIP AND PLEDGE TO ABIDE BY THE REQUIREMENTS OF THE COAMP/NAMB CODE OF ETHICS AND THE BEST BUSINESS PRACTICE GUIDELINES. I ALSO PLEDGE TO SUPPORT THE COAMP/NAMB BYLAWS AND POLICIES. **I also understand that COAMP publishes a membership directory given to their affiliates and others in the industry; and puts my contact information on their website. I understand that the contact information I provide will be included unless I specifically ask that it not be included. Ƒ No, don’t post any of my information on COAMP Web site Ƒ No, don’t post any of my information in the COAMP directory I am the applicant and I hereby certify that I am in compliance with all provisions of the Mortgage Broker Registration Act. My signature on this application certifies that I am in compliance with all applicable federal, state and/or local statutes and regulations. Signed: _______________________________________________________________________

Date: __________________________________________________

Please attach your dues remittance payable to COAMP or select a payment by credit card below:

‰ Visa

‰ MasterCard

‰ American Express

Credit Card Number: ___________________________________________CCV # _________________

‰ Discover

Expiration Date: ___________________________________

Name that Appears on the Credit Card: _______________________________________________________________________________________________________

COAMP ~ 302 Elati Street, ~ Denver, Colorado 80223 ~ 303.991.2240 Office ~ 720-946-1801 Fax WWW.CoAMP.ORG

National Mortgage Professional Magazine

Visit Our









September 2011





Volume 3, Number 9

Web Site



A Special Look at “School is Back in Session: Certification, Education & SAFE Act Compliance” MLO Compensation and Stricter Regulations Make Education More Important Than Ever By Tycho Rosenfeld Continuing Education: From Mandatory to Meaningful By Paul Donohue, CRMS

Four Questions to Ask Yourself About Certification By Gibran Nicholas

Continuing Education: A Must for FHA Loan Specialists

AllRegs ............................................................ ............................34 Bay Equity LLC ................................................ ........................................CO1 & 10 Benchmark Mortgage ...................................... ......................................5 Calyx Software ................................................ ......................................21 CBC National Bank..........................................................................................................................7

32 33

Elliott and Company Appraisers, Inc................... ................................36 Flagstar Wholesale Lending .............................. ..........................Back Cover Freedom Mortgage .......................................... ......................Inside Back Cover Frost Mortgage Lending Group .......................... ..............................41 GSF Funding .................................................... ........................................................11


Hometown Lenders .......................................... ................................18 HVCC Appraisal Ordering .................................. ..........................21

By Jeff Mifsud


The SAFE Act: The Destruction of Small Business That No One Acknowledges By George Duarte


The Top 20 Education Providers


Icon Residential Lenders, LLC ............................ ..............................10 & 13 Land Home Financial Services .......................... ....................................40 Loyalty Express ................................................ ..............................12 & 35 Menlo Park Funding ........................................ ................................37 Mortgage Brokers Network Corp, Inc. ................ ......................21 NAMB West...................................................... ..........................C02, CO3 & 22


NAPMW .......................................................... ..................................................26 Nationwide Equities Corp. ................................ ..............................................17

Compliance Corner: Remaining in Compliance With Advertising Guidelines By Jonathan Pinard & Bonnie Nachamie


The Elite Performer: Time/Self-Management By Andy W. Harris, CRMS


Ability-to-Repay: The Basics and a Chart By Jonathan Foxx


NJAMB ............................................................ ..................................................39 PB Financial Group Corp. .................................. ..............................................14 Polaris Home Funding Corp. (Branches).............. ..................15 Polaris Home Funding Corp. (Wholesale) ............ ............................................31


REMN (Real Estate Mortgage Network)................ ....................................29 Ridgewood Savings Bank .................................. ....................................25

NMP Mortgage Professional of the Month: Mike Cox, Director of Sales and Marketing, Clear Home Loans The Secondary Market Overview: From Bonds to Production … Roller Coasters and Yo-Yos


Laboring Over Ineffective Marketing By Mary Beth Doyle

12 12

How to Get the Attention of Agents, Brokers, Attorneys, Accountants, Etc. in a Very Creative Way


ValueNation: A Guide to Evaluating & Selecting a Valuation Management Platform By David Rasmussen


A Hand Up, Not a Handout By John Walsh


Three Questions to Ask Yourself if You Aren’t Closing at 30 Least Five Loans per Month By Eric Tishaw


Lykken on Leadership: Communication and Leadership 40 (Part 1) By David Lykken


11 21 28 28 44 48

Predictive Methods Conference ........................ ..............................................32 Windvest Corporation ...................................... ........................................23


NMP News Flash: September 2011 Heard on the Street USA Cares Mortgage Heroes: Vicki White of SunTrust Mortgage & Byron Webb of SunTrust Mortgage New to Market NMP Mortgage Professional Resource Registry NMP Calendar of Events

United Northern Mortgage Bankers Ltd. ............ ............................14 & 19


By Ron Vaimberg

TMS Funding.................................................... ..........................................27 


Five Reasons Why You Know More About Real Estate Than Real Estate Agents By Erik Wind

StreetLinks Lender Solutions ............................ ....................Inside Front Cover The Warrior Sales Academy .............................. ................................48

By Dave Hershman

REMN’s New Division Answers the Call for Immediacy From the Internet Generation By Eric C. Peck

Shortsale Speedway.......................................... ................43

September 2011 Volume 3 • Number 9



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

1220 Wantagh Avenue • Wantagh, NY 11793-2202 Phone: (516) 409-5555 / (888) 409-9770 Fax: (516) 409-4600 Web site: STAFF Eric C. Peck Editor-in-Chief (516) 409-5555, ext. 312 Andrew T. Berman Executive Vice President (516) 409-5555, ext. 333 Joey Arendt Art Director Jon Blake Advertising Coordinator (516) 409-5555, ext. 301 Kelsey Domino Executive Sales Assistant (516) 409-5555, ext. 316


Tara Cook Billing Coordinator (516) 409-5555, ext. 324

ARTICLE SUBMISSIONS/PRESS RELEASES To submit any material, including articles and press releases, please contact Editor-in-Chief Eric C. Peck at (516) 409-5555, ext. 312 or e-mail The deadline for submissions is the first of the month prior to the target issue. SUBSCRIPTIONS To receive subscription information, please call (516) 409-5555, ext. 301; e-mail or visit Any subscription changes may be made to the attention of “Circulation” via fax to (516) 409-4600. Statements, articles and opinions in National Mortgage Professional Magazine are the responsibility of the authors alone and do not imply the opinion or endorsement of NMP Media Corp., or the officers or members of National Association of Mortgage Brokers and its State Affiliates (NAMB), National Association of Professional Mortgage Women (NAPMW), National Credit Reporting Association (NCRA) and/or other state mortgage trade associations. Participation in NAMB, NAPMW, NCRA, and/or other state mortgage trade associations events, activities and/or publications is available on a non-discriminatory basis and does not reflect the endorsement of the product and/or services by NMP Media Corp., NAMB, NAPMW, NCRA, and other state mortgage trade associations. National Mortgage Professional Magazine, NAMB, NAPMW, NCRA, and/or other state mortgage trade associations do not make any misrepresentations or warranties concerning the regulatory and/or compliance aspects of advertisers, products or services and/or the editorial content contained in NMP Media Corp. publications. National Mortgage Professional Magazine and NMP Media Corp. reserve the right to edit, reject and/or postpone the publication of any articles, information or data. MO








ADVERTISING To receive any information regarding advertising rates, deadlines and requirements, please contact Senior National Account Executive Karen Krizman at (516) 409-5555, ext. 326 or e-mail




National Mortgage Professional Magazine is published monthly by NMP Media Corp. Copyright © 2011 NMP Media Corp.

A Message From NMP Media Corp. Executive Vice President Andrew T. Berman n this month’s issue on page 6, our compliance expert, Jonathan Foxx of Lenders Compliance Group, takes a deeper look at the Federal Reserve Board’s ability-torepay Rule, breaking down the options we have under the Rule and providing insightful comments on this very hot button topic. Jonathan also provides a handy reference chart highlighting scenarios where the ability-to-repay Rule is applicable and how to maintain compliance with the Rule. Moving ahead to page 20, John Walsh of Total Mortgage Services shares his insightful thoughts on the need housing has for products that are more risked-based and how the industry should price the products accordingly. He’s far from saying we should make a “Return to Sub-Prime,” but John thinks that all factors should be looked at for a return back to common sense underwriting.


September’s Mortgage Professional of the Month is crushing it! This month’s Mortgage Professional of the Month is Mike Cox, director of sales and marketing for Clear Home Loans. Mike has been very successful in the mortgage business over the years, but not too long ago, was given a copy of Gary Vaynerchuck’s book, Crush It, and took on the responsibility of doing an online daily video show called Rates in Motion with insights for borrowers, real estate professionals and even mortgage professionals. I learned about Mike by stumbling upon one of his shows, providing easy-tounderstand housing news in a fun, yet professional, format. We all know that it’s hard to talk about video in the mortgage space and not mention the work of Frank Garay and Brian Stevens from Think Big Work Small, but I think Rates in Motion is a great example how you can effectively connect with borrowers and real estate agents using this medium.

A new direction for ValueNation First off, I want to thank a long-time supporter of our publication, Charlie W. Elliott Jr. He’s been writing insightful articles about appraisals and valuations for publications I’ve been involved with spanning two decades. He championed the ValueNation monthly column since the inception of National Mortgage Professional Magazine and is now allowing us to give the opportunity to another organization. For this endeavor, we tapped into a long-time leader in valuation, property and risk analytics, Veros, to carry the torch of the ValueNation column. Each month, a high-level executive from Veros will share their insights on what’s going on in the world of valuation, and we begin this month on page 18 with a piece on valuation management platforms from Veros SVP of Operations David Rasmussen.

Back to school! As students nationwide are making their way into classrooms to begin a new year of learning, we are faced with an unprecedented situation where an entire industry (at least on the non-depository side … don’t get me started here!) has to send all of its mortgage loan originators (MLOs) for continuing education (CE) renewal. We figured this issue would be an ideal one to focus on “Certification, Education and SAFE Act Compliance.” This section starts off on page 32 with a piece from Tycho Rosenfeld, CEO of, talking about how LO compensation rules and other regulations now place more structure on the MLO. Following Tycho on page 33 is a piece from Paul Donohue, CRMS who challenges mortgage professionals to not only make CE something you must obtain, but something you can benefit from and enhance your career with. There’s also a great piece on certification on page 34 where CMPS Institute Founder Gibran Nicholas discusses the benefits of adding some initials beyond your name and obtaining an industry designation by expanding your education. Later in the section on page 36 is a contribution from our in-house FHA expert, Jeff Mifsud, discussing how he has embraced furthering his education and knowledge base by becoming an expert in FHA loans. In the final article of this section on page 37, George Duarte discusses the significant impact and hindrance that the SAFE Act has had on small business and how the high-cost of education is shutting many out of the business. The section wraps up with a list of the 20 Top Education Providers as told by our readers through polls taken via our social media outlets, Facebook and LinkedIn. We bring all this and much more to the September 2011 issue, so don’t let me keep you back, keep reading and enjoy yet another amazing month of National Mortgage Professional Magazine. Until next month …

Andrew T. Berman, Executive Vice President NMP Media Corp.

The National Association of Mortgage Brokers

National Association of Professional Mortgage Women

2701 West 15th Street, Suite 536  Plano, TX 75075 Phone #: (703) 342-5900  Fax #: (530) 484-2906 Web site:

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

NAMB Board of Directors Officers President—Michael D’Alonzo, CMC Creative Mortgage Group 1126 Horsham Road, Suite D Maple Glen, PA 19002 (215) 657-9600 President-Elect—Donald J. Frommeyer, CRMS Amtrust Mortgage Funding Inc. 200 Medical Drive, Suite D Carmel, IN 46032 (317) 575-4355 Vice President—Michael Anderson, CRMS Essential Mortgage 3029 S. Sherwood Forest Boulevard, Suite 200 Baton Rouge, LA 70816 (225) 297-7704 Treasurer—John Councilman, CMC, CRMS AMC Mortgage Corporation 2613 Fallston Road Fallston, MD 21047 (410) 557-6400 Past President—Jim Pair, CMC Mortgage Associates Corpus Christi 6262 Weber Road, Suite 208 Corpus Christi, TX 78413 (361) 853-9987

Directors Fred Arnold, CMC American Family Funding 24961 The Old Road, Suite 101 Stevenson Ranch, CA 91381 (661) 284-1150

Deb Killian, CRMS GMAC 246 Federal Road, Unit C-24 Brookfield, CT 06804 (203) 778-9999, ext. 103 Linda McCoy Mortgage Team 1 Inc. 6336 Picadilly Square Drive Mobile, AL 36609 (251) 610-0494

President-Elect Candace Smith, CME (512) 329-9040

Vice President-Eastern Region Christine Pollard (607) 656-5005

Senior Vice President Jill Kinsman (206) 344-7827

Secretary Katheryn M. Farrell (509) 528-0349

Vice President-Northwestern Region Nita Cook, GML, CME, CMI (360) 705-5053

Treasurer Jeanne Evans, CME (918) 431-0155

Vice President-Western Region Lyman King III, CME, CMI (916) 967-4653

Parliamentarian Hulene Bridgman-Works (800) 827-3034

National Credit Reporting Association Inc. 125 East Lake Street, Suite 200  Bloomingdale, IL 60108 Phone #: (630) 539-1525  Fax #: (630) 539-1526 Web site:


2011 Board of Directors & Staff Tom Conwell President (800) 445-4922, ext. 1010 Donald J. Unger Vice President (303) 670-7993, ext. 222 Daphne Large Treasurer (901) 259-5105 Marty Flynn Ex-Officio (925) 831-3520, ext. 224 William Bower Director—Tenant Screening Chair (800) 288-4757 Mike Brown Director—Technology Chair (800) 285-6691

Janet Curtis Director—New Membership & Elections Co-Chair (212) 224-6121 Renee Erickson Director—Tenant Screening Co-Chair (800) 311-1585, ext. 2101 Nancy Fedich Director—Conference Chair (908) 813-8555, ext. 3010 Judy Ryan Director—New Membership & Elections Chair (800) 929-3400, ext. 201 Tom Swider Director—Legislative Co-Chair (856) 787-9005, ext. 1201 Terry Clemans Executive Director (630) 539-1525

Susan Cataldo DirectorEducation & Compliance Chair Jan Gerber (404) 303-8656, ext. 204 Office Manager/Membership Services (630) 539-1525


Walter Scott Excalibur Financial Inc. 175 Strafford Avenue, Suite 1 Wayne, PA 19087 (215) 669-3273

Vice President-Central Region Lisa Puckett, CME (405) 741-5485


Donald Fader, CRMS SMC Home Finance P.O. Box 1376 Kinston, NC 28503-1376 (252) 523-5800

President Laurie Abshier, GML, CME, CMI (661) 283-1262 

Olga Kucerak, CRMS Crown Lending 222 East Houston, Suite 1600 San Antonio, TX 78205 (210) 828-3384

National Board of Directors 2011-2012

Remaining in Compliance With Advertising Guidelines By Jonathan Pinard & Bonnie Nachamie The purpose of advertising any product or service is not to sell the product per se, but to get the consumer to take action. From the dawn of advertising, deceptive or misleading advertising generated the most amounts of interest and activity. Advertising claims became so outrageous that congress formed the Federal Trade Commission (FTC) in 1914 with its primary focus to stop unfair methods of competition in commerce. The federal rules for advertising mortgage loans state that if an ad contains any of the triggering terms below, it requires that the amount of the downpayment, the terms of repayment and the annual percentage rate (APR) be disclosed: I I I I

Time Self-Management

The amount or percentage of a downpayment The number of payments or period of repayment The amount of any payment The amount of any finance charge

If an interest rate is stated, you must provide the APR in the same type size as the interest rate. Essentially, if you tell part of the story, you need to tell the rest of the story. Deceptive or misleading advertising The FTC, U.S. Department of Housing & Urban Development (HUD) and many State Banking Departments are focusing on Deceptive or Misleading Advertising, and from the recent settlements, you may be surprised by some of their interpretations. Here are some of the things mortgage companies have been cited for:




I Using FINAL NOTICE OF RATE INCREASE and LOAN SERVICING DEPARTMENT instead of their company name in the area normally used for a return address. I Saying “Skip up to two mortgage payments” and “No out-of-pocket closing costs” in a mail solicitation. I Displaying a misleading Federal Housing Administration (FHA) seal in a manner that falsely represents that the mortgagee’s business services or products originate from HUD. Since Mortgagee Letter 2011-17 was issued on April 15, 2011, the use of the FHA-Approved Lending Institution logo must be accompanied by a conspicuous disclaimer that clearly informs the public that the mortgagee authoring the advertisement is not acting on behalf of or at the direction of HUD/FHA or the federal government. Even using the acronyms such as Ginnie Mae, FHA or HUD can lead to problems. In addition, mortgagees are now responsible for reviewing all advertisements generated by lead generators on behalf of their company for compliance with advertising requirements and all business names, aliases, and d/b/a’s used by FHA-approved mortgagees must be registered with HUD. Doing it right I Don’t include an interest rate or other triggering terms without including the necessary disclosures. I No advertisement may include language which deceives, defrauds or misrepresents loans terms, conditions or charges, including, but not limited to, the use of words indicating “Immediate Approval” or “Immediate Closing.” I Don’t make it appear that you are an exclusive provider of government loans or that your company is acting on the governments behalf. What should an advertisement contain? I In addition to the required disclosures, all advertisements and solicitations should prominently include the name and address of the originating entity, state licensing information and the company’s NMLS Identifying number. I When using pictures of applicants, make sure they are representative of the population as a whole. I Use the Equal Housing Lender or Equal Housing Opportunity Logo. I Add a disclaimer subject to credit approval. Advertising policy Advertising violations are costly. Protect your company by having a written advertising policy detailing the required components of an advertisement and the procedures that are required before an advertisement can be placed on behalf of the company. List an individual in management that must approve any ad before it is placed. Some states prohibit loan originators from advertising on their own and require that the company be listed on the advertising contract.

Jonathan Pinard is president and Bonnie Nachamie is chief executive officer of First National Compliance Solutions Inc. in Merrick, N.Y. Jonathan may be reached by phone at (800) 400-4134 or e-mail Bonnie may be reached by phone at (800) 400-4134 or e-mail SPONSORED EDITORIAL

Time is defined as a one-dimensional quantity used to sequence events, to quantify the duration of events and the intervals between them, and to quantify and measure the motions of objects and other changes. Whatever we choose to do each day, we have no control over time. Since the beginning, time has always been consistent. We might measure time in our own ways with a clock or by the sun, but how do we utilize and maximize the time that we’re provided each day? What exactly is time management and how do you manage the unmanageable? Well, it begins with managing yourself. I have always pushed the importance of “self-management” in business and how vital it is for any level of success. I have found that the ability to consistently manage and organize workflow with the limited time provided each day is not an easy task for anyone. Maximum productivity is a challenge that requires ongoing effort and the ability to adapt to change and workflow demands. Productivity at work is important simply because it’s the definition of getting anything done. Wasting time at work is not fair to your clients or your family. If time is spent on activities which are not productive, than it’s important to determine what they are. I believe our current climate for technology provides tools which can help increase productivity, but many which can also prohibit productivity if you allow. If you are able to maximize the time you have each day, you will have a better quality of life with less stress and much more success in business. Here are a few tips to help self-manage:  Follow a schedule and have a plan. Have a plan each and every day. Create tasks or a “to do” list

“Don’t be fooled by the calendar. There are only as many days in the year as you make use of. One man gets only a week’s value out of a year, while another man gets a full year’s value out of a week.” —Charles Richards

each day with the most vital tasks highlighted. Check off tasks completed and move on to the next until you complete all tasks. Try to automate reminder alerts for those tasks that are consistent and especially for appointments and meetings. Time-block accordingly to get the most important tasks done first and those which have deadlines.  Automate and prioritize marketing. If you are in a sales- or commission-based position than it’s important to have time to market and prospect every day. Automate any marketing possible, but spend quality time and focus with your clients and business partners.  Delegate. This is one of the most challenging things for me, but also one of the most important I know I must follow. Trust in others and train well. Delegate tasks and get things off of your workload which do not require your full attention.  Don’t put things off. We all have tasks we don’t enjoy, but need to get done. A delay of an hour turns into a day, into a week, etc. If you cannot delegate tasks, than just get it done to avoid that nagging reminder in the back of your brain. continued on page 23




Positive Attitude






Ability-to-Repay: The Basics and a Chart

By Jonathan Foxx

The basics




On May 11, 2011, the Federal Reserve Board (FRB) issued a proposed rule (Rule) to implement ability-to-repay requirements for closed-end residential loans.1 The Rule implements Section 1411, Section 1412, and part of Section 1414 of the Dodd-Frank Wall Street Reform and Consumer Financial Protection Act of 2010 (Dodd-Frank).2 Comments on the Rule are to be received by no later than July 22, 2011.3 Having published the proposed Rule, the FRB retired from its involvement in this matter and handed over its rulemaking authority in the subject statute to the Consumer Financial Protection Bureau (CFPB) on July 21, 2011.4 As a revision to Regulation Z (the implementing regulation of the Truth in Lending Act), the Rule requires creditors to determine a consumer’s ability to repay a mortgage before making the loan and would also establish minimum mortgage underwriting standards. The Rule applies to any consumer credit transaction secured by a dwelling, except an open-end credit plan, timeshare plan, reverse mortgage, or temporary loan or ‘‘bridge’’ loan with a term of 12 months or less. 5 It appears that the Rule applies to purchase money and refinances, but not modifications of existing mortgages. There is a prohibition on prepayment penalties unless the mortgage is a prime, fixed rate, qualified mortgage and unless the amount of the prepay-

ment penalty is limited. The Rule sets forth limits on prepayment penalties, the lengthening of the time creditors must retain records evidencing compliance with the ability-torepay and prepayment penalty provisions, a prohibition to evading the Rule by structuring a closed-end extension of credit as an open-end plan, the delineation of new terms, procedures, and their resulting implications, and, very importantly, the means by which the Rule claims to offer tools to prevent likely default and mitigate risk for creditors and others who arrange, negotiate, or obtain an extension of mortgage credit for a consumer in return for compensation or other monetary gain. Complying with the requirements of the ability-to-repay Rule is essential, because borrowers in a foreclosure proceeding will likely claim that the creditor failed to comply with the Rule as a defense by way of recoupment or set off, without regard to the normal statute of limitations under the Truthin-Lending Act (TILA).6 A violation of the Rule subjects the creditor to the TILA civil monetary penalties, plus the same enhanced civil remedies that apply to violations of TILA’s high-cost loan rules,7 and TILA also would authorize state attorneys general to bring actions for violations of the Rule for a period of up to three years.8 A loan that is a covered transaction must qualify, among other things, as a “qualified mortgage” if the creditor wishes to include a prepayment penalty in the loan. The Rule provides a presumption of compliance with the ability-to-repay requirements if the mortgage loan is a

“qualified mortgage,” which does not contain certain risky features and limits points and fees on the loan. Furthermore, one feature of a higherrisk mortgage loan (i.e., subject to enhanced appraisal requirements under Dodd-Frank § 1471) is the loan may not be a qualified mortgage.9 There are four (4) options to the determination of compliance with the Rule. The Rule refers to these origination options as “methods” and equips each method with a description of (1) limits on the loan features or term, (2) limits on points and fees, (3) underwriting requirements, and (4) payment calculations.

Option #1: General Ability-to-Repay Standard A creditor can meet the general abilityto-repay standard or test by: *Considering and verifying the following eight underwriting factors: 1. Income or assets relied upon in making the ability-to-repay determination; 2. Current employment status; 3. The monthly payment on the mortgage; 4. The monthly payment on any simultaneous mortgage; 5. The monthly payment for mortgagerelated obligations; 6. Current debt obligations; 7. The monthly debt-to-income ratio, or residual income; and 8. Credit history. *Underwriting the payment for an adjustable-rate mortgage based on the fully indexed rate. Comment: This is an option that will be carefully reviewed by plaintiff’s counsel

in an action to challenge a creditor’s compliance with the Rule. Consequently, enforcing compliance with the Rule will require fully vetted, tested, and continually updated, written procedures to govern every aspect of the application and underwriting process. Without clear and unambiguous policies and internal enforcement of appropriate policies and procedures, the creditor is allowing exposure to such a challenge. This option contains rigorous underwriting criteria and requires unmitigated, fact-based evaluations. Option #1, the ability-to-repay test, is somewhat unstable (due to the invariant rigors of procedural compliance) though a relatively favorable methodology for the creditor, even if the loan flow process leaves very little room for error.

Option #2: Qualified Mortgage (QM) A creditor can originate a “qualified mortgage” which provides special protection from liability. Two alternative definitions of a “qualified mortgage” are being considered by the CFPB: Alternative #1: Provides a legal safe harbor and defines a “qualified mortgage” as a mortgage for which:  The loan does not contain negative amortization, interest-only payments, or a balloon payment, or a loan term exceeding 30 years;  The total points and fees do not exceed three percent of the total loan amount;  The income or assets relied upon continued on page 14

Big enough to matter. Small enough to care! In the current mortgage environment, every originator is looking for a true business partner when working with their wholesale lenders. The most important aspect of being a lender in today’s market is the ability to build and maintain a meaningful relationship with each customer. At CBC National Bank, we understand that these meaningful relationships coupled with competitive pricing and efficient technology are the pillars of today’s lending environment. When working with CBC you have a dedicated team that provides you: • Direct access to all underwriters and management


• Competitive pricing on a variety of loan programs • A user-friendly LOS system with real-time loan tracking

We work to make it happen!

• Respect and customer service at all times. Service is paramount for a successful wholesale company like CBC National Bank.

CBC National Bank strives to earn your business and we look forward for the opportunity to show you how much we care!

For more information please contact us at 888-486-4304.


