O FEBRUARY 2012
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Mortgage PROFESSIONAL P E N N S Y LVA N I A
Your source for the latest on originations, settlement, and servicing
Pennsylvania Association of Mortgage Brokers 3800 Market Street O Camp Hill, PA 17011 Phone #: (717) 737-2117 O (888) 311-PAMB Web site: www.pamb.org
Paul Logan Jim Mahler Jr. Wayne Angelo Tom Constan Lou Cesare Rose Stancato John Anthony Michael D’Alonzo, CMC Jami Braafhart James Clarke George Hanzimanolis, CRMS Paul Krause Tony Piestrak Walter Scott Jr. Beth Stephans
STATE OFFICERS Phone # President (800) 295-1020 President-Elect (717) 299-6801, ext. 27 Vice President (717) 397-7500 Secretary (610) 690-7400, ext. 228 Treasurer (570) 824-7811 Immediate Past President (610) 430-6901 Board Member (717) 591-3278 Board Member (215) 657-9600 Board Member (717) 731-9700 Board Member (724) 453-0335 Board Member (570) 620-9561 Board Member (717) 269-4957 Board Member (570) 207-6334 Board Member (215) 669-3273 Board Member (610) 977-0662
Paul Krause Tony Piestrak Wayne Angelo Beth Stephans James Clarke
REGIONAL LEADERSHIP Central Chapter Governor (717) 269-4957 North East Governor (570) 207-6334 South Central Governor (717) 397-7500 South East Governor (610) 977-0662 Western Governor (724) 453-0335
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Jim Mahler Jr. Sandy Fisher John Anthony Wayne Angelo Paul Logan Michael D’Alonzo, CMC Paul Krause George Hanzimanolis, CRMS Walter Scott Jr. Jami Braafhart Lou Cesare John Anthony Larry Frank, CRMS
COMMITTEE CHAIRS By-Laws Committee (717) 299-6801, ext. 27 By-Laws/Ethics Committee (215) 852-5978 Communications Committee (717) 591-3278 Community Relations Committee (717) 397-7500 Conference Committee (800) 295-1020 Education Committee (215) 657-9600 Finance Committee (717) 269-4957 Legislative Committee (570) 620-9561 Membership Committee (215) 669-3273 Membership Committee (717) 731-9700 Nominating Committee (570) 824-7811 Past President’s Council (717) 591-3278 Past President’s Council (215) 510-9701
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PAMB OFFICE Administrative Assistant (717) 737-2117
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For information on all PAMB events, call (717) 737-2117 or visit PAMB.org.
r ne Lea
a of Florid s: L e: Out Bos m e h r c S e v Frau d erco o rtgag e Un d exas M T t s a E Major 203(k) Rehab Loan Program: Foreclosures Present Challenges, Opportunity NMLS an d St ate Testing fo r Mortgage Pr ofessionals
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PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
MARCH 2012 Sunday-Thursday, March 11-15 29th Annual Regional Conference of MBAs Trump Taj Mahal Casino Resort 1000 Boardwalk at Virginia Avenue Atlantic City, N.J.
The delinquency rate for mortgage loans on residential properties in Pennsylvania was 8.87 percent at the end of the fourth quarter of 2011, an increase of 28 basis points from the third quarter of 2011, according to the Mortgage Bankers Association (MBA). The delinquency rate excludes loans in the process of foreclosure. The percentage of loans in Pennsylvania on which foreclosure was started during the quarter fell nine basis points to 0.56 percent, while the percentage of loans in the foreclosure process at the end of the quarter rose one basis point to 3.39 percent. These rates are not seasonally adjusted. Mortgage delinquency rates normally increase from the third to the fourth quarter of the year due to a variety of seasonal factors, for example, holiday spending and heating bills. As noted in recent quarters, the percentage of loans in the foreclosure process is significantly affected by the foreclosure regime of the specific state. Overall, states with a judicial foreclosure system are seeing a buildup of loans in the foreclosure process, while most states with a non-judicial process are seeing declines. This is despite a relatively even distribution of increases in new foreclosures started across all states, judicial or non-judicial. The delinquency rate for prime adjustable-rate mortgages (ARMs) decreased 24 basis points to 10.56 percent and the rate for prime fixed rate mortgage loans increased 25 basis points to 4.84 percent. The delinquency rate for the sub-prime ARMs decreased 152 basis points to 28.47 percent, while the rate for sub-prime fixed rate loans decreased 19 basis points to 23.51 percent. The delinquency rates for FHA and VA loans were 13.24 percent and 8.1 percent, respectively—up 111 basis points for FHA loans and up 12 basis points for VA loans. The foreclosure starts rate for prime ARMs in Pennsylvania decreased 12 basis points to 0.94 percent, while the rate for prime fixed rate loans decreased seven basis points to 0.33 percent. The foreclosure starts rate for sub-prime ARMs decreased 35 basis points to 2.37 percent, while the rate for sub-prime fixed rate loans decreased 17 basis points to 1.62 percent. The percentage of prime ARMs in foreclosure increased one basis point to 6.2 percent and increased one basis point to 2.02 percent for prime fixed rate loans. The rate for sub-prime ARMs decreased 12 basis points to 20.02 percent, while the rate for sub-prime fixed rate loans increased seven basis points to 9.28 percent. The percentage of FHA loans in foreclosure increased 16 basis points to 2.66 percent. The percentage of VA loans in foreclosure increased 18 basis points to 2.55 percent. Among the 50 states and the District of Columbia, Pennsylvania ranked 15th in delinquencies and 44th in foreclosures started. Mississippi ranked first in delinquencies with a rate of 13.13 percent and Florida ranked first in foreclosure starts with a rate of 1.68 percent. On a national level, the delinquency rate for mortgage loans on one- to fourunit residential properties was 8.15 percent on a non-seasonally adjusted basis, down five basis points from 8.20 percent in the third quarter of 2011. The seasonally adjusted delinquency rate on residential properties was 7.58 percent in the third quarter, down 41 basis points from last quarter’s seasonally adjusted rate. The non-seasonally adjusted percentage of loans on which foreclosure was started during the quarter decreased nine basis points to 0.99 percent, while the non-seasonally adjusted percentage of loans in the foreclosure process at the end of the quarter decreased five basis points to 4.38 percent.
Pennsylvania Mortgage Delinquencies Rise in Latest Survey
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PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
O FEBRUARY 2012
29th Annual Regional Conference of MBAs Sunday-Thursday, March 11-15
Trump Taj Mahal Casino Resort • 1000 Boardwalk • Atlantic City, N.J.
Commercial Property Program Sunday, March 11 7:00 p.m.-9:00 p.m. ......Commercial Property Opening Networking Cocktail Reception
Monday, March 12
9:00 a.m.-10:30 a.m. ....Economic Overview of the Commercial Market I Marilyn L. Brown, President, Eleford & Company Inc.; Liaison, Mortgage Bankers Association of NY Inc.; Vice Chair, MBA of NY Scholarship Foundation Inc.
11:00 a.m.-Noon............Keynote Speakers I Mike J. Heid, President, Wells Fargo Home Mortgage; Executive Vice President, Wells Fargo & Company I David H. Stevens, President and Chief Executive Officer, Mortgage Bankers Association
10:45 a.m.-Noon............State of the Commercial Mortgage Market I Charles H. Kauffman Jr., CMB, President, C.H. Kauffman & Associates Inc.
12:15 p.m.-5:00 p.m. ....Exhibit Hall Open
Noon- 1:30 p.m. ............Lunch With an Economist
12:15 p.m.-1:45 p.m. ....Lunch in the Exhibit Hall
1:45 p.m.-3:00 p.m. ......Current Status and Update of the CMBS Market I Lawrence J. Longua, Clinical Associate Professor, Director-REIT Center; NYU Schack Institute of Real Estate I Richard L. Jarocki Jr., CMB AMP, Managing Director-Debt & Equity Finance Practice, Grubb & Ellis Company
1:15 p.m.-3:00 p.m. ......Panel II: Consumer Financial Protection Bureau (CFPB) This panel will discuss the CFPB regulations and enforcement, including CFPB regulations on examinations, investigations and hearings. The Dodd-Frank Act and the LO compensation rule will be analyzed, and a question and answer session will follow. I Jack Konyk, Executive Director of Government Affairs, Weiner Brodsky Sidman Kider PC I Ken Markison, Associate Vice President and Regulatory Counsel, Mortgage Bankers Association
6:00 p.m.-8:00 p.m. ......Commercial Property Networking Cocktail Reception
Tuesday, March 13 9:00 a.m.-10:30 a.m. ....Lenders Panel—$1M-$25M+ I Ronald M. Shapiro, Senior Vice President, Union Center National Bank
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
10:45 a.m.-Noon............Small Loan Program—$50T-$1M+ I Jim Leister, Apex Mortgage Corporation
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I Regina M. Lowrie, CMB, President and Chief Executive Officer, Vision Mortgage Capital LLC I Kevin D. Schneider, President and Chief Executive Officer, Mortgage InsuranceU.S., Genworth Financial I Michael L. Vitali Sr., Executive Vice President, TBI Mortgage Company
Noon-3:00 p.m...............Commercial Property Exhibit Hall With Lunch 7:00 p.m.-9:00 p.m. ......Commercial Property/Opening Residential Networking Cocktail Reception in the Exhibit Hall
3:15 p.m.-5:00 p.m...........Special State Regulators Panel and Roundtable Discussions This State and Federal Regulation and Enforcement Panel will discuss the MultiState Mortgage Committee and their examinations (Don DeBastiani is Chair of the Committee); the exam procedures and LO Comp enforcement as well as CSBS Exam guidelines for state regulators to determine compliance with the LO Comp Rule. 3:15 p.m.-4:30 p.m. ......Using Social Media to Enhance Your Profitability I Steve L. Richman, Genworth Financial 6:00 p.m.-8:00 p.m. ......Networking Cocktail Reception
Thursday, March 15
Tuesday, March 13
8:30 a.m.-9:30 a.m. ......Continental Breakfast
NMLS Education (Separate Registration Fee Required) 7:00 p.m.-9:00 p.m. ......Commercial Property/Opening Residential Networking Cocktail Reception in the Exhibit Hall
9:00 a.m.-10:30 a.m. ....Panel III: The Loan Originator Recruiting, training and hiring loan originators. What is a good LO and how do you motivate them? What are some of the characteristics of top producers? Call centers, targeted zip codes and other marketing techniques will be discussed. I Pat Sherlock, Owner/Founder, QFS Sales Solutions
Wednesday, March 14 7:30 a.m.-9:00 a.m. ......Continental Breakfast 8:30 a.m.-12:15 p.m. ....General Session 9:00 a.m.-11:00 a.m. ....Panel I: What Will the Industry Look Like in 2012 and Beyond? Panel I will discuss liquidity, risk retention and effects of QRM, ability-to-repay issues, QM, role of the GSE’s where will they be? FHA, Ginnie Mae, state regulation and enforcement, the role of the rating agencies, the role of mortgage insurance, secondary marketing issues, and the impact of HARP. A question and answer session will follow. I Garry A. Cipponeri, Director of Capital Markets, Chase Home Finance I Tim Dale, Executive Vice President, BB&T Corporation
10:45 a.m.-12:15 p.m. ..Panel IV: The Future of Housing Will the 30 year mortgage survive? What is left of the American Dream? This panel will discuss, among other things, the mortgage interest deduction, renting vs. purchasing and multi-family lending. 12:30 p.m.-2:00 p.m. ....Buffet Luncheon and Economic Panel Top economists provide their views on the marketplace and the issues critical to attendees. 2:15 p.m.-4:00 p.m. ......Panel V: Lender Roundtable Discussion Interaction with medium and small lenders—sit at roundtables with companies of your size in an open discussion concerning business development.
For more information, call (732) 596-1619 or visit MBANJ.com.
Att CBC C Nationall Bank k we: I Prioritize purchase u/w times by contingency or closing dates I Provide touch points throughout the process to ensure on time closings I Encourage direct access to all underwriters, internal processors, closers & your Account Executive I Order your appraisal online without submitting the credit package â€“ no delay I Offer diverse line: Conventional loans up to 97% LTV VA loans down to 640 Agency High Balance (100% LTV/105% CLTV) FHA loans down to 640 USDA loans
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE O FEBRUARY 2012
FEBRUARY 2012 O
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE O NationalMortgageProfessional.com
National Mortgage Professional Magazine
TABLE OF CONTENTS
Volume 4, Number 2
A Special Look at “It’s All About Marketing”
Best Rate Referrals, LLC .................................... www.bestratereferrals.com ..................................15
Marketing 101: It’s the Message That Makes the Difference! By David Lykken & Jon Traver ..............................34
Calyx Software ................................................ www.calyxsoftware.com ......................................37
Do You Have a Marketing Problem or a Branding Problem? By Patrick H. Seroka ........................................................35 “Don’t You Forget About Me” … Make Marketing Matter By BJ Bounds ......................................36
CBC National Bank .......................................... www.cbconnex.com ..................................PA5 & 17 Elliott and Company Appraisers, Inc................... www.appraisalanywhere.com ................................18 Equity Loans LLC .............................................. www.equityloans.com ............................................5 Freedom Mortgage .......................................... www.fmbranch.com ......................Inside Back Cover
Direct Mail Marketing Best Practices By Jim Blatt ............37
Frost Mortgage Lending Group .......................... www.frostmortgage.com/nmp ..............................40
Jumping Onto the Social Media Bandwagon and Reaping the Profits By Ray Eickhoff ....................................38
Hometown Lenders .......................................... www.hometownbranch.com ................................21
Finding Success for Your Brand in Social Media: By Chris Clothier ..................................................................39 The Relentless Pursuit of Perfection and the Ultimate Marketing Machine By Joy Beam-Burns ..............................41 Where Will You Enroll: New School or Old School Marketing? By Chris Nordby ................................................42
Icon Residential Lenders, LLC ............................ www.iconwholesale.com ..................10 & Back Cover Land Home Financial Services .......................... firstname.lastname@example.org ....................................37 Loyalty Express ................................................ www.loyaltyexpress.com ......................................43 MBA-NJ/NJAMB ................................................ www.mbanj.com ........................................PA6 & 28 Menlo Park Funding ........................................ www.menloparkfunding.com ................................41 Mortgage Brokers Network Corp, Inc. ................ www.mortgagebrokersnetwork.com ......................19
How Mortgage Brokers Find Customers in a Bad Economy By Justin Restaino ................................................43
NAMB.............................................................. www.namb.org/legconference ..............................33
PB Financial Group Corp. .................................. pbfinancialgrp.com ..............................................10
Make the Most of an Extra Day By Mary Beth Doyle ............4
Polaris Home Funding Corp. (Branches).............. www.polarishfc.com/TimeForAChange ....................9
Pursuing Excellence By Casey Cunningham ..........................4
Polaris Home Funding Corp. (Wholesale) ............ www.polarishfc.com ............................................25
The FHA 203(k) Loan: How to Help Clients Buy the House of Their Dreams By Ginger Bell ..........................8 The NAMB Perspective ..................................................12
Trigger Lead Complaints on the Rise By Terry W. Clemans ....16 For Managers Only By Dave Hershman................................18 Marketing HARP 2.0 By Raymond Bartreau ..........................20 The Elite Performer By Andy W. Harris, CRMS ......................20 Supply & Demand in the TPO Channel By Mark Greco ......22 Appraisal Quality Control is No Longer Optional for AMCs By Jennifer Frank..............................................................23 The Top Five Things to Know to Start Your Career as an LO By Leif Boyd ......................................................................27 The Foreclosure Landscape in 2012 By Christopher G. Brown ........................................................29 A Deeper Dive Into 2012’s Mortgage Industry Hiring Forecast By Drew Waterhouse ..................................30
Columns Heard on the Street..........................................................6 New to Market ................................................................32 NMP Mortgage Professional Resource Registry ..........44 NMP Calendar of Events ................................................48
Shortsale Speedway.......................................... www.shortsalespeedway.com/freedemo ................24 Streetlinks LLC ................................................ email@example.com ..................Inside Front Cover TMS Funding.................................................... www.tmsfunding.com ..........................................11 Veros Real Estate Solutions .............................. pmc2012.com ......................................................14
NMP News Flash: February 2012 ..................................19
REMN (Real Estate Mortgage Network)................ www.remnwholesale.com ............................PA3 & 7
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
USA Cares Mortgage Heroes By Beverly Frase ..................21
ValueNation: A Review of What to Expect in a Collateral Management Solution By David Rasmussen ........16
NAPMW .......................................................... www.napmw.org ..................................................6
February 2012 Volume 4 • Number 2
A Message From NMP Media Corp. Executive Vice President Andrew T. Berman It really is all about the marketing!
STAFF Eric C. Peck Editor-in-Chief (516) 409-5555, ext. 312 firstname.lastname@example.org Andrew T. Berman Executive Vice President (516) 409-5555, ext. 333 email@example.com Joey Arendt Art Director firstname.lastname@example.org Jon Blake Advertising Coordinator (516) 409-5555, ext. 301 email@example.com Kelsey Domino Executive Sales Assistant (516) 409-5555, ext. 316 firstname.lastname@example.org Tara Cook Billing Coordinator (516) 409-5555, ext. 324 email@example.com 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 firstname.lastname@example.org. 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 email@example.com. 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 firstname.lastname@example.org or visit www.nationalmortgageprofessional.com. 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. FE SSIONAL
National Mortgage Professional Magazine is published monthly by NMP Media Corp. Copyright © 2012 NMP Media Corp.
We are about a month away from the 2012 NAMB Legislative & Regulatory Conference, set for March 1820, 2012 in Washington, D.C. If the state primaries are firing you up for this election year, get a head start and join your peers on the frontlines as they walk the halls of Congress at the 2012 Legislative Conference, this March in D.C. In this month’s NAMB Perspective beginning on page 12, NAMB President Donald J. Frommeyer and Government Affairs Committee Chair John P. Hudson give an overview on what to expect in D.C. by breaking down the agenda. If you ever felt compelled to become involved in the political process, now is the time to band together for this unique opportunity to meet with your elected officials and educate them on the importance of your role to the American homebuying public.
That’s not all … We have assembled yet another great slate of contributors to educate and update you on the latest happenings in the industry in our February 2012 issue. Like our marketing experts, these contributors are the tops in their field and aim to share with you, their expert knowledge and thoughts on ways in which to improve your bottom line. From 203(k) loans, to collateral management solutions, to trends in mortgage industry employment in 2012 … this issue is jam-packed with ideas on how to take the resolutions you made just one month ago at the outset of 2012 to the next level. Until next month ...
Andrew T. Berman, Executive Vice President NMP Media Corp.
The political scene is heating up … jump aboard!
1220 Wantagh Avenue • Wantagh, NY 11793-2202 Phone: (516) 409-5555 / (888) 409-9770 Fax: (516) 409-4600 Web site: NationalMortgageProfessional.com
This issue happens to come out on the heels of one of America’s biggest non-holidays, the Super Bowl. Hype around this event spans nationwide, no matter if your city is sending a team to the game or not, but this year in particular, the New York Giants represented my home turf against the New England Patriots. Needless to say, you couldn’t turn to any media outlet in New York over the past two weeks and not have the New York Giants in your face in the top headlines. Each year, as the nation tunes in, the big-budget advertisers line up, cash in hand, to pay for their 30- to 60-sec. spots at an average of $3.5 million per 30-secs. of air time. The audience was there, as an estimated 111 million Americans tuned in, and the advertisers waged war, marketing their beer, cars, Web sites, summer blockbusters, etc. via spots featuring babies, scantily-clad women and cute animals. Was there ever actually a game played on the gridiron? Or, did that game serve as filler to the multitude of TV timeouts to accommodate these multi-million dollar commercial spots? Maybe this is a bad example because most of America’s TV sets were tuned into the big game, but what are you doing to get your message across to your target audience? Has your own marketing budget suffered? What tactics do you use to promote your goods and services? You may not have Chrysler’s money to hire Clint Eastwood for a big budget commercial, but this month, we take a look at proven tactics and tips used by today’s mortgage professionals to market to their audience. Kicking things off on page 34 is David Lykken and co-author Jon Traver of Mortgage Banking Solutions with their piece on the importance of the “message” in marketing. Does the message get lost in translation? Patrick H. Seroka of Seroka discusses the proper way in which to brand yourself on page 35 in his piece, “Do You Have a Marketing Problem or a Branding Problem?” On page 36, BJ Bounds of Calyx Software explains how it is important to target what is best for your client, not for you, in her article, “Don’t You Forget About Me.” In the age of all things digital, Jim Blatt of Mortgage Returns details a method that many have been abandoned in direct mail in order to yield positive results. Ray Eickhoff of Fairway Independent Mortgage, on page 38, explains how to utilize today’s social media outlets into your marketing campaigns. Chris Clothier of Memphis Invest stays on the subject of social media and networking beginning on page 39, as he analyzes social media personas to avoid in marketing to your social media contacts. We return to another piece on branding on page 41 as Joy Beam-Burns of CBC National Bank looks inside what it takes to create the optimal marketing machine. Chris Nordby of Protelus looks at old school marketing versus the new school and digital era of marketing in his piece, “Where Will You Enroll: New School or Old School Marketing?” on page 42. Things wrap up on page 43 with Justin Restaino of Titan List & Mailing Services Inc.’s piece on mortgage professionals marketing to the homebuying public in a down economy. When we put this section together, it was our intent to provide our readers with the tips and tools necessary to take their marketing abilities to the next level. Hopefully, our panel of experts will equip with the means and tips to do so.
