NMP MORTGAGE PROFESSIONAL OF TH
Pam Marron, Senior Loan Officer Bankers Mortgage of Pasco County
JANUARY 2014 n Indiana Mortgage Professional Magazine n
NationalMortgageProfessional.com
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ach month, National Mortgage Professional Magazine will focus on one of the industry’s top players in our “Mortgage Professional of the Month” feature. Our readers are encouraged to contact us at newsroom@nmpmediacorp.com to be considered for a future “Mortgage Professional of the Month” article. This month, we chat with Pam Marron, a 29-year mortgage veteran who has recently been embroiled in the troubling world of underwater mortgages and short sales. Her grassroots efforts, along with those of the National Consumer Reporting Association (NCRA) and the Consumer Financial Protection Bureau (CFPB), helped enact change at a government level in regards to short sale coding, working with both Florida Sen. Bill Nelson and Fannie Mae. How did you first get involved in the industry? I have loved this business from the beginning. Finance was something that was second-nature to me. Each day brings about new challenges and there is never a dull moment. How has the mortgage industry changed over the years? Now, we pay attention to detail that
BY ROBERT OTTONE
was missing in the early 2000s. Frankly, it has reverted back to the way it was 10 or so years ago. The industry seemed to be getting far too lax. How so? Guidelines allowed for sloppiness and lacked common sense sometimes. An 80/20 percent loan to value, in other words no skin in the game, with lousy credit? What were we thinking? What I found was that when the market heated up, houses were going so fast that often, consumers felt like they had no choice but to go the route of a riskier sub-prime mortgage due to the speed of closing. Many properties had multiple backup offers. Speed, rather than the best product, which might take longer to document, was preferred. Can you talk about the difficulties in weeding out that type of problem? Ironically, new regulations, courtesy of the Consumer Financial Protection Bureau (CFPB) were needed. I may catch some flak for saying that, but I think that the rules enacted by the CFPB were passed down because the industry was out of control. The CFPB’s oversight was definitely needed. We may not agree with all of the rules, but we have to learn to live with it, it’s doable, and safety nets have been put
back in place. Those who stay in the business will still be able to make a reasonable, good living, as we have in the past, with limits in place for lenders and consumers. With every regulation that comes about, there are always the unintended consequences. I think, as we work through the changes of the CFPB’s qualified mortgage (QM) rule, we will work through these unintended consequences. Are you prepared for the QM rule that was enacted as of Jan. 10th? All of us are holding our breath, but yes, as much as can be expected. We’ve had a year to prepare for it. I understand the apprehension. I have already been to one “what to expect” luncheon this week, and it would be a good idea for those in this industry to make this a priority to do now. Realizing we are all in the same boat and getting to the bottom of confusion now is incredibly important. Do you think the industry as a whole is going to be fine? Absolutely. There was a recent report that stated that four-fifths of the loans that are going through now will be able to get through, even in the wake of QM. There are already a whole bunch of private enterprise investors
looking at doing non-QM. And, quite a few of them are the same QM wholesalers. Product will be rational and realistic, with more attention paid to good credit and greater down payment. The sub-prime of the past, with blended first and seconds where no skin was in the game, with low credit scores, I believe, is gone. That is the face that I am seeing for new non-QM loans. When people don’t meet QM standards, investors will charge a slightly higher fee, and will see them as a worthy credit risk with skin in the game. Frankly, I’m relieved that QM is finally in place, we don’t have to wait anymore, and we can get on with business. You are literally the first person I’ve talked to in the industry that doesn’t seem panicky about new CFPB and QM legislation. Why is the industry having such an adverse reaction to change in this way? I don’t think that anyone is happy with change in their industry. And, those of us still in the business are working harder now, much due to problems we saw and felt helpless to do anything about. Now, it’s harder for all us. If you’re going to stay in this business, you need to adapt and evolve with the business.