Member FDIC


• Regular communication with all staff members through phone calls, emails, and promptly returned voicemails 

• The ability to work closely with your Account Executive & designated Loan Coordinator, who together will give you the confidence to know your target closing date will be met

Mike Cox, Director of Sales and Marketing Clear Home Loans




yourself out there as the ence at all. Back then, person to go to for that all you had to do was type of loan. You need to pay a licensing fee and make sure that every then start making calls real estate agent, every … you learned on the Each month, National Mortgage investor and every bank job through training on Professional Magazine will focus on one of knows that you know the frontlines. I quickly the industry’s top players in our “Mortgage everything there is possifound my groove in the Professional of the Month” feature. Our bly to know about the industry, and that was readers are encouraged to contact us by eFHA 203k loan and that no easy task back then mail at to if they had someone due to the massive be considered for a future “Mortgage needing that type of amount of programs Professional of the Month” feature article. loan, they would be that were available. At This month, we had a chance to chat insane to refer them to the same time, I was with Mike Cox, director of sales and anyone else. finding my place in the marketing for Clear Home Loans. It’s not enough just industry and getting Mike grew up in Kimberly Wis., played knowing the program really good at marketing football and wrestled throughout grade inside and out. You need myself, as I stumbled school and high school. Mike has a threeto promote the heck out upon and became well“If you are comfortable and-a-half-year old son, Kaine Michael of it. When anyone thinks versed in downpayment in front of the camera, Cox, born with CDH (Congenital “FHA 203k,” your name assistance programs. I maybe you want to do a Diaphragmatic Hernia), a disorder where should pop into their quickly learned the proweekly or monthly video his diaphragm was not developed on one head at the same time. grams, how to structure blog post. If you engage half of his body while in gestation. His Let’s be honest … you can the FHA loan and I was with your followers and organs were where his lung should have be the best at anything, on my way. It was such a provide true value to been. This was a major obstacle in Mike’s but if nobody knows great program, and I had them, you will be on life, but became a situation where he took about you, it doesn’t do financing signs made your way to using video a lot out of, realizing that everyone is you any good. It really and put them in all of my to get more business.” strong enough to overcome whatever life comes down to personal real estate agent’s listthrows at you. Mike enjoys biking and any ings. “This house qualifies for NO DOWN- branding and how you want to brand yourkind of exercise, including taking part in a How did you first PAYMENT” could be seen everywhere in self in the market. If you are going to take recent grueling Tough Mudder competi- get started in the mortgage industry? my area, and I was the first one in my area the time to brand yourself, you better be tion in Wisconsin and is planning on par- I left the restaurant and bar management to offer such a program. FHA financing able to back it up. That is a must! ticipating in another this winter. game in February 2000 and got involved with no downpayment … how much betMike entered the mortgage business in in the mortgage industry with no experi- ter could you get? Since I was the only one As someone with a great deal of expeoffering it, my business took off. I was a top rience with the For Sale by Owner producer at GSF Mortgage after only one (FSBO) market, can you share some tacyear of being in the business. I would def- tical tips on ways that mortgage proinitely say it was the marketing of the fessionals can work with this market? product that took me to the next level. The FSBOs are the best way to get purchase product was great, but I just didn’t see any- business in the door and get referrals for one else marketing themselves as aggres- your real estate agents. You can go from sively as I was. The best compliment I got one extreme and start your own FREE FSBO was, “I see your name everywhere.” I still program with signs and a Web site, or you can simply offer marketing support and be love to hear that to this day. a resource for the FSBO. The thing about Do you feel it is important for a mort- any way you approach it is that it takes a lot of work to structure and work efficientgage professional to have a niche, or ly, but if it’s done right, you will have a lead can they be everything to everyone? I absolutely think you need a niche in the generation system that will give you purmortgage business. You need to be well- chase leads for the rest of your career. If you have never worked an FSBO rounded in every single loan program available and be able to specialize in before and you want to start small, here something that will set you apart from are a few things you can do today. Find the competition. It can be something as an FSBO with a little red sign in your “If you are going to take the time to brand yourself, simple as being the best FHA 203k person area (ask friends, real estate agents and you better be able to back it up. That is a must!” in your area. If that’s the case, you can appraisers to keep a look out) and then —Mike Cox (right) with Gary Vaynerchuck (left), market yourself that way, do presenta- call them. Ask them about their house author of the book, Crush It tions on the 203k loan, and really put and why they are selling it. After they February of 2000, and soon established himself in the niche of downpayment assistance. He then began, a free for sale by owner (FSBO) program that came with a yard sign, Web site, marketing materials and a financing sign. The program flourished and eventually was bought by GSF Funding. His video site, Rates in Motion was inspired by Gary Vaynerchuck, author of the book, Crush It. Rates in Motion is a daily video blog site providing information to both consumers and mortgage industry professionals. Clear Home Loans is Mike’s latest endeavor where he is looking to provide transparency to the mortgage lending process. Clear Home Loans is built around helping real estate agents utilize the technology of today, such as videos and social media, to market their listings and get buyers. “I think most people would tell you I do whatever I am doing at 100 percent,” said Mike when asked to describe himself. “Whether it be work, play or spending time with my son … then that’s all I do. Whenever I do something, it’s all about that one thing. I think you are just better at the task at hand when you dive into only that particular task.”

Who is the one person you’ve met or crossed paths with in life that has had the biggest impact on you? I have met a lot of people in my life that

I have admired and have had a very positive influence on me. I think I took a little bit from many different people, and that has made me the person I am today. The person who has had the biggest impact on me personally is my three-anda-half-year-old son, Kaine. He has taught me to always face my challenges head on like there is no tomorrow. He has inspired me, motivated me, and all around, has made me a better person. Kaine was born with Congenital Diaphragmatic Hernia or CDH and has had a very difficult start to his young life. The first five months of his life were spent in the NICU of the Children’s Hospital of Milwaukee. He faced a challenge I hope nobody ever has to deal with even before he took his first breath (which he did not do on his own for at least four months). The challenges he faced during that time were nothing compared to the day-to-day issues that come into our lives. I have no idea what was going through his little head during that time, but I know he never gave up. Whenever I face a challenge in my life, I look at him and his experiences and say,, “Screw it … it’s not that bad.” He helps me keep things in perspective. I have learned to face things head on and work through whatever challenge is in my way. He is easily the biggest motivator in my life as well. I am sure all parents want the best for their kids as do I. I also want to be the person who he looks up to and he will admire for the rest of his life. I hope I earn the respect from him and that he will mention me someday when someone else asks him this very same question. I also hope that he has a child that changes his life for the better like he did for me. Thank you Kaine! I also have to thank my parents for teaching me that hard work pays off. Without that lesson alone, I would not have had the success that I have enjoyed. I want to thank them both for that.



There has to be a middle point between not having video and creating a Rates in Motion daily show. How can a mortgage professional get started in video? This is pretty simple. They can do this today. First, pick your message. What do you want to say, or more importantly,

What is the next big thing for you? My new focus is on Clear Home Loans, a company designed around being as transparent as possible about the mortgage transaction and the process. I have created an online update system that keeps the real estate agent, the buyer and the seller updated on the process of the sale every step of the way. It e-mails updates on the loan’s progress, or if you ever just want to just check in and see where the process is, just log in and check the status. There is no more “Where is the loan at in processing?” phone calls from the real estate agent. You can check rates online and get any type of mortgage information you need all from the Web site. I have also created a very unique program that will help real estate agents and the FSBO segment market their listings through video and other social media outlets. The new site will be focused on videos of loan programs, educational videos and videos of real estate agents and FSBO listings. There is no such thing as too much marketing for anyone trying to sell a home. I will also be offering some unique ways for real estate agents to get new leads and boost their Internet presence. The new site should be functioning soon, and I look forward to taking the purchase business to the next level. I am so excited to roll this out. I think people will be shocked to see how much content and video will be on the site. My goal is to make my new site a true resource for the consumer, real estate agent and FSBO market. Shouldn’t that always be the goal?

“You need to be well-rounded in every single loan program available and be able to specialize in something that will set you apart from the competition.”


What led to the creation of your daily consumer and referral partner targeted Rates in Motion videos? Rates in Motion was inspired by the book Crush It by Gary Vaynerchuck. One of the owners of GSF Funding, Phil Siebert, sent me the book and said to read it. After a few days of reading the book, we met to

what do your clients want to know about. Take that topic and shoot one single video and post it to YouTube. Send the link to your database and wait for the response you get. You will be amazed. I honestly think the best use of video for originators is a video you can use over and over again. So, if you want to explain a loan product, just shoot one awesome video that explains that program and either put it on your Web site or send it to your clients as needed. Videos are tools that should be used in your business to help make your business more efficient. Here is a good example. Shoot a video explaining everything a customer will need in order to get preapproved for their mortgage and a synopsis of the mortgage process. Then, when you schedule an appointment or get a new customer, send them this video. How much time does that save you from going over that with each and every client? Now they know what you look like, they know a little bit about your personality through the video, and it breaks down some barriers before you even meet with them face to face. If you are comfortable in front of the camera, maybe you want to do a weekly or monthly video blog post. If you engage with your followers and provide true value to them, you will be on your way to using video to get more business. 

discuss how we could take something boring like mortgages, make it fun and still provide great information to the world about how to get the best possible deal on their mortgage through a daily video. I have always been about doing things that nobody else is doing and just being different. This was a chance once again to make something happen and change the mortgage world in the process. There were months of brainstorming sessions before we came up with the initial version of Rates in Motion. I had never done videos before and it was a definite learning curve for me. Yes, it was a train wreck at the beginning, but once things got going, we found our groove and continue to improve each video we produce. It has been amazing to speak with people throughout the country just looking to get the best deal on their mortgage. The people I speak with, or the ones that are always pricing their loan to double check their lender, are the ones I get my content from each day. Sure, I add in a little flavor here and there, but the issues and questions these guys come up with are the topics of my show. If they are dealing with it, then so are others out there in the industry. The goal is just to provide great information, the best rates I see each day, and hope that people use this information to get the best possible deal. If they cannot find someone that will give them those rates and cost, the consumer just contacts me and I set them up with someone I trust that I know has the best rates available. It’s that simple. If anyone wants to become a When a customer comes to you specif- Rates in Motion-approved lender, contact ically for the best rate, do you feel that me and I will see if you have what it takes. the focus becomes less on value of How hard is it to produce a daily show service and more on rates? This is a debate I have with people all the with actual live pricing? time. On one side, you have the saying, “If It is insanely hard. There are so many they come to you for rates, they will leave details that go into doing one show that you for rate,” and on the other side, I say any one little thing can throw the whole if they come to you for rate and you pro- day off. The market changes so rapidly that vide them with service and true sound it’s hard to post rates sometimes. Rates are financial information and advice they will only one of the issues you come across not leave you for price. It is really about when doing a daily video. Just think about building trust with your clients from day traveling, appointments, maybe the kids one and asking the right questions about are sick, or one of the hundreds of other their financial goals. If you educate them reasons you may either miss a day of work and let them know you are always work- or have an altered schedule. This has not ing in their best interest, you will have a been an option for me since February of customer for life. Will some people jump 2011. It requires a ton of pre-planning, ship no matter what when rates dip a scripting and then shooting … it’s a lot of quarter during their lock? Of course, work. It is so much work outside of a norsome people are just that way. You either mal work day that I know nobody else will renegotiate that lock or say goodbye and do it. It’s a huge sacrifice on a personal move on. A good indicator of this type of level. It eats up a lot of my “me time,” but person is when they have 21 credit just like all things that take a ton of work, inquiries over the past five months. Be it’s worth it. I have helped hundreds of cautious of locking someone like that. people get a better deal on their mortgage. But, for the most part, the originators I have received national exposure and just that bring something to the table like have had a great response from all of those years of experience and true industry watching it. That always drives me to do knowledge have the least fallout. They the next show. All in all, it has been an amazing experience. also have the most referrals. tell you everything there is to know about the house, let them know what you do— you work for a mortgage company and have many pre-approved buyers who might be interested in their house. You just wanted more info to provide to your clients. Let them know you can then offer them some free marketing materials, like flyers with payment options, a nice financing sign out front, online advertisements (Craigslist) and even help them make sure the house is priced right (your agent’s market analysis). You will do all this for free to help them sell their home in the hopes of getting the mortgage of the person buying it. Be honest about your intentions … after all, the price is right for them. This simple phone call can get you a sign and advertisements that will produce calls or Web site traffic directly to you on a daily basis. The more signs, the more calls. Here’s the catch … you need to truly provide a service to the FSBO. You should follow up every couple weeks, update your flyers and provide a true service that will help the FSBO sell their home. In return for your hard work, here is what you get out of it—purchase leads from the sign, a potential listing referral for your realtors and a possible purchase from the seller if you can help them. That is off one house. Only take on what you can handle and do it extremely well. You will never be disappointed about all of the opportunities that come from this type of program. You may just end up refinancing the FSBO and their friends.

Roller Coasters and Yo-Yos




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There are rumors that half of Wall say that rates would go up? Well, unlike Street had to visit emergency rooms a company or even another country, this past month. They were all suffering America is a bastion of safety. There are from motion sickness … and what a two major places to turn for safety, U.S. Treasuries or gold. Rates went down wild ride it has become. First, we had worries about the because the volatility and uncertainty European debt crisis which weighed on scared investors and they bought stocks. Then, we moved to a stock market Treasuries (and gold). Now, it should be rally which gave some optimism that the noted that mortgages right now are far soft patch of growth was ending. This did from a bastion of safety. Though the not last long because of the budget stand- rates on mortgages went down as off which took the wind out of the mar- Treasuries rallied, they did not go down ket’s sails. The standoff came too late and quite as fast. That means that the was weak, as the markets were not really spread between mortgages and impressed. Neither was Standard & Poor’s Treasuries widened. You may not which took one business day to down- notice it because rates were moving grade our nation’s credit, and subse- down so fast. The question is, did the spreads widen because of the precipiquently, the Dow dropped 600 points. One business day later, the Federal tous drop in Treasury yields, because of Reserve Board (FRB) was meeting. the downgrade or a bit of both? Any wider spread between Treasuries Unfortunately, the Fed had used up most of its bullets to fight the slow and mortgages would actually mean that mortgage rates economy. So what have risen. Now could they do? “There are two major places to They declared a turn for safety, U.S. Treasuries or that is a tough one free pass from gold. Rates went down because the to explain when high rates forever volatility and uncertainty scared they are going down. However, it and ever, which in investors and they bought will be noticeable “Fed-speak,” is Treasuries (and gold).” when rates go up, two years. Since and if we don’t the Fed rarely puts become fiscally sound enough to warrant a timeframe on the direction of rates, two years is indeed infinity for them. a AAA rating. I am not saying when they are going up, but eventually, they will. The Dow then rallied 400 points. Didn’t I just say the Fed stated that The next day, worries about Europe returned, and many realized that the rates would not rise? It should be noted Fed was really saying is that growth was that the Fed controls short-term rates too weak to bring down unemployment directly and long-term rates indirectly. or fix housing. The Dow plummets 500 Even with the Fed holding short-term points. The beginning of August re- rates low, if the economy does start to defined the term roller-coaster. But the heat up, long-term borrowing costs will next question is … where do we go rise, regardless of the Fed’s efforts. As a matter of fact, if the Fed leaves shortfrom here? First let’s look at the scorecard. The term rates low in the face of a recovery, stock market had undergone a 20 percent long-term rates are likely to rise even correction in a matter of a few weeks by faster. So the next question is—is the Aug. 22. Oil prices fell around 20 percent. recovery ever going to happen? The Fed definitely acknowledged Rates were also down significantly with mortgages again hitting record lows set that the economy was growing too last year. Of course, gold was up signifi- slowly and that there is more risk to the cantly. Why do I say “of course?” Well, downside at the present time. One facseems that no matter what happens, gold tor after another has affected the econonly goes in one direction in the past few omy’s performance, from earthquakes years—and that direction is up. No one is to floods to the European debt crisis. blinking because the market could Now budget cuts stand to take some more air out of the recovery. Many are reverse itself overnight. Why would rates go down if the S&P continued on page 20 downgraded our credit? Didn’t analysts

dies in filing these complaints and seeks to recover on losses to the GSEs that are the legal responsibilities of others.

Bank MLOs Info Now Available on NMLS Consumer Access Site

SEPTEMBER 2011 FHFA Takes Legal Action Against 17 Firms to Recoup GSE Losses

continued on page 17



The Federal Housing Finance Agency (FHFA), as conservator to the government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, has filed lawsuits against 17 financial institutions, certain of their officers and various unaffiliated lead underwriters. The suits allege violations of federal securities laws and common law in the sale of residential private-label mortgagebacked securities (MBS) to the GSEs. Complaints have been filed against the following lead defendants: Ally Financial Inc. (formerly known as GMAC), Bank of America Corporation, Barclays Bank PLC, Citigroup, Countrywide Financial Corporation, Credit Suisse Holdings (USA) Inc., Deutsche Bank AG, First Horizon National Corporation, General Electric Company, Goldman Sachs, HSBC North America Holdings Inc., JPMorgan Chase, Merrill Lynch & Company/First Franklin Financial Corporation, Morgan Stanley, Nomura Holding America Inc., The Royal Bank of Scotland Group PLC, and Société Générale. These complaints were filed in federal or state court in New York or the federal court in Connecticut. The complaints seek damages and civil penalties under the Securities Act of 1933, similar in content to the complaint FHFA filed against UBS Americas Inc. in late July. In addition, each complaint seeks compensatory damages for negligent misrepresentation. Certain complaints also allege state securities law violations or common law fraud. As conservator of Fannie Mae and Freddie Mac, FHFA is charged with preserving and conserving these companies’ assets and does so on behalf of taxpayers. The complaints filed reflect FHFA’s conclusion that some portion of the losses that Fannie Mae and Freddie Mac incurred on private-label MBS are attributable to misrepresentations and other improper actions by the firms and individuals named in these filings. The FHFA alleges that the loans had different and more risky characteristics than the descriptions contained in the marketing and sales materials provided to the GSEs for those securities. FHFA filed the complaints under the broad authority granted to it by the Housing and Economic Recovery Act of

2008 (HERA). The U.S. legal system provides for addressing such alleged misrepresentations through the nation’s securities laws and traditional common law. FHFA is following those legal reme-

The Conference of State Bank Supervisors (CSBS) announced information for federally registered insured depository institutions and mortgage loan originators (MLOs) employed by such institutions and their subsidiaries, is now available on NMLS Consumer Access. With the addition of federal registrants, NMLS Consumer Access is a comprehensive record of individuals, companies,

and financial institutions licensed or registered through the Nationwide Mortgage Licensing System & Registry (NMLS). NMLS Consumer Access is a searchable site that provides the public with standardized information concerning state-licensed companies, branches and mortgage loan originators, as well as federally registered financial institutions and mortgage loan originators. Information on mortgage loan originators include: identification information about the individual, employment history, license and registration status, and the individual’s current employer. Launched in January 2010, NMLS

Laboring Over Ineffective Marketing

REMN’s New Division Answers the Call for Immediacy From the Internet Generation

by Mary Beth Doyle, Founder

September is a great time to get back to basics – and to reassess the core strategies of your business. By Eric C. Peck

Don’t work harder, work smarter. Let’s look at methodologies that top-producing LOs incorporate into their business for ongoing success:

t Consistent, quality communications t Post-close customer retention programs t Stay-in-touch programs for past customers t Weekly Partner communications & updates 12

t Lead management automation t High-impact direct mail & e-mail templates



t Time-sensitive, actionable database alerts t Effective content t Variable data printing & boutique formats

LoyaltyExpress is the leading mortgage marketing company, and we’ve recently been named to the Top 500 Fastest Growing Companies in the United States. Take advantage of the opportunity to improve your career. We’d love to hear from you.

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Real Estate Mortgage Network Inc. (REMN) has announced the launch of its new consumer-direct lending division, officially doing business as online, to serve the needs of homebuyers who prefer the convenience of securing mortgages via the Internet. Headquartered in Dallas, Texas, is a consumer-direct platform to help qualified homebuyers secure a loan quickly and easily and at their own convenience. As online price comparison shopping has grown, the launch of is REMN’s answer to the Internet generation’s demand for immediacy. offers a full menu of traditional mortgage products, including conventional, Federal Housing Administration (FHA) loans, U.S. Department of Veterans Affairs (VA) loans, jumbo loans, United States Department of Agriculture (USDA) loans, and Fannie Mae HomePath loans. Customers will have access to’s FHA 203(k) Concierge Service, an initiative that ensures the 203(k) process runs smoothly for all parties involved. An in-house short sale department is also in place to help loan originators and realtors navigate the short sale process in an efficient manner. “ is geared toward that 20-something or 30-something who wants to know what amount they qualify for and what zip code they are looking for a home in, opening a direct line of communication with them either via phone or e-mail,” said Tim Bartosh, senior managing director of “We provide the consumer with a ballpark figure of what they qualify for and give them a snapshot of the next steps they need to take in order to secure financing and get the homebuying process underway.” The user-friendly site offers a range of tools for consumers, including:  A detailed “Education Center” that provides a list of factors to consider when considering homeownership.  A “Useful Tools” module featuring a checklist of documents needed for the homebuying process; mortgage calculators to estimate income qual-

ifications, average monthly payments and affordability; and a Widget powered by Zillow that provides the current estimated market value of a property by entering the street address and location.  A “Client Testimonial” page where site users can recount and critique their experiences with’s representatives.  A “Loan Tracker” feature that provides clients the ability to monitor the progression of their mortgage, from application through closing. In addition to traditional networking with referral partners, will be marketed through branded television and radio ads, in addition to utilizing a multi-site social media campaign. “As we see it, the Internet has become more about recommendations for younger generations,” said Bartosh. “Right now, we are using Facebook to have people follow us and comment on their experiences with us. These comments and recommendations are then pushed out to our audience of followers on Twitter (@finance_my_home). Our LinkedIn page is used for Realtors and title companies in building out our referral network.” Bartosh, who serves as the company’s senior managing director, joined Real Estate Mortgage Network Inc. (REMN) in November of 2010. He spent the previous 16 years as chairman and chief executive officer at CTX Mortgage Company.’s leadership team is comprised of a core of industry-savvy veterans, including Managing Director Matt Payan, Directors of Consumer Direct Ron Lopez and Ronald Blake, and Operations Manager Theresa Finchum. REMN, doing business as, is currently licensed to originate in 15 states with more than a dozen additional states pending. In 2010, REMN closed nearly $3 billion in home loans, further solidifying its position as one of the largest independent non-bank lenders in the country. “Our average loan originator has more than 12 years of industry experience and is licensed in multiple states,” continued on page 14

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in making the ability-to-repay determination are considered and verified;10 and,  The underwriting of the mortgage (a) is based on the maximum interest rate that may apply in the first five years, (b) uses a payment scheduled that fully amortizes the loan over the loan term, and (c) takes into account any mortgagerelated obligations.

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







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Alternative #2: Provides a rebuttable presumption of compliance and would define a “qualified mortgage” as including the criteria listed under Alternative #1 (above), as well as additional underwriting requirements from the general ability-torepay standard (see Option #1). In any event, under Alternative #2, the creditor would also have to consider and verify:  The consumer’s employment status;  The monthly payment for any simultaneous mortgage;  The consumer’s current debt obligations;  The monthly debt-to-income ratio or residual income; and  The consumer’s credit history. Comment: Two alternatives are given: in Alternative #1, to obtain a legal safe harbor, the creditor must consider and verify the borrower’s current or reasonably expected income or assets to determine the borrower’s repayment ability; and, in Alternative #2, to obtain a rebuttable presumption of compliance, the creditor must consider and verify the borrower’s current or reasonably expected income or assets (i.e., other than the value of the dwelling in question), the borrower’s current employment status (assuming the creditor relies on employment income), the borrower’s monthly payment on any simultaneous loan, the borrower’s current debt obligations, the borrower’s monthly DTI or residual income, and the borrower’s credit history. It should be noted that the second alternative is for the most part similar to the ability-to-

repay test. There are some important aspects of Option #2 that should be considered. With the safe harbor alternative, the Rule would provide that a QM will be deemed to have complied with the ability-to-repay test; therefore, the only way that the borrower can get past the safe harbor is by proving that the loan is not a QM. If this occurs, the burden will shift to the creditor or assignee to demonstrate that the loan meets the ability-to-repay test. With the presumption of compliance alternative, the Rule would provide that a QM is presumed to have complied with the ability-to-repay test; which means that, even if the mortgage is a QM, the borrower can rebut the presumption of compliance with evidence that the mortgage did not meet the ability-torepay test. Part of the basis of the proposal is to determine, through public comments, which conditions should apply, either the safe harbor or the presumption of compliance. Creditors and similarly situated entities would probably favor the safe harbor approach because of the protection from liability that it will afford. On the other hand, consumer advocacy groups and plaintiff’s bar will favor the presumption of compliance, because that offers the opportunity to challenge the ability-torepay for any mortgage, particularly those in imminent foreclosure.

Option #3: Balloon-Payment Qualified Mortgage This option is obviously meant to preserve access to credit for consumers located in rural or underserved areas where creditors may originate balloon loans to hedge against interest rate risk for loans held in a portfolio. Under this option, a creditor may make a balloon-payment qualified mortgage with a loan term of five years or more by:  Complying with the requirements for a qualified mortgage; and continued on page 16

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said Bartosh. “App-takers basically just sell rates, but we are looking at our higher-quality loan originators having higher conversion rates as they provide greater value to the customer. Our focus on quality is what will differentiate us from the other low-quote providers in the marketplace.” The company is also looking to establish REMN University, a recruitment program designed to train loan originators and grow and cultivate a

strong team from within the company’s own ranks. “Strategically, you need to have that farm network to grow loan originators internally and retain a team a highlyskilled loan originators,” said Bartosh. “We are making a name for ourselves in the marketplace as there is a lot of talk on the street about in the Dallas area right now. We are looking to add more than 100 new employees before the end of 2011.”