The Association of Mortgage Professionals
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: www.namb.org
P.O. Box 451718 Garland, TX 75042 Phone #: (800) 827-3034 Fax #: (469) 524-5121 Web site: www.napmw.org
NAMB Board of Directors
National Board of Directors 2011-2012
OFFICERS President—Donald J. Frommeyer, CRMS Amtrust Mortgage Funding Inc. 200 Medical Drive, Suite D Carmel, IN 46032 (317) 575-4355 email@example.com Vice President—Donald Fader, CRMS SMC Home Finance P.O. Box 1376 Kinston, NC 28503-1376 (252) 523-5800 firstname.lastname@example.org Treasurer—John Councilman, CMC, CRMS AMC Mortgage Corporation 2613 Fallston Road Fallston, MD 21047 (410) 557-6400 email@example.com Secretary—Olga Kucerak, CRMS Crown Lending 222 East Houston, Suite 1600 San Antonio, TX 78205 (210) 828-3384 firstname.lastname@example.org Past President—Jim Pair, CMC Mortgage Associates Corpus Christi 6262 Weber Road, Suite 208 Corpus Christi, TX 78413 (361) 853-9987 email@example.com
Fred Arnold, CMC American Family Funding 24961 The Old Road, Suite 101 Stevenson Ranch, CA 91381 (661) 284-1150 firstname.lastname@example.org
Deb Killian, CRMS GMAC 246 Federal Road, Unit C-24 Brookfield, CT 06804 (203) 778-9999, ext. 103 email@example.com Linda McCoy Mortgage Team 1 Inc. 6336 Picadilly Square Drive Mobile, AL 36609 (251) 610-0494 firstname.lastname@example.org
President-Elect Candace Smith, CME (512) 329-9040 email@example.com
Vice President-Eastern Region Christine Pollard (607) 656-5005 firstname.lastname@example.org
Senior Vice President Jill Kinsman (206) 344-7827 email@example.com
Secretary Katheryn M. Farrell (509) 528-0349 firstname.lastname@example.org
Vice President-Northwestern Region Nita Cook, GML, CME, CMI (360) 705-5053 email@example.com
Treasurer Jeanne Evans, CME (918) 431-0155 firstname.lastname@example.org
Vice President-Western Region Lyman King III, CME, CMI (916) 967-4653 email@example.com
Parliamentarian Hulene Bridgman-Works (800) 827-3034 firstname.lastname@example.org
National Credit Reporting Association Inc. 125 East Lake Street, Suite 200 Bloomingdale, IL 60108 Phone #: (630) 539-1525 Fax #: (630) 539-1526 Web site: www.ncrainc.org
2012 Board of Directors & Staff Donald J. Unger President (303) 670-7993, ext. 222 email@example.com Daphne Large Vice President & Treasurer (901) 259-5105 firstname.lastname@example.org Tom Conwell Ex-Officio & Legislative Chair (800) 445-4922, ext. 1010 email@example.com Nancy Fedich Director–Conference Chair (908) 813-8555, ext. 3010 firstname.lastname@example.org Judy Ryan Director-Strategic Alliance Chair (800) 929-3400, ext. 201 jryan@Kroll.com
Mike Brown Director–Technology Chair (800) 925-6691, ext. 4350 email@example.com Maureen Devine Director–Education & Compliance Co-Chair (413) 736-4511 firstname.lastname@example.org Renee Erickson Director–New Membership & Elections Chair (800) 311-1585, ext. 2101 email@example.com Terry Clemans Executive Director (630) 539-1525 firstname.lastname@example.org Jan Gerber Office Manager/Membership Services (630) 539-1525 email@example.com
Susan Cataldo Director–Education & Compliance Chair (404) 303-8656, ext. 204 firstname.lastname@example.org
William Bower Director–Tenant Screening Chair (800) 288-4757 email@example.com
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
Kay A. Cleland, CMC, CRMS KC Mortgage LLC 200 South Wilcox Street #224 Castle Rock, CO 80104 (720) 810-4917 firstname.lastname@example.org
Vice President-Central Region Lisa Puckett, CME (405) 741-5485 email@example.com
Rocke Andrews, CMC, CRMS Lending Arizona LLC 1996 North Kolb Tucson, AZ 85715 (520) 886-7283 firstname.lastname@example.org
President Laurie Abshier, GML, CME, CMI (661) 283-1262 email@example.com
[NOTE: Develop “Pursuing Excellence” header artwork to be picked up monthly] Pursuing Excellence
Make The Most Of An Extra Day by Mary Beth Doyle, Founder What would you do with an extra day? Since 2012 is a Leap Year, it’s a great time to find out. Ambitious professionals look at 24 extra hours as an opportunity. Staying ahead of the competition is all about making the most of every minute. Why not utilize the extra time as an incentive to re-assess business development strategies? Start by calculating how effectively you currently engage customers, partners, and prospects. And if there is a way to do it better, make it happen. LoyaltyExpress is the #1 choice of the most demanding loan officers & executives across the nation. We provide comprehensive, high-impact marketing solutions that continuously capture new, repeat, and referral business. No other marketing platform delivers better results: 4
t Our proprietary technology empowers the automation of high-impact communications that engage & motivate recipients to take action. Intelligent data mining quickly identifies and promotes new opportunities.
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t Our extensive selection of targeted programs engages recipients through cross-media formats and channels. By combining high-quality direct mail, e-mail, and ondemand marketing pieces, wider audiences are continuously reached, resulting in a steady increase in closed loans. t Our solutions are easy to use. With a few clicks of the mouse, targeted marketing campaigns are sent that achieve exceptional ROI. There’s a reason that we continue to lead the industry with our methodologies and products. Bottom line, LoyaltyExpress is the company to call for serious business development impact. Take a few minutes to learn more about the benefits of working with us. It would be a pleasure to hear from you.
LoyaltyExpress is the leading mortgage marketing company in the nation. For more information: call 877.938.1175 or visit www.loyaltyexpress.com.
What Marketing is Meant to Be ... Effective By Casey Cunningham
As it relates to marketing, the question is simply this: How do the efforts you put forth with your sphere of influence make them feel? Does it stop them in their tracks? Does it create that “wow” factor you’re looking to achieve? Does it set you apart from your competition—the same competition that is also employing a number of different marketing techniques and gimmicks? As I pondered the focus for this short write-up, I was reminded of one of my favorite quotations that I feel is so very, very important to keep in mind in both business and in life: “People will forget what you said, people will forget what you did, but people will never forget how you made them feel.”—Maya Angelou If we are being completely honest with ourselves as salespeople, we all know that the majority of the marketing materials we receive in our own lives do not create the desired effect. Why then, when we are on the “sending end” of marketing materials, should we expect a different effect? There are a myriad of books, seminars, strategies and other newfangled approaches to the world of marketing. It is my opinion, however, that of all the available “noise” out there, two things need to be kept in mind when marketing yourself to your sphere of influence: Injection of Personality and Platinum Club. Why are YOU different? Why should these clients work with YOU? What “Twenty percent of the makes YOU the right choice? It is critical that you personalize your marketing individuals currently efforts. Inject your personality into the process. These days, clients can get their in your database yield loan virtually anywhere, including places like Costco. Now, more than ever, 80 percent of your it is imperative that you inject YOU into the process of marketing to these clients. referrals. They are the I know of one loan officer who has a penchant for classical music. For the past cream of the crop.” 10 years, he has been putting together an annual CD of his favorite classical pieces. Using limited computer knowledge, he was able to design a jewel case and select tracks to be burned to CDs from his personal collection of classical music. He has built an entire marketing strategy around his love of the works of Beethoven, Chopin, Rachmaninoff and the rest. He readily admits the recipients of this annual CD will not always listen to it, but he is convinced that it sets him apart from the other loan officers who drop off a desk calendar emblazoned with some random corporate logo. On the subject of personalization, there is another approach, and while more timeconsuming, that can be incredibly effective—inject the recipient’s personality into the marketing materials. Does your target have an English Bulldog? Is your target a huge Atlanta Hawks fan? Does your target coach Little League? Does your target ride horses? These are the questions that, when answered, can give you an incredibly unfair advantage as it relates to making an impact on your target audience. Most salespeople automatically discount the notion of personal marketing as being too expensive and unaffordable. This is simply is not true. Making an emotional connection does not cost money. I received a simple e-mail referencing my love for fly fishing (something on my LinkedIn profile) from a vendor trying to get an appointment. And yes, they got the appointment! In my 10 years in business with a sales training organization and being solicited daily by countless sales professionals, I have only been on the receiving end of personalized marketing a shocking one time. Because personal marketing is continued on page 18
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REMN Expands Into the New England Region
Why W hy NAP NAPMW? M MW? Three T hree Simple Reasons Reaso ons Education E d duccation Organized Or ganized ffor or the pur purpose pose of providing providing education education tto o pr professionoffe essionals in all phases off the mor mortgage industry, NAPMW offers educa-tgage industr y, NAP N MW off ers educa tion via man enues – seminars and w orkshops k ound the manyy vvenues workshops held ar around on-line,, and National Conference ccountry, ountry, on-line a at at its Na tional EEducation ducation C onference held May. each hM ay. 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 webinar FREE TO TO MEMBERSS monthly monthly w ebinar 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 1400309) P rovider # 140030 09) 6
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IIff 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 industryy w work industr ork force, force, then you you believe believe in NAPMW. NA APMW. NAPMW Butt sinc since women NAP MW is not a women’s women’s organization. organization. Bu ew omen make majority profesup the major ity off professionals professionals in the mortgage/banking morrtgage/banking pr ofession, our purpose business,, personal personal,, purpose is to to help them advance advance in business and leadership development. de evelopment.
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Real Estate Mortgage Network Inc. (REMN) has announced the opening of its newest retail location in Burlington, Vt. REMN’s new Burlington office will be overseen by Matt Hemphill, area manager, a New England native who joins the company with more than 20 years of industry experience. Hemphill will work alongside a team of local, seasoned mortgage industry professionals, each one a veteran of the New England real estate industry. New associates joining Hemphill in REMN’s Burlington office as loan originators include John Blouin, Lorene Butler, Barbara Holzel, Kim Negron, Elizabeth Porzucek, Henry Rackliff and Terryann Stein. They will be supported by Kelly Bellinger and Donna Bigger, experienced mortgage loan processors. “Vermont, along with the New England area in general, represents great opportunities for REMN,” said Doug Tarta, Northeast regional manager for REMN. “We’re well-known in the national real estate community for providing quality mortgages bundled with top-rate customer service and the same will hold true for this new office. Regardless of if someone is looking for a traditional mortgage, or something such as a 203(k) product for a fixerupper, the team in our Burlington office will be able to help them secure the loan they need with the customer service REMN is known for nationwide.” REMN employs more than 600 throughout offices in California, Colorado, Connecticut, Delaware, Florida, Georgia, Maryland, Missouri, New Jersey, New York, North Carolina, Pennsylvania, South Carolina and Tennessee. In 2011 alone, REMN closed more than $2.3 billion in home loans, solidifying its position as one of the largest independent non-bank lenders in the U.S.
PRMI Launches Enterprise Risk Management Group
Primary Residential Mortgage Inc. (PRMI) has announced the formation of a new Enterprise Risk Management
(ERM) group. The creation of new ERM group demonstrates the company’s commitment to manage risk through the entire loan origination process and ensures that the company has the appropriate monitoring and evaluation policies. “Over the last couple years, the mortgage industry has been under intense scrutiny,” said Dave Zitting, president and chief executive officer of PRMI. “While the larger banks all have ERM departments, it’s uncommon for a company of our size to have one but we wanted to take aggressive steps to demonstrate to our customers, partners and employees our commitment to providing a safe and compliant mortgage experience.” Twenty-five year mortgage banking industry veteran H. Burton Embry has been named senior vice president– Enterprise Risk Management and will be responsible for overseeing the compliance, licensing, quality control (QC), insuring, final docs and HMDA Departments for the company’s more than 190 nationwide offices and more than 850 mortgage loan originators. “In today’s mortgage environment, lenders must manage compliance and quality issues more closely than ever before,” said Embry. “By establishing this new group, we are implementing a solution that will sharpen our focus on complying with all mortgage banking laws and regulations, improve on our overall loan quality and help us to better manage risk across all areas of our company.” In addition to Burton’s promotion, Shelly Hill has been promoted to compliance director. Hill will be responsible for the day-to-day compliance activities of PRMI. Previously, Hill was PRMI’s state compliance manager, a position she’s held since April 2011.
Former Silver Hill SVP Mike Boggiano to Head SL Capital Mike Boggiano, former senior vice president and national sales manager of Silver Hill Financial LLC, has announced the launch of SL Capital LLC, a full-service commercial mortgage banking firm providing capital from $3 million to $200 millionplus, for a variety of commercial loan
programs and non-performing notes nationwide. SL Capital is an affiliated company of the Lynd Company, an established organization with more than 30 years of experience in multiple facets of the commercial real estate markets. Boggiano will serve as president of SL Capital. “Investors are coming back to the market and deals are closing—there is a need for access to competitive capital, and we knew we could provide it in one convenient source,” said Boggiano. “With our national network of commercial lending relationships, experience, and affiliation with Lynd Company, we’re able to assist investors and execute the type of transactions they need to capitalize on opportunities in the market.” SL Capital offers a variety of national loan programs including commercial mortgage-backed securities (CMBS), multifamily financing, mezzanine debt, preferred equity, bridge loans and senior financing for non-performing notes. SL Capital has also been designated a correspondent lender of Cantor Fitzgerald’s Cantor Commercial Real Estate, offering CMBS fixed- and floating-rate loans from $5 million to $200 million-plus for stabilized commercial properties including multifamily, office, retail, industrial, warehouse, self-storage, mobile home park, assisted living and hospitality. Steve O’Shaughnessy, former vice president of loan acquisition for Bayview Financial, and Jonathan Mettel, former vice president of sales for Silver Hill Financial, join Boggiano, rounding out a team with decades of industry experience through multiple market cycles and billions in commercial loan transactions.
Gateway Mortgage Group has announced that it has developed an inhouse subservicing unit focused on the specialty and default servicing of Federal Housing Administration (FHA) and U.S. Department of Veterans Affairs (VA) loans, and has hired Kevin Osuna
tutions that allows them to retain their customer relationships. “In 2008, Gateway decided to retain our servicing in house to keep the entire lending relationship from origination through servicing under our roof to ensure quality service for our borrowers,” said Kevin Stitt, president of Gateway Mortgage Group. “We now want to use our experience to provide smaller companies with an alternative to traditional sub-servicers, offering the expertise and performance of a large organization with the personal care of a smaller institution.” In his role as vice president of default services, Osuna will be responsicontinued on page 10
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE FEBRUARY 2012
GSF Mortgage has announced the addition of its newest Wisconsin branch in Fond du Lac, Wis. The new location will be led by Branch Manager Brady Onsager, Sales Manager and Fond du Lac native Lynn Farr, Production Assistant Tammy Kilsdonk, and Loan Originators Laurie Jarvenpaa and Kelly Diny. “We are thrilled to offer our portfolio of services to the Fond du Lac community and are pleased with the tremendous amount of expertise our veteran team brings to the table,” said GSF National Sales Manager Mike Maida. Onsager added that the marketing focus includes networking business relationships with real estate agents and other business referral sources driving mortgage applications for purchase business—with an emphasis on first-time homebuyer financing through the Federal Housing Administration (FHA) and USDA Rural Development. “Our entire team is committed to educating customers when it comes to the dynamic mortgage industry,” Maida
Gateway Mortgage Launches New Default Services Division
to direct the new operation as vice president of default services. Due to more stringent government loan requirements and increased oversight by regulators, small servicers have experienced problems with traditional sub-servicers, such as high delinquency ratios under Ginnie Mae, high FHA curtailments, low loss mitigation workout ratios and challenges with conveying properties to FHA. Gateway’s new division was created to provide small servicers and community institutions with high-touch expertise in specialty and default servicing for FHA and VA loans. The subservicing unit reduces risk for servicers working with government loans and provides a viable servicing solution for community insti-
GSF Mortgage Continues Expansion in Wisconsin Market
said. “Our value proposition includes extensive experience and success in our trade, along with our commitment to responsible lending and responsible homeownership.”
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
By Ginger Bell
Another home that just won’t sell! The home had been on the market for more than six months without a single offer. The sellers were anxious, and their agent wasn’t sure just what to do. “Remodel the kitchen and replace your countertops and cabinets,” their real estate agent instructed, trying to come up with a solution that would help the house move. Yes, the kitchen was dated, but could the stressed sellers be sure they’d select colors and styles that the perfect potential buyer would like? Luckily, the listing agent shared their dilemma with a friend who was experi-
enced with Federal Housing Administration’s (FHA’s) 203(k) Streamlined Loan. “Have the owners pick up a few countertop and cabinet samples, and place them in the kitchen for your next showing,” the 203(k) expert said. “Post a sign that says, You Choose!” The agent and sellers followed instructions. Not only did they get a full offer, but they received several!
The 203(k): Not just a rehab loan The bottom line is that buyers want choices, and the 203(k) delivers. FHA’s 203(k) loan program allows potential homebuyers to locate a great home with a shockingly good price in a wonderful neighborhood, then select their own upgrades—in addition to what may actually need to be repaired. This
opportunity makes the FHA 203(k) one of the most important loan programs available. Real estate agents need to understand this valuable loan!
What is a 203(k) loan? Across the nation, agents and homebuyers are finding that many properties currently on the market are in dire need of upgrades or repairs. Short sales, foreclosures and properties that have been on the market for some time make for dated, distressed and ignored inventory that needs some TLC. The ability to upgrade with new carpet, paint, cabinets and appliances immediately renders many listings more marketable. The biggest challenge is that stretched borrowers often cannot afford to remodel right away, if ever, and the owners and banks offering
short sales and foreclosure inventories are unable to dedicate funds to rehab or upgrade. Basically, buyers do not have enough money to cover the cost of home purchase and take on a renovation of their recently purchased property at the same time. Great news: They don’t have to! The FHA offers a fantastic loan program, called the FHA 203(k) Renovation Loan, which was specifically designed to help borrowers purchase (or refinance), and repair, remodel or renovate the home—all at the same time, with a single loan. Don’t be misled, though, the 203(k) is not just a rehab loan. The 203(k) program allows your buyers to buy their dream home and swap out that 1980s-era kitchen they don’t have the cash to tackle. continued on page 28
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continued from page 7
ble for enhancing and expanding Gateway’s default management division. Prior to joining Gateway, Osuna spent 15 years in the default management department of a top five FHA servicer. He has managed each of the functions within default management, most recently overseeing collection and loss mitigation strategies while serving as senior vice president of default and credit risk management. “In speaking to various industry participants, it became clear that traditional sub-servicers and small community banks were struggling with FHA default servicing requirements,” said Osuna. “Gateway has the knowledge and proven processes to remove this burden from small servicers and mitigate the risks, such as findings and penalties on FHA claims or audits. I am happy to lead Gateway’s Default Services Division and look forward to the impact it will have on the market.”
CampusMBA Extends Educational Partnership With Insurance Advisors
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CampusMBA, the education division of the Mortgage Bankers Association (MBA), has announced that it has extended its partnership with Stamford, Conn.-based Insurance Advisors LLC. Under the agreement CampusMBA, in conjunction with Insurance Advisors, will continue to offer live online workshops addressing a variety of insurance issues for commercial/multifamily real estate loans. “We are proud to continue to join Insurance Advisors to offer valuable industry education, especially in this challenging economic environment,” said David H. Stevens, MBA’s president and chief executive officer. “Commercial insurance issues continue to be vital for our commercial and multifamily members, and we look forward to continuing to offer relevant courses to educate industry professionals on important and timely insurance related issues.” Each workshop will cover both broad issues as well a specific topics that industry professionals address on a daily basis. The workshops are designed to provide practical information that is useful to commercial loan originators and underwriters, loan closers, drafting attorneys and loan servicers. Course topics will include: Self-insurance, captives and fronting arrangement. The workshops will also cover terrorism insurance, flood insurance and the principles of property insurance. “We are very excited to continue our work with MBA and its members on such relevant issues facing the industry,” said Bernie Brown, president of Insurance Advisors LLC. “By working with MBA and its education division, CampusMBA, Insurance Advisors is able to educate industry professionals on
vital and timely insurance related issues. We are committed to providing superior educational assistance to MBA members and we are proud the MBA has chosen to continue our partnership with them.”
Radian and LoanSifter Reach Rate Quote Agreement Radian Guaranty Inc., the mortgage insurance (MI) subsidiary of Radian Group Inc., has announced a partnership with LoanSifter, where LoanSifter will include an MI rate quote or estimate from Radian as a part of its MI Best Execution Pricing Platform. “We are very excited to announce our integration with LoanSifter, an industry leader known for helping lenders save time and money by managing their mortgage process workflow more efficiently,” said Brien McMahon, chief franchise officer at Radian. “Although this is a first for Radian, this relationship marks the beginning of an extensive connectivity strategy for us. By expanding our exposure through a variety of notable product and pricing engines, we’re making it easier than ever for customers to do business with us—which is always our number one goal.”
Inlanta Mortgage Adds New Wisconsin Branch Inlanta Mortgage is pleased to announce Tracy Anderson and her team in Hales Corners, Wis., has merged with Inlanta. Branch Manager Anderson brings more than 20 years of experience to Inlanta, along with a highly experienced team of mortgage professionals. Anderson chose to partner with Inlanta due to its strong and positive reputation in the industry and helpful support staff. “Local underwriting, state-of-the-art mortgage origination software and a reliable pricing engine are just added bonuses to the reasons why we decided to join Inlanta,” said Anderson. “We felt that Inlanta was a great fit for us!” The Hales Corners staff has built their business on referrals and repeat customers by providing excellent service and a high level of communication. With the Inlanta partnership, Anderson and her team will continue to provide a high level of service and according to Anderson, “It will give us the capabilities to further help our customers achieve their dreams of homeownership.” Inlanta Executive Vice President Nicholas DelTorto stressed the importance of partnering with a company like Inlanta during financial times like these. “The opportunity in the future will be great for those backed by solid companies, the survivors will get more market share by working to develop and deliver high quality service locally as the market volume continues to grow and recover,” said DelTorto.
Mortgage Professionals to Watch
Valuation Partners has added Clint Reinhardt as vice president of and national account executive.
continued on page 32
Lyle Lasky has been named AVP, national underwriting and credit compliance manager for First Guaranty Mortgage Corporation (FGMC).
Veros Real Estate Solutions has announced the addition of Charles Rumfola, former VP of single-family at Fannie Mae, as senior vice president of strategic initiatives. Real Estate Mortgage Network Inc. (REMN) has added Anthony Durso and Roger Del Giorno as account executives.
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
Scott Houp has joined Kinecta Federal Credit Union as director of national correspondent wholesale loan production.
Mortgage Contracting Services (MCS) has added Tod Phelps as chief information officer.
TMS Funding, the wholesale residential lending channel of Total Mortgage Services LLC, has named Domenic Melillo its new vice president of wholesale lending. Total Mortgage Services has also announced the addition of Neil Bader as the firm’s new national retail sales manager. NewDay USA LLC has added Rear Admiral Thomas C. Lynch as chairman of its board of directors. John F. Macke has joined Stonegate Mortgage Corporation as executive vice president of capital markets. Sherry B. Apanay, former executive vice president of Generation
Technology provider Blueberry Systems LLC has announced a strategic partnership with mortgage credit reporting company, Advantage Credit Inc. where Advantage Credit customers will now have preferred access to Blueberry Systems’ suite of scalable technology solutions designed to give lenders maximum flexibility in securely managing their entire loan production pipeline. “Providing a very high level of service has always been the focus for us at Advantage Credit Inc.,” said Jim Kaiser, sales director of Advantage Credit. “Through this integration, our customers will experience enhanced workflow integration while lowering technology and overhead costs. We are excited to partner with Blueberry Systems and look forward to the benefits it will provide the mortgage industry.” Users of Blueberry Systems’ RELAY loan origination system (LOS) can now seamlessly access credit reporting products provided by Advantage Credit, enabling them to more effectively make loan decisions and more efficiently process and close loans. “For 18 years, Advantage Credit has provided extraordinary credit reporting tools and resources to the mortgage industry, and we at Blueberry Systems are excited to be working with them,” said Lloyd Booth, president and chief operating officer of Blueberry Systems. “Providing our customers access to industry-leading credit reporting services will enable them to streamline processes and increase efficiencies, which will ultimately result in greater productivity.”
Rob Smith has joined zIngenuity Inc. as head of the mortgage analytics team.