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How to Get the Attention of Agents, Brokers, Attorneys, Accountants, Etc. in a Very Creative Way By Ron Vaimberg One of the great strategies that can explode your referral partner network is direct marketing. By engaging in a deliberate campaign at targeted relationships such as real estate agents, accountants, attorneys, etc., you can multiply your referral business rapidly with little investment. However, the key to a deliberate targeted effective marketing campaign is that it must be properly designed and executed completely. I have witnessed repeated mistakes (and even made some of them myself) that many loan officers and mortgage companies make when launching a marketing campaign to develop referral partners. To make sure that you don’t waste time, money and effort, your campaign must contain the following seven success elements: 1. Make sure you properly define your target list. 2. Deliver your message in a manner that stands out. 3. Your message must keep the recipient’s attention. 4. Clearly explain the benefit the recipient will receive by speaking with you. 5. Call to action. 6. A clearly defined presentation. 7. Consistent follow-up. Below is a breakdown of each critical success element so you can maximize your results. I Success Element #1: When you engage in direct marketing, you want to make sure that you are spending your time, energy and resources reaching out to referral partners that are doing business and are in the position to refer business to you.


I Success Element #2: You have to get the envelope opened. One of the most effective tools I use to deliver my message to the target is the U.S. Post Office Priority Mail Service. For only $4.95 you can send your target a Priority Mail envelope that is genuine and is guaranteed to get opened and the target will remember receiving it.



I Success Element #3: Once the letter is opened, you must keep the target engaged. One of the most powerful tools I use is I personally handwrite my letter to them. If your target is worth developing a relationship with, they are worth the time to send a handwritten note. For an example of a note my coaching clients use to develop real estate agent relationships go to I Success Element #4: You must remember that your target reads whatever you sent them with one question in their mind, “What is the benefit to me?” Your marketing piece must clearly state that your intention is to help them make more money, get more clients, etc. Remember … don’t tell them everything. The goal of your marketing piece is to get their attention. I Success Element #5: Make sure your marketing piece has a “Call to Action.” Unless you tell them what to do, they are not going to do anything. You must specifically tell your target what action to take, and why to take it. For example, call a specific number or visit a specific Web site for more information. I Success Element #6: A clearly defined presentation is critical in creating a relationship. Delivering your message to your target once you make contact is critical to your success. You must practice your benefit presentation so when you are granted the appointment, you make the most of it. I Success Element #7: The biggest mistake that loan officers often make is that they sit and wait for the phone to ring after having sent their marketing piece. Research shows that by making follow-up phone calls on your direct marketing piece, you will increase your results from 80 percent to 200 percent. Don’t call just once … keep calling until you get them on the phone and they say either “No” or “Yes.” To read last month’s article, “How to Build Your Referral Network Without Ever Cold Calling,” please visit

Ron Vaimberg is president of The Warrior Sales Academy and a leading national trainer and coach to MLOs. He may be reached by phone at (866) 360-6645, e-mail or visit SPONSORED EDITORIAL


continued from page 14

 Underwriting the mortgage based on the scheduled payment, except for the balloon payment.

borrower to defer repayment of principal, and does not result in a balloon payment; the total points and fees do not exceed the permitted percentage of Comment: This option is meant to pre- the total loan amount (see above: serve access to credit for consumers Alternative #1 or Alternative #2); the located in rural or under-served areas.11 loan term does not exceed 40 years; the This type of QM is a loan that generally interest rate is fixed for at least five qualifies as a QM but also includes a bal- years after consummation (this includes loon payment. The creditor is permitted step-rate mortgages without a variable to underwrite a balloon loan using the rate feature); and, the loan proceeds maximum payment scheduled during the are used solely to pay off the outstandfirst five years after consummation. This ing principal balance on the non-stanapproach would not capture the balloon dard mortgage and closing costs payment for a balloon loan with a term (including escrow amounts). of five years or more.12 This option is subOption #4 is available when (1) a ject to certain requirements to which all non-standard mortgage is refinanced QMs are subject; for instance, there must into a standard mortgage, and (2) the be regular periodic payments that do not following conditions are met: result in an increase in the principal bal(1) The creditor for the standard ance, the loan term may not exceed 30 mortgage is the current holder or years, the total points and fees may not servicer of the non-standard exceed the permitted percentage of the mortgage; total loan amount, and the loan must sat(2) The monthly payment on the isfy the same underwriting and verificastandard mortgage is materially tion requirements. lower than the monthly payment on the non-standard mortgage;14 Option #4: (3) The creditor receives the borrowRefinancing of a er’s written application for the Non-Standard Mortgage standard mortgage before the A creditor may refinance a “non-stannon-standard mortgage is recast; dard mortgage” with “risky” features (4) The borrower has no more than into a more stable “standard mortgage.” one payment more than 30 days It has been asserted that this option is late on the non-standard mortmeant to preserve a consumer’s access gage in the 24 months before the to a streamlined refinance that “matericreditor receives the borrower’s ally” lowers the mortgage payment. written application for the stanUnder this option, a creditor comdard mortgage; plies by: (5) The borrower has no payments  Refinancing the consumer into a more than 30 days late in the six “standard mortgage” that has limmonths immediately before the its on loan fees and that does not creditor receives the borrower’s contain certain features such as negwritten application for the stanative amortization, interest-only dard mortgage; payments, or a balloon payment; (6) The creditor has considered  Considering and verifying the whether the borrower is likely to underwriting factors listed in the default (a lower standard than general ability-to-repay standard, “imminent default”) on the nonexcept the requirement to consider standard mortgage once it is and verify the consumer’s income recast; and, or assets; and (7) The creditor has considered  Underwriting the “standard mortwhether the standard mortgage gage” based on the maximum will prevent the borrower’s interest rate that can apply in the default. first five years. Comment: The Rule introduces a new A non-standard mortgage is a cov- term to replace a term that has been in ered transaction that is an ARM with an use for ARM adjustments for many introductory fixed rate for a period of years. Specifically, for adjustable-rate one year or more (i.e., a 2/28 ARM), an mortgages with low, fixed introductory interest-only loan, or a negative amorti- rates, the term “reset” has typically zation loan. Dodd-Frank refers to a meant the time at which a low teaser “hybrid mortgage,” but the Rule uses rate converts to a fully indexed rate, the term “non-standard mortgage.” resulting in significantly higher monthA standard mortgage is a covered ly payments for homeowners. transaction which, among other things, According to the Rule, the term “recast” does not contain negative amortization, is henceforth to be used in reference to interest-only payments, or balloon pay- the time at which fully amortizing payments, and limits the points and fees. ments are required for interest-only Essentially, the standard mortgage and negative amortization loans, on structure provides regular periodic pay- the basis that the term “reset” is more ments that do not cause the principal balance to increase,13 does not allow the continued on page 24

news flash

continued from page 11

Consumer Access originally housed data regarding state-licensed companies, branches, and individuals licensed through NMLS. Mortgage loan originators employed by insured depository institutions that are federally registered with NMLS are also available on NMLS Consumer Access. Currently, there are 16,422 licensed mortgage companies, 109,001 licensed mortgage originators, 10,507 registered depository institutions, and 349,825 registered mortgage loan originators housed within NMLS and available on NMLS Consumer Access. Through the NMLS, every MLO is assigned a unique identifier, known as the NMLS ID, which is required to be incorporated into every loan sold to Fannie Mae and Freddie Mac and insured by the Federal Housing Administration (FHA). Consumers can search for MLOs and their employing company or institution using the NMLS ID. This unique identifier allows regulators to associate the loan documents and business practices with the individual and company that negotiated the transaction, ensuring that bad actors cannot hide from their past actions.

improve their short-sale processes, clearly, they are not doing enough,” said CAR President Beth L. Peerce. “Instead of helping struggling homeowners who need to sell and willing home buyers who want to buy, lenders have created man-made roadblocks that have caused real estate gridlock and hindered a desperately needed housing recovery.” Realtors continued to cite communication issues as the most frequent obstacles in working with lenders and servicers during the short sale process.

These communication issues include lenders’ slow response time to a short sale package (cited by 66 percent of Realtors), poor communication with lender representatives (cited by 55 percent of Realtors), and repeated requests for documentation (cited by 51 percent of Realtors). More than 15 percent of Realtors indicated that the lender foreclosed on the home before the shortsale transaction could be completed. Sixty-seven percent of Realtors said it took more than 60 days for lenders or servicers to return a written response on the approval or disapproval of the short sale agreement submitted. Additionally, 43 percent of Realtors said it took the lender more than five days to return any form of communication. Less

than 20 percent said lenders responded “within one business day” or less. Overall satisfaction with the lenders Realtors worked with in their most recent short sale transaction remained extremely poor, with 75 percent saying they were “not satisfied” or “not at all satisfied,” up from 67 percent in December. Moreover, nearly eight in 10 Realtors (78 percent) said they were “not likely” or “not at all likely” to refer buyers to the lender for future home purchases. “With short sales accounting for a fifth of all transactions in California, it’s crucial that lenders improve their short sale process so that a meaningful recovcontinued on page 23

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More Realtors characterized closing short sale transactions as “difficult” or “extremely difPhoto credit: Stockbyte ficult” than late last year, indicating that lenders’ and servicers’ short sale procedures have shown little improvement in the past six months, according to the latest Lender Satisfaction Survey conducted by the California Association of Realtors (CAR). Seventy-seven percent of respondents reported closing short sale transactions as “difficult” or “extremely difficult,” up from 70 percent in December, according to the survey. The survey, a follow-up to a survey conducted in December 2010, gauges Realtors’ experiences working with lenders in their most recent transaction. The majority of those surveyed dealt with short sale transactions. The survey was conducted in June 2011 to gauge Realtors’ experience in working with lenders or servicers during their most recent transaction, the majority of which were short sales. Most of the Realtors surveyed dealt with Bank of America, Wells Fargo, and JP Morgan Chase in their most recent transaction. The latest survey findings show that the situation has not materially improved in the six months since CAR first surveyed its members. “Despite promises by lenders to


Is 100% Commission As Good As It Gets?

ohn’s old company paid him 100%. He thought he had the best deal there was to be had. He thought his comp plan was ‘good enough’…His branch comp plan was set at 300 bps, & his LO’s were set at 125 bps. One day John started noticing a few small ‘holes in the bottom of the boat’. In May, his branch closed 12 loans (2 million) with his old company. The total income to his branch after paying his LO’s = $35,000

A Guide to Evaluating & Selecting a Valuation Management Platform

Then John joined Hometown Lenders so he could: I Have more control over his branch’s profitability. I Increase/decrease his branch’s loan pricing at will…and get PAID from it! I Get his money faster (he didn’t have to wait until the loans funded - he got paid when they closed) I Hide his income (SRP) from his LO’s (They already think he makes too much...)


After joining Hometown Lenders, his branch closed the same amount in July. Right off the bat, John got an .125% volume incentive bonus from Hometown Lenders - an extra $2,500 to his branch. In addition to the volume incentive, and since he was now able to control his LO’s pricing, he got paid an additional 25bps that he built in for himself (that his Loan Officers couldn’t see) – an extra $5,000 to John’s branch.

By David Rasmussen

As the mortgage industry has evolved in the wake of the 2008 financial and housing crisis, there has been an increased focus on collateral valuation, as well as integrating auditable, rules-based systems to maximize product and provider tracking, transparency and efficiency. A valuation management platform fills a distinct void by providing a means to effectively manage the multitude of valuation products and valuation providers utilized in the mortgage chain from a Web-based platform. Ultimately, such a solution allows for better control of business operations by providing a deeper level of organization and tracking over the entire loan workflow. Systems managing such complexity can be difficult to properly evaluate and the following provides a guide from component review to implementation to aid your evaluation process.

Valuation management platform components



It gets better… Since John was now able to include front end fees in his pricing/comp plan, he added another $750 to each of his loans - an additional $9,000 to his branch! Now….In addition to giving himself an instant $16,500 pay raise, he also got to keep ALL of his branch’s overage (since he was a non-producing manager), which added another $5,325 to his bottom line. At Hometown Lenders, the total income to John’s branch increased by $21,825! Just for the fun of it, John decided to calculate how much MORE he makes per year with Hometown Lenders… He got a little light-headed when he realized he had just increased his income by $261,900 a year. Then John took a much needed vacation with his family (they went to Bora Bora). He could finally relax with his family and enjoy himself because he knew Hometown Lenders support was second to none and that his people would have every one of their phone calls and emails answered within minutes and his loans were in the best hands in the business. He also knew his recruiting efforts wouldn’t come to a standstill while he was on vacation because Hometown Lenders recruiting department was constantly looking for more producers for his office daily.

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A valuation management platform is comprised of several components seamlessly working together, including:       

Order placement Quality assurance Review management Reporting tools (standard reporting to advanced analytics) Valuation provider management and optimization Complete UCDP connectivity Data retention, exporting and archiving

It is important to carefully consider which system components are most significant and how they would be utilized. Consideration must also be made for long-term business goals and what components might be added at a later time.

Selecting a valuation management platform A best practice approach in selecting any enterprise-wide workflow tool dictates early and broad involvement from the various stakeholders who will be impacted by the technology. This will range from upper management to daily users, but ultimately depends on the size and needs of the company. Typically, a committee is formed to include representatives with compliance, technology, and appraisal backgrounds to assess needs from the platform. It is important to properly assess internal requirements and answer key questions about the platform itself to ensure the selection fully meets your corporate goals. Below are a few questions to consider:  What specific functionality do you need in the platform?  Can the platform immediately automate your current workflow? continued on page 20

All inquiries held in absolute confidence. Hometown Lenders is currently looking for high-quality Originators, Branch Managers, and Regional Managers in TX, GA, AL, TN, FL, MS, and SC.






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

A Hand Up, Not a Handout: How Marginal Mortgage Reform Can Revive the Housing Market and Help Save Our Economy By John Walsh




The expression that we should give those in need “A hand up, rather than a handout” is based on the premise that responsible people will achieve success on their own if we help get them started on the right path; while giving them more than a start will destroy their initiative and sense of responsibility. In their book Nudge, Richard Thaler and Cass Sunstein describe the importance of how choices are presented to us relative to the major life-decisions we make. They argue that presenting choices to consumers that put wise decisions in a favorable light is a way to nudge people into beneficial behavior. We have come to that point in the mortgage market, where a nudge is needed. A nudge that takes the form of a marginal relaxation in underwriting standards (in exchange for higher pricing) that can have a tremendous impact on the housing marketplace and U.S. economy. News out on Aug. 10 indicates that mortgage applications increased by 21.7 percent. This is not surprising given the dramatic drop in rates that are being impacted by the economic turmoil of the U.S. debt ratings cut, the Federal Reserve’s decision to park the Fed Funds rate at zero percent and Europe’s sovereign debt crisis. Americans have always seen the wisdom in lowering their “life operating costs” if possible through refinancing their mortgages. It’s a beneficial choice they want to make. Unfortunately, for approximately 75 percent of these new mortgage applicants, they will be denied the loan based on new stringent underwriting factors. If we can send a man to the moon, why can’t we design a mortgage underwriting scheme that properly evaluates and prices risk and then offers beneficial opportunities to more consumers? Don’t get me wrong, some people should simply not qualify for a mortgage at any price. The “ability to repay” a loan is paramount. While a blemished credit report can be acceptable, and having only a 10 percent down payment still provides sufficient “skin in the game” to promote responsibility, a candidate’s employment, income, value and assets must be stable, sufficient and verified. We must be smart and learn from our previous mistakes. Our economy and local communities

desperately need the benefits that millions of existing homeowners with lower housing costs would produce. Not only that, but our economy must have a stable and growing new housing sector before this disaster can truly be put behind us. I am not advocating a return to subprime lending. Sub-prime lending turned the American Dream into the American Nightmare as every participant in the sub-prime loan process from the consumer to the originator, to the lender, to the insurer, to the securitizer, to the rater, to the investor, to the regulator, to the legislator layered risk upon risk and ignored common sense due to greed. But it doesn’t have to be this way. Also, I understand that housing values are a major hurdle in the way of refinancing and home sales. However, price stability comes from having a balance between home sellers and homebuyers. Risk-based lending can create more potential buyers, thereby helping to support or even raise housing prices. We need loan products that can provide a vehicle for Americans to purchase the excess housing inventory that is available at significantly reduced costs. We need products that will allow working, yet somewhat imperfect borrowers, the opportunity to purchase homes from those who are facing unemployment—unlocking equity or freeing the homeowner and the lender from likely foreclosure. We need mortgage products that lead to follow-on consumer spending on household goods and services. We need homeowners who have the ability to renovate and rehab existing properties to improve values and neighborhoods. We need construction jobs from new housing construction. We need Americans buying in to the American Dream, rather than giving in to the American Decline—rhetoric that is growing louder by the day. One effect of the Fed’s action was to make short-term U.S. Treasuries an unattractive place to invest money. Longerterm U.S. Treasury securities and prime mortgage-backed securities (MBS) offer better, yet still anemic, returns. Investors are going to be clamoring for better returns. Growth stocks and high dividend stocks will surely fit the bill; however, a marginal relaxation of underwriting standards on privately-created and insured mortgage products that are properly rated and disclosed can also provide better returns for investors.

Fed Chairman Ben Bernanke said unequivocally that every participant in our economy must focus on doing their part, taking well-considered risks and investing in our nation if we are to prevail over this threat to our future. The redevelopment of riskbased lending can be a nudge to our system if properly conceived and regulated. Millions of Americans’ lives can be positively affected through its

careful re-introduction into the marketplace. Risk-based lending is a hand up, not a handout. John Walsh is president of Total Mortgage Services. Walsh founded Total Mortgage Services in 1997, with a customer-centric approach and a mission of responsible lending. He may be reached by e-mail at or visit

the secondary market overview asking if we are heading for another financial meltdown. “Not likely” say most analysts. This is not 2008. The economy is growing, albeit slowly. We added only 100,000 jobs in July, but it was better than the hundreds of thousands we were losing each month just a few years ago. Companies, including many banks, are flush with cash and have the ability to hire as soon as it is evident that the economy will not fall back into recession. The risk of a double-dip recession has risen, but is far from probable. So, we get back to the question: Where do we go from here? On the positive side, lower rates will increase refinancing and home purchases. Lower oil prices will enable the consumer to increase spending in other areas. On the negative side, we have the European debt crisis and a spooked stock market. Remember, this is a crisis of confidence and roller coasters get people scared rather than give them confidence. If rates stay where they are for a few


continued from page 10

months, what has been a trying year for mortgage bankers could turn into a much better one as the refis line up. If you are not reaching out to your sphere right now, you should be. Anyone who wants a refinance letter to send to their clients, just e-mail and we will send you a copy. On the other hand, don’t blink because the latest refi boom-ette could be over in a second. Anyone out there know how to control a yo-yo? Dave Hershman is a leading author for the mortgage industry, with eight books and several hundred articles to his credit. He is also a top industry speaker. If you would like to stay ahead of what is happening in the markets, visit for a free trial. Dave’s NewsletterPro Marketing System can be found at and he may be contacted by e-mail at

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 Does the platform provide a wide range of rules and policies?  What functions within the platform are logged and auditable?  Does the system allow for complete vendor management?  Is the platform intuitive and userfriendly?  Is the platform backed by a responsive customer support team?  How does the provider handle user and management training?  Does the host company have a successful integrations track record?  Is the platform scalable for company growth?

Implementation The implementation process includes important steps for the successful integration of the valuation management platform. First, users must be properly coached with a platform overview, detail on uploading and managing information, and trouble-shooting scenarios. Secondly, technology may need to be integrated with loan origination systems, vendor providers and propri-

etary systems. Thirdly, company rules and guidelines need to be correctly imbedded into the platform. Finally, the platform must be thoroughly tested before it goes live. Users of the platform should commit to daily use of the technology and begin to fully utilize its capabilities.

Reaping the rewards One of the most significant benefits of integrating a valuation management platform comes from dramatically increased efficiencies. This includes improved functionality, better reporting and tracking capabilities, automated quality controls, and a redeployment of effort from manual reviews to more critical functions. Proper implementation should result in improved efficiencies within the first 90 days and will continue to grow as the capabilities are utilized at a higher level. David Rasmussen is senior vice president of operations at Veros Real Estate Solutions. For more information, call (714) 415-6300 or visit

Total Mortgage Services to Add 50 New LOs to Expand Its Retail Channel

Academy Mortgage Announces Partnership With Credit Plus Credit Plus Inc. has been named the preferred credit reporting partner of Academy Mortgage Corporation, headquartered in Salt Lake City, Utah, with 112 branches in 24 states. Academy Mortgage’s branches will pull credit reports from Credit Plus. “Academy Mortgage has a solid reputation in the mortgage industry and we’re excited to be selected as its preferred credit vendor. We’re committed to providing its team with exceptional service and sophisticated technology that will allow it to maintain and expand upon its market leadership position,” said Greg Holmes, national director of sales and marketing for Credit Plus Inc. Additionally, its mortgage professionals will have access to other tools, such as Lending Hand, wherein an indepth credit file evaluation takes place showcasing the impact of various decisions that could potentially positively or negatively influence the credit score. “Credit Plus and its tools and technologies will help Academy Mortgage fulfill our clients’ dreams of homeownership,” said Mike Jensen, chief marketing officer of Academy Mortgage. “This partnership brings us a wealth of resources to assist our clients in navigating the mortgage process, such as unique credit score enhancement tools and impressive reporting capabilities.”




Mortgage Branch Opportunities! Several Mortgage Companies With Banker and Broker Status To Choose From! With hundreds of mortgage branch employment opportunities out there, making a choice on who to sign up with is not an easy task. We are here to help!

continued on page 25

Call Today! Toll Free 1-888-589-7048 or visit Subscribe to Mortgage Brokers Network Daily Feed by Email


Bay Equity Home Loans has announced that Pacific Bay Financial Corporation, one of the longest-standing mortgage brokerages in the San Francisco area, has joined its team of retail branches. Since its founding in 1985 by Manny & Elfa Kagan, Pacific Bay Financial has established a solid reputation as one of the premier mortgage companies in the Bay Area through its focus on providing the highest quality service to its clients. “When the mortgage industry changed, I recognized that we had to change too in order to stay in business,” said Kagan. “We interviewed five banks looking for the right fit, but Bay Equity stood out because they were a true mortgage bank built by


Pacific Bay Financial Joins Bay Equity Home Loans 

Total Mortgage Services LLC has announced that it is aggressively hiring 50 new retail loan officers to help expand its retail channel’s market position throughout the 23 states it is currently licensed in to originate residential mortgage loans. Total Mortgage is actively recruiting high-quality mortgage production professionals, offering a highly competitive compensation package and access to some of the lowest mortgage rates and best in class operational support in the industry. “Total Mortgage’s vision is to deliver the perfect mortgage, which we believe starts with our advice-driven loan officers establishing a trust-based relationship with a borrower at initial contact and continuing to offer the best advice through closing,” said John Walsh, president of Total Mortgage Services. “Part of our expansion strategy is to significantly increase our retail production team by adding 50 high-quality mortgage sales professionals, who not only have a track record of producing quality loans, but who are technologically savvy, have great communication skills and are aligned with our integrity-based culture and our centralized model.” Total Mortgage recently received its Colorado Mortgage Lender License from the Colorado Department of Regulatory Affairs, Division of Real Estate and its state of Mississippi Mortgage Lender License from the Mississippi Department of Banking and Consumer Finance. Total Mortgage is now registered as a mortgage lender in the state of Colorado and the state of Mississippi and can originate residential mortgage loans in 23 states and the District of Columbia. Total Mortgage has experienced multi-channel growth and expansion through its wholesale segment with its new AE hires. By receiving licensing approval in the states of Colorado and Mississippi, the company has expanded its presence nationwide, with five additional state licenses pending. Total Mortgage has additional product extensions in their pipeline as well, including its recent lending program for cooperative apartments (co-op) for its retail and wholesale lending channels.

e-mail: visit:

Conference fees Member Registration Fee Access to all conference events. You must be an NAMB member in good standing by Friday, Nov. 18 to obtain the member rates. If you are not a member in good standing by this date you will be charged additional fees upon arrival to the conference. To check the status of your membership, go to Early fees (on or before 11/09/11)—$200 Regular fees (11/10/11 or later)—$250 Non-Member Registration Fee Access to all conference events. Early fees (on or before 11/09/11)—$350 Regular fees (11/10/11 or later)—$450

NAMB/WEST 2011 Loan Originator Conference Friday-Monday, December 3-5 MGM Grand Las Vegas • 3799 Las Vegas Boulevard South • Las Vegas

New in 2011! Attendees of the 2011 NAMB/WEST Conference will receive a Passport for the Exhibit Hall on Sunday, Dec. 4. Passports will need to be validated by each exhibitor in order to be eligible for drawings. The grand prize drawing, a trip to Hawaii, will be held at the conclusion of the conference on Monday, Dec. 5. Attendees must be present to win. As a bonus, attendees who book their hotel with the group rate before Wednesday, Nov. 9 will receive an extra Passport.

Agenda at a glance (Subject to change)

Saturday, December 3 10:00 0 a.m.-5:00 0 p.m. ........Registration n Open


10:00 0 a.m.-Noon ..............Committeee Meetings Some or all of the following NAMB Committees could meet during these times … additional details will be posted at a later date: The Government Affairs Committee, Membership Committee, Ethics Committee, By-Laws and Education Committee, Communications Committee and the Finance Committee. 1:00 0 p.m.-4:00 0 p.m. ..........NAMB B Delegatee Councill Meeting 0 p.m.-6:00 0 p.m. ..........Networkingg Event 4:00

Sunday, December 4



8:00 0 a.m.-6:30 0 p.m. ..........Registration n Open 8:30 0 a.m.-9:30 0 a.m. ..........NMLS—FHA A (Onee Hour) FHA course to be instructed by David Luna of Mortgage Educators. 9:30 0 a.m.-9:45 5 a.m. ..........Break 9:45 5 a.m.-12:45 5 p.m. ........NMLS—Federall Law w (Threee Hours) Federal Law course to be instructed by David Luna of Mortgage Educators. 12:45 5 p.m.-2:00 0 p.m. ........Networkingg Lunch 2:00 0 p.m.-6:00 0 p.m. ..........Expo o Halll Open n & Networkingg Reception

Monday, December 5 8:00 0 a.m.-4:00 0 p.m. ..........Registration n Open 8:30 0 a.m.-10:30 0 a.m. ........NMLS—Reversee Mortgagee (Two o Hours) Reverse Mortgage course to be instructed by David Luna of Mortgage Educators. 10:30 0 a.m.-10:45 5 a.m. ......Break 10:45 5 a.m.-12:45 5 p.m. ......NMLS—Ethicss (2 2 Hours) Ethics course to be instructed by David Luna of Mortgage Educators. 12:45 5 p.m.-2:00 0 p.m. ........Networkingg Lunch 2:00 0 p.m.-3:00 0 p.m. ..........Presentation n From m Suee Woodard d & Jim m McMahan, Mortgagee Successs Source 3:00 0 p.m.-3:15 5 p.m. ..........Break 3:15 5 p.m.-4:15 5 p.m. ..........Presentation n From m Suee Woodard d & Jim m McMahan, Mortgagee Successs Sourcee (continued) 4:15 5 p.m.-4:30 0 p.m. ..........Grand d Prizee Drawingg forr a Trip p to o Hawaii 4:30 0 p.m.-6:30 0 p.m. ..........NAMB B Board d Meeting

Visit Exhibit Hall Only This is for mortgage originators only. Early fees (on or before 11/09/11)—$100 Regular fees (11/10/11 or later)—$100 Cancellation and refund policy: Notice of cancellation must be made in writing (no exceptions) and sent to or faxed to (303) 798-3668. Cancellations received by 5:00 p.m. EST on Wednesday, Nov. 9 will be refunded 50 percent of the registration fee that was paid. Any cancellation received after that date will receive no refund.

Hotel information NAMB/WEST has discounted rates for conference attendees at the MGM Grand Las Vegas, located at 3799 Las Vegas Boulevard South in Las Vegas ( Any attendee who books their reservations under the NAMB Group Rate will be eligible to receive an extra Passport. The extra Passport will increase your chances to win prizes at the conference. Group rates Friday, December 2........................$110 Saturday, December 3....................$110 Sunday, December 4........................$80 Monday, December 5 ......................$80 Room rates are subject to state and local taxes. The group rate will be offered until Wednesday, Nov. 9. Reservations can be made by calling (877) 313-5757 or (702) 891-7777, or visiting In order to secure the NAMB Group Rate, you must identify yourself as part of the National Association of Mortgage Brokers (NAMB) Conference. Check in for the MGM Grand is 3:00 p.m. and check out is at 11:00 a.m. For your convenience, MGM Grand offers room registration at McCarran Airport. There is an Airport Registration Desk located in the south baggage claim area, near the bottom of the escalators descending from the C and D gates, next to carousel #1 and #2. Shuttle service is available from 9:00 a.m.-11:00 p.m. Porterage service is available 9:00 a.m.5:00 p.m. only.

For more information on the

NAMB/WEST 2011 Loan Originator Conference, contact Kinsley at (303) 798-3664, e-mail or visit

news flash

continued from page 17

ery in the housing market and overall economy can occur,” said Peerce.

J.D. Power Finds Homebuyer Dissatisfaction Up in 2011

AARP Attempts to Halt Wells and Fannie Foreclosing on Reverse Borrowers’ Surviving Spouses AARP, along with the law firms of Mehri & Skalet PLLC and Kerr &

elite performer

Wagstaffe have filed a class action suit on behalf of reverse mortgage borrowers and their survivors designed to head off illegal foreclosures and evictions. The suit, filed in the U.S. District Court for the Northern District of California in San Francisco, seeks a declaration of the rights of class members, as well as an injunction prohibiting illegal foreclosures and evictions, and damages for breach of contract. The case involves the failure of Wells Fargo and Fannie Mae to accord the surviving spouses and heirs of reverse mortgage borrowers the right to purchase the property for its appraised value after the loan continued on page 41

continued from page 4

here and there, if you are at work,  Get out of the office. It’s importhen get off Facebook. I’ll just tant to break up your day and get leave it at that. fresh air or take a break. Especially if you feel stressed at work, take a few minutes to get out and enjoy a  Set goals. Setting and hitting both short- and long-term goals is break. As difficult as it is to get important. Make sure they are away, just do it. A short time away realistic, and each time you meet during the day will help you be your goals, it will motivate more more productive while at the productive activity. office.  Exercise and eat right. I’ve always preached the importance about how exercise can help you manage time better even if it takes time to exercise. Feeling good and getting better sleep results in a refreshing day. Your brain and body rely on fuel. If you don’t eat breakfast or skip meals, then don’t be surprised by a lack of energy and focus.  Facebook. If you are at work, get off Facebook. Other than a few business-related Fan Page updates

Try to determine what you need to change in order to maximize the time allotted each day and your personal productivity. Always remember that you cannot manage time, only yourself. Andy W. Harris, CRMS is president and owner of Lake Oswego, Ore.-based Vantage Mortgage Group Inc. and 20102011 president of the Oregon Association of Mortgage Professionals. He may be reached by phone at (877) 496-0431 or e-mail or visit




Although conditions in the real estate market point to the continued existence of a buyers’ market, homebuyers indicate they are less satisfied with real estate company services, compared with 2010, while home-seller satisfaction has improved during the same time period, according to the recently released J.D. Power and Associates 2011 Home Buyer/Seller Study. The study, now in its fourth year, measures customer satisfaction of homebuyers and sellers with the largest national real estate companies. The 2011 Home Buyer/Seller Study includes more than 4,200 evaluations from more than 3,680 respondents who bought or sold a home between March 2010 and April 2011. The study was fielded between March and May 2011. Overall satisfaction is determined by examining three factors of the homebuying experience: Agent/salesperson; office; and a variety of additional services. Four factors were examined for the home-selling experience: Agent/salesperson; marketing; office; and a variety of additional services. Overall satisfaction among homebuyers averages 797 on a 1,000-point scale in 2011—A decrease of six points from 2010. The decrease is primarily due to lower satisfaction with the agent/salesperson, which is the most influential aspect of buyer satisfaction with the real estate company. Agent/salesperson satisfaction averages 814 in 2011, compared with 828 in 2010. “Although the current real estate market—with the confluence of low home prices and historically low interest ratescreates the perception of a buyers’ market, there are still traditional barriers to purchase in place, which could be negatively affecting buyer satisfaction with their agent,” said Jim Howland, senior director of the real estate and construction practice at J.D. Power and Associates. “Agents who properly manage client expectations around the homebuying process and communicate with clients about potential challenges-such as higher requirements for downpayments, tighter loan standards and additional costs on top of the monthly mortgage may be better able to keep clients satisfied.” In the homebuyer segment, RE/MAX ranks highest with a score of 805. Following RE/MAX in the rankings are Coldwell Banker (802) and Better Homes & Gardens (801). Coldwell Banker performs particularly well in the agent/sales-

person factor while Better Homes & Gardens performs well in the variety of additional services factor. Among home sellers, satisfaction with real estate companies has improved substantially to an average of 779 in 2011 from 742 in 2010. While satisfaction with each of the factors has improved from 2010, the greatest gain has occurred in the marketing factor, which has increased by 62 points in 2011. In 2011, the variety of additional services and office factors have increased in importance to overall satisfaction, while the importance of the agent/salesperson and marketing factors have declined. According to Howland, many real estate companies have made cutbacks in additional services and offices during recent years, and the increasing importance of these areas reflects that sellers may be missing these amenities, which provides an opportunity for companies to improve satisfaction. Among home sellers, RE/MAX ranks highest with a score of 791 and performs particularly well in the agent/salesperson and office factors. Following RE/MAX in the rankings are Prudential Real Estate (786) and Century 21 (785). Century 21 performed particularly well in the variety of additional services factor. The study findings include the following key trends:  Recommendations and referrals play a key role for both buyers and sellers in choosing an agent and real estate company. In 2011, six in 10 buyers and sellers say their agent asked for a referral or recommendation—up from 47 percent in 2010.  The average number of homes that buyers were shown prior to making a purchase is nine in 2011, down notably from 17.5 in 2010.

 The average number of home showings in 2011 is 8.6, on average, prior to sale, down considerably from an average of 12.1 showings in 2010.  In 2011, just 58 percent of sellers indicate using a Web site listing to market their home, compared with 82 percent in 2010.


The Chart continued from page 16

frequently used to indicate the time at which adjustable-rate mortgages with an introductory fixed rate convert to a variable rate.15 Consequently, the Rule uses the term â&#x20AC;&#x153;recastâ&#x20AC;? to cover the conversion to less favorable terms and higher payments not only for interest-only loans and negative amortization loans but also for adjustable-rate mortgages.16

Other provisions There are other provisions incorporated into the Rule,17 such as:  Implementing the Dodd-Frank Actâ&#x20AC;&#x2122;s limits on prepayment penalties.  Lengthening the time creditors must retain records that evidence compliance with the ability-to-repay and prepayment penalty provisions.  Prohibiting evasion of the Rule by structuring a closed-end extension of credit as an open-end plan.

Points and Fees Embedded in the QM requirements is a test for Points and Fees, the purpose of which is to determine what does or does not constitute a QM. The Rule would limit the total points and fees to a specific percentage of the total loan amount in order to create a threshold to identify a QM.




Loan Originator Compensation and Third-Party Charges As it relates to the QM points and fees test, the following should be noted regarding the role played by the recent revisions to TILA with respect to loan originator compensation.18 Compensation to loan originators is included in the points and fees. However, compensation to a loan originator that cannot be attributed to a particular loan at the time of origination is not included in the points and fees. Examples of excluded compensation are compensation based upon the long-time performance of the loan originator, compensation based on the overall quality of the loan originatorâ&#x20AC;&#x2122;s loan files, and the base salary of a loan originator who is the employee of the creditor. Jonathan Foxx, former chief compliance officer for two of the countryâ&#x20AC;&#x2122;s top publicly-traded residential mortgage loan originators, is the president and managing director of Lenders Compliance Group, a mortgage risk management firm devoted to providing regulatory compliance advice and counsel to the mortgage industry. He may be contacted at (516) 442-3456 or by e-mail at

Footnotes 1â&#x20AC;&#x201D;Federal Register, Vol. 76, No. 91, Wednesday, May 11, 2011, Proposed Rules, 12 CFR Part 226, Regulation Z Truth-in-Lending Act. [Regulation Z; Docket No. Râ&#x20AC;&#x201C;1417].

2â&#x20AC;&#x201D;HR 4173: Dodd-Frank Wall Street Reform and Consumer Protection Act, 111th Congress (2009-2010): â&#x20AC;&#x153;A bill to promote the financial stability of the United States by improving accountability and transparency in the financial system, to end â&#x20AC;&#x153;too big to failâ&#x20AC;?, to protect the American taxpayer by ending bailouts, to protect consumers from abusive financial services practices, and for other purposes.â&#x20AC;? Sponsored by Rep. Barney Frank (D-MA) and Sen. Christopher Dodd (D-CT). 3â&#x20AC;&#x201D;It is worth noting that the Consumer Financial Protection Bureau (CFPB) received rulemaking and examination authority over the â&#x20AC;&#x153;enumerated lawsâ&#x20AC;? on the transfer date of July 21, 2011, the Designated Transfer Date. See Designated Transfer Date, Bureau of Consumer Financial Protection, Federal Register, Vol. 75, No. 181 (09/20/10). Accordingly, this rulemaking will become a proposal of the CFPB and will not be finalized by the FRB. 4â&#x20AC;&#x201D;For a detailed analysis of the Ability-toRepay rule, see Foxx, Jonathan, Ability-toRepay: Regulating or Underwriting (Part I), National Mortgage Professional Magazine, June 2011, Volume 3, Issue 6, pp. 26-30; and, Foxx, Jonathan, Ability-to-Repay: Regulating or Underwriting (Part II), National Mortgage Professional Magazine, July 2011, Volume 3, Issue 7, pp. 20-42. 5â&#x20AC;&#x201D;Also, includes a closed-end home improvement loan on a vacation residence. 6â&#x20AC;&#x201D;Op. cit. 2 § 1413. 7â&#x20AC;&#x201D;Under the Home Ownership and Equity Protection Act (HOEPA), a consumer has a right to rescind a transaction for up to three years after consummation when the mortgage contains a provision prohibited by a rule adopted under the authority of TILA § 129(l)(2). Any consumer who has the right to rescind a transaction may rescind the transaction as against any assignee. See: TILA §131(c). The right of rescission does not extend, however, to home purchase loans, construction loans, or certain refinancing with the same creditor. See: TILA § 125(e).

HIGHLIGHTS OF PROPOSED ABILITY-TO-REPAY RULES 7KH SURSRVDO XQGHU 5HJXODWLRQ = ZRXOG UHTXLUH FUHGLWRUV WR GHWHUPLQH D FRQVXPHUÂśV DELOLW\ WR UHSD\ D PRUWJDJH before making the loan and establish minimum mortgage underwriting standards. The revisions to the regulation, which implements the Truth in Lending Act (TILA), are being made pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act or Act). * SCOPE Consistent with the act, the proposal would apply the ability-to-repay requirement to all consumer-purpose mortgages (except home equity lines of credit, timeshare plans, reverse mortgages, or temporary loans). COMPLIANCE OPTIONS OPTION # 1 (1) Income or assets relied upon Considering and verifying eight (8) in making the ability-to-repay GENERAL underwriting factors: determination ABILITY-TO-REPAY STANDARD (2) Current employment status (3) The monthly payment on the mortgage (4) The monthly payment on any simultaneous mortgage (5) The monthly payment for mortgage-related obligations (6)Current debt obligations (7)The monthly debt-to-income ratio, or residual income (8) Credit history Underwriting the payment for an adjustable-rate mortgage based on the fully indexed rate. OPTION # 2 QUALIFIED MORTGAGE Alternative 1


Alternative 2 would provide a rebuttable presumption of compliance and would GHILQHD³TXDOLILHGPRUWJDJH´DVLQcluding the criteria listed under Alternative 1 as well as additional underwriting requirements from the general ability-torepay standard.

Thus, under Alternative 2, the creditor would also have to consider and verify:



9â&#x20AC;&#x201D;Mortgages covered by the HOEPA amendments have been referred to as â&#x20AC;&#x153;HOEPA loans,â&#x20AC;? â&#x20AC;&#x153;Section 32 loans,â&#x20AC;? or â&#x20AC;&#x153;high-cost mortgages.â&#x20AC;? The Dodd-Frank Act now refers to these loans as â&#x20AC;&#x153;high-cost mortgages.â&#x20AC;?

11â&#x20AC;&#x201D;A county is â&#x20AC;&#x153;ruralâ&#x20AC;? if it is not in a metropolitan statistical area (MSA) (or a micropolitan statistical area), contains no town with 2,500 or more residents, and is (a) either not adjacent to any metropolitan statistical area (or a micropolitan statistical area) or (b) is adjacent to an MSA with fewer than one million residents (or adjacent to a micropolitan statistical area). 12â&#x20AC;&#x201D;TILA § 129D(d) authorizes an exemption from escrow requirements for certain creditors operating predominantly in rural or underserved areas and providing an exemption from escrow requirements for transactions secured by shares in a cooperative. 13â&#x20AC;&#x201D;The safe harbor offered requires that a 10 percent or larger reduction in the monthly pay-

The loan does not contain negative amortization, interestonly payments, or a balloon payment, or a loan term exceeding 30 years. The total points and fees do not exceed 3 percent of the total loan amount. The income or assets relied upon in making the ability-to-repay determination are considered and verified. The underwriting of the mortgage (1) is based on the maximum interest rate that may apply in the first five years, (2) uses a payment scheduled that fully amortizes the loan over the loan term, and (3) takes into account any mortgage-related obligations.

Alternative 2

8â&#x20AC;&#x201D;Op. cit. 2, §§ 1416, 1422.

10â&#x20AC;&#x201D;Does not define a â&#x20AC;&#x153;qualified mortgageâ&#x20AC;? to include a requirement to consider the consumerâ&#x20AC;&#x2122;s debt-to-income ratio or residual income.



* Rulemaking Process

CRQVXPHUÂśVHPSOR\PHQWVWDWXV The monthly payment for any simultaneous mortgage. CRQVXPHUÂśVFXUUHQWGHEW obligations. The monthly debt-to-income ratio or residual income.


A creditor operating predominantly in rural or underserved areas can originate a balloon-payment qualified mortgage. This option is meant to preserve access to credit for consumers located in rural or underserved areas where creditors may originate balloon loans to hedge against interest rate risk for loans held in portfolio. Complying with the requirements Under this option, a creditor can for a qualified mortgage. make a balloon-payment qualified Underwriting the mortgage mortgage with a loan term of five based on the scheduled years or more by: payment, except for the balloon payment. $FUHGLWRUFDQUHILQDQFHD³QRQ-VWDQGDUGPRUWJDJH´ZLWKULVN\IHDWXUHV LQWRDPRUHVWDEOH³VWDQGDUGPRUWJDJH´7KLVRSWLRQLVPHDQWWRSUeserve FRQVXPHUVœDFFHVVWRVWUHDPOLQHGUHILQDQces that materially lower their payments. Refinancing the consumer into a Under this option, a creditor ³VWDQGDUGPRUWJDJH´WKDWKDV complies by: limits on loan fees and that does not contain certain features such as negative amortization, interest-only payments, or a balloon payment. Considering and verifying the underwriting factors listed in the general ability-to-repay standard, except the requirement to consider and YHULI\WKHFRQVXPHUœVLQFRPHRU assets. 8QGHUZULWLQJWKH³VWDQGDUG PRUWJDJH´EDVHGRQWKH maximum interest rate that can apply in the first five years. OTHER FEATURES Implement the Dodd-)UDQN$FWœV The proposal would also: limits on prepayment penalties. Lengthen the time creditors must retain records that evidence compliance with the ability-torepay and prepayment penalty provisions. Prohibit evasion of the rule by structuring a closed-end extension of credit as an openend plan. On July 21, 2011, the FRB transferred general rulemaking authority for TILA to the Consumer Financial Protection Bureau (CFPB). Accordingly, this rulemaking will be finalized by the CFPB.

ment will meet the â&#x20AC;&#x153;materially lowerâ&#x20AC;? standard in reducing monthly payments. 14â&#x20AC;&#x201D;Op. cit. 13. 15â&#x20AC;&#x201D;The term â&#x20AC;&#x153;recastâ&#x20AC;? is to be used in order to accommodate the proposed Regulation Z §§ 226.43(c) and (d). 16â&#x20AC;&#x201D;For instance, an ARM recasts upon the expiration of the period during which payments based on

the introductory fixed rate are permitted. An interest-only loan recasts upon the expiration of the period during which interest-only payments are permitted. A negative amortization loan recasts upon the expiration of the period during which negatively amortizing payments are permitted. 17â&#x20AC;&#x201D;Op. cit. 4, Part II, inter alia. 18â&#x20AC;&#x201D;Regulation Z § 226.36(a).

heard on the street

continued from page 21

talented young professionals. Joining their team provides us the opportunity to create new, positive experiences for customers. Bay Equity Home Loans was founded in June 2007 by three brothers, Brett, Jon and Casey McGovern, and funded its first loan 11 months later. To date, the firm has financed more than 7,000 loans totaling more than $2 billion. The company is headquartered in the heart of San Franciscoâ&#x20AC;&#x2122;s Financial District, one of the very few mortgage lenders actually located in the City by the Bay. â&#x20AC;&#x153;Manny Kagan is a well-respected veteran in the Bay Area mortgage business,â&#x20AC;? said Brett McGovern, president of Bay Equity. â&#x20AC;&#x153;He built his entire business on a service-oriented culture that fits well with Bay Equityâ&#x20AC;&#x2122;s mission to be a premier service organization. Manny and his team are a tremendous addition to our organization. He brings a wealth of knowledge, respect, and experience to the company that will truly fuel our growth. That is invaluable.â&#x20AC;?

Ellie Mae Announces $25.2 Million Acquisition of Del Mar DataTrac Ellie Mae Inc. has announced the acquisition of Del Mar Datatrac Inc. The acquisition accel-

erates Ellie Maeâ&#x20AC;&#x2122;s growth strategy by expanding its already extensive lender customer base, significantly increasing the number of mortgages funded by its customers, and broadening the functionality of its Encompass solutions. Del Marâ&#x20AC;&#x2122;s origination software, DataTrac, is used by more than 200 mortgage lenders as a core operating system to process and fund loans, create workflow efficiencies, manage secondary marketing transactions and handle reporting and business intelligence. Its current customers are expected to fund an estimated 500,000 mortgages in 2011. The combined companiesâ&#x20AC;&#x2122; customer base has the potential to originate approximately 30 percent of all residential mortgages originated in the United States this year. Ellie Mae acquired 100 percent of the equity of Del Mar Datatrac for $17.2 million cash at closing, and future cash payments of $3 million, $3 million and $2 million to be paid over the next three years. According to Ellie Mae, the acquisition could eventually add approximately 20,000 users to the Ellie Mae Network, the electronic network that connects the more than 50,000 users of Ellie Maeâ&#x20AC;&#x2122;s Encompass360 Mortgage Management software to the service providers, business partners and investors they need to interact with in order to process and fund loans. Ellie Mae also intends to make

Encompass360 available to DataTrac users as a front-end point-of-sale component for the DataTrac core operating system. â&#x20AC;&#x153;Del Marâ&#x20AC;&#x2122;s roster of customers includes some of the biggest and most respected lenders in the country. With this acquisition nearly a third of all residential mortgages originated in the United States will be able to flow through Ellie Maeâ&#x20AC;&#x2122;s systems,â&#x20AC;? said Sig Anderman, president and chief executive officer of Ellie Mae. â&#x20AC;&#x153;I founded Ellie Mae to transform the mortgage industry by automating loan origination and driving paper out of the process, so the addition of the impressive Del Mar team and customer base is a big milestone for us. Our customers are looking to us to automate and streamline their businesses, and the combined Ellie Mae and Del Mar teams will continue delivering the high levels of innovation and service that our clients have come to expect.â&#x20AC;? Operations for Del Mar DataTrac will remain based in San Diego, Calif. and its sales, technology, support and business development teams will continue to support Del Marâ&#x20AC;&#x2122;s clients and partners. Jeb Spencer, chairman of Del Mar, has joined Ellie Maeâ&#x20AC;&#x2122;s board of directors and Rob Katz has been named Ellie Maeâ&#x20AC;&#x2122;s EVP of product strategy. â&#x20AC;&#x153;In the mortgage technology industry today, bigger is indeed better, as it takes significant development resources to meet client demands for loan quality, compliance and efficiency,â&#x20AC;? said Katz. â&#x20AC;&#x153;As our industry has evolved over the past several years, with independent mortgage

bankers, banks and credit unions gaining greater market share, and with more demands being placed on them by regulators and investors, technology vendors have been called upon to provide ever more sophisticated solutions to address those challenges. Through this acquisition, we will be able to offer DataTrac users the functionality and services they need to remain competitive and efficient in todayâ&#x20AC;&#x2122;s challenging marketplace.â&#x20AC;?

QuestSoft Announces Partnership With ClosingCorp to Maintain GFE Compliance QuestSoft, a provider of mortgage compliance software for lenders, has Photo credit: George Doyle added La Jolla, Calif.-based ClosingCorpâ&#x20AC;&#x2122;s SmartGFE service to Compliance EAGLE, an endto-end, automated compliance review solution. The integration of SmartGFE into Compliance EAGLE ensures that fee amounts in Good Faith Estimates (GFEs) produced by integrated loan origination and document software will be accurate and in compliance. The addition of SmartGFE to Compliance EAGLE enhances a lenderâ&#x20AC;&#x2122;s automated compliance review process by streamlining the generation and compliance of GFEs. SmartGFE imports continued on page 26


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Why W hy NAPMW? NAPMW? M Three T hree Simple Reasons Reaso ons Education E d duccation Organized for Organized for the purpose purpose of providing providing education education to to professionproffession e als in all phases off the mortgage mortgage industry, industry, NAPMW N NAPMW offers offers educaeducamanyy vvenues workshops held ar around tion via man enues – seminars and w orkshops k ound the on-line,, and National Conference ccountry, ountry, on-line a at at its Na tional EEducation ducation C onference held each h May. May. NAPMW NAP MW membership membersship gives gives you you exclusive exclusive access a cess to ac to timely educaeducaaffecting career tion regarding regarding the e regulations regulations aff ecting yyour o car our eer such as a FREE TO TO MEMBERSS monthly monthly webinar webinar on industry ind dustry updates updates AND education class offering our 8 hour NMLS continuing continuing educa tion cla ss off ffe ering (NMLS Provider P rovider # 1400309) 140030 09) 26

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If If you you believe believe in helping helping to to elevate elevate the educational edu ucational standards standards of this industry, industry, or assisting asssisting in developing developing the e most competent competent industry work industry w ork force, force, then you you believe believe in NAPMW. NA APMW. NAPMW Butt sinc since women NAPMW is not a women’s women’s organization. organization. Bu ew omen make up the major majority profesity off professionals professionals in the mortgage/banking morrtgage/banking pr ofession, our purpose purpose is to to help them advance advance in business, business, personal, personal, and leadership development. de evelopment.

Networking Network o kiing NAPMW is a ccommunity NAPMW omm munity of near nearly ly 2,000 professionals prof o essionals acr across oss the Country engage mortgage banking industry. C ountry who eng age in the mor tgage / ba anking industr y. Men Men and w omen fr om all backg rounds ha ve joi ned NAP MW because women from backgrounds have joined NAPMW excel whatt they do do.. Emplo Employers want they want want tto oe xcel e aatt wha yers who w ant eexcelxcellence with NAPMW lenc e from from their employees e employees engage eng N NAPMW for for up-to-date up-to-date education. Both professionals employers have there educa tion. B oth p professionals and emplo emp yers e ha ve ffound ound ther e is place a plac e ffor or them in n NAPMW. NAPMW W.