Blueberry Systems and Advantage Credit Partner to Streamline Credit Reporting Tools
The President’s Corner: February 2012 f you would have told me that in the first 90 days of being president of the National Association of Mortgage Brokers (NAMB)—The Association of Mort-gage Professionals, that I would have written a letter to the President of the United States, a letter to our Senators and Congressmen, and had a meeting with Richard Cordray, the current director of the Consumer Financial Protection Bureau (CFPB), I would have been amazed. But if it is one thing that I have found out, there is never a dull day being your president. I must admit that this job definitely takes more time out of my day than anticipated. The phone calls alone have prompted one of my loan officers to come into me and ask me to hire someone to just take calls so he can call his customers and write some loans. I am currently using about 25-30 hours a week on NAMB-related business and another 30 hours on trying to write loans myself. But we are in the most challenging times that we have had in the mortgage business, and I am invigorated to be able to do this and my real job of closing mortgage loans. As we look forward to our 2012 Legislative & Regulatory Conference coming up in March in Washington, D.C., this is the event that, if you ever felt that you can help to make a difference, this is the one to attend. To make yourself available to go to Washington, D.C. and walk up and down the floors of Capitol Hill, stopping in the offices of your congressional reps and senators and speaking directly to our legislators is one of the biggest thrills you can ever have as a citizen of these United States. It is as basic as you can ever get. Yes you, a citizen of the United States, walking in these halls and stopping to speak to someone that represents you and all of your fellow citizens is as great as it gets. So log on to NAMB.org/LegConference and make your reservations to join us Sunday-Tuesday, March 18-20. It will be well worth the time and money to be there. And then you can join us on the night of Tuesday, March 20 in the Capitol Visitors Center for a reception with some of the most influ-
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
ential congressional reps and senators, and share your experiences with other NAMB members. I hope to see all of you there. And please, if you see me, stop and introduce yourself to me. I would be honored to meet you. Membership is my true vocation for this year. I am working with our new Membership Committee Chair Kay Cleland and her committee to get the information out to everyone about the intrinsic value of NAMB membership and why you should become a member. We need everyone who is a member to go out and sign up five of your friends and let them know that membership has its rewards and now is the time to join. The real question is: Why not join? I think all of you know that I umpire high school and little league baseball. The state of Indiana requires me to join the local association to make sure that I am receiving the required information that keeps me up to date on all of the new rules and interpretations of umpiring and that I understand them. Whether I am a rookie or a seasoned veteran, I have to belong to assure the state that I am getting the required hours of instruction and on-field experience. My association even goes to the extent to require two mandatory on-field clinics that we must attend and be graded on how well we do. And every year that I want to umpire in the state tournament, I have to take a test and score at least 90 percent to be able to qualify to work the states. In addition, every two years, I am required to attend a state-sponsored meeting to review all of the rules and rule changes. At every game, we are graded on how we do and that report is kept for the whole year on your progress. In little league, we have an umpire’s registry that we join to get all of the information and rulebooks and such. I also have to attend our District Umpires Meetings (eight of them annually), an onfield clinic, and take a test to make sure that I know the rules, just to be able to umpire. And with little league, it is a volunteer situation where we do not get paid to umpire. I find it ironic that with all of the regulations we have in the mortgage business, it is not a requirement that you have to belong to a state or national association, and we just have to attend eight hours of continuing education to renew our licenses every year. There are more
demands on me to umpire baseball than to conduct the largest monetary transaction in people’s lifetimes. So, my hat’s off to all of you who belong to your state and national association. That tells me that you care about what you do, and you want to make your job and life better for those whom you call your customers. Just a little perspective! I hope by the time that you are reading this, we will have rolled out and jumpstarted our NAMB blog through Think Big Work Small, as the states are also putting their state blogs together as well. This is a great opportunity to make sure that you are reaching out to get more business. Brian Stevens and Frank Garay of Think Big Work Small, along with NAMB Communications Committee Chair Fred Arnold and I have spent numerous hours getting this out and you should spend just a few minutes seeing how this can improve your business right now. Both Frank and Brian will be in D.C. at the Legislative Conference to go over this one more time for all of the attendees. As I end this month’s letter, I want to
thank all of you who have sent me an email or have given me a phone call. I am motivated to make this association grow and thrive, and every time I get one of your notes, it makes me work a little harder to make this happen for you and for our members. I am still looking for people who want to make a difference. Go get you professional designation, a Certified Residential Mortgage Specialist (CRMS), a Certified Mortgage Consultant (CMC), or go and get your Lending Integrity Seal of Approval, and help me make a difference. We need members and the only way we can get them is by you talking about the difference that we can make as an association together. So email me at firstname.lastname@example.org and let me know what you want to do. Sincerely,
Donald J. Frommeyer, CRMS, President NAMB—The Association of Mortgage Professionals
Now More Than Ever, Your Participation is Needed By John P. Hudson
Last March, more than 200 mortgage professionals from across the country convened in Washington, D.C. to participate in the National Association of Mortgage Brokers Legislative & Regulatory Conference. Not only did the attendees learn the latest news on issues affecting their business, they passionately advocated on behalf of all mortgage professionals, small business, and the preservation of consumer choice on Capitol Hill. From Sunday-Tuesday,
March 18-20, NAMB will rally the troops once again and your presence is imperative! The year 2012 is already proving to be a significant one for mortgage professionals, consumers and small business. With the appointment of Richard Cordray as director of the Consumer Financial Protection Bureau (CFPB) and more elements of the Dodd-Frank Act coming to light, mortgage professionals MUST be ready, willing and able to get involved in the legislative process along with NAMB to ensure that our industry and consumers are protected from the unintended consequences of ill-advised regulation and legislation. Loan originator (LO) compensation, appraisal portability, the Qualified Resident-
ial Mortgage (QRM)/Qualified Mortgage (QM), loan limits, Nationwide Mortgage Licensing System (NMLS) license portability, new Good Faith Estimate (GFE)/Truthin-Lending Act (TILA) are just some of the issues currently facing thousands of mortgage professionals and millions of consumers. So what are you going to do about it? YOUR members of Congress and the U.S. Senate were elected to represent YOU. Now is your opportunity to work with NAMB to get “face time” with influential legislators and decision-makers to not only let them know how their decisions have impacted small business and consumers, but to educate them in order to improve and help save the housing industry and the overall economy of this country. Special thanks to Provident Funding for sponsoring the 2012 NAMB Legislative & Regulatory Conference. Provident Funding has once again demonstrated their commitment and loyalty to mortgage brokers and all mortgage professionals in the housing industry.
Monday, March 19, 2012 8:30 a.m.-8:45 a.m. Opening Remarks From Provident Funding, 2102 NAMB Legislative & Regulatory Conference Sponsor
4:10 p.m.-5:00 p.m. Lobbying Tips and Tools for Effective Advocacy Guest Speaker: Roy DeLoach, NAMB Chief Lobbyist of DC Strategies Group Get prepared to visit your representatives on Capitol Hill with a briefing from NAMB’s Chief Lobbyist Roy DeLoach. You will get NAMB’s talking points and materials for your meetings, senators, members of congress, and staffers to promote and educate them on the benefits of your profession to consumers and the overall economy. 5:00 p.m.-6:00 p.m. NAMB Blog/State Blog Guest Speakers: Brian Stevens & Frank Garay of Think Big Work Small We are very excited to work with Brian Stevens and Frank Garay to help NAMB and our state and local mortgage professional associations better communicate our message to our members, consumers, and all hosing professionals. 6:30 p.m.-8:30 p.m. 2012 NAMB Legislative & Regulatory Conference Opening Reception Network with your peers and prepare your strategies for Lobby Day!
Tuesday March 20, 2012 7:00 a.m.-Noon Lobby Day Registration Confirm your scheduled visits and head to “The Hill” 9:30 a.m.-5:30 p.m. Lobby Day Hill Visits When you march the halls of Congress,
For more information, please visit NAMB.org/LegConference or e-mail us at email@example.com. Also, be sure to visit us on Facebook for regular updates as our conference gets closer. Here is the bottom line … NAMB’s advocacy has been effective over the years because our members get involved. NAMB members are leaders within the mortgage business because of their experience and expertise. They are widely regarded as leaders within their communities because they recognize the importance of getting involved and making a difference. In order for NAMB to continue to be an effective
John P. Hudson is 2012 Government Affairs Committee Chair for NAMB. He may be reached by phone at (817) 247-4766 or email firstname.lastname@example.org.
Passion By Donald J. Frommeyer, CRMS
When I first started to think about what to say here, I was torn between several topics. But it seemed to always lean towards having a PASSION. I thought that everyone who gets involved in any volunteer association has to have a certain type of passion. And then I walked away from the computer and was working with several customers and realized that this job that I have as a licensed mortgage originator requires a somewhat different type of passion. Having to go through all of the steps to qualify customers and gather their documents and then submit the information to our lenders requires you to love what you do. If you don’t, it will eat
at you from every angle and then all you get is frustrated. “Passion” can be defined by Webster’s Dictionary as an intense, driving or overmastering feeling or conviction; an ardent affection; a strong liking or desire for or devotion to some activity, object or concept. Could you imagine not having a strong liking to talk with customers, gather their docs, and get the loan approved? Believe it or not, some originators do this job every day, and do not have the passion to move this forward. I have spoken with numerous originators over the last year, and yes, some of them think this is such a complicated business, that they only do it for the money. However, I have been doing this for 36 years. And I can tell you that it is a “PASSION.” Back in the “Good Old Days,” continued on page 14
8:45 a.m.-11:45 a.m. Opening Session: Working Together for Housing Housing Panel Discussion: The Future of Housing, QRM/QM, the Three Percent Rule, G-Fees and Beyond Listen and learn the latest legislative news from the National Association of Mortgage Brokers (NAMB), National Association of Realtors (NAR), Mortgage Bankers Association (MBA) and the National Association of Home Builders (NAHB).
3:00 p.m.-4:00 p.m. Ten Things You Should Know Before You Get Examined by the CFPB Guest Speaker: Larry Platt, Partner with K&L Gates Now that you know what the CFPB Examination will entail, Larry Platt will teach how to be prepared.
5:30 p.m.-8:30 p.m. Capitol Visitors Center: Come and Meet Key Legislative Members The grand finale of the 2012 Legislative & Regulatory Conference is the opportunity to hear directly from key members of Congress and the Senate. We have a very impressive lineup of “special guests,” including House Financial Services Committee Chair Spencer Bachus, Rep. Gary Miller of California, and more.
advocate for mortgage brokers and mortgage professionals, you must participate in the political process. Your involvement ensures that members of Congress hear a perspective that they care most about—a constituent who can communicate the impact of potential legislation on the marketplace, homebuyers and the general public. We must continue to look out for the interests of the customers we serve and for the general good of the American people. We continue to face enormous change. You need to know the issues, learn about what’s on the horizon and what you can do to protect your interest through political action. The number one reason you should attend this event is the satisfaction of knowing that you are doing your part to ensure that mortgage professional issues are heard on Capitol Hill. You are the best spokesperson for our issues. Your participation benefits you, mortgage professionals and our clients as a whole by strengthening our presence in the halls of Congress. See you in March.
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NAMB has organized a tremendous program for the 2012 Legislative and Regulatory Conference. Here is a breakdown of the event.
1:45 p.m.-2:45 p.m. Loan Originator Examination Guidelines Guest Speaker: Peggy Twohig, Team Lead, Non-Bank Supervision for the Consumer Financial Protection Bureau Learn exactly how the CFPB plans to audit your company. Please read the CFPB’s “Examination Procedures for Mortgage Origination” before attending this session.
you will have the satisfaction of knowing that you were part of the legislative process and represented your industry!
Support YOUR industry and let YOUR voice be heard
Noon-1:30 p.m. Luncheon and Keynote Speaker
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we used to have to do a lot of what the computer does for you manually. We would have to put together Good Faith Estimates (GFEs) and Truth-in-Lending (TIL) statements using our calculators and compute them manually. And back then, you did it because of the true love of the beast. I had so much fun working up deals for customers and showing them how much money could be saved with consolidation loans, paying off their cars, and getting extra cash for college tuition. And when you were working on a purchase, wow! We used to work 10 hours a day and not even think twice about it. I can remember the first few days when I became a mortgage broker. Our hours were 10:00 a.m.-9:00 p.m., because we had to be available whenever the customer wanted us. We would take a lunch at 2:30 p.m. in the afternoon so we could make ourselves available as the customers were going home. We used to have internal contests to see how many times we could ring the bell when you got an application, and back then, we have 20 loan officers in our small office and it was a “PASSION” to make the bell ring! You didn’t want everyone else ringing the bell and you not being able to participate. There was that word again … PASSION! Now we are in 2012 and much has changed in this industry. Everything done in the mortgage business is scrutinized by your bosses. The look to make sure that you have not only completed your paperwork correctly to comply with all of the laws, but when it comes time to get paid, we are all making 30 percent less because of the loan officer (LO) compensation rule from April 2011. Each broker company is also making less than what it did back in
2010 because the rules and laws have changed, but you are still around because of your PASSION. My dad once told me that if you are going to do something, make sure that you do it right, and by all means, love what you are doing. I love being in the mortgage business and seeing customers’ faces as you save them money, getting them their first house or their next house, getting them the money they need to pay for their children’s college tuition, or just making them happy that they are going to be saving money each month now that they have refinanced. I feel this burst of energy in my life as each and every loan closes because I know that I did my best and gave them 110 percent of my experience to make their dreams come true … PASSION! I also have this passion when it comes to NAMB. I have this passion when it comes to my entire life, because I won’t do anything unless I can give it my passion. So each one of you should probably look at your lives and realize that the one thing that you cannot get back is time. Once it is gone, you cannot get it back. So make sure that everything going forward that you do, do it with PASSION. You only have one life to live, make it worth living! If you relate it to being a mortgage originator, mortgage broker, account executive or are just working in the mortgage business, whatever you may do, make sure that each and every day, you do it with PASSION! Donald J. Frommeyer, CRMS is president of NAMB—The Association of Mortgage Professionals. He may be reached by phone at (317) 575-4355 or e-mail email@example.com.
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NAMB Supports Obama Administration’s Housing Crisis Solutions he National Association of Mortgage Brokers (NAMB)—the Association of Mortgage Professionals, applauds the Obama Administration in its efforts to seek out ways to address the nationwide housing crisis. NAMB supports three areas in the Obama Administration’s recommendations that will help bring solutions to the current mortgage crisis and assist the U.S. economy in its return to normalcy. “When this plan is implemented and homeowners are given the opportunity to refinance their homes, it will create capacity issues,” said Donald J. Frommeyer, president of NAMB. “It is imperative that any refinance program that is created, revised and offered to responsible homeowners is available to all origination channels so that they have the ability to help consumers with their loan. This initiative will not only allow the industry the capacity it will need to process the increase in refinances, but it will allow the consumer to shop the most competitive lender with the best service in their own neighborhood.” First, NAMB supports the Administration’s recommendation to help responsible, qualified homeowners with non-government-sponsored enterprise (Fannie Mae and Freddie Mac) loans who cannot refinance their home because their current balance exceeds the value of their homes to take advantage of historically-low rates. This portion of the plan will help responsible homeowners save an estimated $3,000 per year, according to the White House, and this money can be used to help stimulate the economy toward a full recovery. NAMB is concerned that relaxed underwriting requirements will be needed to refinance these homes. “It is important if we use the Federal Housing Administration’s loan programs for these refinances, that we make sure the new loan is suitable for the consumer and the consumer has the ability to repay,” said John H.P. Hudson, NAMB Government Affairs Committee chairman. “This will ensure that the FHA program remains strong for future homeowners to utilize fixed-rate financing as a tool in purchasing their future home and as a refinancing option for their current home.” Second, NAMB enthusiastically endorses the Administration’s Homeowner’s Bill of Rights protecting the consumer, and helping to clarify and streamline the mortgage process for the consumer in obtaining a loan. As many homeowners have experienced, this process can be confusing and rigorous. The proposed Bill of Rights will help homeowners complete their home loans efficiently. And third, it is important, as the Administration recommends, that more homes are made available for sale to investors. These homes can be made available for rent to those displaced by the current economic environment, an environment that has created a shortage of affordable housing in some areas of our country. NAMB looks forward to working with the Obama Administration and the Consumer Financial Protection Bureau (CFPB) in advising on the sound implementation of the Administration’s recommendations to address the housing crisis.
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Trigger Lead Complaints on the Rise By Terry W. Clemans
A Review of What to Expect in a Collateral Risk Management Solution By David Rasmussen
In wrapping up this series on valuation management, I wanted to review the most important components to be considered when selecting a valuation management platform. The implementation of such a system has given lenders, servicers and investors the ability to effectively coordinate and audit a number of valuation processes. As stated in previous columns, a valuation management solution allows for better control of business operations by providing a deeper level of organization and tracking over the entire loan lifecycle. Below is a recap of the most critical attributes among the core functionality of a platform.
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Order module An order module should be an effortless interface for placing single/batch orders and connecting users to valuation providers, and should lend naturally to a number of tangible business benefits. The foremost benefit is provided through needed layers of objectivity by giving the ability to set up rules that fall into place for every order processed. Users are assured that their orders are routed to the most appropriate providers and the necessary steps are taken to eliminate the type of subjectivity that can result in regulatory infraction. The system should also provide business efficiencies and speed of processing by keeping orders from getting lost, mixed up or stuck in the course of fulfillment, as well as ensuring scalability by distributing orders to providers in a management flow.
Quality controls Quality control (QC) procedures surrounding valuation management are critical for safe and successful lending practices. The most comprehensive practice requires a combination of a platform’s predefined, automated QC checks, along with a manual review where qualitative assessments are necessary. The platform can ensure essential compliance standards, including conformance with the Uniform Appraisal Dataset (UAD), known Uniform Collateral Data Portal (UCDP) hard stops and underwriting requirements. A strong platform should remove subjective decisions and protect against human error.
Reporting A platform should include a comprehensive selection of standard reports with access to frequently retrieved data. While these reports may fulfill common business objectives, a standard report suite will not encompass every possible combination of data points desired. Ad hoc reporting gives users the ability to configure output by utilizing available data fields to immediately generate a user-created report.
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A nemesis to the first mortgage originator who takes an application from a consumer—and the source of a hot lead to other mortgage originators—trigger leads are regaining popularity. Based on complaints surfacing about them over the last couple of months, the resurgence of trigger leads is due to low interest rates. The complaints seem to be more about the misuse of trigger leads and the sometimes deceptive practices of the users, rather than the common complaint of a few years ago regarding the very existence of trigger leads. So what exactly are trigger leads? Trigger leads are zip code, credit score and other mortgage qualification filtered leads that are compiled on a daily basis by the national credit repositories. They do this by assembling all of the names and contact information for consumers who have had their credit reports accessed for a mortgage application within the last 24 hours. These leads are then sold by the national credit repositories to other mortgage originators based on the specific type(s) of consumer(s) who fit the originators’ lending parameters. The purchasers of the trigger leads then offer the consumer another loan offer to compare with the original mortgage quote, often to the dismay of the original mortgage originator. Trigger leads have been around for a long time. Between the years of 2006-2008, there were a flurry of attempts by a few states and private individuals to regulate or stop trigger leads, all without success. After the Minnesota General Assembly passed legislation to prohibit trigger leads in the land of 10,000 lakes, the Consumer Data Industry Association (the trade association for the national credit repositories) sued the Minnesota Attorney General and won, stopping the law from ever going into effect. Trigger leads are allowed under guidelines in the Fair Credit Reporting Act (FCRA), which preempts all but very specific laws passed in a couple states prior to 1971, and there is very little that the individual states can do to regulate them. There has also been no success in the private litigation attempts to stop trigger leads to date, leaving the practice alive and well in 2012. The position of the federal regulators has been that trigger leads are good for consumers as they promote competition. The Federal Trade Commission (FTC) has defended the use of trigger leads in Congressional hearings and has publications on
“The position of the federal regulators has been that trigger leads are good for consumers as they promote competition.” their Web site to explain and defend their use. At www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt171.shtm, you will find the FTC’s consumer alert on trigger leads, and information on how to opt out of receiving pre-screened offers of credit. Basically, a trigger lead is that a prescreened offer of credit, just like those pre-approved credit card offers that fill the mail, but only for a home loan. Opting out is the only current way for consumers to avoid being part of the trigger lead program and exercise their rights to cease any types of pre-approved offers. From a non-governmental perspective on trigger leads, log on to About.com at http://homebuying.about.com/od/financingadvice/qt/0407TriggerLead.htm for more information about the opt-out programs, as well as a look into the darker side of trigger leads and the manners in which they are abused. Some users of trigger leads apply a little misinformation regarding how the caller knows the consumer has recently applied for a mortgage to get into the loan process, instead of offering a competing bid. The recent complaints about trigger leads have claimed that some mortgage lenders using trigger leads are currently stretching the rules and using deceptive acts to try to persuade the consumer into a loan with their company. Prescreened offers of credit come with specific rules about their legal use, and it seems that some recent reports are well outside of those rules. The new Consumer Financial Protection Bureau (CFPB) has a leader with the recent appointment of Richard Cordray, and the CFPB has vastly improved authority to provide rule-making in this area, should they deem to use it. It’s too early to tell if that is a possibility, but the CFPB has a special process for obtaining consumer complaints and taking actions based on the issues it hears about the most. This opens the door to a potential action by the CFPB if there is enough consumer outrage over these practices, an action not likely at the FTC if they were the only regulator on this issue. Could this be one of the first tests to see if the new watchdog is the same as the old one? Stay tuned … Terry W. Clemans is executive director of the National Credit Reporting Association Inc. (NCRA). He may be reached at (630) 539-1525 or e-mail firstname.lastname@example.org.
Att CBC C Nationall Bank k we: I Prioritize purchase u/w times by contingency or closing dates I Provide touch points throughout the process to ensure on time closings I Encourage direct access to all underwriters, internal processors, closers & your Account Executive I Order your appraisal online without submitting the credit package â€“ no delay I Offer diverse line: Conventional loans up to 97% LTV VA loans down to 640 Agency High Balance (100% LTV/105% CLTV) FHA loans down to 640 USDA loans
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE FEBRUARY 2012
A Great Recruiting Plan is Not Rocket Science By Dave Hershman
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
Sales management is one of the most difficult jobs within the mortgage industry. Most sales managers are personal producers and produce at a level which constituted a full-time job before they became managers. After 50 percent of their time or more is taken by their personal caseload, how much time is left to dedicate to great management skills? Unfortunately, the majority of the rest of a sales manager’s time is quickly absorbed by fighting fires. It is said that 80 percent of a manager’s supervisory time utilized by 20 percent of the poorest performers. This leaves precious time for a manager’s most important task—recruitment. Why is recruitment a manager’s most important task? A manager can possess the best management skills in the world, but if that manager hires the wrong people, their life is going to be a supervisory nightmare. The most significant rule of great leadership is to hire the right people. Most managers cannot hire the right people because they do not have the time to dedicate to a great recruitment plan. This is because they are spending their time trying to fix the wrong people. Sound like a vicious cycle? You bet it is! The question remains: How do we
break out of this vicious cycle? We could to outline a recruitment plan that would absorb 10 hours of a manager’s time each week. The actions would look great on paper. In reality, there would be no implementation of such a plan. Our sales managers do not have an extra 10 hours per week to expend, no matter how much time and stress it will save them in the long run. The only solution is to find synergies between the manager’s present activities and our recruitment objectives. We have already identified what activities occupy the greatest portion of a manager’s working day: Personal production and supervision of present employees. We must identify actions which will help us meet recruitment objectives and increase personal production. We must also identify actions which will help us increase our supervisory capacity and help us meet recruitment objectives. To illustrate this point, let us take a few examples:
Most sales managers hold periodic sales meetings Far too many managers complain that these meetings degenerate into complaint sessions such as: Why are our rates too high or why does processing take so long? Consequently, many originators complain that these meetings do not help further their sales objectives because we are spending too much time focusing on problems and products.
How much time in the meeting does the manager spend focusing on the company’s most important objectives— increasing production and attracting top notch sales and operations personnel? Is each originator asked to help recruit every meeting and enticed with incentives? When your sales force becomes part of your recruitment plan, they are also enticed to start focusing on the positives within their environment. This strategy also helps solidify their own support and loyalty to the company. Why recruit alone when you could have a recruitment team of several members working in concert to meet your objectives? Finally, this strategy can also help you achieve additional objectives. An incentive plan may also be combined with a mentorship program to enable your originators to facilitate the transition of new originators, especially those with limited experience. This relieves additional time pressure from the manager and helps their loan officers obtain experience in basic management skills which may prepare them for another step in their career. It is our responsibility as leaders to further the careers of those we lead. I will cover more regarding mentorship in a future column.
One of the major goals of producers is to learn about their competition Your objectives for interviewing targets should always include several questions regarding whom they are presently using, whom their peers use, what level of service they receive and more. What better way to benchmark potential recruits than through in-depth interviews with your targets. If their report is glowing: You have a potential recruitment target. If their report is not so glowing, you have a great opportunity to obtain more business. Ask the target to set up a meeting with you and their favorite originator, just to network. You
will be surprised at how you might benefit. Many producers report that the majority of their production comes from loan officer sources, rather than real estate agents or builders. Of course, not everyone can handle every deal. Talk about real synergy!
Take a look at your pipeline Within every loan is a sphere. This sphere can lead to more business and opportunities for recruitment. It is a matter of opening your eyes wider to opportunities which are in front of you. The CPA preparing tax returns for your client, do they know a loan officer? If they don’t, you have an important referral prospect. If they do, well you get the picture … These examples sufficiently illustrate how we can link the two most time consuming elements of a manager’s day with the number one objective—recruitment. Of course, before we go about implementing these solutions, we must have a clear idea of our recruitment objectives. All too often, we blindly recruit anyone who is available and wind up adding bodies instead of upgrading our staff. When we open our eyes to take full advantage of the concept of synergy, there will be no end to the possibilities. Any action which helps us meet more than one objective will decrease our stress levels because they help us conserve our most precious resource—which is time. Any upgrading of our staff will also help decrease our stress levels. More productivity and less stress? You bet! Dave Hershman is a top author in the mortgage industry with seven books published, as well as hundreds of articles. Dave has delivered hundreds of keynote speeches, seminars and schools for the industry as well. He may be reached by e-mail at Dave@HershmanGroup.com or visit OriginationPro.com.
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rarely used, you have a huge opportunity in building your relationships. As you begin to compile a couple of years under your loan originating belt, you will begin to compile a database of “too many people,” and by “too many,” I mean too many clients, referral sources, prospects and industry partners to market to on an individual or personal basis—at least not with any real effect. Either due to the size or due to the cost involved, you will need to find a way to make an impact on the folks that matter … and who are those folks? Think of the Pareto Principle, It’s the principle of time versus results and it holds true with your database. Twenty percent of the individuals currently in your database yield 80 percent of your referrals. They are the cream of the crop. They are your elite group. They are your Platinum Club (XINNIX terminology).
The Platinum Club clients are the referral partners, family, friends, etc. that are the backbone of your operation. Most good originators I know have a database of anywhere from 2,000 to 20,000 people in it. Even on the smaller scale, an effective marketing campaign to 2,000 people is virtually impossible. I highly recommend you market to them all generically, while the Platinum Club receives more personalized attention. Whittle the group down and trim the fat. Designate the members of your database that create closed loans time and time again. Find your 20 percent and establish your own Platinum Club! Casey Cunningham is president of XINNIX, a provider of mortgage sales and leadership development programs. She may be reached by phone at (678) 325-3501 or e-mail email@example.com.
FEBRUARY 2012 FHA Announces Measures to Better Protect Itself From Possible Bailout
Freddie Mac to Grant 12-Month Forbearance for Unemployed Borrowers
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Freddie Mac has announced that it is giving mortgage servicers expanded authority to provide six months of forbearance to unemployed borrowers without Freddie Mac’s prior approval and up to an additional six months with prior approval. This means unemployed borrowers may be eligible for up to 12 months of forbearance. Freddie Mac’s forbearance options are being expanded at the direction of its conservator, the Federal Housing Finance Agency (FHFA), and will take effect on Feb. 1, 2012. According to the latest statistics, nearly 10 percent of delinquencies on Freddie Mac mortgages were tied to unemployment. “These expanded forbearance periods will provide families facing prolonged periods of unemployment with a greater measure of security by giving them more time to find new employment and resolve their delinquencies,” said Tracy Mooney, SVP of single-family servicing and REO for Freddie Mac. “We believe this will put more families back on track to successful long-term homeownership.” Delinquent borrowers in an existing short-term forbearance plan can be evaluated for an extended forbearance under Freddie Mac’s new policy. Previously, Freddie Mac allowed servicers to grant up to three months of
Acting Federal Housing Administration (FHA) Commissioner Carol J. Galante has announced the latest in a series of steps to protect and strengthen the FHA’s Mutual Mortgage Insurance Fund. The newlyannounced regulations seek to strengthen the process by which the FHA requires certain lenders to indemnify the U.S. Department of Housing & Urban Development (HUD) for insurance claims paid on mortgages that are found not to meet the agency’s guidelines. In addition, the final rule requires all lenders with the authority to insure mortgages on HUD’s behalf (“Lender Insurance” mortgagee) to meet stricter performance standards to gain and maintain their approval status. More than 80 percent of all FHA forward mortgage loans are insured by Lender Insurance lenders. “Taken together, the changes announced today will protect FHA’s insurance fund from unnecessary and inappropriate risks while offering clear guidance to lenders regarding HUD’s underwriting expectations” said Acting Commissioner Galante. “FHA must continue to strike a balance between managing risks to its insurance funds and ensuring that FHA products are offered as widely as possible to qualified borrowers. We hope that the added clarity and certainty provided through these rules will enable lenders to extend financing opportunities to larger numbers of American families as the nation’s housing market and economy continue to recover.” For those loans insured by Lender Insurance lenders, HUD may require indemnification for what they deem “serious and material” violations of FHA origination requirements and for fraud and misrepresentation such that the mortgage never should have been endorsed by the lender. Additionally, the regulation changes the basis under which lenders qualify for Lender Insurance authority. A Lender Insurance mortgagee must demonstrate a two-year seriously delinquent and claim rate at or below 150 percent of the aggregate rate for the states in which the lender does business. Further, FHA will also monitor lender performance on an ongoing basis to ensure that participating
lenders continue to meet the program’s eligibility standards. Finally, the regulation establishes a process by which new HUD-approved lenders created through corporate mergers, acquisitions or reorganizations may be considered for Lender Insurance authority. In a separate Federal Register notice soon to be published, the FHA will propose to reduce the maximum allowable seller concession from its current level to one more in line with industry norms. The current level exposes the FHA to excess risk by creating incentives to inflate the appraised value. The revised proposal reflects public comments received on an earlier proposal published in a Federal Register notice on July, 15, 2010. The revised proposal calls for a 30 day comment period. Following an analysis of the public comments received, a final rule will be issued.
It’s Time to Check the Balance Sheet at YOU Inc.
By Raymond Bartreau
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
re you excited about the potential behind HARP 2.0? I know I am! It finally gives many of our fellow Americans the chance to refinance their underwater loans and take advantage of currently low rates. Ever since the news was released last year, I have been looking forward to 2012. Fannie Mae and Freddie Mac have not released projections on the number of Americans who will qualify under the new HARP 2.0 guidelines. However, a quick count through the bureaus shows that there are roughly eight million Americans that may benefit for HARP 2.0. Although this is a rough estimate, the thought of eight million refinance loans being processed in the next two years shows a sustainable model for any broker or loan officer. Early beta test numbers have shown above average responses from current HARP direct mail marketing campaigns. It makes sense too … let’s think about who we are targeting and why responses are expected to be higher than your traditional refinance marketing campaign. We are targeting a Fannie Mae or Freddie Mac homeowner who is upside down, but still making their mortgage payments on time. Many of these homeowners tried to refinance recently, but were denied due to owing more than what their home is worth. They have seen their neighbors and friends struggle to make their payments only to later modify their loan or short sale the property. At this point, the mindset of most of these homeowners is, “Why can’t I get help when I am making my payments on time?” On top of that, very few of these homeowners have seen a mortgage offer of any kind in quite some time. All of this combined equals high responses from all types of HARP marketing. The key is marketing to right list of homeowners. In short, you want to target current Fannie Mae or Freddie Mac loan holders who are upside down on their mortgage and have not been late on their payments. If you focus on this group of homeowners, you will be talking to the people who have been saying, “Why can’t I get help when I am making my payments on time?” You now have the answer with HARP 2.0. The only question now is: How are you going to take advantage of it? Raymond Bartreau is chief executive officer of BestRate Referrals, and founder and chief executive officer of www.harpmortgageleads.com. He may be reached by phone at (800) 811-1402 or e-mail RBartreau@BestRateReferrals.com.
Tax time is here again … or at least it will be soon. With 2011 in the rearview mirror, all that’s left of it are the forms and paperwork to file with the Internal Revenue Service (IRS). Checking the profit and loss (P&L) and the balance sheet should be a regular occasion to confirm you’re in the black and growing. Hopefully, no one is surprised by year-end figures or trying to play catch up now while your focus should be on 2012. If you own a business or not “on paper,” you’re still a business owner if you’re a mortgage loan originator (LO) and need to track your progress. The name of your business is YOU Inc., and your shareholders include those in your client database and your referral partners. The main focus for 2012 is to keep the stock hot at YOU Inc. so no one sells or downgrades the value. Each day is like a fresh balance sheet at YOU Inc., and the chief executive officer (You) are on one side or the other as an asset or liability to the business. Look back at your behaviors yesterday or even last week. How often were your actions proactively and intentionally ensuring that you’re an asset to YOU Inc.? What unintended actions or reactions caused you to become a liability? Was it for a day, for a week? Let’s face it—a person is an asset because of the proactive efforts they make to generate results. It’s easier to go through the daily motions or complain than it is to proactively seek advancement and growth. Never take the path of least resistance as a liability if your plan is to grow YOU Inc. So, how do you improve your balance sheet and become an asset to the business every day? There are many different ways to accomplish this, but let’s focus on K.I.S.S for 2012 (Keep It Simple Stupid): Decrease debt (stress, pessimism, fear, and things that are holding you back) Pay attention every day to focus on
the tasks that reap the greatest reward. Understand that you have control over your mind and your actions to proactively seek excellence in production and growth. Eliminate negative thoughts and remove pessimistic people from influencing your life. Increase assets (vision, focus, relaxation, determination, and the things that move you forward) Always have a plan in writing and always seek knowledge and continuing education. Water the soil every day to grow and learn in your career, while taking the time necessary to relieve stress and keep balance. There are no limits other than the limits you put in place yourself. So, if you’re surprised by your balance sheet this year, don’t be next year. Always have a plan and monitor your progress during the year to confirm that you are always in the black.
Tip of the month … Qualify prospects quickly. Don’t drag clients or potential clients on. It’s a waste of their time and a waste of your time. Place and prioritize quickly to ensure they get in the pipeline as soon as possible, or that they are provided with the best recommendations should now not be the best time to move forward. Saving time means you’ll have more to prospect for new clients and close more loans. Andy W. Harris, CRMS is president and owner of Lake Oswego, Ore.-based Vantage Mortgage Group Inc. and 2010-2011 president of the Oregon Association of Mortgage Professionals. He may be reached by phone at (877) 496-0431 or e-mail firstname.lastname@example.org or visit AndyHarrisMortgage.com.
USA Cares Mortgage Heroes By Beverly Frase Like the perfect wave that begins building long before anyone near shore can see it, the Certified Military Housing Specialist (CMHS) Course has been gaining momentum with the timing of a perfect storm. The free CMHS course (funded by a grant from Fannie Mae) was created and launched to a public who is eager to help our military in any way they can during this time of economic turmoil in communities everywhere. Word of mouth and media attention have helped hundreds become certified and work with this underserved niche market. Rising to the top of this effort is a group of individuals who believe so strongly in helping our military heroes that they’ve undertaken volunteer responsibilities as regional and state coordinators. We deeply appreciate and salute these industry leaders: KAY CLELAND Board of Directors, National Association of Mortgage Brokers (NAMB) & USA Cares Rocky Mountain Coordinator “I am very excited about the possibilities for this program, and I am honored to be a part of it. Anything I can do to help, I am ready.” CAROL GARDNER President, Illinois Association of Mortgage Professionals (IAMP) & USA Cares Midwest Coordinator “I chose to donate my time to the efforts of USA Cares for two reasons: First, my husband is a Vietnam veteran and second, I saw the need to help and assist our heroes from Iraq and Afghanistan. I know how difficult it is for our military to return to everyday living, and USA Cares most definitely helps fill the gap towards their assistance. I thank these men and women for helping us keep our freedom since freedom does not come without a price. USA Cares help fills that gap.”
VICKI WHITE-SKLARK Government Lending Training Consultant & USA Cares Southeast Coordinator “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 my drive to serve our veterans, old and young alike, as we work to find solutions to satisfy their needs. I look forward to working with each of you in 2012 in identifying opportunities to grow this effort.”
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Before they’re finished, these volunteer coordinators will help be responsible for thousands of trained housing professionals from sea to shining sea, ensuring that skilled services are available to all military personnel, whatever their location. Everyone who commits their time to make a difference in their respective community is a hero in the challenge to help those who serve our country. To do your part, please contact CMHS Program Manager Beverly Frase by phone at (270) 319-3688 or e-mail email@example.com.
No matter who you compare us to, see for yourself why Hometown Lenders is "BETTER!"
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RICHARD BOOTH Certified Mortgage Banker (CMB) and Faculty Member, Mortgage Bankers Association (MBA) & USA Cares New Jersey State Coordinator “As an independent mortgage lender, I have a deep admiration and respect for those who are protecting my family. Unfortunately, I am well past the expiration date of being able to put on a uniform and raise my right hand, so, I have decided to join the fight to assist and protect our service members. I enlisted with USA Cares. I offer my residential mortgage lending experience to any service member who needs help in navigating the maze of lending rules, and I call on all of my colleagues in the residential lending community to help educate our service members about their mortgage rights.”
Our program was designed to be ‘BETTER’. Better people, better tools, & better products. We believe in long-term relationships with our partners and that’s what makes us better.
MARY ANN PINO President, New York Association of Mortgage Brokers (NYAMB) & USA Cares Northeast Coordinator “As soon as I heard about the USA Cares initiative to educate financial industry professionals, I knew it would be tremendously important to spread the word so our entire industry could be trained to help military borrowers everywhere. I am extremely grateful for the sacrifice our service members and their families make to protect and maintain our freedom, and I am honored to be a part of the USA Cares initiative.”
“A Better Home For Your Branch”
Supply & Demand in the Mortgage Industry By Mark Greco
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
Supply and demand is the most basic economic model for determining price in a market. Demand is the amount of product or service that is desired and supply is the amount of product or service that is available. When either side falls out of balance, price is directly affected. This model has become more apparent than ever in today’s mortgage industry. A simplified description of the players in the mortgage industry’s supply chain includes the originator, the aggregator and the agencies. The originator is self-explanatory. The aggregator, which sells paper to agencies and retains or sells the servicing rights, is the heart of the secondary market and has become dominated by large banks. The agencies buy the notes and guarantee the mortgage-backed securities (MBS). Over the last four years, there has been a constant contraction of the secondary market (supply) in the entire mortgage supply chain. While the contraction has been across the board in all channels (retail, wholesale and correspondent), the industry’s third-party origination (TPO) channel has been most affected within the industry. Since the “meltdown” first began, we have witnessed bank after bank exit the wholesale business and eventually vacate the mortgage business altogether. Since the decrease of supply channels began, we have seen an increase in administration fees, secondary market margins, and agency level g-fees. I believe this is only the beginning. The first bank to send the shot heard ‘round the industry was Chase when, in 2009, they announced they would no longer accept business through their wholesale channel or correspondent division that was originated through a third-party. This created a huge vacuum in the wholesale market and many aggregators followed suit in the coming months. In September 2011, when Bank of America announced its decision to exit the correspondent channel, which supported TPO through correspondent lenders, it almost pushed the wholesale segment of mortgage lending into the abyss. The industry is just beginning to recover. In recent months and as a result of the latest exodus wave, we have seen service-release premiums (SRPs) dwindle and margins increase. Historically, the pricing model for the secondary market uses agency (FNMA, FHLMC or GNMA) prices plus an SRP of 100 to 125 basis points (BPS). Today, we are seeing SRP values ranging from a negative factor to 25 BPS at the highest. This secondary margin and the government mandated g-fee increase at Fannie Mae and Freddie Mac is going to drive mortgage prices even higher. If other large secondary market lenders exit the space, then margins will continue to widen. The void created by big banks vacating the secondary market is now being filled with smaller mid-level mortgage banks with direct agency approval. Direct agency approval, which only a fraction of the mid-level mortgage banks currently have, is crucial for a mortgage bank to be a continued viable entity. The likelihood and viability of moving forward in the industry will become grim without agency approval. With the increase in net worth requirements and the protracted turn times to get through the gauntlet of the agency approval process, those who have not started this process have a steep incline ahead of them. The reality is that no one likes to see an increase in prices, but the fact is that if there is going to be a mortgage industry in the future, the participants have to be profitable. If a business model is not working, there must be a change that, in effect, creates revenue that exceeds expense. Those who can adopt this perspective will find the changes in the secondary market more palatable. Mark Greco founded 360 Mortgage Group LLC, a privately-owned wholesale lender, and seized the opportunity to service the underserved wholesale segment of the market. As president of 360 Mortgage, he has overseen more than 50 percent growth every year. With more than 15 years of personal experience as a mortgage banker, Greco truly understands the business, and knows the issues facing the industry today. He may be reached by phone at (512) 418-6000 or visit www.360mtg.com.
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forbearance with no payment and without prior approval, or six months at a reduced payment with prior approval. Longer forbearance required prior approval and was generally restricted to events such as natural disasters, permanent disability or long-term medical emergencies.
Missing Docs Account for 40 Percent of QC Issues Interthinx has announced that it has identified two major defects in the outsourced quality control (QC) programs of lenders that affected residential mortgage loan files in 2011 and may pose significant risk in 2012. According to Interthinx, 40.9 percent of its QC findings relate to missing documentation or data integrity issues. Eligibility and credit issues account for only 18.3 percent of 2011 findings. “Many in our industry will be surprised to learn that more than 40 percent of our findings last year were related to missing documentation or data integrity issues,” said Connie Wilson, executive vice president of Interthinx. “It’s significant when comparing this recent data to data from 2006 to 2009 when missing documentation only accounted for 7.1 percent of all findings. If lenders are not outsourcing their quality control processes, they should at least consider having someone from the outside take a look at their processes. If a lender’s internal quality control process mimics their internal originations process, the lender could easily miss documentation or data integrity issues.” The QC process provided by Interthinx includes learning how each client does business to assist in identifying critical issues from application to close. Interthinx provides lenders valuable statistics on the individuals who deal with their loans on a daily basis to identify training and process needs and to help lenders gain more confidence about the loans they originate. “If lenders haven’t used outsourced quality control in the past, 2012 may be the year to try it,” said Wilson. “To reduce repurchase requests, most major government-sponsored enterprises (GSEs) recommend having an independent source back up internal processes. The shift towards manufacturing defects in 2011 from historical borrower eligibility issues is a significant finding. Today’s borrowers are very well qualified for the most part. However, a well-qualified borrower does not always protect lenders from elevated defect rates or even repurchase issues. The lender’s loan manufacturing process needs to be sound in all areas to avoid potential repurchase. A simple breakdown can leave the lender on the hook for a loan that should have been bulletproof.”
MetLife Bids Farewell to Forward Mortgage Business MetLife Inc. has announced that it is exiting the business of originating forward residential mortgages. MetLife Home Loans, the residential mortgage division of MetLife Bank NA, will no longer accept new loan applications for forward mortgages. MetLife Home Loans continues to originate reverse mortgages. MetLife Home Loans will continue to service its current mortgage customers. In addition, MetLife Home Loans will honor all contractual commitments for loans in process and expects the majority of loans to close in 90 days. MetLife expects $90 to $110 million, after tax, in costs related to exiting the business to be incurred over the next year, with no expected impact on the company’s operating earnings. On Dec. 27, MetLife announced that GE Capital Financial Inc. had agreed to acquire most of MetLife Bank’s depository business, including certificates of deposit and money market accounts. MetLife’s entire retail banking business, including mortgages, represented under two percent of MetLife’s 2011 operating earnings as of Sept. 30.
REOs and Foreclosures Make Up 20 Percent of Q3 U.S. Home Sales RealtyTrac has released its Third Quarter 2011 U.S. Foreclosure Sales Report, which shows that sales of homes that were in some stage of foreclosure or real estateowned (REO) properties accounted for 20 percent of all U.S. residential sales in the third quarter of 2011, down from 22 percent of all sales in the second quarter and down from 30 percent of all sales in the third quarter of 2010. Third parties purchased a total of 221,536 residential properties in some stage of foreclosure or REO during the third quarter, down 11 percent from a revised second quarter total and down five percent from the third quarter of 2010. The average sales price of homes in foreclosure or in REO status was $165,322 in the third quarter, up one percent from the previous quarter but down 3 percent from the third quarter of 2010. The average sales price of these foreclosure-related sales was 34 percent below the average sales price of homes not in foreclosure, matching the 34 percent foreclosure discount in Q2, but below the 37 percent discount in the third quarter of 2010. “While foreclosures continue to represent an excellent bargain-buying opportunity for many buyers and investors, foreclosure sales accounted
for nearly 57 percent of all residential sales in Nevada during the third quarter, the highest percentage of any state. Third parties purchased a total of 13,992 homes in foreclosure or bankowned in Nevada during the third quarter, nearly identical to the 13,858 foreclosure-related sales in the previous By Jennifer Frank quarter, but up 24 percent from the The recent lawsuits filed by the Federal third quarter of 2010. Deposit Insurance Corporation (FDIC) against two appraisal management compaJustice Department nies (AMCs) highlight the need for AMCs to Releases Report be performing thorough quality control to Assist Foreclosure (QC) reviews of their appraisals. In early Mediation Programs The Access to Justice May, the FDIC filed lawsuits against both LSI Initiative has released Appraisal and CoreLogic Valuation Services “Foreclosure Mediation: alleging that these two companies perEmerging Research and formed sloppy appraisals, which led to lossEvaluation Practices,” a es at Washington Mutual of several hunreport resulting from a March 7, 2011 dred million dollars. The FDIC is still evaluworkshop with dozens of foreclosure ating many more claims against AMCs for mediation program stakeholders and appraisals delivered during that same time researchers. The report summarizes the period to other failed lending institutions. workshop proceedings and compiles There is little doubt that at some point in the most recent foreclosure mediation the not too distant future, the FDIC will be filing additional lawsuits against several research and resources. “The loss of a home to foreclosure more AMCs who delivered faulty appraisals can be devastating to a family,” said to failed lenders. It is also reasonable to Senior Counselor for Access to Justice anticipate that several AMCs may discover Mark Childress. “The report released the professional liability insurance policy today compiles the best available which some of their appraisers carry research on foreclosure mediation pro- excludes claims made by the FDIC. In late grams and serves as an important 2010, in response to the “failed lender-bad resource for existing programs around loan” crisis a few errors and omissions (E&O) the country as well as for jurisdictions insurance providers began limiting appraisattempting to establish foreclosure er’s coverage for “prior acts.” Given the current climate, pending litmediation programs. Well-structured foreclosure mediation programs may igation and other issues, it should be offer the millions of families at risk of obvious that if AMCs are to survive and foreclosure a way to stay in their thrive in the future, they will need to become proactive in terms of obtaining homes.” The March 2011 workshop at the U.S. quality appraisals in order to reduce their Department of Justice (DOJ) and the risk, and hopefully their liability, for poor newly-released report build upon a quality appraisals. A proactive AMC appraisal QC program Nov. 19, 2010 event co-hosted by the Middle Class Task Force and the Access starts with a thorough vetting of an to Justice Initiative at the White House. appraiser prior to adding him or her to At the event, Vice President Joe Biden their appraiser panel. Currently, many and Attorney General Eric Holder AMCs hold the mistaken belief that “vetunveiled a series of steps designed to ting” an appraiser means visiting the help middle class and lower-income Appraisal Subcommittee (ASC) Web site to families secure their legal rights and ensure that the appraisers’ name with its announced new resources to help bring current license status is listed. stakeholders together, share knowledge Unfortunately, even if an appraiser has and expertise, and highlight the most committed repeated multiple Uniform effective new strategies for foreclosure Standards of Professional Appraisal Practice (USPAP) violations in their home mediation. The March 2011 workshop was state and even if those violations resulted designed to achieve two goals in sup- in thousands of dollars of fines unless their port of the development of mediation license was revoked, more often than not, that appraiser will be listed no differently as a foreclosure intervention: To illuminate best practices for than an appraiser who has a perfect record research and evaluation of foreclo- on the ASC site. It is worth noting that sure mediation programs and relat- many of the eAppraiseIT appraisers whose appraisals serve as part of the basis for the ed interventions; and To build and strengthen relation- current FDIC lawsuit had prior disciplinary ships among program administra- histories with the Florida appraisal board tors, researchers, advocates and rep- prior to undertaking their work for resentatives from government agen- eAppraiseIT. AMCs must therefore take the time to thoroughly check each state’s cies and the lending community. Several key findings emerged from appraisal board records even though it frethe workshop and are expanded upon quently means reading each states’ appraisal board newsletters month by in the report: In a tight budget climate, foreclo- month or quarter by quarter for the last 10 sure mediation programs’ survival years in order to be able to pull the individual appraiser’s disciplinary history. After continued on page 24 an AMC has completed the initial vetting
Appraisal Quality Control Is No Longer Optional for AMCs
Jennifer Frank is director of valuations and collateral solutions for Brentwood, Tenn.based Quality Mortgage Services LLC. She may be reached by phone at (615) 724-4100, ext. 125 or e-mail firstname.lastname@example.org.