National Education National Education National T raining National Training National Networking Na tional N etworking

To T o Join NAPMW NAPMW W visit: w ww.napmw.o org or ccall: all: 1-800-827-3034 1 800 8 1-800-8 827 3034 827-3034 Have Ha ve Q Questions? uestion ns? Please ffeel eel free free to to e e-mail -m mail us a at: t: napm w1@aol.c . om

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continued from page 25

data directly from the loan origination software and incorporates that data into Compliance EAGLE’s automated reviews to eliminate manual data entry, save time and reinforce strong compliance processes. “In this constantly changing regulatory climate, lenders want proven applications to help them meet compliance requirements,” said Paul Mass, president of ClosingCorp. “Our partnership with QuestSoft will improve lenders’ efforts to provide accurate and timely data to consumers while also giving them the peace of mind that they are in compliance.” ClosingCorp’s SmartGFE combines a company-backed compliance guarantee with instant access to real-time pricing data for title insurance, settlement services and GFE Block 6 data as well as local transfer taxes and recording fees. The SmartMonitor Alert feature automatically notifies lenders or brokers of any changes in transfer taxes or recording fees prior to closing, giving them time to re-disclose. Compliance EAGLE tests loan applications against an extensive library of compliance standards and regulations, including the Home Mortgage Disclosure Act (HMDA), Community Reinvestment Act (CRA) and flood determination requirements as well as the Truth-inLending Act (TILA), federal, state and local lending laws. The stringent compliance testing process generates reviews widely accepted by many in the secondary market investing community. “The partnering of Compliance EAGLE with SmartGFE, removes the stress of keeping up with the everchanging list of rules and regulations at every level of government, while giving lenders the peace of mind that all of their documents and data meet any and all areas of compliance,” said Leonard Ryan, president of QuestSoft. “This commitment to provide lenders with the most accurate, up-to-date and fully compliant lending information is reaffirmed with the joining of QuestSoft’s Compliance EAGLE and ClosingCorp’s SmartGFE.”

Newest Acquisition Positions Carrington to Launch Wholesale Channel Carrington Mortgage Services LLC (CMS), a national mortgage lender and servicer, has announced the expansion of its mortgage origination business through the purchase of certain assets of American Home Equity Corporation (AHE), an Irvine, Calif.-based mortgage lender. Established in 2001, AHE specialized in residential financing of agency, government, and non-conforming loan programs. The acquisition grows Carrington’s existing origination

platform through the addition of AHE assets and key personnel. Providing a sound foundation for launching the CMS wholesale origination channel, the expansion presents an opportunity to offer wholesale origination with the same high-touch service levels and credit quality as that of Carrington’s retail channel. AHE originated over $1billion in the last two years, offering a wide range of loan programs supported by state-of-the-art technology and quality customer service—characteristics aligned with Carrington’s current origination business model. AHE shares a similar business philosophy and commitment to quality with Carrington. “The overall sales culture is a good fit with CMS and is based upon the delivery of a customer-centric value proposition,” said Steve Patton, executive vice president of mortgage lending at CMS. “This addition will provide Carrington with an immediate proven foundation to launch our wholesale origination model on a nationwide basis.” Key personnel joining Carrington include Alan Pott, president of American Home Equity Corporation (AHE), with more than 20 years of experience in the loan origination industry and a staff of 40 wholesale lending professionals.

Technology Partnership Formed to Ensure GFE Compliance Wipro Gallagher Solutions (WGS), a provider of endto-end loan origination technology and fulfillment Photo credit: BananaStock services for mortgage lenders, has announced a partnership with Ernst Publishing to integrate Ernst’s XML Direct to enable lenders to reduce costs, increase efficiencies and minimize errors that result in expensive reporting errors. The collaborative effort offers users of WGS’ loan origination system (LOS), NetOxygen, access to Ernst Publishing’s XML Direct data and calculation tools to accurately populate Good Faith Estimate (GFE) and HUD-1 forms and update LOS and title programs. “After the Real Estate Settlement Procedures Act (RESPA) requirements went into effect in 2010, accurate listing of fees and taxes for recording documents have become exceedingly crucial for lenders,” said Jan Clark, vice president of sales and marketing at Ernst Publishing. “Our interface with NetOxygen guarantees RESPA compliance, speeds along lenders’ day-totoday production levels and enables them to focus more on their core competencies rather than devote extra time and energy to research and maintenance.” NetOxygen’s integration with Ernst Publishing’s XML Direct grants lenders

access to a suite of XML solutions that can automate the generation of fees, such as title services and insurance, government recording charges and transfer taxes. The interface eliminates lengthy maintenance and research in locating correct recording jurisdictions and computing accuracy for every transaction processed. “By adding the Ernst Publishing service to our strong interface ecosystem, WGS assures its customers attain the most accurate calculation results to remain in full compliance with today’s ever-changing regulatory landscape,” said Chris Anderson, general manager for WGS. “This integration allows NetOxygen to provide greater workflow automation and an overall greater experience to our customers.”

 360 Mortgage Group has added Tommy Cruse as an account executive for the company’s southeast region.  First American Title Insurance Company has named Kurt Pfotenhauer executive vice president and vice chairman.  Brian Hartman has joined the Mortgage Bankers Association (MBA) as associate vice president of marketing.  Martin Schuh has joined The CRE Finance Council as the Council’s new director of legislative and regulatory policy.  Susan Pelto has been named chief compliance officer for Shore Financial Services Inc. and the company has also named Kathy Welty to the newly-created position of chief risk officer.  Pro Teck Valuation Services has pro-


moted Sarah Baldo to the position of vice president of sales. Michael Picker has been promoted by Avista Solutions to the position of senior vice president of sales. Axis Appraisal Management has named Ron Simmons, SRA as its new chief appraiser and director of valuation services. DecisionReady Solutions has named Matthew Lichtner to the position of executive vice president, director of national sales and client relations. Aklero Risk Analytics Inc. has announced the promotion of Julia Hernandez to the position of senior vice president of professional services. GMH Mortgage has announced the addition of Michael Bower.

Your turn National Mortgage Professional Magazine invites its readers to submit any information, events, passages, promotions, personal or professional occurrences that seem appropriate and/or other pertinent data to the attention of:

Heard on the Street/Mortgage Professionals to Watch column Phone #: (516) 409-5555 E-mail: Note: Submissions sent via e-mail are preferred. The deadline for submissions is the 1st of the month prior to the target issue.

Mortgage Capital Trading Opens East Coast Operations in Pennsylvania


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Mortgage Capital Trading Inc. (MCT), a provider of mortgage pipeline hedging and risk management services, has announced that it has established an office in Bala Cynwyd, Penn., just outside of downtown Philadelphia. The new facility expands MCT’s presence on the East Coast, allowing the company’s traders and analysts to facilitate regular personal interaction with clients in the Eastern Standard Time zone. Officials at the company say they also plan to host prospective and existing clients at the new office to provide training, educational seminars and faceto-face meetings. “We have been strategically positioning ourselves to add new clients at a healthy rate in an effort to avoid the growing pains that many companies experience when operating in a growth phase,” said Curtis Richins, president of MCT Trading Inc. (MCT). “This office’s proximity to East Coast lenders ensures that we continue to deliver excellence in service and responsiveness. A big part of our value proposition is to provide clients with extensive education, coaching and continuous support in making the transition from best efforts to mandatory mortgage executions, managing risk and maximizing profitability. The addition of this office lays the foundation to deliver on that promise.” MCT is headquartered in San Diego and also has locations in Dallas, Texas; Charlotte, N.C.; San Francisco; and now Bala Cynwyd, Penn. Notable is that each of MCT’s locations are linked together with the same phone lines and video cameras. Each office is designed with the capability to operate independently in the event of a natural disaster in a single location, thus preventing any slippage in providing realtime hedging services to clients.

USA Cares Mortgage Heros “I have been very grateful throughout my lifetime for the freedoms and opportunities afforded to me in our great country. This has motivated the vision behind our drive to serve our South Florida veterans, old and young alike as we work to provide solutions to satisfy their needs.”

—Vicki White-Sklark, Production Manager Government Lending, SunTrust Mortgage “Helping our veterans is the least we can do to try and repay them for the sacrifices they have made for all of us.”

—Byron Webb, Mortgage Loan Consultant, 2011 President’s Club, SunTrust Mortgage, Vero Beach, FL




Sometimes one mortgage hero begets others. Such is the case with Vicki WhiteSklark, whose 30-year career in mortgage lending has given her experience in processing, credit underwriting, servicing, quality control, originations and marketing. In February 2006, her role with SunTrust Mortgage focused on FHA and VA lending opportunities. This was Vicki’s dream position, a role of training and business development for the south Florida region. “I was able to laser focus to develop an exceptional originations and operations team,” she says. “We redirected our focus on supporting veteran homebuyers,” says Vicki. “As our market does not have an active military base, it was apparent that our military veterans and service personnel did not have a local lending institution experienced at serving their home buying needs. We recognized that to create an experienced and willing market, we had to start with our Realtor partners. They are often the first to encounter military/veteran homebuyers. When they understand the VA lending and appraisal process they’re less likely to turn away an opportunity to work with a VA-eligible candidate or encourage an alternative financing option with less favorable terms. From this was born the ‘Realtor VA Train for Gain Program.’ We’ve trained over 300 Realtors throughout our region since it launched.” Familiar with the Certified Military Housing Specialist course, Vicki recognized it as the perfect foundation for the quality training SunTrust wanted to provide their team. “We’ve trained and certified our team to ensure we’re providing the best, most qualified service available for our veterans,” she says. “We’re pleased to support our veterans on many levels.” One particularly grateful client, Mr. Sanchez, praises his positive experience with Loan Consultant Byron Webb. “My situation was unique,” he says. “I had a short sale a few years ago following a tumultuous divorce and child custody battle. My goal was to provide a home that my kids and I could call ours. The big banks all gave me the same answer about a VA loan: The time between my short sale and a new purchase was too close. A mortgage broker told me about the VA ‘extenuating circumstances provision’ that would allow me to get a VA loan if I met the criteria, which I did. But his salesman-like tactics soon became obvious; empty promises and a failed attempt to procure the loan finally resulted.” “I nearly lost hope,” he says. “Then I found Byron Webb of SunTrust Mortgage through a friend who said ‘if anyone can help, it’s Byron.’ He gave me straight, honest answers. Whether I liked them or not, they were the truth and I respected that.” “The team (Andrea Webb and Renee Riley) that helped facilitate my loan was amazing!” They all helped this family’s dream come true in March 2011. “I closed and moved into my new home” says a grateful Mr. Sanchez, “and it wouldn’t have happened without Byron Webb and his skilled team. He has gained my respect as a person. His service was exemplary and I’m now a loyal customer of SunTrust.” As skilled trainers like Vicki and loan consultants like Byron increase in numbers around the country, our military service personnel will enjoy more affordable and sustainable homeownership and neighborhoods everywhere will benefit. Are you a “Mortgage Hero” or know of anyone who might be? This monthly spotlight is FREE to anyone who has made the commitment to provide skilled mortgage services to our military servicemen and women. We want to hear from you if you’ve completed the FREE Military Housing Specialist Course, as “Mortgage Heroes” deserve to be recognized for their outstanding service to our military personnel. Please send a short bio to MHE Program Manager Beverly Frase at

With Change in Lending Limits Looming, TMS Funding Launches New Jumbo Product

TMS Funding, the wholesale residential lending channel of Total Mortgage Services LLC, has announced that it has launched a new flexible jumbo mortgage product into the wholesale marketplace. “This new jumbo mortgage product is further proof of TMS Funding’s commitment to the wholesale channel and the mortgage broker community,” said John Walsh, president of Total Mortgage Services, the parent of TMS Funding. “This product offers mortgage brokers the opportunity to provide borrowers access to a competitively priced jumbo program that can help them purchase some of the excess housing inventory that is available at significantly reduced costs or refinance a higher-cost loan freeing up much needed household cash flow.” Highlights of TMS Funding’s new jumbo product include:  5/1, 7/1 and 10/1 London Interbank Offered Rate (LIBOR) adjustable-rate mortgages (ARMs)  Up to $2 million loan amount  45 percent debt-to-income (DTI) ratio  80 percent loan-to-value (LTV) to $1 million  90 percent LTV to $625,000  Second home to 80 percent LTV to $650,000 and 75 percent LTV to $1 million “With the maximum temporary conforming loan limit of $729,750 scheduled to be reduced meaningfully through all the eligible high cost areas in the U.S. on Oct. 1, 2011, we believe this is a timely new product that offers a solution for borrowers in those areas as well as in many other locations throughout the country,” said Walsh. After Oct. 1, areas like Washington, D.C.; Salt Lake City, Utah; Sacramento, Calif.; San Diego, Calif.; New York City; Los Angeles and San Francisco will see a greater than $100,000 drop in access to confirming mortgages. This jumbo product is currently eligible in all areas of Colorado; Connecticut; Washington, D.C.; Delaware; Florida; Georgia; Illinois; Massachusetts;

Maryland; Maine; Michigan; North Carolina; New Hampshire; New Jersey; New York; Pennsylvania; Rhode Island; South Carolina; Tennessee; Texas; Virginia and Vermont.

QMS Offers Service for OCC’s Required Foreclosure Audits to Prevent Improper Practices Quality Mortgage Services LLC (QMS), a provider of mortgage quality assurance and mortgage compliance solutions nationwide, has announced that its federal regulatory and custom foreclosure audit services fulfill the requirements for foreclosure audits as outlined by the Office of the Comptroller of Currency (OCC). More than two million homeowners hit with foreclosure in 2009 and 2010 will receive letters explaining their right to an independent audit review of how they were treated during the foreclosure process. The purpose of the letter is to identify homeowners who were financially harmed due to improper foreclosure practices by their servicer. Homeowners then have the right to demand a review of their case. “This is a perfect fit for us,” said Tommy A. Duncan, president of QMS. “We already have the staff and software support to provide this service to mortgage servicers who will need to hire third-party auditors to review their cases.” Mortgage servicers and independent mortgage auditing firms can conduct these reviews, who will then decide whether the homeowner should be financially compensated based upon an unlawful foreclosure or excessive fees.

Total Mortgage Services Builds Upon Its Product Offerings With Introduction of USDA Loans Total Mortgage Services LLC has announced that it is expanding its product lineup by offering the Guaranteed Rural Housing Loan Program insured by the U.S. Department of Agriculture (USDA) through its Rural Development program. A USDA home loan is guaranteed by The Guaranteed Rural Housing Loan Program and is offered through the

Rural Housing Service, an agency of the U.S. Department of Agriculture and provides low and moderate-income rural residents to access to more affordable housing finance options. “Total Mortgage is committed to helping borrowers either purchase or remain in their homes on the most affordable terms available,” said John Walsh, president of Total Mortgage Services. “The USDA home loan program is one of the most compelling mortgage products in today’s challenging mortgage marketplace and offers real solutions for rural borrowers, especially those in need of 100 percent financing or with lower credit scores. Our team of fully-licensed loan officers recently completed an extensive internal training program on USDA home loans guidelines, and are ready to educate and help borrowers qualify for this money saving mortgage product.” The Guaranteed Rural Housing Loan program provides very low- and moderateincome rural residents with better access to affordable housing finance options with little or no downpayment or out-of-pocket costs. Borrowers may obtain a loan to purchase a new or existing home that is located in a designated rural area. A rural community generally has a population of 10,000 or less; however, a community with a population of 20,000 or less can be considered “rural” if it is located outside a metropolitan statistical area.

homebuyers, will appreciate the seamless online user experience MEGA Data provides, helping them quickly mine our foreclosure data for potential short sales, profitable foreclosure auction purchases, and bank-owned opportunities, among other applications.”

New Software Tool to Assist in the Fight Against Mortgage Fraud CoreLogic has announced that its next-generation LoanSafe Fraud Manager platform now incorporates software from FICO, the leading provider of predictive analytics for decision management. FICO Origination Manager 4.0 has been inte-

grated within the next generation fraud solution, enabling new alert creation and modification, case management capabilities, and access to unique data sources that give mortgage lenders more control to manage fraud cases and reduce mortgage fraud. FICO Origination Manager enhances the next generation LoanSafe Fraud Manager by providing a configurable decision engine for writing and managing business rules and alerts and an enhanced workflow capability to help lenders better assess fraud risk during the origination process. “By leveraging technology provided by FICO, we are bringing new best-in-class fraud prevention capabilities to lenders more quickly, and continuing to revolutionize the way fraud is prevented in the mortgage industry,” said Tim Grace, senior vice

president of product management and analytics at CoreLogic. “Lenders can now make better use of CoreLogic data assets to create and modify fraud alerts, which helps lenders speed their response to new and emerging fraud trends and schemes. Leveraging FICO Origination Manager, we offer lenders the ability to configure work flow and manage fraud fighting activities through a sophisticated case management system. The next generation LoanSafe Fraud Manager is becoming the next best practice in mortgage lending.” LoanSafe Fraud Manager provides mortgage originators a more holistic view of risk potential as a result of the product integration with FICO Origination Manager. continued on page 30

Pulling your hair out with other lenders?

RealtyTrac Releases New Foreclosure and REO Data Mining Tool 29 

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Real Estate Mortgage Network, Inc. is located at 499 Thornall Street, Second Floor, Edison NJ 08837. NMLS #6521. This information is for use by mortgage professionals only and should not be distributed to or used by consumers or third parties. Information is accurate as of date of printing and is subject to change without notice.



RealtyTrac has unveiled its new bulk foreclosure data search and download tool now known as MEGA Data. This new product gives users the ability to quickly sift through RealtyTrac’s database of more than two million foreclosure properties to create targeted lists of distressed homeowners, scheduled auctions and real estate-owned (REO) properties. MEGA Data allows real estate brokers, agents, buyers, investors and direct marketing professionals to fine tune a data search matching their specific criteria. Search filters include the following: Property type (single-family, multi-family, commercial, etc.); loan amount and loan position; lender and trustee name; estimated market value and equity; and for sale status Users can view the updated data counts along with the cost of those records as the list is being built in real-time. The data is organized geographically so that users can decide how much of the data they want to buy and then purchase either a full or partial list that fits their budget. Once the customized list is created, downloading it is quick, with the data available immediately. “MEGA Data is one of the most revolutionary new products we’ve created in years, making our nationwide foreclosure data available in an entirely new interface that features a very easy-to-use list generation and export tool,” said RealtyTrac Chief Executive Officer James J. Saccacio. “Real estate and direct marketing professionals, along with many real estate investors and

Three Questions to Ask Yourself if You Aren’t Closing at Least Five Loans per Month Does existing business or new business take priority? Dealing with your existing business should never take priority over finding new business. Focus your time, money and energy on doing the one thing you should be doing every day—FINDING NEW BUSINESS. Move everything else out of the way! Finding new business is usually the first thing that gets moved to the backburner when things get busy. You know how it goes … we get a loan and immediately start doing the processor’s job. We are so proud of that new loan and now we finally have a reason to be “busy!” Break away from that pattern and think “Creating Business,” not “Doing Business.” Instead of doing other people’s jobs for them, pick up the phone and call the seller’s agent on that new loan! When is the last time you introduced yourself to the seller or their agent? Of course, we all want to get the easy stuff out of the way first, but that’s a toxic way of thinking for sales people. Don’t let old business get in the way of your new business!

Are you maximizing/expanding your sphere of influence?


continued from page 29

This generation of LoanSafe Fraud Manager leverages patented pattern recognition technology and offers comprehensive business intelligence which aids decision making by harmonizing data, analytics, policy, strategy and operational workflow.

dent of LPS Applied Analytics. “That level of independence is best achieved with an open cascade that delivers the most accurate AVM solutions for any given market, without bias. Our collaboration with AVMetrics enables LPS to deliver the most independently verified cascade on the market.”

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new to market

Be in the business of getting the business! Top producers don’t let trivial conversations and meaningless tasks dominate their day. They are very focused on growing their sphere of influence on a daily basis. They are constantly talking to those who can help them grow their business and are constantly seeking to maximize and increase their sphere of influence. Always be re-evaluating yourself and your lead/referral sources. Just because a certain real estate agent calls you every day does not automatically make them a great lead or referral source. How many closings did that relationship produce last month, last quarter or last year? One of the most common mistakes most originators make is marketing to the same group of people on a continual basis, regardless of the results. Chances are good that you have enough friends already … what you need is business! Break out of the rut and expand your sphere of influence every week.

What’s the one thing I should be doing every day? Day in and day out, top producers never stop generating new leads. You should have a set time every day for lead generation or it won’t get done. Block out time for lead generation every day from 8:00 a.m. to 11:30 a.m. I know … that comment just made some people cringe (I think we just found out what happened to our business). Does this sound familiar? TV, kids, coffee, donuts … lucky if I’m in the office by 9:30 a.m., then the e-mails, videos, rate sheets, socializing … that keeps me feeling productive until at least 10:30 a.m., then we have to talk about where we’re going for lunch until we actually go at 11:30 a.m., then back to the office no later than 1:30 p.m. Don’t forget, I have to leave early today to take the kids to the doctor … there’s just not enough time in the day!” Kill the distractions and block out time every day to generate new leads, and do it while you’re fresh for the best results. Eric Tishaw is the COO of Hometown Lenders and author of the Net Branch Survival Kit. Eric and his Hometown Lender’s team have a long history of assisting mortgage loan professionals reach their fullest potential. He may be reached at SPONSORED EDITORIAL

New SaM Solutions Upgrade Allows for Lender Processing Immediate Compliance Services Inc. (LPS), a Adoption to Investor and provider of inte- GSE Guidelines

grated technology, data and analytics to the mortgage and real estate industries, has announced that its Applied Analytics division has released the LPS Advantage Cascade AVM. This automated valuation cascade model is an open, independently supported and verified solution powered by AVMetrics, an automated valuation model (AVM) testing and auditing authority. With AVMetrics providing independent testing and verification, LPS Advantage Cascade ensures conformity with the latest Interagency Appraisal and Evaluation Guidelines by offering LPS and non-LPS products, to ensure unbiased and optimal AVM results for a specific property. LPS Advantage Cascade leverages multiple AVM suppliers and distinct databases, and is able to automatically determine which provider will deliver the most accurate results for any given market. The model preference table within Advantage Cascade includes 11 different AVM models and uses prior observations to identify the best AVM, down to the county level when possible. The model preference table is updated quarterly to ensure the most accurate AVM selection. Working with AVMetrics, LPS Applied Analytics ensures that all AVM products used in the LPS Advantage Cascade are held to the highest accuracy standards for AVMs. Testing conducted by AVMetrics has proven that less than 50 percent of today’s AVM vendors currently meet these stringent requirements. While LPS Applied Analytics focuses on maximizing the accuracy and hit rate for the LPS Advantage Cascade, AVMetrics determines exactly how this is accomplished. To ensure LPS Advantage Cascade’s independence and compliance with Interagency Guidelines, AVMetrics is the only organization that has access to the underlying cascade structure. AVMetrics has no financial stake in the LPS Advantage Cascade, which further reinforces independent, unbiased results. With LPS Advantage Cascade, lenders have access to independent testing by AVMetrics, which is included in the cost of the cascade. Lenders also receive quarterly cascade updates based on new testing and/or the inclusion of new AVM brands. Lenders are given the option to secure customized due diligence reports from AVMetrics that detail the performance of LPS Advantage Cascade in a specific market. “The latest Interagency Guidelines demand true independence when it comes to AVM selection,” said Dan Berman, presi-

SaM Solutions US, the developer of Engage, a mortgage loan origination and processing system, has released its enhanced business rules engine that allows users to compare and validate data points at any stage of the loan origination process. “This upgrade allows lenders to create dozens of different internal rules and quickly adopt any guidelines from investors or the government-sponsored enterprises with a few clicks of a mouse without cost and without programming of any kind,” said Aaron Cope, head of operations at SaM Solutions US. “Moreover, this upgrade allows lenders to quickly implement fixes to problems found in internal or external quality control, and to do so in an automated fashion.” The platform lets lenders extend the business rules engine to satisfy their internal processes or address gaps in the information that the borrower has provided that need to be cleaned up. “You don’t have to wait for system administration or for a new build to come out because it’s a straightforward process to incorporate rules into the existing webbased architecture and application work flow,” said Cope. “Our aim was to ensure that clients have a powerful tool that they can use to create rules and to provide a dynamic, intuitive quality control feature.”

Stewart Launches New REO Solution Stewart Lender Services (SLS), a wholly-owned subsidiary of Stewart Title Company, has developed a boutique asset management and disposition solution for community banks. The focus is maximizing the value of each bank’s assets in the shortest amount of time. By using a proactive approach, starting as early in the pre-foreclosure process; preserving the property upfront; maintaining the condition; and accurately valuing the asset from the onset, Stewart reduces a bank-owned property’s days in real estateowned (REO) status to save its clients time and money. Stewart’s approach combines a disciplined metric-management methodology with the ability to customize the process and strategy for each individual asset. “Community banks have very valid concerns about the disposition of bank-owned

properties given current market conditions,” said Michael Harris, senior vice president of SLS. “Stewart’s solution provides customers with assurance that all their assets are handled in the same high-quality manner. Additionally, we ensure that all vendor partners are up to date and in compliance with local laws and regulations regarding vacant properties.” In addition, building relationships through one-on-one communication to fully understand each community bank’s individual requirements helps Stewart to tailor its processes to meet the specific needs of each customer. “Community banks have a great deal of apprehension over value reconciliation,” said Harris. “Determining the value of an REO property is critical. Most clients still rely on the appraisal ‘cost’ approach vs. the direct sales comparison, i.e. ‘market’ approach of a Broker Price Opinion (BPO). We value a property accurately from the onset to save time and money for our client.”

LOS Provider Wipro Gallagher Solutions Releases Upgrade to Comply With LQI Mandate

New to Market column Phone #: (516) 409-5555 E-mail: Note: Submissions sent via e-mail are preferred. The deadline for submissions is the 1st of the month prior to the target issue.


Same owner navigating industry since 1986. Privately held.

” #1 USDA RD lender in multiple states ” Quality FHA/VA lender ” Innovative technology ” Direct access to your underwriter ” Instant closing docs 616-667-9000 NMLS ID#: 38072 Licensed in: AL, AR, AZ, FL, GA, IL, IN, IA, KS, KY, MI, MN, MO, MD, OH, OK, PA, NC, SC, TN, TX, VA, WV, WI


In conjunction with the launch of the new Consumer Financial Protection

National Mortgage Professional Magazine invites you to submit any information promoting new “niche” loan programs, new products or any other announcement related to the introduction of a new program, to the attention of:

Wholesale Lending


Wolters Kluwer Launches Products to Navigate the CFPB

Your turn

A Bright Spot in 

Wipro Gallagher Solutions (WGS), a provider of endto-end loan origination software (LOS) and services for financial organizations, has announced that it has implemented EarlyCheck, a Web-based interface, in its NetOxygen loan origination system to remain in full compliance with Fannie Mae’s Loan Quality Initiative (LQI) mandates. EarlyCheck enables users to identify and correct potential eligibility and data issues as early as possible—prior to loan delivery, which greatly lessens the number of loans that are returned from Fannie Mae on account of incorrect information. The interface can be used for loans underwritten with any method—Desktop Underwriter (DU), manual, etc.—and there is no usage fee associated with the checks as part of the initial release. Once a user enters a loan application and submits the application to DU, the user can run the EarlyCheck interface on the loan. EarlyCheck produces a report detailing any inconsistencies between the information submitted to DU and existing information. Errors that keep a loan application from passing through Fannie Mae are marked as a fatal error for the loan application in the report. The user can correct the error before submitting the loan to Fannie Mae, thereby streamlining servicing and saving time. “NetOxygen’s seamless integration with EarlyCheck enables our users to proactively identify and correct any potential hiccups that could hold up the loan delivery process,” said Narayan Bharadwaj, head of business for WGS. “This greatly saves time and eliminates unnecessary frustration for lenders interested in closing more loans.”

Bureau (CFPB), Wolters Kluwer Law & Business has announced that it is implementing a suite of products and services created specifically to assist banking and securities legal professionals in understanding and responding to the new regulations and enforcement activities the CFPB is expected to effect, to ensure that their clients are better equipped to respond to outcomes/consequences. “There has been a tremendous amount of speculation as to the scope of the CFPB’s activities,” said Mark Dorman, president and chief executive officer of Wolters Kluwer Law & Business. “As a result, legal practitioners are struggling to synthesize all of the information they are finding into something meaningful for their clients. Our respected banking and regulatory consultants and analysts, as well as our expert authors, have been distilling all this content to provide necessary guidance from a single, trusted source. Moreover, we are delivering this information in a relevant context, pairing it with expert commentary and analysis that will help professionals stay current and as a result better advise their clients.” The first of these solutions is the Consumer Financial Protection Bureau Reporter, authored by the international law firm Dewey & LeBoeuf LLP. Available in print and online, the Reporter is the industry’s first comprehensive, regularly updated resource offering timely coverage of the rules, regulations and enforcement activities of the CFPB, with practice commentary and analysis from Ralph C. Ferrara, Gary Apfel and the experienced attorneys at Dewey & LeBoeuf. The Reporter serves as a guide for legal professionals across a broad range of industries, from banks and credit agencies, to mortgage finance and trust management. As a centralized source of content and commentary, it enables legal professionals to get quickly up to speed on Bureau activities and their implications on clients’ day-to-day business. “Because the Bureau is a new independent federal agency with broad and wide-ranging authority, we expect a tremendous amount of activity over the first few months after its launch,” said Jim Hamilton, Principal Federal Securities Law Analyst. “For legal practitioners to effectively advise their clients, it’s critical that they stay current.” Wolters Kluwer Law & Business expects to launch additional CFPB resources in the coming months.

MLO Compensation and Stricter Regulations Make Education More Important Than Ever By Tycho Rosenfeld




Extensive changes in the mortgage industry over the past four years have caused a fundamental challenge for mortgage loan originators (MLOs) and the institutions that hire them. While MLOs are now required to have a higher degree of competence with regards to understanding compliance and liability, recent DoddFrank Act compensation rules are resulting in decreasing average pay. The new world requires that MLOs have a strong understanding of the Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act), the Home Valuation Code of Conduct (HVCC), the revised Good Faith Estimate (GFE), the Mortgage Disclosure Improvement Act (MDIA), the Dodd-Frank Act, a myriad of changes to Federal Housing Administration (FHA) guidelines and more. Many of these changes are critical to reforming the industry, but at the same time, have a significant impact on what is demanded of the employee. The 2011 MLO sitting in the same seat as the 2006 MLO has to be a far different, much more knowledgeable employee. Meanwhile, the 2011 MLO now participates in a very different compensation structure where the average pay is generally lower. At the end of the day, this means that jobseekers will likely be newer and lessexperienced people willing to challenge themselves within the new pay structure.

What are the impacts of these trends on employers and employees? How will brokers hire top producers and how will would-be top producers find their institutions? And finally, what does all of this have to do with education?

What does this mean for employers? The key employer impacts of the last few years are that compensation adjustments, stricter regulations and revised licensing requirements necessarily alter the hiring pool and hiring strategies. Because new compensation schemes mean lower average MLO pay, and given that this compensation change is specific to one industry, experienced MLOs and candidates will inevitably explore other opportunities. The result is that your applicant pool will be less experienced than the previous pool of applicants. At the same time, the result of stricter and more complex regulation is that MLOs need more knowledge than before. Even for experienced MLOs, keeping up with the number of legislative changes in the industry requires solid training. From a discussion at the Conference of State Banking Supervisors (CSBS) Annual Meeting earlier this year, audits are projected to increase due to the implementation of streamlined call reports information, a reduced pool of

June Ju ne 4-6, 2012




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licensed entities and more didate who is already proactive regulators. In licensed; however, take a short, the risks of having step back and consider what untrained MLOs have an interviewer is looking for increased. and why. The first thing a SAFE Act licensing company wants to know is re q u i r e m e n t s h a v e the same as always—how addressed these chalmuch can you increase lenges somewhat with bottom line production? education requirements; The qualifications for however, these requirethat part of the job are ments present another still the same and are challenge. An unlicensed critical to demonstrate; “The result of stricter employee cannot prohowever, there are also and more complex duce immediately, and two new challenges. regulation is that each national exam failFirst, companies want MLOs need more ure costs another month an employee who can start knowledge than of production. quickly. No matter how before. Even for We hear from many promising a jobseeker experienced MLOs, employers that, as a general seems, if the candidate keeping up with the solution to the above chaljoins a company and fails number of legislative lenges, they only hire prethe test three times, causchanges in the licensed employees, a trend ing a nine-month delay in industry requires solid reflected on job boards as licensing, how much can training.” well. This strategy reflects the the employee help with assumptions that there will bottom line production? continue to be an adequate supply of pre- Even a one month delay costs money. licensed applicants and that the burden of The second aspect a company wants licensing can be shifted to jobseekers. to know is whether you will increase Given the high cost of licensing and a their potential liability. The worst relatively fixed number of pre-licensed nightmare of any employer is an candidates, an employer cannot rely on employee who brings down the compasuch a hiring strategy for the long-term, ny. This example may seem extreme especially when there are sudden upticks (though it has happened), but the point in certain products or when the housing is clear—an MLO needs to have the market eventually improves. Inevitably, knowledge, capability and awareness to companies will have to commit to bring- manage the origination process effecing on new, less-experienced and unli- tively and correctly. Production won’t censed hires. counterbalance risking regulatory A hiring strategy that includes candi- action or even having bumps in the dates new to the industry requires some auditing process. way to get new hires up to speed quickly. One alternative to paying for licensTo protect the organization from risk and ing upfront, but a cheaper way of getting a maximize production, training becomes a foot in the door and making yourself more critical part of the hiring and boarding attractive to an employer is to take the test. process. The education required by the You don’t need to pay licensing fees or SAFE Act is critical, but companies should even take the education to test. Taking the also consider additional training, whether national exam costs $92, and a great deal it be inside or outside of the firm. of elbow grease in preparing and coming up to speed on the industry, but can proWhat are the impacts vide a valuable job-seeking tool while saving you the cost of fully licensing. You will on jobseekers? Entrance into the mortgage industry is now demonstrate more knowledge of the field more challenging. As mentioned above, and make licensing prospects easier in the many employers tell us, and advertise pub- eyes of the employer. Remember, of licly, that they will only consider hiring expe- course, that in order to pass, you need rienced MLOs who are already licensed. For solid preparation and education. a new MLO, outside of working for an To go one step further, if you really bear exempt institution, possible solutions down on the test, you can show the interinclude investing upfront time and money viewer your score. It’s definitely a stateto launch your new career or finding a com- ment if you pass with a 90 percent as pany who will sponsor you. opposed to a 75 percent. Of course there Ideally, interviewers want to hire a can- are a lot of important aspects to this busi-

ness that are not covered in the national exam, but compliance knowledge reduces employer risk, which is definitely a plus in the process. If you want to go another step, training in sales and other aspects of the business is beneficial, but the point of taking the national exam is that it is inexpensive, it benefits the employer and it gives you an organized start for knowledge in interviews and in the start of your career. An optimal employee is one who quickly starts contributing to the bottom line with minimal risk of liability.

In summary … Whether we like it or not, the myriad new rules of the past four years are here to stay, and even more legislation and regulatory changes are on the horizon. Those who adapt quickly to the shifting regulatory landscape will have a leg up in the next business cycle. Rather than viewing the new requirements for testing and course-

work as a painful exercise needed only for SAFE Act compliance, employers and mortgage professionals need to look at it as a critical component of their overall preparation for growth in the industry. Education is one clear solution both for loss mitigation and MLO preparedness, as well as the prevention of production delays. Tycho Rosenfeld is president and chief executive officer of During his three-year tenure with the company, Tycho has grown into a nationwide provider of all SAFE core and state-specific required pre-licensure and continuing education. Prior to his current position, Rosenfeld spent nine years in finance at Bank of America and formerly worked as a financial services consultant for Accenture. He holds an MBA in Finance from the University of Chicago Booth School of Business. He may be reached by e-mail at

Continuing Education: From Mandatory to Meaningful


view, you may never have been pushed outside of your comfort zone. Education helped shape who you are today, and you remember those educational experiences because they were meaningful.

Mandatory to meaningful This year, you will be joining more than 100,000 licensed mortgage loan originators (MLOs) in satisfying the mandated continuing education (CE) requirement. For the first time in the history of the industry, every licensed MLO must complete a minimum of eight hours of CE for license renewal before Dec. 31. With the tougher new Nationwide Mortgage Licensing System (NMLS) protocols, you will sit for an entire eight hours, and in most cases, you will take an exit exam to obtain your CE credits. This is all mandated, but the question you must ask yourself is: “Will it be meaningful?” You can indeed make your CE meaningful. To do so, you will need to raise your expectations and view your CE requirements as an opportunity to enhance your


The most successful originators, those who are outstanding, devote time to training, education and self-improvement. You may view education as a burden or something to overcome, or, you may view it as an opportunity to improve your skills and knowledge. This is a clear choice. Do you remember when learning was fun? If asked, could you name the best teacher you ever had? Do you remember your favorite class in high school? Think about your favorite teacher who may have touched your life, opened your mind and helped you see the world in a different light. Out of the blue, this teacher was lightning in a bottle, where everything seemed new and possible. Do you remember how that felt? You were required to attend grade school; you had to go to high school; you were forced to take all of those tests and final exams. School was mandated and much of it was less than memorable. If it weren’t for that special teacher who believed in you; if it weren’t for the course that caused you to re-think your point of



By Paul Donohue, CRMS


Learning is a Choice

and an instructor leads the class. Pros: The student can do the reading, quizzing and exercises 24/7 on their own schedule with minimal interaction with the instructor or other students. This type of class tends to be less expensive, and in most Choose the cases, does not have a right mode strict timer. The NMLS sets the CE stanCons: All the reading and dards and has defined four “Learning is comprehension is up to distinct modalities from irretraceable. the student with limited which you can choose. You cannot unlearn Choose wisely as there are or extract knowledge interaction with a knowledgeable instructor. pros and cons to each. once it enters These courses can often your brain.” take longer to complete  Live classroom: A live than the eight required hours, and classroom setting means being at a there is a required exit exam you class in-person attending a live must pass in order to get your training event in front of a live credits. instructor. Pros: When taught by a knowledgeable, thought-provoking instructor  Self-paced online: This is a timed solo course experience for those who want where you can participate in an open no instructor interaction. The content is discussion, have your questions often text-based, some offer audio and answered, and network with other provideo where the student reads through fessionals, this mode delivers the most the content, answers interactive quizzes impact. The live classroom experience and completes an exit exam. has the power to transform your pracPros: Tends to be the least expentice, and there is no required exit testing. sive format, allows 24/7 access with Cons: Tends to be more expensive, no defined time schedule with virtuas you must travel to an off-site locaally no instructor interaction. tion, adjust your schedule to the Cons: If the content is bad or boring, course availability and live classyou’ll be stuck with it for eight full hours room events are not offered in many because it is timed, there are frequent remote areas of the country. quizzes throughout and you must pass the final exam to get your credits.  Live equivalent: The live equivalent setting is a live class in realtime, yet you participate at a dis- Getting the right stuff tance, via your home or office com- To make CE meaningful, consider your puter. The better versions of a live learning style and choose accordingly. If equivalent class go beyond a you are a visual learner, be sure the course Webinar to include live streaming includes video. If you love social interacvideo and live instructor interaction. tion, you may want to choose a live class or Pros: The best live equivalent offer- live equivalent setting so you can interact ings give you the power of a live in real-time with other professionals. If you class with the convenience of distant are a big reader and want to get your CE in learning. It is virtually available small pieces over a longer period of time, everywhere, with many offerings, no you may want to choose an online class. Learning is irretraceable. You cannot travel expenses and no required unlearn or extract knowledge once it course exit exam in order to pass. enters your brain. When you apply new Cons: Because the teacher is live, it tends to be slightly more expensive learning to your daily work, knowledge can change your behavior and make you a betthan other online formats. ter professional. This year, take the oppor Instructor-led online: This format tunity to choose a CE course that will prois very similar to a correspondence pel you forward. It is, after all, your future course with a strictly defined start and and your career is at stake. end times in which the class participants read the content independently continued on page 34

knowledge. You will need to expect more from your education provider by choosing a course that will challenge you, that provides you current and meaningful content that will make you a better originator.

Components or comprehensive The Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) mandates a minimum of eight required CE credits as follows:  Three hours of federal law  Two hours of non-traditional lending  Two hours of ethics, fraud, fair lending and consumer protection  Plus, one hour of elective or statespecific law


Note that 19 states require some amount of state-specific law each year. Go to and check whether your state has an annual CE requirement and how many hours are required. You can take several short course components from different education providers, or you can take a “Comprehensive Course” that includes all of the mandated components in one seven-hour or eight hour course. Buyer beware … read each course description carefully or call the course provider to make sure you know what you are buying.



Learning is profitable Mortgage lending is profitable and fulfilling when you see yourself as a professional. As in any career, you must pay a price to ascend to the upper levels of income and reputation. What differentiates a professional originator from a mortgage clerk is knowledge, expertise and your ability to

translate these factors into meaningful solutions for your borrowers. A mortgage professional offers guidance and sells advice, while the drone takes orders and sells rate. In today’s business, your prospects see your rates, products and fees as the same as your competition. To them, there is little or no difference in service, and good service is what is expected. The true difference between you and everyone else is the knowledge and expertise you bring to the transaction. Every successful professional knows you are either learning or you are dying. Learning is profitable and its part of the job.

Four Questions to Ask Yourself About Certification By Gibran Nicholas

Now that you’ve passed your Nationwide Mortgage Licensing System (NMLS) licensing exam, what’s next? Do you even need certification above and beyond the minimum licensing requirements? Here are four questions that help you make an informed decision about (a) whether You have a choice to get certified, and (b) which certifiRemember back in school when you cations to pursue. were choosing your electives. That was exciting right? You chose all of your I. What’s the benefit courses, and then you couldn’t wait to (beyond the initials compare your classes with your friends. behind my name)? Learning can still be fun. Learning is We all want to receive a great return progressive and continuous learning on investment (ROI) whenever we will make you a better professional. spend our time and money on someThis year, before you make your CE thing and certification is no different. choices, pause for a moment and ask your- It is utterly useless and a total waste self, will this CE sharpen my skills and of your time and money to get certiimprove my career? If you choose a great fied just to get a bunch of initials course and commit to learning, you might behind your name. First of all, the inicatch that lightning in the bottle, where tials are meaningless to the majority everything is new and possible once again. of your target audience. Second of all, who cares most about initials behind Paul Donohue is the founder of Abacus your name? You! But you aren’t sellMortgage Training and Education. He ing to you. You are selling to me, my may be reached by phone at (336) 254- neighbor, my Realtor and my finan3027 or e-mail cial advisor. We don’t care about

“you.” We care about “us” and what can you do for us? Many people with initials behind their name take their focus off of solving the customer’s problems. Instead, they focus on themselves, their initials, and why they are God’s gift to this Earth. That’s what you need to avoid … don’t get certified just for the initials. Are the initials nice? Sure. Do they set you apart and add credibility? Maybe, depending on who you talk to. So why get certified if not for the initials? Any certification you pursue should give you three specific results:  Increased confidence: You should be able to do or say things that you were not able to do or say before you got certified. For example, let’s assume that you are afraid of contacting financial advisors because you don’t know what you would say or how specifically you can solve their problems. A certification that claims to help you increase referrals from financial advisors should give you the skills, training and systems to increase your confidence level when you approach financial advisors and have conversations with them.  New skills: If you really want to set yourself apart, do something for someone that no one else can do for them. A certification should give you the skills to increase your competitive advantage and help you solve problems that your competitors cannot or will not solve.  Easy to implement daily habits: It doesn’t matter how many tests you take, how many seminars you attend or how many initials you have behind your name if you don’t take the daily steps to turn it into sales. What really matters is whether the certification gives you a system that you can use every day in your business when you talk to borrowers and referral partners.

II. How will this certification increase my confidence?

education even though I havenâ&#x20AC;&#x2122;t started saving yet.

 T h e u s a b i l i t y o f t h e knowledge/certification: Life is not theoretical. Neither is the business of mortgage origination. Therefore, the certification you choose should be grounded in practical daily habits that help you implement your new skills. Some certifications include software and/or other implementation resources. These are the types of certifications that could be most impactful in your every-day business.

Whatâ&#x20AC;&#x2122;s next? Donâ&#x20AC;&#x2122;t get certified if you have all the confidence in the world, if you donâ&#x20AC;&#x2122;t need any new skills, and if you are completely happy and satisfied with the

results you are generating with your current daily habits. On the other hand, the right certification could really benefit you if you could use an extra dose of confidence, some unique new skills, and some more effective daily habits. Gibran Nicholas is the founder and chairman of the CMPS Institute (NMLS Provider ID# 1400384). The CMPS Institute administers the Certified Mortgage Planning Specialist (CMPS) and Certified Mortgage Coach designations through the CMPS Premier membership program. CMPS Premier consists of certification training and software that gives you confidence, unique skills, and four daily habits to generate more business with borrowers, Realtors, and financial advisors. He may be reached by e-mail at


Leading the Industry with Marketing Solutions tXXXMPZBMUZFYQSFTTDPN


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 If Iâ&#x20AC;&#x2122;m a borrower, There is nothing sexier in help me feel good this world than confiabout buying a home dence. You can have the even though the best mortgage rates, best whole country (and loan programs and the the whole world) best customer service on seems to be losing its the planet. So what? Do mind. you really think thatâ&#x20AC;&#x2122;s why a borrower, Realtor â&#x20AC;&#x153;It is utterly useless  If Iâ&#x20AC;&#x2122;m a Realtor, solve or financial advisor and a total waste of my problems and chooses you over every- your time and money help me differentiate one else? No way! They to get certified just to my listings from all choose you (or donâ&#x20AC;&#x2122;t get a bunch of initials of the other listings choose you) because of behind your name.â&#x20AC;? in the market. how you make them FEEL when they talk to you, and when they  If Iâ&#x20AC;&#x2122;m a financial advisor, solve my do business with you. problems and help me add value to If I am greedy, I will do business my clientsâ&#x20AC;&#x2122; personal lives and finanwith someone who makes me feel cial well-being that no one else can give me a better deal. If I am fearful, I will do busiCould your skill set use improvement ness with someone who makes me feel that I wonâ&#x20AC;&#x2122;t be safer with anyone in any of these areas? If so, find a certielse. If I am human, I will do busi- fication that helps you improve upon ness with someone who makes me these skills. â&#x20AC;&#x153;Feel like I am the only girl [or guy] in the worldâ&#x20AC;? (to quote Rihanna). You IV. How will canâ&#x20AC;&#x2122;t make me feel that way unless this certification impact you have confidence. Confidence my daily habits? that what you are doing is in my best You can have all of the skills in the interest and the confidence that world, but theyâ&#x20AC;&#x2122;re literally worthless if what you are saying is so beneficial you donâ&#x20AC;&#x2122;t take the daily steps to turn to me that it will positively change your skills into sales. There are two facmy life forever. How do you get to tors that help you evaluate whether a that level of confidence? By having certification would impact your daily the right skills and that brings us to habits: question number three.  Your own level of commitment: Certification is not a spectator III. How will this sport. You need to commit the certification increase time and financial investment to my skills? get certified and implement your The mortgage salesperson of the new skills. Even if a certification future has to have the kind of conprogram is designed to give you versations where the customer would the exact results that you want, pull out a checkbook and write a you wonâ&#x20AC;&#x2122;t get any results at all check for the call because it was so unless you follow the system. Itâ&#x20AC;&#x2122;s valuable. Do you bring that level of kind of like working out. You can skill to your conversations? If not, invest in the P90X exercise profind a certification that helps you gram or even join a gym if you develop those kinds of skills. Iâ&#x20AC;&#x2122;m want. But if you donâ&#x20AC;&#x2122;t spend the talking about the types of skills that: 30-, 60- or 90-min. a day working out, you wonâ&#x20AC;&#x2122;t get any results.  If Iâ&#x20AC;&#x2122;m a borrower, help me feel good Thatâ&#x20AC;&#x2122;s not because the system about my retirement even though I doesnâ&#x20AC;&#x2122;t work. Itâ&#x20AC;&#x2122;s because you just lost a bundle of money in my didnâ&#x20AC;&#x2122;t work the system. The same retirement account. is true with mortgage certifications. If you are committed to  If Iâ&#x20AC;&#x2122;m a borrower, help me feel good implementing the certification, about funding my childrenâ&#x20AC;&#x2122;s college

the certification should give you the results you bargained for.

Continuing Education: A Must for FHA Loan Specialists By Jeff Mifsud Whether you aspire to become a Federal Housing Administration (FHA) expert or are a seasoned FHA originator, taking the time for continuing education is a must. Over the last three years alone, there have been more than 500 changes to FHA loan programs! The challenge is figuring out which of those changes you need to know about, and which ones you can ignore.