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
for an appraiser panel candidate, the AMC needs to continue to monitor that appraiser’s state appraisal board disciplinary activity to ensure that appraiser’s competency. QC at an AMC also means that the AMC will not pay its appraisers unreasonable compensation because doing so precludes its access to a large pool of good appraisers. While I concede the definition of a “reasonable fee” varies depending upon who is defining it, I think we can all agree that the $250 or $275 which some AMCs pay is “unreasonable.” Is it really all that surprising that LSI, one of the worst offenders in terms of appraiser compensation, is one of the first AMCs to be sued for poor quality appraisals by FDIC? When Francois Gregoire, a forensic appraiser, was asked about the appraisers employed by the AMCs whose appraisals were the basis of the FDIC lawsuit, he responded, “I don’t think the AMCs can claim they have the cream of the crop.” QC for an AMC also means ensuring that an appraiser has adequate time to prepare a quality appraisal report. The most important aspect of an AMC QC program is performing a review on each and every appraisal prior to delivery to the lender. While at first sight, reviewing every appraisal might seem like a significant burden to an AMC, in actuality, it is not. Quality Mortgage Services, a nationwide company that provides QC and compliance solutions, has recently introduced Appraisal Defect Detection and Prevention or ADDP. ADDP is an automated appraisal review report which can provide an AMC a thorough appraisal review at a low-cost per transaction. Let’s look at one of the specific examples cited in the FDIC lawsuit against LSI in which an appraiser valued a property at $2.3 million resulting in Washington Mutual approving a $1.8 million loan on which the buyer defaulted and WaMu was left charging off $1 million. Among its many issues, the appraiser failed to address whether the 6,000-sq. ft. home was overbuilt for the neighborhood which consisted entirely of homes ranging from 2,500- to 3,500-sq. ft. An ADDP report would have flagged the home’s non-conformity because ADDP provides a homogeneity and conformity report on not only the Gross Living Area (GLA), but the price per square foot, lot size and bedroom count. ADDP then provides a comprehensive breakdown of those same categories, so you know exactly where in that range the property falls. With the proper tools and technology available to AMCs, there is no excuse for delivering a non-reviewed appraisal report to a lender, now or in the future.
for a smaller share of the total market in the third quarter. That trend is not too surprising given the continued ambiguity surrounding proper foreclosure procedures—and the ripple effect that has on sales of foreclosed properties that might have been improperly foreclosed,” said Brandon Moore, chief executive officer of RealtyTrac. “The sooner the market gets more clarity about accepted foreclosure procedures, primarily through the long-promised settlement between multiple states attorneys general and major lenders, the sooner the market can more efficiently dispose of these distressed properties. A total of 92,824 pre-foreclosure homes—in default or scheduled for auction—sold to third parties in the third quarter, a decrease of nine percent from the previous quarter and nearly identical to the 92,967 pre-foreclosure sales in the third quarter of 2010. Pre-foreclosure sales accounted for nearly nine percent of all sales, the same as in the second quarter, but down from 12 percent of all sales in the third quarter of 2010. Pre-foreclosure sales increased more than 30 percent on an annual basis in Michigan (up 68 percent), North Carolina (up 44 percent), Ohio (up 43 percent) and Georgia (up 35 percent). Pre-foreclosure sales outnumbered REO sales in several states in the third quarter, including Colorado, Florida, New Jersey and New York. Pre-foreclosures, which are often sold via short sale, had an average sales price nationwide of $191,119, a discount of 24 percent below the average sales price of homes not in foreclosure. That was up from the 23 percent discount in the previous quarter and matched the 24 percent discount in the third quarter of 2010. Pre-foreclosures that sold in the third quarter took an average of 318 days to sell after receiving an initial foreclosure notice, up from an average of 245 days in the second quarter and average of 236 days in the third quarter of 2010. A total of 128,712 REO properties sold to third parties in the third quarter, down 13 percent from the second quarter and down nearly eight percent from the third quarter of 2010. REO sales accounted for nearly 12 percent of all sales in the third quarter, down from 13 percent of all sales in the previous quarter and down from nearly 18 percent of all sales in the third quarter of 2010. Nationally, REOs had an average sales price of $146,437 in the third quarter, a discount of nearly 42 percent below the average sales price of homes not in foreclosure. That matched a 42 percent discount on REOs in the second quarter, but was down from a 45 percent discount in the third quarter of 2010. REOs that sold in the third quarter took an average of 193 days to sell after being foreclosed on, up from 178 days in the second quarter and 161 days in the third quarter of 2010. Foreclosure-related sales accounted
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For a free demo, contact Erik Wind, at (800) 262-3783, ext. 701 or visit shortsalespeedway.com/freedemo
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depends on rigorous research and evaluation to determine which program models and program characteristics produce the best outcomes. The creative collaborations represented in the workshop, such as those between programs and academic institutions, foundations, legal aid organizations, think tanks and government partners, can lead to efficient use of resources and quality evaluation. In order to conduct the kind of research and evaluation that is needed, there must be consensus regarding which data points and categories of data must be collected. The federal government should take an active role, both in helping to develop program and evaluation guidelines and in providing resources for mediation programs and research. The Access to Justice Initiative, headed by Senior Counselor Mark Childress, was established in March 2010 to address the access to justice crisis in the criminal and civil justice system. The mission of the Access to Initiative is to help the justice system efficiently deliver outcomes that are fair and accessible to all, irrespective of wealth and status. The Access to Justice staff works within the U.S. DOJ, across federal agencies, and with state, local and tribal justice system stakeholders to increase access to counsel and legal assistance and to improve the justice delivery systems that serve people who are unable to afford lawyers.
Homebuyers Steering Clear of ARMs Freddie Mac has released the results of its 28th Annual Adjustable-Rate Mortgage (ARM) Survey of prime loan offerings, which was conducted Jan. 3-5 of this year. The results show ARM initial-period rates are at historically low levels and hybrid ARMs remain the most common adjustablerate product in the market. The 5/1 hybrid ARM continued to be the most popular loan product offered by lenders. Nearly all of the ARM lenders participating in the survey offered such a loan. The next most popular products were the 3/1 and the 7/1 hybrid ARMs. Less than one-half of lenders offered the one-year ARM, and only four percent of lenders offered a 3/3 ARM, which adjusts once every three years. “Homebuyers have shied away from ARMs, particularly traditional one-year ARMs, because they are wary of the risk and uncertainty,” said Frank Nothaft, vice president and chief economist, Freddie Mac. “The potential for much larger payments if future shorter-term
interest rates are significantly higher and the high delinquency rates that borrowers have experienced with ARMs in recent years have led consumers to prefer fixed-rate loans over ARMs. In addition, fixed-rate loans currently are at near historic lows, and initial ARM rates are only slightly lower than fixedrate loans.” In early January, the interest rate savings for the popular 5/1 hybrid ARM compared to the 30-year fixed-rate mortgage (FRM) amounted to about one percentage point, about the same as during January 2011. There was little difference in the initial interest rate for the 1/1, 3/1 and 5/1 products. Longerterm hybrid products, such as the 7/1 and 10/1 ARMs, were also available from 63 percent and 38 percent of the survey participants, respectively. Because of the long initial fixed-rate period (seven or ten years), the initial interest rates were priced closer to the rate on a 30-year FRM for these products. “Borrowers who have taken out ARMs generally prefer hybrids, because these products include an extended initial period where the interest rate is fixed,” said Nothaft. “ARMs today are financing just over 10 percent of new home-purchase loans. In June 2004, ARMs hit a peak share of 40 percent of the home-purchase market but by early 2009, that share had fallen to just three percent, according to the Federal Housing Finance Agency. We are expecting ARMs to gradually gain back some favor with mortgage borrowers rising to a 14 percent share of the homepurchase market in 2012.” Among 121 ARM lenders, 65 percent offered loans tied to constant-maturity Treasuries, down from 71 percent in 2011; the remaining offered products tied to future rates indexed to the London Interbank Offered Rate (LIBOR). With the onset of the debt crisis in the Eurozone, the one-year LIBOR rate less the one-year constantmaturity Treasury yield peaked over the week ending Jan. 6 at over one percentage point, compared to around 0.5 percentage points over the same week in 2011. As a result, one-year LIBOR indexed ARMs may have adjusted up or did not adjust materially down compared with Treasury-indexed ARMs. The uncertainty over LIBOR movements may have led some current borrowers to avoid LIBOR ARMs.
Report Finds U.S. Seniors Have $3.19 Trillion in Home Equity Data released by the National Reverse Mortgage Lenders Association (NRMLA) shows senior home equity increased $46 billion in the third
quarter of 2011. Seniors have $3.19 trillion in home equity available according to the most recent NRMLA/Risk Span Reverse Mortgage Market Index (RMMI) report. “This data further demonstrates that the home must be considered as part of the funding longevity equation. Reverse mortgages are a creative tool to help seniors better use the assets they have to safely fund retirement,” said Peter Bell, president and chief executive officer of NRMLA. The NRMLA/RiskSpan Reverse Mortgage Market Index (RMMI) showed signs of stabilizing in the third quarter of 2011, increasing by 1.5 percent to 152.0. In Q3, housing prices in 69 percent of the 395 Metropolitan Statistical Areas (MSAs) (including eight of the 10 biggest MSAs) tracked by the Federal Housing Finance Agency (FHFA) and RiskSpan saw quarter-over-quarter increases, sending aggregate senior housing values up one percent to $4.2 trillion. Senior mortgage debt levels fell for the 10th straight quarter to $1.02 trillion, leaving seniors with $3.19 trillion in equity. “The home is, by far, the largest financial asset most families have for use in retirement,” said Bell, “Reverse mortgages have evolved from a circumstance-based product to an accepted forward looking tool used for financial planning.”
Housing Starts Rise 4.4 Percent in December
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HOPE NOW has released its November 2011 data showing that permanent loan modifications totaled almost 84,000 for the month, bringing the total for 2011 to approximately 969,000. Since HOPE NOW began tracking foreclosure prevention data in 2007, member mortgage servicers have completed 5.13 million total permanent loan modifications for homeowners nationwide. Additionally, HOPE NOW Executive Director Faith Schwartz announced the cities for homeowner outreach in the first quarter of 2012 that include expanded efforts to assist at-risk military homeowners as well.
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Nearly One Million Loan Mods Granted Through November
A Bright Spot in
Nationwide production of new singlefamily homes rose 4.4 percent to a seasonally adjusted annual rate of 470,000 units in December, according to newly released figures from the U.S. Commerce Department. This marked a third consecutive increase and the fastest pace of single-family housing starts since April of 2010. Meanwhile, the overall number of housing starts for the month declined 4.1 percent to a 657,000unit rate due to a 20.4 percent dip on the more volatile multifamily side. Looking forward, NAHB is forecasting gains of approximately 17 percent in both single- and multifamily housing production in 2012. “This report adds to the growing evidence that demand for new, single-family homes is finally starting to firm up in an increasing number of markets nationwide,” said Bob Nielsen, chairman of the National Association of Home Builders (NAHB) and a home builder from Reno, Nev. “This emerging trend is allowing builders to put more crews back to work, and could be even stronger if not for the overly tight credit conditions that prevail for both builders and buyers, as well as the continuing foreclosure crisis and the challenges of obtaining accurate appraisal values on new homes. Policymakers should be doing everything possible to allevi-
ate these problems and nurture the fledgling housing recovery in order to promote job and economic growth.” Combined single- and multifamily housing starts fell 4.1 percent to a 657,000-unit rate in December due to the multifamily side retreating 20.4 percent from a big gain in the previous month, to a seasonally adjusted annual rate of 187,000 units. However, for the year as a whole, overall housing production was pegged at 606,900 units, which was 3.4 percent better than the overall number of starts in 2010. Regionally, December housing starts rose 54.8 percent in the Midwest following a big decline in the previous month. The Northeast posted a 41.2 percent decline that offset a big gain in the previous month, while the South and West also posted declines of three percent and 17.6 percent, respectively. Permit issuance, which can be an indicator of future building activity, held virtually flat at a 679,000-unit rate in December. Single-family permits rose for a third consecutive month, by 1.8 percent to 444,000 units, while multifamily permits declined 3.7 percent to 235,000 units. Regionally, permits rose 5.8 percent in the Midwest and held unchanged in the West, but declined 6.5 percent in the Northeast and 0.6 percent in the South in December. “This report is in keeping with our expectations for slow but steady improvement in the single-family market, where production hit its lowest yearly rate in over 50 years in 2011,” said NAHB Chief Economist David Crowe. “Meanwhile, it should be noted that the decline in multifamily starts in December was coming off a dramatic increase from the previous month and simply brought that sector back closer to trend. Apartment production generally continues to gain strength heading into 2012 after posting a more-than 50 percent gain in 2011.”
nmp news flash
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“The mortgage industry and its partners have worked hard for homeowners nationwide,” said Schwartz. “With almost one million loan modifications completed in the first 11 months of 2011 and over five million since 2007, it is clear that efforts to assist at-risk families via all available channels are bearing some fruit.” Homeowner events are already in the advanced stages of planning for Charlotte, N.C.; Miami, Fla.; Tampa, Fla.; Las Vegas; Sacramento, Calif. and Los Angeles in the first quarter of 2012. “There are more alternatives to foreclosure than ever before for homeowners through federal programs, proprietary modifications, and state level initiatives such as Hardest Hit Funds,” said Schwartz. “Mortgage servicers and non-profit, housing counselors are using all tools at their disposal to find options that fit each individual homeowner’s situation whenever possible. The emphasis continues to be on improving the customer experience through enhanced technology, single point of contact and leveraging all tools available to assist with foreclosure prevention, which in some cases includes graceful exits.” Since HOPE NOW began reporting
data in 2007, the mortgage industry has completed 5.13 million loan modifications for homeowners. This includes approximately 4.22 million proprietary modifications and 909,953 completed under the Home Affordable Modification Program (HAMP). From January through November 2011, there were approximately 969,000 modifications, 639,000 proprietary and 330,303 completed under HAMP. “As we move into the heart of the first quarter of 2012, HOPE NOW, its government, non-profit and state partners have already planned multiple face to face outreach events in key markets,” said Schwartz. “Additionally, HOPE NOW has worked with several military partners to implement events geared towards a specialized segment of at-risk military homeowners who have a unique set of mortgage challenges.” Of the 84,000 loan modifications for the month of November, approximately 57,000 were proprietary and 26,877 were HAMP modifications. According to the survey data, the inventory of 60 day plus delinquencies is 2.77 million for November 2011, up from the 2.65 million reported in October. Foreclosure starts for November 2011 decreased
National Mortgage Professional Magazine recognizes the support of those Mortgage Professionals who have stepped up to pay tribute to the men and women who have fought to preserve freedom for our great country. We will be featuring these Mortgage Professionals in our Mortgage Heroes feature in National Mortgage Professional Magazine. We want to hear from you if you:
# Make significant donations to any veteran's organizations # Hosts or sponsors events recognizing and paying tribute to veterans # Provides support for the families of veterans # Any other noteworthy assistance to help improve the lives of veterans and their loved ones
To be considered for Mortgage Heroes, visit
from the previous month—166,000 compared to 209,000. Completed foreclosure sales increased for the month—71,000 compared to 64,000.
Poll Finds 75 Percent of Voters Believe in Tax Incentives to Promote Homeownership By an overwhelming margin, American voters strongly value homeownership and would oppose efforts to weaken or eliminate the mortgage interest deduction or diminish a federal role to help qualified homebuyers obtain affordable 30-year mortgages, according to a new nationwide survey gauging likely voters’ attitudes towards homeownership and housing policy issues. “The American electorate is sending a clear message that owning a home remains a cornerstone of the American Dream and preserving a federal commitment to homeownership is essential to maintain a thriving middle class and get housing and the economy back on track,” said Neil Newhouse, a partner and co-founder of Public Opinion Strategies. Conducted Jan. 2-5 on behalf of the National Association of Home Builders (NAHB) by the Republican and Democratic polling firms of Public Opinion Strategies in Alexandria, Va., and Lake Research Partners in Washington, D.C., the comprehensive survey of 1,500 likely voters includes data from key political “swing areas,” including National Journal political analyst Charlie Cook’s swing House and Senate seats and Stuart Rothenberg’s presidential swing states. The survey, which has a margin of error of ±2.5 percent, is a follow-up to a similar national poll conducted last May. The poll shows that three out of four voters, both owners and renters, believe it is appropriate and reasonable for the federal government to provide tax incentives to promote homeownership. This sentiment cuts across regional and party lines, with 84 percent of Democrats, 71 percent of Republicans and 71 percent of Independents agreeing with this statement. Also, two-thirds of respondents say that the federal government should help homebuyers to afford a long-term or 30-year, fixedrate mortgage. Nearly three/fourths, 73 percent, of voters oppose eliminating the mortgage interest deduction. These figures held firm across the political spectrum, with 77 percent of Republicans, 71 percent of Democrats and 71 percent of Independents against doing away with the mortgage interest deduction. Meanwhile, 68 percent would be less likely to vote for a congressional
candidate who proposed to abolish the deduction, a figure that was virtually identical across all party affiliations (69 percent of Independents and 68 percent of Democrats and Republicans). A majority of voters are also against proposals to reduce the mortgage interest deduction, eliminate the deduction for interest paid for a second home, limit the deduction for those earning more than $250,000 per year, scale back the deduction for homeowners with mortgages above $500,000 and do away with the deduction for interest paid on home equity loans. “With the 2012 election season in full swing, candidates running for the White House and Congress would be wise to heed the will of the American voters, who have expressed broad support for government policies that encourage homeownership and oppose efforts to make it more difficult to get a home loan and to tamper with the mortgage interest deduction,” said Celinda Lake, president of Lake Research Partners. The survey findings are consistent with the results of other public opinion surveys. In a New York Times/CBS News poll conducted in June, 89 percent said that homeownership is an important part of the American Dream and more than 90 percent indicated that it is important for the federal government to continue the mortgage interest deduction. According to a Pew Research Study conducted last March, 81 percent of respondents agree that buying a home is the best long-term investment a person can make and 81 percent of renters surveyed said they would like to buy a house. “Even in a down housing market, homeownership remains a core American value, with the vast majority of citizens who do not currently own a home saying they want to buy a home,” said Bob Nielsen, president of NAHB and a home builder from Reno, Nev. “Those running for office in November need to understand that voters will not look kindly on any candidates who seek to dismantle the nation’s long-term commitment to homeownership.”
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The Top Five Things to Know to Start Your Career as an LO
By Leif Boyd
As new hires enter the loan origination business each day, there are five key tips that can help them transform a job into a thriving career. Although this is primarily geared toward those who are just getting into the industry or have entered within the last five years, many of the tips can be utilized by even the most seasoned loan originators (LOs).
3. Put the customer over the commission every time Oftentimes, LOs, especially young LOs, think that a $450,000 loan deserves more of their attention than a $60,000 loan. The reality is that both are customers and both deserve the same attention to detail and wise counsel. It even pays off to provide counsel to prospective clients who might not currently qualify for a loan. Working with these clients early to help them get their financial footing grounded will make them a good client in the future. These people, and those who have lower loan values, will see the quality service that the originator provided them, and in many cases, could give some of the best future referrals. Remember that taking an extra few minutes to help everyone is worth a lot in the long run and helps to “pay it forward.” After all, there is a little bit of good karma that comes along with doing the right thing.
27 how they can help send referrals in their direction. This does not mean making a sales pitch during every conversation. It does mean using basic conversation techniques to ensure that the loan originator gets to briefly describe what they do. When at the gym, hanging out at a backyard family barbeque and getting dinner with friends, ask them what they do. That question and the subsequent answer will almost always end with “and what do you do?” This is the perfect opportunity to give a 45 to 90 sec. elevator pitch on what an LO does, how they can help, and close with, “I’m always looking for referrals, so if you or someone you know needs a loan, contact me.” Facebook and Twitter also offer opportunities to let others know what an LO does. This does not mean posting “I need referrals” every day for friends and family to see. It does mean posting useful information that friends and family may find interesting about your industry. Then, every few weeks, remind friends and family about sending referrals if they or someone they know needs a loan. 5. Take every mistake and challenge as a learning opportunity Some of the best lessons come from mistakes made while on the job. There will be a time when an LO forgets to ask continued on page 32
4. Everyone you know should know what you do There was a running joke on the NBC television show “Friends” of people guessing what the character Chandler really did for a career. It was not until season nine, when he quit, that his friends and wife Monica, finally learned he was an IT procurement manager. If the people originators are closest to do not know or understand what they do, they cannot be a source for referrals or come to the originator when they need a loan. It is the successful LO’s job to ensure that every single friend and family member know what they do and
“The bottom line is the more time an LO is willing to invest in their career, the more income potential there will be. Remember … nothing happens without hard work.”
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2. This is a 55-60-plus-hour a week career Being successful takes time. Being a successful LO is a minimum 55-60-hour work week. It takes additional time to read blogs and articles like this one in National Mortgage Professional Magazine while you’re at home in the mornings, after work or on the weekends. Every originator needs to be able to do their job with clients and stay informed about the industry, and keep up with new regulations and economic trends. All of this cannot be done without coming in early and leaving late. The only exception to this rule is if you’re an hourly employee. This is a career choice. It is not just a job where you clock-in and clock-out. There will be a lot of phone calls, a lot of in-person meetings and a lot of keeping clients, potential clients and past clients informed on mortgage rates, the
status of loan documents and checking on referrals. The bottom line is the more time an LO is willing to invest in their career, the more income potential there will be. Remember … nothing happens without hard work.
1. Always ask for referrals Seems like common sense—Sales 101. That being said, most LOs fail to realize the importance of simply asking their clients for a referral. Happy clients will rarely automatically refer others to an originator. However, if they are asked for referrals, they are more likely to search through their rolodex, tell their Facebook friends and share the contact information of their LO freely with many others. These potential new clients are already very warm leads since they trust what their friends say. LOs have an intense and intimate relationship with their clients for 30-60 days as they work together on a loan. After this relationship is built, some LOs dismiss the client and forget about them. Successful originators continue to work with the client, keeping in touch with them on a regular basis and always asking for referrals. Here is an example of a basic script: “My business is built on service. If you think I do/have done a good job, please give me a referral. If you have been unhappy with any part of the service I have offered then please let me know how I can continue to improve.” Saying this once at the end of the process is helpful, saying it throughout the process is even more effective. At the beginning of the relationship, when an
originator first meets a client, the expectation of a referral should be clear. Towards the end of the initial conversation, say: “Throughout this process, I am going to ask for a referral,” and go on to talk about the service they should expect from you during the loan process. Then, at each high point in the loan process, remind them about the need for referrals. These high points include loan pre-approval, preparation for document signing and the final funding. Finally, even after the loan has closed and the client has been asked for a referral, the relationship does not end. Utilize a drip marketing strategy to follow up with the client every six to nine months after the loan closes. Call them to see how they are doing and ask, “How do you like your new home?,” “Do you have future plans that may require a move or remodel to your current home?,” or “Do you have any new referrals?”
the fha 203(k) loan
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The FHA’s primary goal is to assist homebuyers with a purchase they may not otherwise be able to afford, by providing mortgages with favorable loan terms, higher loan limits and flexible downpayment options. The 203(k) Standard and Streamlined loan programs are unique because they facilitate homeownership for borrowers and properties that may not be able to qualify for a conventional loan program. The popular 203(k) Streamlined loan can be used to purchase a home or refinance an existing mortgage, and at the same time, cover the cost of a remodel or necessary upgrades, up to $35,000. Although this is a great program for first-time homebuyers, it is not a requirement under the program. Buyers don’t have to be a first-time homebuyer to obtain an FHA 203(k) loan. Basically, a 203(k) loan is just like a regular FHA loan with an added component that allows for repair, remodel and renovation. All 203(k) programs allow borrowers to finance the purchase price of the home along with the extra funds needed for repairs and closing costs. Once the purchase transaction is closed, renovation funds are held in escrow and released through a draw process to pay for pre-determined renovation work completed by approved contractors. FHA’s low downpayment requirements help borrowers obtain an affordable loan that allows them to upgrade, repair or rehabilitate a neglected or distressed property. The 203(k) loan is an important tool to increase homeownership, as well as a significant community resource for neighborhood revitalization.