Have an expertise

Make a commitment to becoming an expert Many mortgage loan originators (MLOs) may fear that becoming an expert in one type of loan will limit them and prevent them from getting other types of loans. In reality, this is an unwarranted fear. Take a look at other professionals, like CPAs and




Very early in my career, I learned from my industry mentors the vital importance of becoming an expert in some particular loan, so I chose the FHA loan. When you become expert at one type of loan, you begin to attract more of that type of loan, and if you continue to upgrade your expertise and do the loan well, what follows is a reputation as an expert. This helps to create new relationships, which, in turn, brings referrals of loans outside of your expertise as well.

attorneys. Though these professionals more than likely have an area of expertise, if you look at their billable hours over the year, you will notice that they do work in many different areas of their profession, not just those in their specialty. So, ask yourself this question: “What loan am I an expert at?” If you cannot answer that question, then it’s time to choose a loan product you enjoy and do well and make yourself an expert in it! One of my personal favorites is the standard 203b FHA loan program; no matter what state the housing industry is in, you will always have more first-time homebuyers than any other type of buyer. And, because these buyers are usually buying lower priced homes, the interest rate has less of an impact on their monthly payment than the higher loan amounts. Other great FHA niches where MLOs can excel and develop a nice referral base are the 203k rehabilitation loan, which I have written about previously in these pages (do a search on the Web site for 203k to read more). Or, Home Equity Conversion Mortgage (HECM) loans, FHA’s reverse mortgage. Bear in mind that each of these loans has a unique sales process and will give you a different type of borrower,


in addition to a different ly say that every FHA type of referral partner, training session I ever so keep this in mind attended was written by when selecting a loan to an underwriter, and become expert in; it’s presented from the perimportant to like the spective of the undertype of people you will writer! Well, this is great be working with closely. if you want to learn how For example, the 203b to be an underwriter, attracts a larger percentbut not if you want to be age of first-time homean expert FHA originabuyers; the 203k tor! requires that you enjoy The fact is that an “When you become the construction compounderwriter doesn’t expert at one type of nent of the process and know what it’s like to be loan, you begin to working with contracon the origination side attract more of that tors; and the HECM of a loan. There are type of loan, and if necessitates that you unique circumstances you continue to enjoy working with which can and do arise upgrade your financial planners and that only an MLO can expertise and do the understand. Given this, elderly clients who have loan well, what a lot of questions and when you select FHA CE take longer to make follows is a reputation courses, it is to your distheir decisions. All these tinct advantage to select as an expert.” factors need to be taken courses that are written into account, as it is important for you by those not only expert in FHA, but to have a passion for the loan pro- with extensive experience actually gram that becomes your area of originating FHA loans. In my experiexpertise. Which leads me to the next ence, of all the continuing education point … providers, Mortgage Success Source understands the importance of proHave a passion for viding educational content from an MLO perspective. This is why they what you do It’s not enough to just possess the req- have produced self-paced online FHA uisite knowledge to do the loan; to CE courses from experienced MLOs excel (and to enjoy your work life like Linda Davidson, one of the more!) you need to have passion nation’s top FHA Originators, and about what you do. This will keep you renowned LEED’s-certified MLO inspired, and will inspire others to Dakota Gale. Of course, these FHA want to do business with you. courses are part of the full eight-hour Whether it’s a real estate agent or a Nationwide Mortgage Licensing potential client, people would rather System (NMLS) requirement, and I am work with someone that not only has sure that you will be very pleased the skill, but also the passion for their with not only the content, but the work. visual appeal and user-friendly course design. Selecting your FHA With your FHA continuing education, you can take your business to the next continuing education Now, here’s the rub … assuming an level and become an FHA expert in your FHA loan is where you want to focus marketplace. It all begins with your your efforts, there are important real- commitment to learn. ities you need to keep in mind with Go FHA! respect to choosing the source of your continuing education (CE) and train- Jeff Mifsud is founder of Michiganing. Being a former FHA DE based Mortgage Seminars LLC, a forUnderwriter trained by the U.S. mer FHA underwriter with 15-plus Department of Housing & Urban years of experience originating FHA Development (HUD), having originat- loans, an FHA expert for ed FHA loans for 16-plus years, and and creator of The having trained MLOs since 1999, this FHA Originator, a monthly FHA has provided ample opportunity to newsletter. Jeff may be reached by take all types of FHA courses in differ- phone at (248) 403-8181 or visit ent parts of the country. I can honest-

The SAFE Act: The Destruction of Small Businesses That No One Acknowledges By George Duarte

processors came into the business in the 1980s and 1990s, straight out of high school or junior college, and this is the only profession they have ever known. It is also true that the vast majority of loan processors are women, with a large percentage of them single parents, being sole providers for their families. The mortgage brokerage and origination business has undoubtedly provided tremendous opportunities for women to become successful, economically independent businesspeople and entrepreneurs. Women represent a majority number of the most successful people in our business, in brokerage ownership, mortgage loan origination, as reps for the wholesale channel, mortgage banking operations and loan processing. continued on page 38


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Thousands of small businessmen and several years ago after the dot-com women have been, or are in the process bust. This was in response to the large of being put out of business by the numbers of laid off tech workers, who Secure and Fair Enforcement for are well-educated and can easily pass Mortgage Licensing Act (SAFE Act). The standardized tests, getting their California Department of Real Estate Broker’s Licenses to get in on the real (DRE), for example, the agency responsi- estate and mortgage refinance boom. ble for SAFE Act enforcement in the This resulted in the phenomenon of state of California, has ruled last year having brokers opening offices and that Independent Contractor Loan recruiting agents, without ever actually Processors must not only be Nationwide ever having done a real estate sale or Mortgage Licensing System (NMLS)- mortgage loan origination transaction. licensed, but have a DRE Broker’s Imagine the joy of doing business with License as well. Currently, this writer is these people. However, the vast majority of loan processors not aware of similar never even had a interpretations in other Salesperson’s License states, but since it seems because they didn’t deal clear that there is considwith the consumers. erable interpretive leeAs we are all aware, way of the SAFE Act the loan processor’s funcrequirements from state tion is to perform the to state, it is not unreaback office administrative sonable to assume this is details, including loan also the case in other setup, knowledge of places. I am very interestunderwriting guidelines, ed to hear where else this opening escrows with title interpretation may be “A case may be companies, ordering required. One of the made that processors appraisals (until 2009), areas we have seen condo require some coordinating inspections, siderable variance is in certification/regulatory submitting loans to credit score and backexpertise, but that lenders, working with the ground requirements of would be a very underwriters, clearing mortgage loan originadifferent sort of loan and funding conditors (MLOs), with some certificate, not to tions, and doing poststates requiring credit the onerous levels closing audit activities. scores of more than 700 of a broker’s license Nowhere in this list of and no bankruptcies in or NMLS licenses.” duties is there any requireorder to be licensed. In California, the Broker’s License ment of working directly with consumers requirements include having a on any substantial matters. There may Salesperson’s License and two years of have been occasions when a processor full-time experience in real estate, as would communicate directly with a client well as successfully completing eight to request additional documentation or college level courses, and passing a very forward a disclosure, but there never was difficult test with an average 40 percent any licensed activity involved—performrate of failure. It is a good thing that the ing qualifying for the consumer, disBroker’s License is challenging to earn, cussing loan programs, structuring the because in the past, it was too easy to loan, or quoting rates and fees. These obtain, and too many incompetent peo- activities were always part of the loan ple became mortgage brokers to the originator’s responsibilities because they detriment of the industry in general, were licensed activities, and that’s what and consumers particularly. The quali- the LOs are supposed to get paid for. After the crash of the markets in fying requirements were tightened up

2007-2008, many very experienced and competent employed loan processors lost their jobs when mortgage banks and brokerages closed and loan originations dried up. Those who could, subsequently, became self-employed contract processors, providing these services to the surviving small brokerages on a per-loan fee basis. This business arrangement that worked for all parties, as the processors kept doing what they knew how to do and made a living, and the surviving brokerages had access to professional loan processing services without having the full-time employee overhead costs. This business model became and remains the most streamlined and viable for those remaining small brokerages to be able to survive in the post-2007, highly-restrictive lending environment. Most of these surviving professional




A strong case can be made that the crash of the mortgage business has affected mortgage businesswomen very disproportionately. Why has this issue not been raised until now? Where are the legislators who purport to represent the interests of their women constituents? The flood of regulations in the past several years is clearly discriminatory against small businesses generally, and women-owned small businesses, specifically. In the rush to punish those “bad’ mortgage brokers for crashing the world economy, regulators and politicians have clearly gone too far, again. Time and again in the halls of Congress and the State Legislature, I’ve heard that legislators judge the benefits of a bill in how much it will annoy the “mortgage guys,” the more, the better. It is high time for Congress and the State Legislatures to refocus their zeal for regulation on the consumer; to deliberately consider if proposed legislation or regulations actually have a tangible benefit to the consumer; and if the consumer will understand and benefit from it. A rising crescendo of protest is taking place nationwide in response to the clear intentions of the legislatures to have regulations just for regulations sake; so they can say, “Look, we did something,” irrespective of whether or not their legislation had any actual benefit to the consumer or any unintended consequences. I’ll never forget President Obama in his speech announcing the passage of Dodd-Frank saying, “We have ended too big to fail” … right, we all saw how successful that was. There is no justifiable reason to require the processor to have the same credential as the broker/owner/originator, even if the processor has their own independent business. I can think of no profession where the assistants and support staff are required to have the same licensing as their boss. The paralegal doesn’t have to pass the bar, nor does the dental assistant need to be a licensed dentist. A case may be made that processors do require some certification/regulatory expertise, but that would be a very different sort of certificate, not to the onerous levels of a broker’s license or NMLS licenses. Also, let us not forget the considerable expense of acquiring those licenses, and the expense of annual continuing education requirements. In California alone, a Broker’s License with eight courses

and test materials will cost well in excess of $2,000 alone. Add in the other $1,000 in fees, tests and courses for the NMLS, and you have an almost insurmountable barrier to market entry for most people, and a very effective mechanism for eliminating people currently employed in the industry. As a small business brokerage owner, I can attest this has impacted my business dramatically, having two originators unable to afford the NMLS requirements, and also having a firstclass independent contractor loan processor not able to afford to get her Broker’s License and NMLS requirements fulfilled. She had to shut her business, and it was only through divine providence that this woman was able to actually get a salaried job as a processor with a brokerage operation that is more than 30 miles away from her home. This woman is a single parent who is the sole provider for her family. Does it benefit the consumer to put her out of business and go on welfare? How many women in the same position were unable to get a salaried job and are forced to provide services under the radar, or worse yet, become unemployed? Is this sorry situation in the best interests of the consumer? Does the consumer benefit from this capricious regulation? I think not. In the end, we can talk about the unfair impact on women, but let’s face it; the SAFE Act is really just another attack on small business in favor of the big banks. All the while, the regulators continue to play wag the dog with the American people, giving the appearance of taking action, rather than actually considering actions that will have a beneficial impact on American consumers that they will understand. Our economic problems are at crisis proportions and an overhaul of attitude towards regulatory policies is long overdue. In this specific instance, I call upon the California DRE to repeal their outrageous, anti-woman, anti-small business arbitrary interpretation of a seriously flawed SAFE Act regulation. George Duarte, MBA, CMC is broker/owner of Horizon Financial Associates in Fremont, Calif. He has been very active in industry associations and local Chambers of Commerce. He has been a mortgage originator for more than 25 years and may be reached by email at

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Five Reasons Why You Know More About Real Estate Than Real Estate Agents

The days of providing your agents with a fancy lunch are gone. What real estate agents need to survive and thrive in today’s marketplace are the tools and resources that originators can often acquire at a fraction of retail’s price, and provide them to the agents. By being a resource of knowledge and utility, you can increase your perceived value and build strong bonds and relationships with greater numbers of real estate professionals. Opening more doors for agents will separate you from the pack, reversing the paradigm of chasing agents. Now you’ll have them begging to do business with you. Erik Wind is co-founder of ShortSaleSpeedway. He may be reached by e-mail at



The financial conversation between an agent and a buyer often involves only two questions: “Have you spoken to a loan officer?” and “Have you been pre-approved?” After these “tough” financial questions have been dealt with, the agent goes back to what he or she does best; selling the dream. And when an offer and contract is negotiated, the financial conversation is then finally addressed. Too many times, the dream doesn’t match the reality. By being able to have the most important, yet less romantic, financial conversation early on in the process, you’ll be invaluable to the majority of real estate professionals, from the rookies to seasoned veterans. You’ll increase their bottom line by saving

5. You can offer products they simply cannot get on their own.


2. You have a superior understanding of the finances involved in a real estate deal.


them time, money and energy by giving them the opportunity to work with For the real estate more qualified buyers who better agent, the real understand their purchasing power and estate transaction will be able to close. can be a complex process full of pit- 3. You review each falls and frustra- transaction with tions. Any one of a fine tooth comb. these can torpedo a closing. As a mort- Historically, real estate agents have gage professional, you hold a number been weak in making strong and consisof keys that will let real estate agents tent referrals to reliable loan officers. open more doors and close more deals. The reality is, agents know the chalThe business model of helping lenges on their side of closings, which agents overcome challenges has proven often stem from mortgage-related itself consistently as a path for both issues. We all know a good originator agents and originators to follow and relentlessly manages their files even grow their businesses together. Here before an underwriter gets involved. are five reasons why you an are invalu- This practice, along with an open line of communication with the agent, able asset to any real estate agent. results in increased loyalty and referrals. Agents are motivated by the num1. You see more ber of deals they close, and will be transactions than motivated by those who help them real estate agents. The average real estate agent closes close these deals. fewer than a handful transactions per year. To close those transactions, the 4. An agent’s agent often chases 10 times or more insurmountable title leads often leaving a lot of money on problem is a manageable the table. As an originator, you are event for you. exposed to more successful transac- What could be the simplest of title tions than the average agent. This expo- issues for you as an originator, could be sure helps you recognize potential the equivalent of an insurmountable problems before an agent would, sav- obstacle to a real estate agent. Most ing them time and increasing their simply don’t even know where to start. results. An efficient agent can identify Once again your vast exposure to more more deals that are likelier to poten- transactions, along with your estabtially close. These deals result in a bet- lished relationships with title compater allocation of everyone’s time, as nies and closing attorneys, creates value well as greater profits and a stronger to any agent. An agent who can count relationship for everyone involved. on your experience to clear title issues Your value increases as you position will make you the go-to person on not yourself as the premier loan officer that only the hard deals, but any deal. these agents refer good business to. By Erik Wind

By David Lykken

Communication and Leadership (Part 1) Communication â&#x20AC;Ś the foundation for every relationship and certainly the key to leadership, good or bad.




Welcome back. This is the sixth installment in a series of articles on â&#x20AC;&#x153;Leadership.â&#x20AC;? Given this monthâ&#x20AC;&#x2122;s article on â&#x20AC;&#x153;communication,â&#x20AC;? it seems an appropriate occasion to communicate a special â&#x20AC;&#x153;thank youâ&#x20AC;? to those of you who have taken the time to e-mail me or send me a LinkedIn message to communicate how much you have enjoyed and benefited from this series of articles. I truly appreciate your encouraging feedback. In this monthâ&#x20AC;&#x2122;s article, my goal is to provide you with some valuable information that I have learned over the years that has helped me in connecting and communicating more effectively with more people than I thought possible. I teach these principles in my seminars and to my clients. Even though we are only going to be able to scratch the surface of this topic, this article contains some practical â&#x20AC;&#x153;nuggetsâ&#x20AC;? of information that, if implemented, will greatly help you improve your ability to communicate and lead a larger and more

diverse group of people more effectively. Please keep in mind that the focus of this article is â&#x20AC;&#x153;leadership development,â&#x20AC;? yet the principles I share are universally applicable to every relationship, whether it be personal or professional. In addition, because the topic of communication has some intricacies and complexities about it, I will break it into two parts (part two will follow next month). When you think about it, we were all born with an amazing ability to communicate, and to do so rather effectively, albeit in a very basic manner. Our ability to communicate was there with our very first breath. If you doubt me, just ask any sleepdeprived parent of a newborn if their baby is able to communicate or not. Babies have no problem communicating when they are hungry or if they need their diaper changed. They start â&#x20AC;&#x153;communicatingâ&#x20AC;? by acting fussy and agitated. If someone does not respond quickly, they begin to throw a fit and scream their lungs out. Everyone around hears it, regardless of the hour of


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day. This may not be the most advanced form of communication, but it is certainly effective and gets results quickly. In theory, we all grow up and learn more advanced forms of communication. However, as some loan processors and underwriters might attest, there are more than a few loan originators (LOs) who have failed to advance beyond this most basic form of communication â&#x20AC;Ś that of being fussy and throwing a fit (sorry, I couldnâ&#x20AC;&#x2122;t resist the opportunity.) Regrettably, some managers use this same style of communication. If the staff doesnâ&#x20AC;&#x2122;t do what the manager wants when they want or in a manner they want, they get bent out of shape and eventually throw a fit. This has more to do with manipulation than management, even though it can have the illusion of getting results. I like how Ken Blanchard defines this â&#x20AC;&#x153;managementâ&#x20AC;? style in his book, The One Minute Manager. He calls it, and I am paraphrasing here, a â&#x20AC;&#x153;seagullâ&#x20AC;? management/communication style. The manager flies in, craps on everybody, and then flies out. It would be funny if it werenâ&#x20AC;&#x2122;t so true and fairly common. Even though the definition of communication (the exchange of information) is simple enough, the topic itself is about as complicated as any on the planet, primarily because we are complicated. In addition to the numerous forms of communication available to us today, consider all of the new methods of communication available to us and how rapidly new methods are emergingâ&#x20AC;&#x201D;texting and social media being some of the more recent methods. Yet, the principles of effective communication across all channels have remained the same since the beginning of time. It all boils down to how well we relate to each other. An interesting side note â&#x20AC;Ś texting is fast-becoming the preferred choice of electronic communication, even in the profes-

sional world, it is supplanting e-mailâ&#x20AC;&#x201D; especially when we need to know if someone received time-sensitive information. The reason is that we have immediate confirmation if someone received a text message. In the case of an e-mail, we donâ&#x20AC;&#x2122;t have that same level of certainty. Therefore, with all of the new and varied methods of communication available to us today, would you say we are doing a better or worse job as a society at communicating with each other? Recent studies indicate that we are doing worse â&#x20AC;Ś MUCH worse in fact! Is it for a lack of exchange of information? No, in fact, while technology is a wonderful enabler to accessing information about each other (Facebook, LinkedIn, etc.), it is not helping us to genuinely â&#x20AC;&#x153;relateâ&#x20AC;? or â&#x20AC;&#x153;connectâ&#x20AC;? with each other. This is profound in its significance. We see evidence of it all the time all around, and it isnâ&#x20AC;&#x2122;t just with our teenagers. Look around the next time you are with a group of your peers. You will see people sitting together, each with their face in a screen (iPhone, iPad or equivalent). We are not talking with each other as we used to, and therefore, are â&#x20AC;&#x153;relatingâ&#x20AC;? to each other like the â&#x20AC;&#x153;good olâ&#x20AC;&#x2122; days.â&#x20AC;? Technology and these new devices are here to stay, but we must go beyond the technology and learn to relate to each other again. Please consider this fact: Our ability to relate to each other is the single biggest predictor of how effective we will be in our efforts to communicate with one another and LEAD. Consider the marriage relationship for a moment. How many marriages do you know that have failed and ended up in divorce because the two parties involved came to the realization that they no longer â&#x20AC;&#x153;relatedâ&#x20AC;? to each other. How is it that two continued on page 42

news flash

continued from page 23

rights to purchase the property for the lower value, and are foreclosing and seeking to evict an heir who is attempting to pay off the current fair market price on an underwater home.

Genworth Study Finds Mortgages With MI Found Less Likely to Default

HOPE NOW Reports: Loan Mods on the Rise as Foreclosures Drop in July HOPE NOW has released its July 2011 data, showing an increase in proprietary loan modifications for the month, as well as decreases in both foreclosure

continued on page 43

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G e n w o r t h Financial Inc. has made available the results of an independent study conducted by Promontory Financial Group which found that, among loans originated prior to the collapse of the housing bubble, low downpayment mortgages with mortgage insurance (MI) were significantly less likely to default during and after the housing crisis than uninsured low downpayment loans with a “piggyback” second mortgage. The Promontory study, of nearly 5.7 million mortgages originated between 2003-2007, found that the cumulative default rate over six years for uninsured low downpayment loans with piggyback second mortgages was nearly 21 percent greater than for comparable loans with mortgage insurance. First mortgages with a simultaneous or piggyback second mortgage were the most prevalent alternative to the use of MI over the past decade. Genworth requested the study to address the question raised by federal regulators responsible for defining the Qualified Residential Mortgage (QRM), as required by the Dodd-Frank Act, of whether MI contributes to a lower frequency of mortgage default. Promontory maintained full control over the research and conclusions in developing and conducting the study for Genworth. “The Promontory study shows that mortgage insurance reduces the frequency of mortgage default, without exposing investors or the broader housing market to undue risk,” said James R. Bennison, CFA, senior vice president, U.S. mortgage insurance strategy and capital markets for Genworth. “Regulators should include loans with private mortgage insurance as an acceptable exemption to risk retention requirements under QRM, so this reliable private sector source of capital can continue to support the nation’s housing recovery through responsible lending to creditworthy borrowers.” Promontory’s analysis simultaneously controlled for a variety of borrower and economic characteristics that might affect default rates, including loan type, unemployment levels, interest rates, and home price and equity fluctuations. The study reviewed thirdparty data from the CoreLogic Servicing database. “Our analysis supports the assertion

sales and starts since June. Permanent proprietary loan modifications for the July 2011 were approximately 56,000, representing an 11 percent increase over the 50,000 estimated totals for June. Since HOPE NOW began reporting data in 2007, the mortgage industry has completed nearly 4.8 million loan modifications for homeowners, including more than four million proprietary loan mods and 763,071 completed under the Home Affordable Modification Program (HAMP). Completed foreclosure sales for July 2011 dropped 11 percent from June (65,000 compared to 73,000). Foreclosure starts also declined by nearly five percent for the month (185,000 compared to 194,000). According to HOPE NOW, the inventory of 60-day-plus delinquencies was 2.81 million for the month of July, up slightly from the 2.75 million reported for June, an increase of two percent. “We are happy to see an increase in permanent proprietary loan modifications for the month of July. More encouraging is the significant drop in foreclosure sales and starts, which is directly related to the extraordinary amount of work that is being done to educate at-risk homeowners about their options,” said Faith Schwartz, executive director of HOPE NOW. 

becomes due and payable, either because of the death of the borrower or for some other reason. The representative plaintiff is Robert Chandler of Elk Grove, Calif., whose mother, Rosemary, died in 2010, five years after obtaining a reverse mortgage. Like many other heirs, Chandler was never given notice of his right to purchase the property for its current value. When Chandler expressed an interest in purchasing the property at that price, Wells Fargo told him that he would have to pay off the full mortgage balance. This is contrary to the explicit terms of the contract his mother signed with Wells Fargo and federal reverse mortgage law. Wells Fargo, acting on behalf of the owner of the mortgage, Fannie Mae, then proceeded to foreclose on the Chandler home. Finding no one willing to buy it for the same market price that Chandler was willing to pay, Fannie Mae then began efforts to evict him from the property, which his family has owned since the 1940s. Congress designed the Home Equity Conversion Mortgage (HECM) program with the explicit goals of helping seniors to access the equity in their homes, without facing a threat of losing them. A key part of the program is an insurance fund that every reverse mortgage borrower pays into, which ensures that their survivors can purchase the property at the current market value, should real estate prices fall. The class action seeks to ensure that any heir of a reverse mortgage borrower who wants to purchase their family home, as Chandler does, will be able to do so. “Mr. Chandler’s case is not an isolated one,” said Jean ConstantineDavis, a senior attorney with AARP Foundation Litigation. “In the wake of HUD’s reversal of its rule on the rights of surviving spouses and heirs earlier this year, we have been contacted by many, many others facing the same problem. It is difficult to understand why reverse mortgage lenders continue to deny them their contractual and legal rights.” In March, AARP Foundation Litigation and Mehri & Skalet filed suit in federal court alleging that the U.S. Department of Housing & Urban Development (HUD) had abandoned long-established federal rules that guaranteed that an heir or surviving spouse would never owe more than the home was worth at the time of repayment. One month after the AARP suit was filed, HUD reversed itself, and reinstituted the HUD policy to the fairer practice of not requiring payment that exceeded the updated value of the home. The new suit alleges that, despite HUD’s correction of its rules, the defendants are still failing to give notice to surviving spouses and heirs of their

that, historically, loans with mortgage insurance have been associated with lower rates of delinquency or default when compared to noninsured first mortgage loans with a piggyback second mortgage,” said Eugene A. Ludwig, founder and chief executive officer of Promontory Financial Group. Other factors the study took into account included borrower’s credit scores, combined loan-to-value ratio, loan purpose and documentation level. The study showed that, for each variable, low downpayment loans with MI had significantly lower delinquency rates than uninsured piggyback loans. For purposes of the study, “low downpayment loans” were defined as those with combined loan-to-value ratios of more than 80 percent, and “insured mortgages” referred to loans with either private MI or federal forms of MI, such as loans backed by the Federal Housing Administration (FHA).

lykken on leadership

continued from page 40

people that supposedly loved and related so well to each other that they committed to spend the rest of their lives together in what has to be the most intimate of all relationships, wake up one morning and say they now no longer want to be together? An “autopsy” of any failed marriage yields some interesting revelations as to why relationships fail. The cornerstone in the foundation of every relationship is our ability to “relate” to each other. Whether we are talking about a marriage of two (as in matrimony) or the “marriage” of a group of people working together (as in a company), the degree to which those interacting parties relate with each other is to the same degree to which those parties will succeed or fail at whatever they collectively set out to do together. Therefore, it comes down to the answer to the million-dollar question: “How can we relate more effectively with each other?” So let’s bring this discussion a bit closer to home. Let’s talk about YOU and YOUR communication style.

A Melancholic person is a someone who is a more self-less, kind, tender hearted, quieter, sensitive, takes on causes of others and more concerned about right & wrong.

A Sanguine person is generally light-hearted, fun-loving, a people person, loves to entertain, spontaneous, confident and can be more selfish. They can lack focus and be impulsive.




First of all, do you know what your personality type is? Take a moment and study the diagram below. Which of the four personality types are you most like … the Social Worker (melancholic) type, the Cheerleader (sanguine) type, the Accountant-Engineer (phlegmatic) type or the Army General (choleric) type? It is important that you accurately understand and know who you are so you can better relate to others. How well we relate and communicate with each other has as much to do with our personality types as anything, and therefore, it is essential that we would do well to incorporate a thorough understanding of these four personality types in our day-today communication. As a way of driving this point home, I will use myself in contrast to my two business partners as examples. I am definitely an outgoing sanguine (blue) personality type. The description of the sanguine person describes me to a “T.” I have a tendency to “think (process) out loud,“ involving

others in my thoughts. Therefore, I find myself using a few more words to communicate my ideas, than some would like. I have two business partners, Chuck Klein and Andy Schell. Chuck is definitely a choleric (red) personality type who typically “thinks before he speaks” and uses far less words to communicate his thoughts than I do. I know there are times where Chuck wishes that I could “get to the point” faster, but at the same time he has learned to understand, appreciate and even value my sanguine nature. By me processing my thoughts out loud, he gets a perspective he may not have considered. Another benefit is that he never has to wonder where I am at which appeals to his choleric “in-control” nature. Nonetheless, I have made adjustments to more effectively “relate” to Chuck’s nature. Then, there is my other business partner, Andy, who has more of phlegmatic personality (green) type. Interestingly, he is a CPA. While Andy might agree with Chuck about “getting to the point,” my phlegmatic business partner Andy would prefer me simply getting to the facts and figures and explain the return-on-investment (ROI) of whatever we are talking about. There are times when I can see strain come

A Phlegmatic person thinks things through, is calm, unemotional, consistent/even temperment, rational, curious, and observant, making them good administrators and diplomats.

A Choleric is a goaloriented, ambitious, very self-confident in what he believes the facts to be, wants info in bullets “short & to the point”, can be a control freak... has a very dominate personality.

across Andy’s face if my sanguine expressive nature is taking too long to get to the point. You see, us sanguine types are more interested in communicating in a colorful and enthusiastic way how we feel about something, rather than simply providing the “boring” facts and figures. Having worked together as business partners now over the past five years, we have learned to make adjustments as it relates to our personality types. We have come together as a cohesive and effective team that has a balance of perspectives. To the degree that you become familiar with other personality types is to the same degree to which you have a better chance of relating to a greater number of people. Whether someone is introverted or extraverted, fun-loving or more serious, intuitive versus logical, or motivated to take action by how they “feel” about something, all plays into how you need to respond. If you don’t know who you are, you will become very confused. However, when you have solidly established who you are, then and only then, can you truly make adjustments to connect and relate with more people. The hardest people to relate to are those who are confused about exactly who they are. What is interesting is that some people project themselves to have one personality type publicly when that doesn’t represent who they are in reality. That is why we recommend a higher end personality assessment tool such as the Birkman Method, something that will be discussed in more detail in next month’s article. But most have a reasonable sense of who they are, and I am excited to begin to teach you specific skills on how to make adjustments on how you communicate so can relate more effectively to a greater number of people. Also, it will make you a more effective leader. And for LOs, these skills can have a positive impact on attracting more business and more loans. So, your homework between now and next month’s article is to study these four personality types and become thoroughly familiar with them. Then, you will be prepared for next month’s article, the second installment in this series on communication. David Lykken is president of mortgage strategies and managing partner with Mortgage Banking Solutions. He has more than 35 years of industry experience and has garnered a national reputation, and has become a frequent guest on FOX Business News with Neil Cavuto, Stuart Varney, Liz Claman and Dave Asman with additional guest appearances on the CBS Evening News, Bloomberg TV and radio. He may be reached by phone at (512) 9779900, ext. 10, or e-mail or

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

news flash

continued from page 41

“Loan modifications continue at a steady rate, and in cases where that option is not possible mortgage servicers and housing counselors have the ability to offer a wide range of other solutions.” There were an estimated 605,000 total permanent loan modifications for homeowners in July, 422,000 were proprietary loan mods, and 183,421 were completed under HAMP.

Federal Housing Agencies Seeking Input on Selling Off GSE-Owned REOs

National Mortgage Professional Magazine invites you to submit any information on regulatory changes, legislative updates, human interest stories or any other newsworthy items pertaining to the mortgage industry to the attention of:

Why It’s Easy to Trap Real Estate Agents with ShortSaleSpeedway™? Many real estate agents shy away from short sales because of the complexity involved in doing it themselves. When they refer the work to an attorney or third party negotiator, they risk losing a great chunk of their commission. ShortSaleSpeedway™ automates the short sale process, by creating all of the documents a real estate agents needs to create the superior short sale proposal exactly how banks want to see them.

How Can ShortSaleSpeedway™ Help YOU Trap Real Estate Agents? Your company can have your very own, private labeled version of ShortSaleSpeedway™ that you offer at no cost to your real estate agents. They will now have the tools provided by your company to be a true short sales specialist. Now they can negotiate short sales with ease and not have to give away their commission to someone else. You’re providing them with a tool that puts more money in their pocket.

What Do We Provide You? When you have your own ShortSaleSpeedway™, we provide you with the following: I Your own customized private labeled ShortSaleSpeedway™ site I Access to reporting on all borrowers being put into the system I Training for you, your real estate agents and a dedicated support team I Marketing materials to promote your ShortSaleSpeedway™ to real estate agents In many cases, the setup for the private labeled site cost you nothing!

NMP News Flash column Phone #: (516) 409-5555 E-mail:

For a free demo, contact Erik Wind, at (800) 262-3783, ext. 701 or visit


Note: Submissions sent via e-mail are preferred. The deadline for submissions is the 1st of the month prior to the target issue.


Your turn


The Federal H o u s i n g Finance Agency (FHFA), in consultation with the U.S. Department of the Treasury and the U.S. Department of Housing & Urban Development (HUD), has announced a Request for Information (RFI), seeking input on new options for selling single-family real estate-owned (REO) properties held by Fannie Mae, Freddie Mac and the Federal Housing Administration (FHA). The RFI’s objective is to help address current and future REO inventory. It will explore alternatives for maximizing value to taxpayers and increasing private investment in the housing market, including approaches that support rental and affordable housing needs. “While the enterprises [Fannie Mae and Freddie Mac] will continue to market individual REO properties for sale, FHFA and the Enterprises seek input on possible pooling of REO properties in situations where such pooling, combined with private management, may reduce enterprise credit losses and help stabilize neighborhoods and home values,” said FHFA Acting Director Edward J. DeMarco. “Partnerships involving enterprise properties may reduce taxpayer losses and meet the enterprises’ responsibility to bring stability and liquidity to housing markets. We seek input on these important questions.” The RFI calls for approaches that achieve the following objectives:  Reduce the REO portfolios of the enterprises and FHA in a costeffective manner;  Reduce average loan loss severities to the enterprises and FHA relative to individual distressed property sales;  Address property repair and rehabilitation needs;  Respond to economic and real estate conditions in specific geographies;  Assist in neighborhood and home price stabilization efforts; and  Suggest analytic approaches to determine the appropriate dispo-

sition strategy for individual properties, whether sale, rental, or, in certain instances, demolition. “As we continue moving forward on housing finance reform, it’s critical that we support the process of repair and recovery in the housing market,” said Treasury Secretary Tim Geithner. “Exploring new options for selling these foreclosed properties will help expand access to affordable rental housing, promote private investment in local housing markets, and support neighborhood and home price stability.” FHFA, the Treasury and HUD anticipate respondents may best address these objectives through REO to rental structures, but respondents are encouraged to propose strategies they believe best accomplish the RFI’s objectives. Proposed strategies, transactions, and venture structures may also include:  Programs for previous homeowners to rent properties or for current renters to become owners (lease-to-own);  Strategies through which REO assets could be used to support markets with a strong demand for rental units and a substantial volume of REO;  A mechanism for private owners of REO inventory to eventually participate in the transactions; and  Support for affordable housing. “Millions of families nationwide have seen their home values impacted as their neighbors’ homes fall into foreclosure or become abandoned,” said HUD Secretary Shaun Donovan. “At the same time, with half of all renters spending more than a third of their income on housing and a quarter spending more than half, we have to find and promote new ways to alleviate the strain on the affordable rental market. Taking steps to encourage private investment in REO properties and transition them into productive use will help stabilize neighborhoods and home values at a critical time for our economy.”

Accounting and Audit

Branch Manager

Branch Manager

Flagship Mortgage Corporation ........1-800-492-5239 Multi-State mortgage bank has management opportunities available for experienced, successful & ethical professionals. Click/Email:

Mark Wilson Certified Public Accountants 9455 Ridgehaven Ct, Suite 101 • San Diego, CA 92123 619-649-0712 A full service CPA firm specializing in the needs of the mortgage industry. Providing monthly bookkeeping services,FHA and financial statement audits , corporate tax preparation and contract CFO services. Contact us today to learn more.

iServe Residential Lending 415-298-2500 Freedom Mortgage Corporation 800.220.9498

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

Freedom Mortgage Corporation, The BEST Branch Solution, Period.

Appraisal Management Company

HVCC Appraisal Ordering National Appraisal Management Center Please call 866-396-6260


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

Guaranteed Home Mortgage Company, Inc. 108 Corporate Park Drive, Ste 301 White Plains, NY 10604 888-329-GHMC • Find out what Guaranteed can do for you. Branch Program for Professionals. It's what we do.

Mortgage Brokers Network Corp, Inc. 1-888-589-7048 http://mortgagebrokersnetwork • Mortgage Branch Employment Opportunities • We work with some of the top mortgage branch companies in the industry! • With hundreds of branch employment opportunities out there, making a choice on who to sign up with is not an easy task! We are here to help! • Hiring Licensed Mortgage Originators for branch management and loan origination. • Bank and Broker status to choose from, multi-State lending and more... Visit our site or call us today to speak to one of our representatives.

Appraisal Management Company

Hometown Lenders (888) 606-8066




United Northern Mortgage Bankers......888-600-8808 Limited room available for established Team Leaders and Licensed Mortgage Originators. Become part of an established 30-year Mortgage Banker with a proven track record and success.

NO File Fee or Monthly Fees

StreetLinks Lender Solutions (800) 778-4920 StreetLinks Lender Solutions provides an innovative and comprehensive suite of valuation services and lending technology solutions used by lenders and appraisers nationwide to improve everyday business operations.

• Get a BPS payback from our volume incentive that your loan officers can’t see • You have the ability to control your loan officers pricing • Create, Customize and Optimize your branch’s compensation plan • Recruiting Support – Our network of recruiters place producers in your branch! • Full Eagle Lender and we’re currently looking for high-quality Producers in TX, GA, AL, TN, FL, MS, and SC

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

StreetLinks industry-leading products include LenderPlus™ full-service appraisal management, LenderX™ lender-executed appraisal management software, BPOs, SCORe™ appraisal validation reviews and more. Our commitment to quality and service, embodied by our partnership approach to clients and appraisers, continues to set us apart as the nation’s premier lending solutions partner. For more information, visit

Inlanta Mortgage W229 N1433 Westwood Drive, Suite 103 Waukesha, WI 53186 • 262-513-9853

Church Financing

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

Does Advertising in the Resource Registry Work? It just did!

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

CONCORD CHURCH FINANCE NATIONWIDE FINANCING FOR CHURCHES Pre-qualify Online @ 800-926-0399 • Fax: 858-756-8108 • Church Purchase & Construction • $100,000 to $2,500,00 • Church Refinance & Cash Out • Churches all 50 states • 75% of Appraised Value • 20 Yr. Fixed Rate

Contact Management/CRM

LoyaltyExpress 877.938.1175 LoyaltyExpress, the leading mortgage marketing company in the nation, delivers high-impact marketing that substantially increases production levels. Direct mail, e-mail, and intelligent alerts are combined to deliver unprecedented results. Learn more today.

Continuing Education

DocVelocity (877) 362-8356 DocVelocity is an end-to-end paperless solution designed to simplify the loan origination experience. Imagine having all your documents in the loan process as electronic files, all online, from pre-approval to closing. DocVelocity provides: Fast and easy loan delivery to any lender … Automatic doc sorting, naming and filing … Real-time online document sharing for anyone you choose … Friendly and intuitive user interface … No start-up fees, and free training and support. DocVelocity addresses important compliance issues while giving your office the competitive advantage of being paperless. It streamlines all aspects of the mortgage process and most important, it does so in one easy-touse and inexpensive package. DocVelocity is the flagship product of Paperless Office Solutions, Inc., a wholly owned subsidiary of Flagstar Bancorp. Visit to find out more.

Abacus Mortgage Training and Education PO Box 780 Summerfield, NC 27358 888-341-7767 • NMLS approved 20 hour Prelicensing Education NMLS approved Continuing Education Live Classroom Instruction, Web Delivery and Private Events The SAFE-Smart ExamCram, Powerfully Innovative Test Prep

MSS Learning Center (800) 963-1900 Email: Time is running out...are you ready?

Document Preparation •

646.210.2545 • 914.763.8008 “The Expo for Real Estate Professionals" For ongoing Networking Events throughout the year please visit

FHA Audit and Licensing

Bonnie Nachamie & Jonathan Pinard have assembled a team of experts to assist Mortgage Brokers, Mortgage Bankers, Federal and State Chartered Banks & Credit Unions with their mortgage compliance needs.


Mortgage Banking Systems - ProClose 1360 Beverly Rd. Ste 200, McLean, VA 22101 800-783-2283 · ProClose provides compliant closing documents and software for Residential Mortgage Lending. Created with closers in mind, we help make a lender’s staff more efficient and supported.

45 LenderCity Home Loans 888.880.2489

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

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

NYC Real Estate Expo LLC Anthony Kazazis - Director

First National Compliance Solutions Inc. 1-800-400-4134

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

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


Doc Management

Robertson | Anschutz 800-343-7160

• Growing with a recognized brand • Local and National marketing and advertising • Online search engine marketing • More aggressive lender pricing based on volume incentives • A proven system that generates more revenue than average broker shops • Ability to retain your license, existing corporation, and autonomy • Lead generation

Direct Mail

• Processing and closing services also available

Document Preparation (SaaS) Best Rate Referrals ............................................800-811-1402

Hard Money/Private Lending Docs on Demand 800-343-7160 Your Complete Mortgage Marketing Solution. Call Us Today! (800) 922-9860

Mortgage Loan Closing Document Preparation & Compliance Software Loan Documents and Compliance – Web-based/SaaS – Easy to Use Intuitive – Secure and Reliable – Integrates with Leading LOS Free Setup and Support – Extensive Compliance Audits

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

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

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

Windvest Corporation ............................877-285-0777 Specializing in rehab loans for property investors in So. CA. Up to 60% ARV, 12.99% fixed rate, 3.5-5 points, 1 yr. term. Fast & professional service since '94! Visit!


Call 888-409-9770 ext 4, to register your company.

ACC Mortgage, Inc. 932 Hungerford Drive #6 • Rockville, MD 20850 240-314-0399 • 240-314-0336 fax


Mortgage marketing company with decades of combined experience providing quality leads, mailers, lists and dialer products. & 

Mortgage Loan Closing Document Preparation & Compliance Services Fulfillment Services Including Pre-Funding Review & Post-Closing Interfaces with Leading Loan Origination Software Systems Foreclosure – Loss Mitigation Services

LenderCity Home Loans is now offering individual franchises. This is perfect for the L.O. who has always wanted to open their own brokerage but didn't know how. Benefits include:

Income Verification Services Advanced Data (800) 537 - 0458 Advanced Data is a leading national provider of data services, streamlining income and employment verification with proprietary software. Clients can submit 4506-T directly through Encompass360. Also ask about our AVM and flood services!



SM • 877-390-4750 is the largest online directory for mortgage professionals and a favorite of consumers shopping for mortgage loans.

Comergence Compliance Monitoring, LLC 630 The City Drive South, Suite 205 • Orange, CA 92868 Office: 714-740-9000

Our network attract over one million visitors per month. Our paid lead program as well as our free lender directory will help you connect with targeted new consumer traffic from with high-intent consumers searching online for the right mortgage lender.

Comergence Compliance Monitoring is the mortgage industry’s only Complete broker desk management software and outsource solution for TPO management and monitoring. We can supplement lenders inhouse management and monitoring resources departments.

Loan Management Systems Income Verification Services Xetus ....................................................877-GO-XETUS Platinum Credit Services, Inc.................631-299-2084 Tax return vertification (4506 tax transcript done in less than 24 hours in most cases). Call Lorenzo Pugliano, President and CEO at 631-299-2084.

Loan Origination Systems 46

Retail Branch

XetusOne is a powerful, easy-to-use loan management system that streamlines loan processing. Our affordable SaaS applications are lenders #1 choice for origination, subordination & modification.


Polaris Home Funding Corp. 616-667-9000 #1 USDA RD lender in multiple states with strong FHA/VA/CONV product lines as well. Don't be held hostage by a captive branch arrangement. Bank it or broker it. Have a business name/identity you don't want to give up? We allow DBAs (subject to state rules).

AAA Refi Leads.....AAA Refi Leads.....AAA Refi Leads Learn how I went from failure to success by mailing cheap refi letters from home, closed 71 loans & made $248,954.62 last yr. I’ll show you exactly how I did it. Go to: www.Refi-Leads.NET

Calyx Software 800-362-2599



Calyx Software, the #1 provider of mortgage solutions is dedicated to offering reliable and affordable software that streamlines, integrates and optimizes the loan process. Find out how PointCentral can streamline your business and create compliant processes today.

Internet’s Leading Consumer Mortgage Marketplace Attracting over 8 million unique consumers every month • 561-630-1257

Mortgage Forms

Reach affluent and creditworthy consumers who are in-market and ready to transact. Bankrate is a consumer direct Web site, NOT a lead aggregator. Qualified leads for every sized budget, and pay only for performance. No set up fees! No contracts! No risk! • Reach self directed, highly qualified consumers that are actively searching for mortgage loans • Geo-targeting – reach the right consumers in the right markets • Our proprietary Advertiser Portal gives you complete control over your campaigns, budgets, and performance reports. • YOU determine your daily/weekly/monthly budget • Pay only for consumers who click on your listing • NO cancellation fees Try us risk-free! Call 561-630-1257 or visit for more details.

(800) LOANS-15 Are you a broker/owner or current branch manager looking to expand your business into Mortgage Banking with FHA capabilities? Then our PARTNER BRANCH ADVANTAGE© program is perfect for you. We are offering you all the benefits of partnering with an established lender while still enjoying your independence. US Mortgage Corporation is a nationwide FHA Direct Lender with a 16 year long reputation of excellence. Same Day Shipping (orders placed prior to 3pm et) 24/7 Secure e-Commerce Site Save 33-50% • • • •

HUD Settlement Cost Booklets CHARM Booklets Uniform Residential Loan Applications HUD Case Binders

YOUR SUCCESS IS OUR SUCCESS! For more information contact THOMAS R. SIRICO, Vice President of Business Development at (917) 923-1472 or email at We look forward to sharing our services with you!

Sign-on weekly at Loanbright 27902 Meadow Drive, Suite 375 Evergreen,CO 80439 866-391-2709 • Loanbright helps mortgage companies capture and close more business through its marketing and software tools. An INC. 500 awardee, Loanbright has helped thousands of companies since 1999 by providing them with well over 3 million qualified sales leads.



BankFinancial ..........................................800-894-6900 We have money to lend for apartments, $250M to $2MM, up to 75% LTV. We offer competitive rates, fees & terms. We’re committed to helping you and your clients close the deal. Call us.


Icon Residential Lenders (888) 247-4207

Flagstar Wholesale Lending (866) 945-9872 Flagstar Wholesale Lending, a division of Flagstar Bank, is one of the nation’s largest wholesale and correspondent mortgage lenders, providing the technology, products, service and support that independent mortgage brokers, correspondents, and bankers need in today’s mortgage arena. In the ever-changing environment of mortgage banking, Flagstar takes pride in accommodating the specific needs of each customer. At Flagstar, we understand that you need every available advantage to stay ahead of the competition. This is why we provide multiple technology options to meet your needs to register, lock, underwrite, close, fund and deliver your loans. Our wholesale website ( and the loan processing tool Loantrac provides our customers with the functionality that make it easier and faster to close loans, saving you time and money! Visit to learn more.

Icon Residential, a wholly owned subsidiary of Grand Bank N.A., is one of the nation’s leading Conforming, Jumbo, FHA and VA wholesale lenders. Our strength, success and longevity is derived from delivering customers service that exceeds our valued business partners expectations. With deep industry knowledge, financial stability and innovative technology we provide the solutions for our business partners to fund loans while avoiding risk. • • • • •

Direct Access to Underwriters Competitive Pricing Innovative Technology Paperless Solution Bank Funding

Terrace Mortgage 4010 W. Boyscout Blvd., Suite 550 Tampa, FL 33607 866-934-4631 • We offer competitive pricing and fast turn-times for FHA, VA, Conventional, and USDA programs without having a retail presence in the industry. We are a wholesale lender with 22 years of experience and believe in exceptional service.

Wholesale/Residential AMX/Land Home Financial ..................800-349-4172 AMX/Land Home Financial Services Wholesale Lending Division - Great Rates, Great Programs, Great Service. Offering financing options that work in today's market.

TMSfunding Wholesale Lending 326 W Main Street • Milford, Ct. 06460 888.371.2989 • WWW.TMSFUNDING.COM Your Partner in Success! • • • •

Paperless! Quick and Easy! Top Tier Account Executives Committed to Wholesale Operations that Earn Your Business

Now Wholesale Lending in:

• Arizona • California • Colorado

• Nevada • New Mexico • Oregon

• Texas • Utah • Washington

Veros Real Estate Solutions 2333 North Broadway, Suite 350 • Santa Ana, CA 92706 (866) 458-3767 • @verosres (Twitter)

CBC National Bank 3010 Royal Boulevard South, Ste. 230 Alpharetta, GA 30022 888-486-4304 CBC National Bank is one of the nation’s fastest growing wholesale lenders offering Conventional, FHA, VA, and USDA. The most important aspect of being a leader in today’s market is the ability to build and maintain a meaningful relationship with each customer. We understand that these meaningful relationships coupled with competitive pricing and efficient technology are the pillars of today’s lending environment. We are now hiring Account Executives in AL, TN, KY, VA, & MD.

Big Enough to MATTER…Small Enough to CARE

to register your company. Wholesale Reverse Mortgages

NATIONWIDE Equities Nationwide Equities Corporation 201-529-1401 For Licensed Mortgage Brokers in NY, NJ, CT, PA and FL No HUD Approval Required – Live Help Desk Will Provide Training at Our Office or Yours 48 Hour Underwriting - Get Paid Within 48 Hours of Funding

Bookmark this! Access these listings online at


Contact Stu Ehrlich in our HR department at for further details.

Call 888-409-9770 ext. 4


Veros Real Estate Solutions is a premier technology leader in the mortgage industry and proven leader in enterprise risk management and collateral valuation services. Veros combines the power of predictive technology and data analytics for advanced automated solutions.

The Resource Registry is a directory of lenders (wholesaler or retail that are recruiting), affiliated services and resources that is seen by more than 191,181 active Professionals.


88 Kearny Street, 3rd Floor San Francisco, CA 94108 Phone: (415) 632-5150 • Fax: (925) 226-1938

If your ad was here, you would be seen by 191,181 Mortgage Professionals looking for resources to help them in their business.

To submit your entry for inclusion in the National Mortgage Professional Calendar of Events, please e-mail the details of your event, along with contact information, to OCTOBER 2011

Monday-Wednesday, October 3-5 Mortgage Bankers Association of Pennsylvania (MBA of PA) 2011 Keystone Conference Wyndham Gettysburg Hotel 95 Presidential Circle • Gettysburg, Pa. For more information, call (888) 739-9991 or visit

Tuesday, October 4 Illinois Association of Mortgage Professionals 2011 Fall Conference Waterford Banquet Center 933 South Riverside Drive • Elmhurst, Ill. For more information, call (630) 916-7720 or visit

Sunday-Wednesday, October 9-12 Mortgage Bankers Association’s 98th Annual Convention & Expo The Hyatt Regency 151 East Wacker Drive Chicago, Ill. For more information, call (800) 793-6222 or visit




Friday, October 21 Kentucky Association of Mortgage Professionals 2011 Annual Convention & Trade Show Four Points Sheraton 1938 Stanton Way • Lexington, Ky. For more information, call (270) 929-2836 or visit

Do you manage a sales team? Call 866-360-6645 and find out just how effective and affordable an on-site training program can be for your entire sales team.

"Ron Vaimberg knows how to teach originators to be successful. His step-by-step approach makes it easy for anyone to take their business to a whole new level!" Julio De Cardenas Executive V.P. of United Northern Mortgage Bankers

"As a 20+ year veteran of the mortgage industry, I believe that you never stop learning, and Ron took my business to the next level. Ron keeps his fingers on the pulse of the market and is spot-on with his insights and strategies!" Scott St. John Executive V.P. of American Pacific Mortgage

Monday-Wednesday, October 24-26 National Reverse Mortgage Lenders Association 2011 Annual Meeting & Expo Renaissance Boston Waterfront Hotel 606 Congress Street • Boston For more information, call (202) 939-1784 or visit NOVEMBER 2011

Tuesday-Thursday, November 1-3 Third Annual Northeast Conference of Mortgage Brokers Presented by the New Jersey Association of Mortgage Brokers (NJAMB) and the Pennsylvania Association of Mortgage Brokers (PAMB) Trump Taj Mahal Casino Resort 1000 Boardwalk at Virginia Avenue Atlantic City, N.J. For more information, call (732) 596-1619 or visit

Wednesday, November 2 2011 Missouri Association of Mortgage Professionals Convention & Trade Show St. Charles Convention Center 1 Convention Center Plaza • St. Charles, Mo. For more information, call (314) 909-9747 or visit

Thursday-Friday, November 10-11 2011 Oregon Association of Mortgage Professionals Annual Convention Multnomah Athletic Club 1849 Southwest Salmon Street Portland, Ore. For more information, call (503) 670-8586 or visit

Thursday-Friday, November 10-11 2011 Eastern Mortgage Summit Education & Expo Charlotte Marriott City Center 100 West Trade Street • Charlotte, N.C. For more information, call (919) 783-0767 or visit DECEMBER 2011

Sunday-Tuesday, December 3-5 2011 NAMB/WEST Loan Originator Conference MGM Grand 3799 South Las Vegas Boulevard • Las Vegas For more information, call (303) 798-3664, ext. 15 or visit MARCH 2012

Sunday-Thursday, March 11-15 29th Annual Regional Conference of Mortgage Bankers Associations Trump Taj Mahal Casino Resort 1000 Boardwalk at Virginia Avenue Atlantic City, N.J. For more information, call (732) 596-1619 or visit

Thursday, March 29 Maryland Association of Mortgage Professionals 2011 March Mortgage Madness Convention Martin’s Crosswinds 7400 Greenway Center Drive • Greenbelt, Md. For information, call (410) 752-6262, or visit MAY 2012

Friday-Wednesday, May 18-23 2012 Mortgage Bankers Association of Georgia Education Forum & Expo Sandestin Hilton Golf Resort & Spa 4000 South Sandestin Boulevard Destin, Fla. For more information, call (478) 743-8612 or visit

Nationwid e FHA Lend er Looking fo r: TO P P R O D U CER


Call for De tails!

T h e B E ST B r a n c h S o l u t i o n , P e r i o d . 800.220.9498 This information is provided to assist business professionals and is not an advertisement extended to the consumer, as defined by Section 226.2 of Regulation Z. Freedom Mortgage corporate office is located at: 907 Pleasant Valley Ave. Suite 3, Mount Laurel, NJ 08054. Lender NMLS ID: 2767. Licensed by the NJ Department of Banking and Insurance, License #9100861. All Rights Reserved.