203(k) and green lending The focus on environmentally conscious and green lending has been receiving a lot of attention nationwide. We are aware of the role energy improvements play in significantly lowering the cost of homeownership through lower utility bills. FHA also offers an insured Energy Efficient Mortgage (EEM), which allows homebuyers to cover some or all of the cost of qualified energy-efficient improvements in both existing homes and new construction. Not only that, an EEM can be combined with the 203(k) loan to provide additional funding for the borrower.
Renovation funds and permanent financing in a single loan Most mortgage financing programs only provide permanent financing. This means lenders will not close a loan or release mortgage funds unless an appraisal demonstrates that the current
“FHA’s 203(k) renovation loan is distinctive in that it allows the borrower to purchase the home and provides additional funds to cover the costs of the proposed remodel or rehabilitation.”
condition and value of the home provides adequate security for the loan. If a property requires repair or rehabilitation, the majority of lenders will stipulate that the improvements be completed before they will offer a longterm mortgage. This means banks are not able to fund a conventional home loan until repairs are complete, and repairs can’t be made until the house has been purchased. FHA’s 203(k) renovation loan is distinctive in that it allows the borrower to purchase the home and provides additional funds to cover the costs of the proposed remodel or rehabilitation. Prior to the 203(k)’s inception, borrowers interested in a distressed property were forced to obtain separate loans to cover purchase, construction, and longterm financing. The 203(k) loan programs have filled an important void by providing affordable financing for poorly-maintained properties, such as foreclosures and short sales, and for potential homeowners who may not have the adequate funds for a conventional downpayment plus the additional rehab costs this type of distressed property often requires. Discover how you can help your real estate agents sell more homes and make more homebuyers and sellers happy. Discover the value, opportunity and potential that FHA’s 203(k) loan program provides. Ginger Bell is an education specialist who develops training programs for many companies, including Plaza Home Mortgage, Rehab Loan Network, OnlineEd and Mortgage Success Source. Formerly with Dale Carnegie Training, Bell has more than 20 years of experience leading workshops in public speaking, leadership, customer service, sales and continuing education. Bell is a Nationwide Mortgage Licensing System (NMLS)-approved instructor and has been awarded the Presidential Award by both the California Association of Mortgage Professionals (CAMP) and the Oregon Association of Mortgage Professionals (OAMP) for her commitment to bringing quality education to the mortgage industry. She may be reached by e-mail at firstname.lastname@example.org or visit www.go2training.com.
The Foreclosure Landscape in 2012 Recent court ruling expected to have a dramatic impact throughout the year By Christopher G. Brown
Lenders will continue to have problems proving they are holders
Borrowers will be more proactive in their defense
Longer mediations with little impact on loan modifications A number of state and federal programs were aimed at getting banks to work with borrowers on loan modifications. Many arrived with a lot of fanfare, but they haven’t really impacted the number of loan modifications the way they were intended. This is why President Barack Obama made it part of his recent State of the Union speech, but I don’t think even that will have much of an impact on the foreclosure scene. The fundamental problem that no one has been able to fix is that lenders don’t seem capable of processing modification requests promptly. They frequently claim that packages are incomplete and request documents or information that the borrowers have already provided. When the same information is re-submitted, they often claim that other documentation has become outdated and needs to be resubmitted. This cycle can be repeated multiple times. There was a lot talk that the banks were striving to
Government Report Cards could impact the modification process In 2011, the Federal government began monitoring loan mods and began issuing Report Cards on lenders. These Report Cards suggest areas in which the lenders need to improve. I’m going to be an optimist here and suggest that the lenders are going to take these suggestions to heart in 2012 and actually try to meet the standards they advocate. I don’t expect the government to go away on that front. I think they’ll put pressure on lenders to get their acts together. We recently had a case where the bank agreed to modify, told us what the new payment would look like and promised to send a written modification agreement. We had to send the written agreement back twice to be corrected because the numbers didn’t match what they told us. I don’t think it was intentional. It was the kind of bungling that has become part of the loan mod process. It’s not uncommon for these modifications to take over a year. I’m hoping that these Government Report Cards will show lenders just how often these kinds of things occur and encourage them to change their processes.
Courts to order lenders to send representatives with real authority to mediation sessions The law requires borrowers to be physically present for mediation, but permits lenders to send only their lawyers. These lawyers are supposed to have the authority to agree to a resolution. In addition, there’s supposed to be a lender representative available by telephone. In practice, that almost never happens. The lenders’ lawyers often do not have authority, and rarely does the telephone representative. Without someone at the table with real decision-
Commercial borrowers to benefit from changes on the residential level I believe that the Connecticut Supreme Court’s decision will also help commercial borrowers. Commercial loans were bought and sold on the secondary market just like residential loans. Plus, the loan documents for commercial loans can often be exotic when compared with residential loans. I would expect to see ownership of the debt issues applied to commercial loans, forcing commercial lenders to re-think their procedures and assumptions here as well. I know that I am doing just that in a number of commercial foreclosures I am defending. In general, I expect the foreclosure environment in 2012 to look very much like 2011 with a few glimmers of hope for borrowers. The economy is still not on the upswing, as joblessness is still a significant issue. Nevertheless, I am hoping that the influence of the courts and an understanding of the need to change will bring banks to the understanding that they have to make adjustments to the ways they deal with mortgage holders. Christopher G. Brown of Begos Horgan & Brown has represented defendants in a number ground-breaking foreclosure cases. His practice concentrates on foreclosure defense and debtor-creditor law. He has been litigating financial cases for 19 years, representing borrowers in residential and business foreclosures and parties on either side of a debtor-creditor or other financial dispute. He may be reached by phone at (203) 226-9990 or e-mail email@example.com.
By recognizing that only the owner of the debt can foreclose, the Supreme Court decision gives borrowers a 10-pound sledgehammer to fight a foreclosure. Before it, borrowers had only a threepound hammer because they were effectively limited to challenging holder status. But no hammer is any good unless it’s swung. Borrowers should not expect the decision to mean that the courts are going to “swing for them” in the upcom-
The Federal Reserve’s promise to keep their rates low in 2011 and 2012 won’t necessarily have a dramatic impact on the number of people falling behind on their mortgages. These rates do have an impact on adjustable-rate mortgages (ARMs), but it won’t be significant. A lot of the problems that would have been associated with ARMs have been ameliorated by keeping interest rates low. That’s good news, because the rates aren’t going to explode next year. But, a lot of those ARMs were fixed rates for five years or less and many of them were interest-only for the fixed period. The bulk of these loans are past the five year period, and it’s time for those borrowers to pay back principal. Even though the interest portion of the payment might decrease because of the low interest rates, the overall payment may increase because it now includes a principal payment.
making ability, it’s tough to get things done. It also makes it easier for the lenders get away without making a decision or to ask for the same information repeatedly. When lenders do not have to take the time to be there in person, it’s easy for them not to take mediation seriously. Lately, borrowers have been asking the courts to direct someone with real bargaining power to attend mediation and the courts have been granting those requests. I expect that trend to increase. I am cautiously optimistic about banks changing their ways. The more they are ordered to come to mediation sessions in person, the more likely they will be to rethink how they are doing things.
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Even though mere holder status is still beneficial for lenders, establishing that they are holders of the note will continue to be difficult for lenders. I recently had a case dismissed for a client because the party that started the foreclosure suit failed to prove that it was the holder—had possession of the note—on the date the action started.
Continued low interest rates to have limited effect
make modifications, but there has been extreme criticism that these plans have done nothing and that few loans are getting modified. But, I do see something of a silver lining on this cloud. The foreclosure process generally does not move forward while mediation is ongoing and the mediation generally continues until the bank says “No.” Borrowers who may not ultimately qualify for a modification benefit from being able to stay in their homes.
hat trends will shape the mortgage foreclosure landscape in 2012? As I look towards the next 12 months, I’m expecting that the most influential trend will be a recent Connecticut Supreme Court ruling that could have a significant impact on who can sue to foreclose. As the foreclosure defense attorney who represented the borrower in this case, I had a front row seat on Connecticut’s recent Supreme Court decision, and I’m expecting it to be something that will give lenders pause. Only a few months into 2012, I’m already seeing how it’s been rocking business as usual when it comes to who has the right to foreclose. Before this decision, lenders claimed that being a holder (the legal term for possessing the note) meant that they had the right to foreclose. The court’s decision confirms that only the owner of the debt has a right to foreclose. Holder status is not enough. I would expect lenders to be slow to change their procedures to account for this decision, which could very likely mean more dismissed foreclosures in 2012. I also foresee a number of other important developments in the foreclosure arena in 2012:
ing year. They will need to take part in the foreclosure and make sure they—and their lawyers—push institutions to prove ownership of the note. It will continue to be up to the borrowers and their legal counsel to make sure that happens in the coming 12 months.
A Deeper Dive Into 2012’s Mortgage Industry Hiring Forecast By Drew Waterhouse
was recently fortunate enough to have my 2012 mortgage industry hiring forecast published online at NationalMortgageProfessional.com. Two of my forecasts were that the movement of top originators among firms would accelerate during 2012 and that consolidation in the industry would continue resulting in mid-tier originators gaining market share. I want to delve a little deeper into my reasoning behind those forecasts in this article. In some ways, 2012 represents the rebirth of the mortgage industry. The ground rules have been and are being reformulated. Old dominant teams and players are becoming less successful, while younger, more nimble teams and players are making their mark, and even some former stars are returning from rehab to stir things up. Let me take a brief detour to illustrate my point. Like many of you, I have watched a lot of football recently. During the NFL conference championship games, I began to see a parallel between this year’s playoffs and the mortgage industry in 2012. Two of the most dominant teams in the history of the NFL, the Pittsburgh Steelers and the Green Bay Packers, who happened to be last year’s Super Bowl representatives, found their dominance overcome this year by teams that rank in the middle-tier of NFL history, the Denver Broncos and the New York Giants. In the cases of both the Broncos and the Giants, talented quarterbacks made all the difference.
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The Broncos relied heavily on the heroics delivered repeatedly by second year quarterback Tim Tebow. An unconventional and widely critiqued draft choice by the Broncos in 2010, Tebow’s play this year, leading the team to the second round of the playoffs, justified the team’s decision to trade their second, third and fourth round draft picks to move up to get him in the first round. Josh McDaniels, the Broncos coach at the time Tebow was drafted, explained his choice this way: “Tebow has all the traits you are looking for in terms of toughness, competitiveness, he’s intelligent, he’s won a lot of games, he’s a leader, he works hard, he’s got all the intangibles you look for in a player at that position.” In other words, Tebow fit their team and what they valued in a player. He was a Model-Match. The Giants depended this year, as they have for many years, on quarterback Eli Manning. Already a Super Bowl champion, Super Bowl MVP and NFL MVP, Manning led the Giants back to the Super Bowl with one of his best seasons to date. But the story of his coming to the Giants is one of the most interesting in NFL draft history. In 2004, there were two top quarterbacks coming out of college, Eli Manning and Phillip Rivers. The San Diego Chargers had the first overall pick in the draft and needed a quarterback. Their first choice was Eli Manning, but Manning’s representatives informed San Diego that he would not sign with them if they drafted him because he did not believe that he was well-matched to their style of offense. Still needing a quarterback, the Chargers negotiated a deal with the New York Giants for the Chargers to draft Manning with the first pick, the Giants to draft Rivers with the fourth pick and for the players would
The decline of the mega-lender In the wake of the sub-prime lending and banking capital crisis, we saw the largest banks in the country emerge far
stronger than their mid- and smallersized competitors. The billions of taxpayer dollars that stabilized the largest banks, combined with their national footprints, gave them a significant advantage in the mortgage origination market between 2008- 2011. However, things are beginning to change. According to industry reports for the third quarter of 2011, the four largest originators—Wells Fargo, JP Morgan Chase, Bank of America and Citi—have seen their combined mortgage origination market share drop to 54.99 percent from 58.40 percent a year earlier. Why are the mega-banks losing mortgage origination market share? There are two primary reasons for this change—costs and effective competitors. According to a recent report from Paul Miller of FBR Capital Markets, these large banks are suffering from high costs and distractions associated with the servicing of previously originated loans and repurchase requests from the government-sponsored enterprises (GSEs). Secondly, smaller competitors, particularly those without legacy servicing or technology constraints, have been effective in scaling up their operations, providing better loan closing execution and reaching out to prospective customers, thereby taking market share. The declining operational conditions at these mega-lenders have cost them many of their top originators. Throughout the fall of 2011, the industry news outlets were filled with report after report of leading originators leaving these large firms for other firms—sometimes to other megalenders, but often to mid-sized or smaller competitors.
The emergence of mid-sized lenders
The rehab of brokers These emerging mid-sized lenders had better not get too complacent, because 2011 origination data also indicates that small lenders, brokers, are picking up market share as well. After hitting an all-time low of 6.8 percent in the second quarter, brokers saw their market share grow to 7.9 percent and 9.2 percent respectively in the succeeding quarters of 2011. As the regulatory environment clarifies in 2012, brokers’ competitiveness may increase further as their ability to offer a more entrepreneurial environment and their proximity to customers entices top origination talent. Moreover, rumors of major investors looking to begin to invest in wholesale lending operations, coupled with the big lenders’ need to reduce costs, may create favorable conditions for brokers. The once dominant players in mortgage origination may revitalize the industry after three-plus years of being essentially out of the game in rehab.
Free-agency of mortgage talent The decline of the big boys, the emergence of the upstart mid-sized firms and the rehab of the former dominant players has created what amounts to almost universal free-agency for talented mortgage originators. Originators, with the stats to back them up, can find a home wherever they want. The fact is that all lenders will have to compete to retain and attract the best originators in the business. Much like a star athlete evaluating their options about where to take their talents, star originators will be evaluating the entirety of offers presented to pick the one that offers the best Model-Match. Anybody want to start a “Fantasy Origination” League? Drew Waterhouse is managing director of Hammerhouse LLC, a national recruiting and strategic growth firm for the financial services industry with mortgage sales and leadership placement at its core. Drew may be reached by e-mail at Drew.Waterhouse@TeamHammerhouse. com or visit TeamHammerhouse.com.
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While the mega-lenders were losing market share, mid-sized firms were gaining. Second-tier lenders, including PHH Mortgage, U.S. Bank, Quicken Home Loans, Provident Funding, BB&T and Fifth Third, have seen a doubling of their market share from 2007 to the third quarter of 2011 according to Paul Miller. This is a diverse group made up of three regional banks, one online lender and two non-bank lenders. These firms share two primary attributes that have helped them grow during these challenging times in the industry. First, they all emerged virtually unscathed and financially secure after the mortgage
and banking crises. Second, they have grown their businesses by investing in technology and talent.
be traded for one another. In other words, a top talent quarterback chose the team with which he believed he was best Model-Matched. What does any of this football trivia have to do with the mortgage industry in 2012? Both football examples illustrate how mid-tier football teams used the acquisition of Model-Matched talent to displace first-tier organizations in the battle for supremacy. The mortgage industry is witnessing a similar phenomenon of mid-tier firms gaining market share from first-tier firms by careful acquisition of origination talent. The fact is, in football, the talents of your quarterback will, in large part, determine the success of your team. In the mortgage industry, the talents of your originators (those who figuratively touch the ball on every play) will determine the success of the lender. Where our analogy suffers, however, is that it has been primarily through free-agency that the mid-tier in the mortgage industry has grown, rather than through the hiring and training of brand new originators (the draft). A free agent in professional sports is an athlete who is not under contract and is free to sign a new contract with any team with which they can reach a deal. The recent courtship of LeBron James when he became a free agent after the 2010 NBA season is the highest profile example that comes to mind. Football is likely to see a similar free-agency, free-for-all this spring when Indianapolis Colts quarterback, first-ballot hall of famer, and Eli Manning’s older brother Peyton Manning will likely be available to sign with any club he chooses. In the mortgage origination industry, free-agency exists because available talent is often not satisfied with the execution provided by the biggest lenders. For top originators—lack of execution— equals a negative Model-Match and a reason to seek a new team.
Zillow Launches Social Media Homebuying Assistance Tool
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Zillow has announced the launch of Neighborhood Advice on Zillow.com, a social home-shopping experience that helps buyers and renters learn about neighborhoods from their Facebook friends. While shopping on Zillow, users are prompted to activate Facebook Connect and then see locally where their Facebook friends live or “check-in” the most. As shoppers search for homes in a specific city or neighborhood, Neighborhood Advice will recommend Facebook friends connected to the area to contact for personal tips and advice. For example, if a user is searching for homes in the San Francisco neighborhood of Noe Valley, Neighborhood Advice will identify friends who have shared that they live in Noe Valley, or who frequently “check-in” to places in Noe Valley. The home shopper can then send these friends a private direct message on Facebook to ask questions about the neighborhood. “When people are looking to rent or buy a new home, they always ask friends, family and co-workers questions about different neighborhoods. Neighborhood Advice takes this further and deeper by allowing shoppers to quickly and easily tap into their broader online social network as they shop for homes on Zillow,” said Spencer Rascoff, chief executive officer of Zillow. “Integrating social media tools and friend networks into the core Zillow home-shopping experience is yet another way we are giving our users access to previously hard-to-find, yet soughtafter, information.”
LendingQB Releases Companion Android and iPhone Apps LendingQB has announced the availability of mobile app companions to their cloud-based, end-to-end loan origination system. The LendingQB apps are designed to enhance the loan closing process by keeping loan officers in constant contact with their loan origination system. “Mobile applications need to be more than a gimmick,” said Binh Dang,
LendingQB’s managing partner. “The LendingQB mobile apps provide useful functionality that helps loan officers stay on top of their loans and foster better communication with their customers.” Available for free on both Androidbased smartphones and Apple’s iPhone, the LendingQB mobile app is linked directly to the full LendingQB mortgage loan origination system (LOS) and provides mortgage professionals with the ability to view real-time status updates of loans in their pipeline, as well as track when loan milestones have been achieved. The LendingQB mobile app also includes a loan pre-qualification and pricing tool that is linked to LendingQB’s built-in automated underwriting engine, PriceMyLoan. Users can enter in loan scenarios and instantly view eligibility and real-time pricing results. Loan scenarios can be saved for quick access at a later time. “Our mobile apps are designed to leverage the best features of our full loan origination system, but in a way that makes sense,” said Linn Cook, marketing director at LendingQB. “Providing loan officers a snap shot of their loan pipeline not only keeps them informed, but it cuts down on the amount of calls that loan processors and underwriters have to field. Additionally, using a smartphone to get instant quotes on loan eligibility and pricing lets loan officers make a powerful impression on prospects and generate more leads.”
understand the risks and potential loss severity of each loan,” said John Walsh, president of DataQuick. “For buyers, the low cost of distressed properties provides attractive investment value, while servicers and owners need to understand how to mitigate their potential losses.” DataQuick’s RiskFinder Distress provides unprecedented capability to track foreclosure, short sale, real estate-owned (REO) or for sale by auction trends. The trends can be analyzed by geographic level and time period, with coverage available nationwide and by ZIP code. “The biggest challenge in clearing out the inventory of distressed homes is in identifying the best strategy for limiting losses or for a profitable acquisition,” Walsh said. “RiskFinder Distress gives users the information and analysis needed to
Your turn 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:
New to Market column Phone #: (516) 409-5555 E-mail: firstname.lastname@example.org Note: Submissions sent via e-mail are preferred. The deadline for submissions is the 1st of the month prior to the target issue.
top five things to know for a financial document, misses an important deadline or even gets two clients mixed up. Making a mistake is a difficult realization for anyone, especially in a detail-oriented career field like this one. Mistakes do happen and can be learning opportunities. It is not enough just to fix the mistake. LOs need to go back and look at why the mistake was made in the first place. Is there a process that could be in place to prevent this mistake in the future? Since the LO business is a process-oriented business, the same factors that contributed to one mistake or challenge will be in place again. Learning how to spot those factors and identify the issues that lead up to the challenge will be one of the most helpful things that an LO can do throughout their career. Jim Harbaugh, head coach of the San Francisco 49ers said it best when he said, “We’re trying to improve in all
heard on the street
New DataQuick Tool Analyzes Distressed Properties DataQuick has announced the release of RiskFinder Distress, a tool that provides investors, lenders and servicers with the ability to search and analyze the risk levels of distressed properties nationwide. RiskFinder Distress enables users to track and analyze key distress events throughout the life cycle of the loan. This provides investors and lenders the information needed to evaluate risk, determine the impact of distress sales on loss severity estimates, drive loss mitigation strategies and identify markets that are starting to recover. “There is a significant opportunity in distressed properties if companies
not only track distress trends, but analyze their influences on home prices and predicting loss severity.”
continued from page 27
areas. [We need to] see where the heck we can get a mile and half faster and one percent better each day. That’s the way we go about things” (Inside the 49ers, Santa Rosa Press Democrat, Nov. 9, 2011). If each LO becomes one percent better each day, in a month they will be 30 percent better. There is always room for improvement. Being an LO is about learning from mistakes, creating new, more accurate ways of completing processes and always asking for new referrals. Leif Boyd is senior vice president of production for American Pacific Mortgage. Since joining American Pacific Mortgage, Leif has taken an active role in overseeing all aspects of mortgage origination, including the oversight of the production department and 114-plus branches. He may be reached by phone at (916) 9601325 or e-mail email@example.com.
continued from page 11
Mortgage Company, has joined Urban Financial Group as head of wholesale and retail sales, and Kristen N. Sieffert has joined Urban Financial as director of corporatewide project management and coordinator of call center operations. Peter J. Grace has joined the Mortgage Bankers Association (MBA) as vice president of strategic planning and internal technology. Herb Suvaco has joined Calyx Software as the newest member of the firm’s new account sales team. MountainSeed Appraisal Management has added Lisa Scott to its sales division. Mark J. Sadlek has joined AssociaTitle as its new director of business development.
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: firstname.lastname@example.org Note: Submissions sent via e-mail are preferred. The deadline for submissions is the 1st of the month prior to the target issue.
Monday-Tuesday, March 19-20, 2012 Capitol Skyline Hotel Be prepared to go to the Hill! Includes Advocacy 101 training: General synopsis and "Question & Answer" on the best ways to communicate NAMB's talking points with your congressional leaders in an effective manner.
Highlights Will Include:
Hotel Accommodations Capitol Skyline Hotel 10 "I" Street, Southwest • Washington, D.C. 20024 Phone #: (202) 488-7500
www.capitolskyline.com Special "NAMB" rates will be available for a limited time only. Book early! You must be registered for the conference in order to book your room.
Visit www.NAMB.org/legconference for details!
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Headlines and blogs from around the web.
I Mortgage industry trade association panel discussion featuring representatives from NAMB, the Mortgage Bankers Association (MBA), the National Association of Realtors (NAR) and the National Association of Home Builders (NAHB) I A closer look at the powers of the Consumer Financial Protection Bureau (CFPB) and what they will be looking for in their audits I Loan originator (LO) compensation and the impact of HR 2509, the Preserving Consumers’ Mortgage Origination Choices Act of 2011, sponsored by Rep. Gary Miller (R-CA)
Headlines and breaking news from NationalMortgageProfessional.com.
The number one reason you should attend this event is the satisfaction of knowing you are doing your part to ensure that mortgage broker issues are heard on Capitol Hill. You are the best spokesperson for our issues. Your participation benefits you, the industry and your clients as a whole, by strengthening the broker’s presence in the halls of Congress.
Marketing 101: It’s the Message That Makes the Difference! By David Lykken & Jon Traver
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This month, you will find a variety of articles in this magazine covering a number of ways in which to market yourself and your company. While there are many great options out there, especially with the world of social media taking off, we wanted to focus on a different part of the marketing process: The message. No matter where you decide to spend your time, money and effort, if the message doesn’t work, your success will not be there. Marketing is everywhere, in every business, and in every media type possible. As we sit here writing this article, we are one week away from the 2012 Super Bowl. We all know that the Super Bowl is as much about marketing and advertising as it is about football, if not more. Now unfortunately, by the time you read this, the Super Bowl and its commercials will have come and gone, but we want to give you a little homework before you start to move forward with your marketing plans for 2012. What we would like you to do is the following: Go to YouTube.com and search for “Super Bowl 2012 Commercials” and watch each of them. While watching them, you need to be making notes about each one. Here are the questions you should try and answer: What is the primary message? (Hint: Not what are they selling!) Was there a call to action? (Did it make me want to go do something?) Can I relate to what they said? Did they set themselves apart from their competition? The goal of this exercise is to get your mind zeroed in on the most important part of marketing, your message. No matter how much effort and research you put into finding the best place to market yourself, without the proper message, it will be a complete waste of time and money. It always amazes us when we sit down with our clients, how much time they have spent deciding where, when and how much to advertise and market themselves, and how little time they have spent, if any, on the message. Let’s take a look at two different very specific areas that mortgage professionals might look at when formulating a marketing plan. The first topic we will look at is
the tough job of generating loans or referral sources. This can be the toughest marketing job in the mortgage world, because every single loan officer is working towards the same goal. Any time we are faced with a great deal of competition, the message we are delivering becomes so much more important. So, after you have decided where to market yourself (Google, direct mail, social networks, pay-per-click advertising, etc.), you must begin to formulate your message. There are two main objectives when building your message. The first objective you need to achieve is, “what sets me apart from my competition?” Be sure not to fall into the simple trap of “I have the best rates” or “we provide the best service.” There are two problems you will encounter when using either of those messages. The first is that everyone says they provide great rates and great service, so how can you differentiate yourself when using those lines? The second issue is that, eventually, you will not be able to back those statements up, and then what? When trying to generate business for yourself, you must have a solid reason for whoever has seen your marketing to feel that there really is something that differentiates you from the competition. And while we cannot go into details about how we help our clients achieve this goal, there are many different ways to do this … it just takes time and creativity. The second important thing about your marketing message is you must include a call to action. McDonald’s spends millions of dollars a year building name recognition, but you don’t have millions of dollars to spend! You must get through to your potential clients the first time. Readers or listeners to your message must be given a reason to reply or respond to your message. Don’t just assume they will see your name and decide to call. You must give them a reason to call, and more importantly, a reason to call NOW! Now, let’s look at things from a company point of view. Many companies are looking to increase their production through either branch or loan officer acquisition. We all see these ads in so many different places. When we sit down with our clients and begin to build a plan to increase pro-
duction through talent marketing in the mortgage acquisition, we always industry fails to achieve the remind our clients to list the success desired. We believe reasons why someone this is because the message would choose their compaincluded simply did not ny over the hundreds of persuade those who were other quality options in the targeted to respond. marketplace. Remember, you must Depending upon your find a way to set yourself company’s name recogniapart and you must have a tion, the task of maximizing call to action in all marketyour marketing dollar can ing messages. Learn all you either be hard or really “It always amazes us can about the many options hard. When trying to attract out there, including social when we sit down attention from those within with our clients, how networking. Don’t forget the mortgage industry, you much time they have your homework, and don’t not only have to adjust spent deciding where, ever stop trying to grow and where to market, but the when and how much succeed. The business is out message you market with. It to advertise and mar- there, you just have to go always amazes us how and find it! ket themselves, and many companies use fast how little time they turn times or low rates as have spent, if any, on David Lykken is president of the reason someone might mortgage strategies and the message.” want to join their firm. managing partner with —David Lykken While that message may Mortgage Banking Solutions. have worked a few years ago, most origi- He has more than 35 years of industry expenators and branch managers left in this rience and has garnered a national reputabusiness are just too smart and experi- tion, and has become a frequent guest enced to fall for such a meson FOX Business News sage. with Neil Cavuto, Stuart Companies must now Varney, Liz Claman and provide solid concrete reaDave Asman with additionsons as to why becoming a al guest appearances on part of their team is advanthe CBS Evening News, tageous. We always ask our Bloomberg TV and radio. He clients the following quesmay be reached by phone at tion: How will your compa(512) 977-9900, ext. 10, or eny help me grow my own mail dlykken@mortgagepersonal production? If you bankingsolutions.com or struggle to answer that email@example.com. tion about yourself, how can Jon Traver is production “When trying to genyou effectively answer that consultant—branching, erate business for question from someone who recruiting and LO training yourself, you must actually answered your call for Mortgage Banking have a solid reason for to action? Solutions. Jon has spent 12 whoever has seen your Any good loan officer or years forging referral relamarketing to feel that branch manager would tionships with builders and there really is somewant their company to prorealtors for his own mortthing that differentivide them with help in gage company. He has ates you from the growing their business. extensive experience workcompetition.” Finding the answer to that ing with branch companies —Jon Traver question above, and then to grow their businesses getting that message across in a marketing through branch and LO acquisition, as well message (including a job posting) can be as building long-term business development tough but crucial to your success. plans. Jon trains executives, branch manIn an industry with so much compe- agers, and loan officers how to redefine tition, differentiating yourself from who they are and what they do. He then everyone else can be tough. But if you helps them build a game plan for taking want your marketing to succeed, you that new knowledge to the streets, including must find a way to accomplish this, with or the execution. He may be reached by phone without help. In our past experience 50 at (512) 977-9900, ext. 112, (972) 467-3990 percent to 70 percent of all advertising and or e-mail firstname.lastname@example.org.
Do You Have a Marketing Problem or a Branding Problem? By Patrick H. Seroka
Clarification number two: The definition of brand development Brand development is the process by which a company’s evidence of distinction is unearthed and communicated internally and externally. Again, employees must “be” the brand before marketing can launch the brand.
Clarification number three: Brand development must be discovered and adopted at the very top echelons of a company or organization Brand development is not and cannot be a Your brand must be built marketing initiative—it must be aligned from within with your business strategy. Brands are the Ask any CEO what their most valuable asset is, reason companies exist. Therefore, brand and they will most likely tell you that it’s their development must start at the top. employees or their brand. They are the same—a company’s brand is its employees. The three most Therefore, employees must learn the brand, important brand live the brand, become the brand and deliv- development questions er the brand before marketing can be As we have already established, brand develemployed to communicate the brand. opment must start from within, you’ll note that the answers to the three most important Three brand development brand development questions cannot be clarifications found through external research. Answering Clarification number one: these questions will require a meeting with The definition of a brand key people in your company (C-Suite, senior If you look up the word “brand” in a diction- management, human resources, sales and ary, you’ll see definitions synonymous with operations). You’ll need their perspectives as identifying and claiming. While this may be you answer these questions: an appropriate definition for marking cattle and identifying property, it is insufficient for 1) Who are we? What type of lender are branding a company or organization. you? What type of loans do you offer? Do you The reason is because any company can specialize in any loan programs? claim to be anything it wants, and many do 2) How are we different? There is a reason
Going through a brand development process will require a significant amount of time, thought and energy. The biggest mistake a company can make is to allow that momentum to coast to a crawl once the new brand has been defined. It is critical that the CEO drive the internal brand adoption while the enthusiasm is still boiling and see to it that progress is made every day. This can best be accomplished by creating “momentum groups,” assigning them tasks and deadlines, and establishing expectations. Internal brand adoption requires much more than a meeting and supporting e-mail to communicate the new brand. Employees—all employees—will need to be engaged in a fun, interactive way to encourage bonding and collaboration. This will not only build their enthusiasm for the new brand, but also boost morale. Again, brand development must start from within. Once your brand has been thoroughly adopted by everyone in your company, it will be time to identify all of your brand touch points (sales, human resources, operations, customer service, etc.) and promote your brand with relentless enthusiasm. Now go and crush your competition! Patrick H. Seroka is president and chief executive officer of Seroka, the only Certified Brand Strategists in North America specializing in the mortgage industry. With Seroka, you’ll experience unique, second-to-none client service and benefit from compelling marketing communications. Plus, we guarantee your growth. For more information, call (262) 5233740 or email email@example.com.
Brand development is typically initiated at the C-Level when a company is suffering from diminishing returns on marketing investments, when a competitor builds a better mousetrap, or when corporate initiatives (such as a merger or acquisition) require a branding effort. The process usually starts with the marketing director who drafts and submits a Request for Proposal (RFP) to branding companies, consultants and ad agencies. When brand devel-
“Given the competitive landscape within the mortgage industry (and in any industry for that matter), most companies don’t suffer from a marketing, advertising or public How to avoid the relations problem— biggest brand they suffer from a development branding problem.”
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The traditional method of brand development
opment proposals start rolling in, they typically include a heavy emphasis on the need for the company to invest in external qualitative and quantitative research to measure brand equity, brand awareness and the process by which customers search for and select mortgage companies. Once the external research is complete, the chief executive officer and other key executives get together to analyze the findings and begin to think in terms of becoming the mortgage company people are asking for. It seems to be the most intelligent and logical approach. After all, everything the CEO needs to know is in his or her hands, and it’s simply a matter of changing a few things internally to meet the wants and desires of the customers who participated in the survey. The next step? Building an aggressive and robust marketing plan centered around the new brand. The problem with this method is that too many competitive companies approach brand development in similar ways; they also acquire intelligence from external research and subsequently change their brand and messaging to resonate with their customers. Is it any wonder why so many competitive companies say the same things, just in different ways?
why your company was started—you had something to offer that was better and/or different from your competitors. 3) What are we capable of becoming? If you’re stuck in a situation where your original unique selling proposition is no longer relevant or has been diffused by competitors, you must identify what your brand is capable of becoming. Of the three questions, this may be the most important, as it will determine how you will grow and emerge with new, improved and enhanced unique selling points.
There is a traditional and unchallenged approach to brand development that, for quite some time, seemed airtight and struck all the senses of logic, yet is flawed and has lost its effectiveness. Before we begin, take a few minutes to jot down the names of four or five lenders you compete with, and make sure to include your own. Next, visit your competitors’ Web sites and your own through the eyes and minds of your customers. Read through the “About Us” pages and peruse through loan programs and services. Question … after looking through three or four sites, did you happen to detect any messages on any of the sites you visited that differentiated one mortgage company from another? Or, did most sites pretty much say the same things, just in different ways? If you found this exercise underwhelming, confusing and maybe even exhausting, you can understand how customers feel when trying to select a lender. The fact is, most people will not take the time to dig and unearth the differences between competing mortgage companies as they navigate through their decision-making process. A company’s failure to communicate a clear, meaningful and relevant distinction leaves “could-be customers” with little choice but to base their decisions on variables such as rate, price and location. Wordof-mouth may influence some, but nowhere near enough to build a strong company and propel sustainable year-over-year growth. Given the competitive landscape within the mortgage industry (and in any industry for that matter), most companies don’t suffer from a marketing, advertising or public relations problem—they suffer from a branding problem.
in the spirit of retaining and attracting customers. But how many of those companies can prove their claims to be true? Next time you are on hold for 20 min. with a company that boasts “stellar customer service,” you’ll understand exactly where I’m coming from. So, for your purposes, the definition of a brand must be “evidence of distinction.” In other words, if you say it, you must be able to prove it. Do you tout _____ (fill in unique selling point) _____? You’ll need to prove it. Do you claim _____ (fill in unique selling point) _____? You’ll need to prove it. You can prove claims through certifications, testimonials, reviews and other factual supporting references, and highlight them on your Web site and in sales collateral.
“Don’t You Forget About Me” Make marketing matter By BJ Bounds
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
Everything we do as business owners is designed to keep our company at the forefront of any potential client’s mind. But as we spend our time developing the perfect slogan, taking the perfect picture or designing the perfect flyer, we often forget the most important thing—the client! Remember the song titled above by Simple Minds from the 80s? That’s what I’m talking about. What may be perfect to us may not resonate the same way with the clients we seek. We must always keep the client in our minds as we seek to market to them. It’s not about us. Reaching out to your audience and marketing your business is not complicated, but it starts with developing an overall look and feel for your business that will attract the clients you seek. Once you have figured out what you audience wants, the next step is to begin the marketing process. Marketing doesn’t just happen. It’s a process that requires a strategy— even a simple one, and it can encompass any number of methods and tools. Today, we’re just going to talk about those things you can do with your main business tool, your loan origination software (LOS), coordinated with an Internet presence, to make your marketing strategy matter.
Know your audience Marketing contacts can come to you from many different sources. A primary source of contacts will come from applicants in your LOS. You LOS enables you to capture many more personal details in addition to the required application data. Get to know your applicants and build your database with relevant marketing information. Birthday, children’s names and ages, interests, alma maters, etc. will be significant to you when you begin your marketing efforts. Along with your applicant contacts, you can and certainly should maintain a database of vendor contacts. Your LOS is more than likely your most secure system and keeping your contacts here would ensure the integrity of your database. Keeping your vendor and referral partners in one consolidated database makes targeted marketing easier and less time-intensive. Determining your audience’s likes and dislikes, along with developing your overall marketing objectives, you can begin
marketing to your contacts. Begin by sorting your contacts by any number of fields to target your messaging. Your LOS allows you to export contact information with filters that suit the message you choose.
Tailor your messages Your LOS is not just a loan processing system. It is so much more than that. It can serve as your database for marketing contacts and store your marketing materials for whenever you need to produce or send them. Because you can categorize your contacts in to segments that work best for your messages, your marketing materials can become the type of targeted communications that mean the most to your audience. Now that you know who your audience is, you can more easily develop your messaging accordingly. Different from the mass marketing techniques of a large corporation, with a “one-size-fits-most” marketing campaign, your campaign should be targeted to the audience categories you have created in your database. This technique allows you determine the messages that resonate best with your contacts and are more likely to make an impact. I mentioned before that personal information is important to capture for your database contacts. This is where sending simple birthday wishes comes into play. Use that opportunity to ask for referrals or maybe even send refinance rates if it makes sense. You could also select the realtors in your database and can create a marketing campaign just for them, whether or not you typically do business with them. It would be a great way to get referrals from new sources or solidify the relationships you have with your favorites.
Establish your online presence Fundamental marketing techniques can establish your business as a true contender in your space. Turning your company’s vision into a decided look and feel is the first step in making marketing matter for you and your clients. Once you have the overall “brand” for your company that speaks to your strengths, your commitments, and most importantly—your intended audience, you have the blueprint with which
you can begin drawing your such a way that they marketing plans. evoke the response that As you develop your you are looking for. That’s plans to promote your why knowing your conbrand and company offertacts’ personal informaings, keep in mind two of tion to the extent possiyour strongest tools. Your ble is crucial. You might Web site becomes the have to use several t e m “face” of your company and plates/designs to accompmust reflect your business’ lish this, but it will be worth strengths and vision. You the additional effort. If you can have the most fun and are lacking the information use the most creativity “What may be perfect for your industry partners, when choosing the overall it’s time to up your netto us may not reslook of your site and the working game so that your onate the same way content you post. communications to them with the clients we Your Web content must seek. We must always can be just as targeted. be relevant to your audi- keep the client in our ence, particularly the audiMake it matter minds as we seek to ence you most want to to them market to them. It’s speak to. Put yourself in There is absolutely no reanot about us.” their shoes … what would son why you should spend they most like to see or what would be the an exorbitant amount of money to design most helpful to them? You want your Web your marketing materials when there are site to solidify their decision to look deeper, so many templates available. Easy-to-use bookmark your site to return, or even make templates can be modified to represent the decision to click your “Apply Now” but- your company’s look and feel as well as ton. Once they apply, they join your other your designated messaging per category. contacts in the database of leads you have This applies to your Web site as well as in your LOS with a seamless integration your printed pieces. Further personalize between your site and your LOS. your materials with the mail merge option in your LOS so that each piece becomes more suited to your intended audience. Freshen up You’ll find that even your e-mails can your marketing If you want to jump on the bandwagon, become a template, and yet still be custhere is always a tremendous amount of tomized and meaningful. Meaningful marketing does matter in retail hype surrounding the holidays. Why not take advantage of that and your business—particularly in a down market your services to your database economy—it is important to maintain a contacts, past clients or even those presence in the marketplace. There are “dead” applications that never went clients who can qualify for mortgages and anywhere? Even those contacts could be refinance loans. You just need to dig a litviable leads. What about having a tle to find them and market to them. Use “Black Friday” event or “President’s the tools and ideas that work and ones Day” extravaganza? You have plenty of that work for you. Today it is not enough options, and you can fit your holiday to produce mass marketing materials that try to speak to everybody but often remain messaging to suit your business. One of the benefits of using your silent. You must determine what truly LOS for your marketing efforts is that it speaks to your audience and make your gives you the ability to truly target marketing matter to them. your audience with mail-merge capabilities and one-stop storage. If you’re B.J. Bounds is senior marketing commulucky, your LOS will work easily with nications specialist for Calyx Software. In Microsoft Word to import and export addition to media relations and copyyour fresh marketing materials. Using writing, BJ is a contributing author to Word to create your documents gives the Calyx Software blog, CalyxCorner. you hundreds of design options with She has more than 10 years of experience the templates you can find within the in sales and corporate marketing with a focus on technology that spans several software and online. If you are creative, your designs, industries. She may be reached by phone even modified from a template, are a at (800) 362-2599 or visit www.calyxsoftgreat way to transport your messages in ware.com.
Direct Mail Marketing Best Practices By Jim Blatt
individual needs—your marketing should demonstrate that this level of personal service still exists, long after the initial transaction.
Targeted marketing The next critical upgrade is to make your direct marketing efforts opportunity-driven for a specific audience. Whether it is a new product launch, a refinance opportunity, or simply advice on how to help someone who cannot qualify for a loan today, targeted marketing requires that you to analyze your database to find those who would benefit from a specific opportunity. Then, tailor the message specifically to them. How does this apply today—think about HARP 2.0 or HARP Phase II. This program will be available for homecontinued on page 38
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the secret to their sucThink for a moment cess? The top producers about how you are have continued to innospending time today vervate in their marketing, sus two years ago—how taking advantage of new much time is spent clostechnology, sophisticated ing a loan? Where does database management that extra time come techniques and variable from? If you are like most digital printing to execute loan originators (LOs), new marketing strategies to you are spending less their prospects, existing time focused on marketcustomers and referral ing. An automated, syspartners. tematic approach would “Don’t be satisfied When utilizing technolomake a tangible differwith the simplest or gy, even classic marketing ence in your results. cheapest marketing. tools like direct mail can be Customer retention in Invest in marketing enhanced to achieve strong the mortgage industry that delivers the best results. Although the beneaverages around 25 perresults.” fits of marketing seem obvicent, which is too low to ous, many originators either use generic ensure long-term success. marketing that isn’t effective or they don’t Looking forward, it is likely that conmarket to past clients at all. Top originasumers will get a new mortgage every five years, implying a very purchase-ori- tors have always used marketing more ented (not refinance) environment. By effectively to produce greater loan volume not keeping in contact with past cus- and profit than their peers. The most successful originators have tomers, originators lose an average of three components to their direct mail 75 percent of the revenue each cuscampaigns. Relationship marketing needs tomer relationship represents. You be regular and automated. Targeted mardon’t need an MBA in finance to see keting needs to be precise in list developthat originators need an easy way to build and maintain relationships with ment and messaging. And, most imporclients, prospects and referral partners. tantly, reputational marketing should be Total originations in the market are relevant to the consumer. Incorporating forecast to fall for the fourth consecu- all three of these elements will increase tive year. Combine this with increased results and ensure long-term success. competition from the top end of the market, and we may see originators’ Relationship-building marketing income decline as well. Direct mail campaigns that are continuBut not every originator will see their ous remind customers, prospects and income plummet. In fact, during the referral partners who their originator is, past few years, some originators have so they will return to you when it’s time seen their income skyrocket. What was to close another loan. An example is holiday cards. When used continuously, holiday cards make it easy to keep your name and picture in front of your target group. While the message is the same to all recipients, we know that frequent communication helps
maintain a relationship. Regular communication, even with a “mass” message, is the first step to a successful marketing campaign. It increases the chances that when a homeowner realizes it is time to conduct a transaction, they will think of you. However, too many originators think that this is all their marketing needs to accomplish. Sending the same message to everyone, while important, has two key flaws. It doesn’t demonstrate that you are continuing to manage the consumer’s account—in fact, it takes your relationship from a detailed and important financial advisor at the time of the loan, and reduces it to an acquaintance who remembers birthdays. And, it isn’t targeted to the homeowners’ individual needs. Instead, it treats all of them the same. You provide a lot of personal service when finding the right loan product and tailoring a loan to meet
owners based on loan date and other restrictions. You need to target the right group of borrowers with a message customized to them. Mass postcards to all homeowners will work, but why waste the money sending a notice to someone who is not eligible and not interested? In addition to wasting resources, it also demonstrates that you are not paying attention to them and their situation— which is not a desirable outcome from a marketing piece.
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The third and most important component of direct mail marketing is to enhance your reputation by making the message both relevant and important to the consumer you are targeting. A study conducted by the direct mail industry revealed that when marketers used more personalized marketing messages, response rates from consumers increased tenfold. In short, the more relevant the marketing, the better the results will be. Relevant marketing will maintain the trust and credibility built when you helped that consumer through the maze of regulations and red tape that is our current closing process. Marketing should have the goal of positioning you as a lifetime financial consultant, not just another salesperson looking to make a commission. To consumers, salespeople are pushy, self-serving and easily replaced. Consultants are trustworthy. Think about your past customers … you know a lot about them. You know the details of the last loan, why they chose it, and what they are trying to do in the future. Sending out “Happy Fourth of July” cards is nice, but if you want them to truly remember the professional and detailed service you provided, you need to do better. Take this message for example: “Andrew, your loan closed in September 2011 at a rate of 4.25 percent. Today’s rate is 4.5 percent, so my recommendation is to not do anything—you have a great rate! If your situation has changed, call me, and let’s talk about it.” The next time rates do drop, or new products come out, and you call him, Andrew will return the call. He will
remember you helped him through the loan process, and then kept track of his loan after the sale. When he has a friend ready to buy a house, he will recommend you. If you have been a successful originator in the market for more than four years, you probably have 300 or more customers in your database. If homeowners do a transaction every five years (a purchase market), then 60 people you know are likely to do a transaction this year. How likely is it that they are coming back to you? What are you investing in that relationship to get them back? You also know a lot about your prospects—you also know a lot. You know who is qualified, who is looking now, who is rate shopping and more. Shouldn’t your marketing demonstrate that you know these things? If it does, you will make it much more likely that the prospect will close their next loan with you. Originators need a marketing engine that truly maximizes the value of existing relationships, rather than trying to survive with a series of one time transactions. You have a lot of information at your fingertips about your customers and prospects; make sure you use it to enhance your reputation. Don’t be satisfied with the simplest or cheapest marketing. Invest in marketing that delivers the best results. The difference in results between good marketing and great marketing is easily measured. Are you satisfied with a loan or two from your past customers, or, do you want to truly capitalize on customer retention? Remember the three keys to marketing—build relationships, target effectively and build your reputation. Any marketing program that doesn’t include all three elements will lower your results. It would be like putting bicycle tires on a Ferrari—it may work, but you wouldn’t be satisfied with the result. Jim Blatt is chief executive officer of St. Louis, Mo.-based Mortgage Returns. Jim co-founded Mortgage Returns in 2004, bringing consumer and database-driven marketing expertise to the company. He may be reached by phone at (314) 9899100, ext. 102 or e-mail email@example.com.
Jumping Onto the Social Media Bandwagon and Reaping the Profits By Ray Eickhoff Most people in sales course, I did not spend remember their first cold my business hours buildcall as pretty scary stuff. ing my contacts on social You could practice your media when I could be approach until your face networking in person, turned blue, but you meeting borrowers, taknever knew what was ing loan applications and going to happen once you closing transactions. I priwere on the phone with a oritized personal meetings. borrower or meeting But when I had down time them face to face. The here or there, social media more you did it, however, became a great use of my “The instantaneous the more comfortable it time. Blogging and video feedback from these became. blogging on YouTube may social media outlets Getting over that initial take slightly more of a time allows you to tailor fear of putting oneself “out your message for the investment because there there”—to be scrutinized, is more to produce, but not greatest effect.” disrespected or ignored— much. Twitter, with a maxis tough. Today, I think the same fears imum of 140 characters per “tweet,” takes apply to social media. We all sense the even less. potential for lead generation, but the The second fear is expense. And yet Internet continues to evolve so quickly with Facebook, Twitter, YouTube and most that it is hard to put one’s head around blogging sites, this issue is moot as these what to do and how to do it. Meanwhile, services are entirely free to use. In fact, not we see our competitor’s blog, Fan Pages only are they free, but they also come with on Facebook and videos on YouTube and analytic tools that allow you to see which we say, “I wish I could do that.” posts, videos or keywords are drawing the Last spring, I took the plunge and most attention. The instantaneous feedbegan using Facebook for my mortgage back from these social media outlets business. I created a personal page and allows you to tailor your message for the then a Fan Page, “Ray Eickhoff Mortgage greatest effect. Coach.” I wanted two pages because I The one exception is video blogging, wanted my business content separate which involves some startup costs. I’ve just from all my updates about my grandkids recently become involved with YouTube (this was my personal choice, however, to and linking up video posts with my each their own). Of course, I invited all my Facebook Fan Page. As a musician, I have friends to join my Fan Page, and many some experience working with video, so I did. I began posting surveys, polls, ques- spent money to create a studio in a deditions, and bits of news about the mort- cated room in my branch where I can bring gage industry on my Fan Page. in real estate agents, builders, partners and Since then, I’ve gotten eight qualified other loan officers. My total investment, leads off my Fan Page that turned into however, was only $500, and this is on the closed transactions. So far in 2012, I high end of the scale. Today, video cameras have four more loans in process based and editing software have become so inexon Facebook leads. So I know it works. pensive that loan officers can get a classy, Still, so many people in our industry high definition Webcam, a clamp-mounted haven’t bought into it. And the number light and video editing software for under one reason, in my opinion, is fear … $100. At that cost, one closed loan would fear of lost time, fear of expense and give you an immediate return-onfear of the unknown. investment (ROI) and then some. The biggest fear is that there’s not The last fear is probably the biggest, enough time. But I was able to generate and that’s the fear of embarrassment. It and convert my Facebook leads by seems to be a pretty popular fear in our culinvesting just a few hours a week. Of ture, this innate dread we have against
The top five online personas to avoid By Chris Clothier Social media and social networking are media and marketing is expanding rapterms that have blown straight to the idly and most new programs designed top of the list of over-used and over- to “teach” you how to market on the analyzed techniques to build buzz for Internet or through social media only businesses in recent years. But why tell you where to go and how to possihave they become so powerful in bly monetize it. Very few actually tell today’s marketplace? It’s simple … you how to be successful when telling because they work. Unfortunately, pre- your story. senting the wrong online persona and I have been lucky enough to learn using these tactics incorrectly makes it about social media and social marketeasy to develop a hard-to-reverse nega- ing from some expert marketers who tive trend about your brand. Every com- have helped me go from a dark shade pany and, in fact, every businessperson, of green (completely new) to a much should be online embracing new tools lighter one. Without being too self-depfor networking, marketing and public recating, I know just enough to be danrelations, but it is essential to have an gerous and learn a little more every effective plan to be successful. day. Here are five types of habits or perRegardless of your line of business or sonas to absolutely avoid in online situation in life, we are all in need of a social marketing and the best ways to Web presence simply for the ability to avoid them: manage our image and the story that others hear 1. The Shameless Plugger: about us. When used effecSomeone who posts nothtively, a sound social ing but spam. Every Tweet, media strategy can not post, blog, video or press only establish and build release is endless, pointless credibility and expertise, garbage. but it can also increase the How to avoid this: awareness of your particuCommunicate about yourlar expertise and company self, your company and to traditional media. your community to build a Most of my experience relationship with your in marketing has revolved audience. Everyone has a around my career in real “When used effective- story to tell, and everyone’s estate investing. Buying story is original. ly, a sound social properties wholesale each media strategy can month, determining budg- not only establish and 2. The Online Troll: ets for repairs, assisting build credibility and People who sabotage anymostly out-of-state thing you do and attempt expertise, but it can investors with purchasing to ruin your image among also increase the those properties at a dispotential clients. awareness of your count, overseeing the How to avoid this: “Talk particular expertise rehab and then managing nice” and forget your and company to the property after the competition. Remember, traditional media.” rehab and marketing are everything you place all core components of my business. online stays online. There will always Through the years, I have slowly picked be a record of it somewhere. up additional marketing skills, operating Today, a legal precedent exists that a thriving real estate investing business. dictates what you say online about It’s vital to underscore the impor- someone else can be used against you tance of being very careful with the in a court of law when facing suits for image that one creates in the online world. The pace of growth for social continued on page 40
Ray Eickhoff is the Northwest regional vice president for Fairway Independent Mortgage Corporation in Edmonds, Wash., a nationwide mortgage banker. Ray has 27 years of experience as a mortgage originator, branch manager and educator. He may be reached by phone at (425) 318-1299 or e-mail firstname.lastname@example.org.
Finding Success for Your Brand in Social Media
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complete the repair prior to closing. Typically, an escrow holdback will only allow for this in winter due to snow on the roof or deck, for example. Not everyone knows this is available, but I can easily inform them via social media. When I do, I solidify myself as the expert and someone looking out for their interests. What about those stories about people getting in trouble for using social media for work? Certainly there are examples of this, just as there are many state and federal regulations that dictate how we can advertise rates and products in print and online. Many companies go a step further and draft policies for loan officers to comply with when using Facebook, Twitter, or other social media platforms. Some simply ban their use altogether. At my company, we have a new social media agreement that talks about the things we can and cannot publish online. Fortunately, Fairway allows for a lot of vanity and personal branding and believes the originator’s value lies in how he or she builds relationships. Regardless of the company they work for and their market area, loan officers should check with their company’s compliance office before jumping on the social media bus. Speaking of jumping on the bus, keep in mind that social media is still in its infancy and it’s not too late to get started. I personally believe that if you want to extend your reach, generating leads through social media will separate the real performers from everyone else. Those in this industry who have well-crafted social media initiatives are starting to rise above the crowd. The truth is we can only physically talk and visit with so many people in one day. Each of us gets only 24 hours. In exchange for a small investment of my time, however, a social media presence allows me to communicate with many people at once—even when I’m asleep. And just one closed transaction justifies the very meager expense. Just like cold-calling, marketing through social media may you feel a little uncomfortable at first. I strongly suggest giving it a chance. Especially in this market, why wouldn’t you want to use all the tools that are available to grow your business? The results might just surprise you.
doing something new for risk of humiliation or failure. It starts when you’re in kindergarten and the teacher tells you to draw a horse. Everyone in the class draws a horse. When the same thing happens in fourth grade, maybe 10 kids in the class will actually draw it. In junior high, just one kid will do it. Why? Because by then, all the other kids have been told they cannot draw. We all regularly come up against this fear, the one that says we cannot do it. But overcoming that anxiety is so critical in this business, because those who do are able to blow through production walls. Everyone’s first attempts at using social media for marketing are bound to come out a little rough. One way to get over this fear of embarrassment is through preparation. We have all heard that taking advantage of social media tools requires planning. I recommend taking a month to research which social media strategy would work best for your line of work. Many mortgage and real estate professionals still prefer to blog, but I prefer video content versus the written word as its immediate and personal. More professionals today are leveraging multiple platforms, and borrowers today are likely to find loan officers on any one of these platforms. Once the fear is overcome, the next question is obvious … what do you post? For me, it’s humor, some personal tidbits, mortgage news and information about the economy—anything that entertains and/or brings value to people. If it gets your attention, there’s a good chance it will get the attention of others. And by the way, even though my Facebook fan page is my business page, it doesn’t mean I don’t share some personal stuff. For example, this winter I created a video highlighting a non-profit called SpendForOthers.org, a site that invests a portion of your order to Amazon, Home Depot, and other approved vendors to six non-profits listed on their Web site. And it costs the consumer no more than if they had gone directly to the vendor’s site! I put a video up on Facebook and 74 people watched it. It’s not related to mortgages, but it certainly kept me on everyone’s radar. I’ll also post information about the kinds of things we can do at my company, Fairway Independent Mortgage, that our competitors cannot or will not do. For example, I’m preparing a post now on our escrow holdback policy, which allows money to be held in escrow even after the loan closes for repairs that cannot be immediately made. For example, the deck or roof on an existing home needs to be replaced, but the seller is unwilling to repair it prior to closing. Or perhaps the seller does not have the funds to
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libel and defamation of character. Be cautious with the words you choose and the subjects you write about. A mentor of mine once told me that the “worst thing you can have for your marketing strategy is an enemy.” I naturally assumed that he meant someone out in the online community printing false or damaging things about me, but he quickly set my thinking straight. I had already learned to control the message about myself and my business and be the dominant voice online when it came to my company. It did not matter what my competition said about me, because I was going to bury that message. The real problem was that when I focused on my competition and gave them any of my online space by addressing them in my social marketing, I was losing focus on what was really important.
3. The Chronic Re-Tweeter: Twitter accounts that consist of nothing but retweets. How to avoid this: Online social sites are like a big party. Get in and party! Then do business. Tell people about yourself, about your day, about your company or about your plans. And when they are interested—sell, sell, sell! 4. The Self-Proclaimed Expert: This describes anyone who cannot back up what they say and do not think prospective clients will notice. How to avoid this: Just be honest. We surveyed our clients who purchased real estate with us and found out that they visited, on average, 3.5 sites before they purchased from my firm, Memphis Invest. The reason they bought from us was because of the genuine message and our refusal to use the word “Expert.” Instead, we
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prefer to say we have a lot of experience, both good and bad. That message resonates with most prospective clients because they know we are real. 5. The Clip & Strip Advertisers: These types are unable to be original in their marketing, so they choose to clip other sites or marketing pieces and use as their own. How to avoid this: Spying on your competition can be a good thing if you know how to use what you find. Find out what works, but do not copy anyone. Be original and it will pay dividends. Your social media focus should be on getting online and being involved every day in promoting your brand and your image to stimulate activity for your company. Many times when I speak to prospective customers or peers in the industry, the audience is made up of real estate professionals and investors that may or may not have a particular company to brand or promote, but by the end of the discussion they understand the need for an online presence. Protecting your image, your name and even your day-to-day story is more important now than ever. When the focus shifts to real estate investors, it’s important not only to tell your story in your own terms, but to also be aware of what stories your actions tell. We all like to talk about ourselves. That desire is inherent in human nature. Unfortunately, many of us also like to talk about others and when you do that online it leads to trouble in more ways than one. How does this scenario play out online? There are real estate investors in my native city of Memphis who constantly talk about their competition (and it’s not always in glowing terms). Talking about your competition in a negative manner not only makes you look bad in the eyes of those that may want to do business with you in the future, but it also distracts you from the positive message about you, which should be your focus. There are only three results that can come from you discussing your competition, and two of them are negative. You can turn off potential clients, you can spend time talking about the negatives of others instead of the positives about you or you could win a client. I haven’t met many people who were won over by the smear campaigns of others. When
using social media, it’s imperative to keep the conversation on you and your brand and keep it positive. It’s also important to recognize and focus on the trail you leave online each day at social networking sites. Many of the latest fads at these sites are games and they make up a huge and thriving revenue stream for these sites so you can bet they are all good with soliciting members to play. However, if your Facebook page shows you have a thriving little patch of green and are excelling at Mafia Wars, how much time can someone assume you are playing online relative to the amount of time you’re working? As we move further into 2012, the footprint of our daily actions that we leave behind is going to be more and more important and not just on social networking sites, but across the Internet in general. Every comment, every picture, every article, every video and every “Like” we have on Facebook and every group we join on LinkedIn becomes a piece of online history and every bit of it is searchable. It is becoming more and more commonplace for banks, lenders, insurance companies, hiring firms and colleges to run the names of those wishing to do business with them across several social sites and through an online name search, just to see what comes up. If you are not in control of your image and your message, you leave yourself vulnerable. Whether it’s having a presence on a simple media tool like YouTube or Facebook, or something more elaborate like hosting your own blog, controlling the message about you personally or about your company is vitally important for 2012 and beyond. Social media and the use of social networking sites for business and brand development are here to stay and will only grow stronger as more people gravitate to best practices while developing online habits. Being aware of how to best position your brand while using these marketing mediums to your advantage can help you move to the forefront of your industry. Chris Clothier is a partner at Memphis Invest, a comprehensive real estate investment services company that acquires, renovates and manages properties on behalf of long-term investors who own rental homes. He may be reached by phone at (901) 751-7191 or by e-mail at email@example.com.
The Relentless Pursuit of Perfection and the Ultimate Marketing Machine By Joy Beam-Burns
Patience Think about the slogans you know. In most cases, the companies associated with them have been building their brand for decades. This does not mean new companies cannot build brand awareness quickly, but it is highly unlikely as it takes time and patience. The excitement created by flashy marketing campaigns that can be created by
leveraging today’s technology, combined with the infinite possibility presented through the Web, are quickly tempered when I think about the proverb: “The more things change, the more they stay the same.” Remember, no matter how brilliant the plan is, it is doomed to fail if you cannot execute the plan. One common thread amongst all truly great organizations is the ability to consistently execute, while maintaining a message that is relevant. Of course, some companies get a few lucky breaks while carrying out their plans, and as Benjamin Franklin once said, “Diligence is the mother of good luck.” Joy Beam-Burns has enjoyed a successful 20-year career in mortgage banking as a sales leader. Currently, she is a regional sales manager at CBC National Bank in Alpharetta, Ga. She may be reached by phone at (877) 700-4427 or e-mail RetailMortgage@cbcnationalbank.com.
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE FEBRUARY 2012
“You’re in Good Hands,” and The slogan is also an after reading this article, you important and inseparable won’t “Just Do It” and will part of your brand. Before “Think Different” when it creating your slogan you comes to rolling out your need to ask the most basic marketing strategy. Hopequestion: What do you have fully, you will think that this to offer to consumers, other article is “The Real Thing” than them buying your and it will leave you thinking product or service and “You Can Have it Your Way” making you rich? Most peoand now “Impossible is ple would agree that the Nothing.” If you can you get “… before you embark following organizations through the poor grammar have successfully integrated headfirst into an and sentence structure in expensive marketing their slogan as an inseparathe first few sentences, you plan, it is imperative ble part of their brand. will probably recognize that you create a these slogans and quickly Lexus: Relentless Pursuit brand that matches name the companies they your culture and you of Perfection are associated with. McDonald’s: “I’m Lovin’ have a team that is There a plethora of arti- dedicated to executing It” cles, blogs, and books about Apple: “Think Different” that plan.” creative marketing tech Coke: “The Real Thing” niques and how you can increase sales and BMW: “The Ultimate Driving Machine” build brand awareness through search Nike: “Just Do It” engine optimization (SEO) or social media. Allstate: “You’re in Good Hands” The authors will dazzle you with great ideas Addidas: “Impossible is Nothing” and plans that can help your organization get to the next level. You will see the brilThe most expensive aspect of marketing liance of each plan as you are presented is acquiring new customers and maintaingraphs showing how inexpensive it is in ing visibility. This means gaining awareness relation to your skyrocketing sales. In fact, and providing relevancy to affect a sale or while reading these articles, I found myself conversion. The difficulty in maintaining ready to embark upon a whole new strate- awareness is exasperated when you offer a gy that involved multimedia marketing, product or service like mortgages because SEO, and pay-per-click advertising without they are not needed on a regular basis. So credence to my company brand. before you embark headfirst into an expenIt is easy to get lost in the myriad of sive marketing plan, it is imperative that available information and caught up in the you create a brand that matches your culexcitement of an extensive and expensive ture and you have a team that is dedicated marketing campaign in an effort to capi- to executing that plan. Remember it is eastalize on the social media revolution. I ier to create a brand or message that firmly believe that you should budget for matches the company then vice versa. Our various marketing mediums and spend slogan is “Big Enough to Matter, Small time and energy working to create a mas- Enough to Care” was only the first and easiter marketing plan that includes social est step. The real work is executing a vision media as it can be successful if approached that matches the message so both marketwith great forethought. To be truly suc- ing and branding is relevant. Many organicessful, you must have an organizational zations create catchy phrases and elaborate culture that can successfully execute “The mission statements only to fail because it Plan.” The ability of the company or indi- not relevant to their organization. vidual to execute on marketing plans will not guarantee success; however, I am quite Consistency certain that the greatest plans and ideas Do not advertise that you are the low-cost will meet your expectations without dili- provider for a couple of months and then gent and consistent execution of your plan. change your message to being the service
leader as it confuses people and may not match your vision. Also, avoid the mistake of trying to change the branding when you cross demographic lines. You can maintain the same brand and message while advertising to first-time homebuyers and super jumbo borrowers in different media outlets, as long as the value proposition is relevant to the audience. Consistency will build awareness and help you gain long term success if you can execute and bring your slogan to life.
Where Will You Enroll: New School or Old School Marketing? By Chris Nordby
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
Over the past several years, there has been a significant increase in interest in the “New School” of digital marketing. This New School focuses on e-mail and social media to deliver messages, whereas the “Old School” uses printed letters, postcards and newsletters. This New School looks especially attractive to salespeople by offering the ability to reach large numbers of clients and business partners with visually appealing messages, at a low perceived cost per message. It is also not as messy as the Old School, and is without the hassles of printing and mailing. This New School sounds cool. It’s hard to believe we haven’t shut down the Old School. Tough economic times have only made the Old School look worse. It seems so costly and time-consuming to use the Old School when you can usually go to the New School without leaving the comfort of your easy chair. These days, the Old School ways of marketing just seem outdated, but if you take a minute to really think about what your marketing is actually delivering, in terms of impact and revenue, the Old School is cool. You may be surprised to learn that even with the growth of social media and e-mail marketing, direct mail has been hurt less by the economy than many other forms of advertising. How is that possible? If e-mail and social media are less expensive and easier, why would anyone want to use direct mail? The reason is ROI, return-oninvestment. This may sound crazy, but the actual ROI on direct mail is higher than both e-mail and social media. It may seem cheaper to reach a potential borrower using email, Facebook or Twitter, but to win the ROI race, a big return can overcome the low investment. Let’s look at the real figures: A recent Direct Mail Association (DMA) report
showed the response rate of e-mail at 1.73 percent when sent to a list of clients, compared with 3.42 percent for direct mail. You are warned to expect a lower response rate from e-mail campaigns to financial services clients because of recipient’s security concerns and junk mail filters. You may be thinking that 1.73 percent isn’t bad when you consider all the advantages of e-mail. Let’s look at this as objectively as possible. For mathematical comfort, let’s assume our two hypothetical loan officers have 1,000 past clients. Ernie uses only e-mail for marketing messages and Dale uses only direct mail. Both are going to execute a sales message to their clients. Ernie is the ultimate New Age marketer, both thrifty and dynamic. Even his thrifty side sees the value in a professionally-designed e-mail template and he happily spends $400 to get his campaign off to a professional and fast start. Dale is firmly enrolled in the Old School, and while not as colorful or dynamic as Ernie, he is still wise enough to have his letter professionally written and printed for $900, including postage. We will assume that both Ernie and Dale convert 10 percent of their responses to sales, generating an average of $3,000 in commissions per transaction. We now have both the investment and return for this example. Before we pull out the calculator, we have a small reality check for Ernie. While Ernie has 1,000 clients and as has been slavishly devoted in collecting client e-mail addresses since he started e-mail marketing a couple of years back, prior to that he wasn’t as diligent. As a result, only 50 percent of his client database has any e-mail address (across all of our clients, the average is 25 percent and the highest is 58 percent). Before you begin an e-mail market-
ERNIE Clients Messages Out 1,000 500
Responses 9 —>(500 * 1.73%)
DALE Clients Messages Out 1,000 1,000
Responses 34 —>(1,000 * 3.42%)
ing campaign, you need to many borrowers are think about the percentage reluctant to follow links of your database that conor respond to unexpecttains an e-mail address. ed email sales offers. Both Ernie and Dale will Borrowers and busihave return mail from bad ness partners want eaddresses and their DMA mails that add valued response rates reflect the knowledge or entertainaverages for e-mail and letment. They will happily ter returns. read what they know are You may still consider sales messages if those the ROI of e-mail very messages consistently attractive considering “A recent Direct Mail provide knowledge or Association (DMA) how much easier it is to entertainment that they report showed the manage. Current statistics value. In a marketing response rate of say that an estimated 100 context, e-mail is a great of both Ernie and Dale’s e-mail at 1.73 percent channel to deliver inforwhen sent to a list clients were involved in a mation, service and relaof clients, compared mortgage transaction in tionship messages. Ewith 3.42 percent 2011. It is important for mail particularly excels for direct mail.” Ernie to consider that in generating referrals when he chose to use ewhere it has been effecmail, those other two loans captured by tively used to deliver valued knowlDale were still done by his clients—only edge or entertainment during and not with him. Phone calls and direct after the initial transaction. All studies mail should form the foundation of stress the importance of having interyour sales plan. E-mail and social media esting, professional messages that are can significantly enhance, but not targeted (relevant) and add value to replace, fundamental sales activities. the recipient. Dale is out there showing us that Old Why does direct mail work? Why is School is still cool. the response rate almost double that of Many loan officers choose e-mail e-mail? There are several reasons. First, because they are focused on the per- you can tailor different messages to difceived appeal of e-mail (and the lower ferent mail formats: upfront cost) and fail to realize that they have to spend the $400 three Postcards are suited for quick times—a total of $1,200—to generate announcements and seasonal greetings the same revenue. Letters are suited for sales messages as Choosing e-mail is an emotional the give more room to build your case. decision, not a rational business deciThey have the best response rate. sion. If the ultimate goal of your mar- Newsletters are a strong branding piece keting efforts is to maximize your net that demonstrates size, professionalism income and retain your hard earned and security clients and referral sources, direct mail is the clear choice. Second, the delivery alone conveys value This math will help you understand even if your client does not read the piece: why large financial services companies are still choosing direct mail over email Your client sees your brand on the front when they are trying to sell products You can transmit a message to the and services. These large institutions recipient on the outside of the piece understand that clients are expensive to Your clients knows you communicated acquire, but can provide many years of income if properly managed. Third, the perceived value of proE-mail is deceptively attractive, but fessionally prepared, personalized is not a venue where most people direct mail is higher than that of wish to receive sales messages. This is email. Your client knows you took the particularly true when it comes to time to prepare and customize a mailfinancial services messages. Cloaking ing for them. e-mail as financial services messages Many loan officers shy away from from known financial institutions is a direct mail because of the effort and popular tool employed by a range of complexity. The letter has to be written, internet miscreants. Because of this, each mail piece has to be personalized
and addressed, the address database has to be maintained and updated. This is time-consuming. There is, however, a new generation of direct mail that dramatically simplifies things for the loan officer. These new direct mail systems automate direct mail so the loan officer literally need do nothing other than close the loan using the loan origination system. Automated marketing systems extract client data directly from the LOS, store the data in the marketing database, and execute regular direct mail campaigns using digital printers for complete personalization.
Direct mail has entered the digital world and is more effective than ever. With direct data connection to the loan origination software (LOS), print mail has never been easier, faster, cheaperâ€”and more timely and professional. We suggest you think hard about which school you will enroll in. Chris Nordby is president of Protelus, a provider of marketing automation and data services exclusively for the mortgage industry. He may be reached by phone at (800) 585-0207, ext. 100 or by e-mail at firstname.lastname@example.org.
How Mortgage Brokers Find Customers in a Bad Economy
is going to qualified candidates is as important as mailing your piece. When selecting a company to handle your direct marketing campaign, it is important to find one that has a proven track record in your industry with references to back it up. Having a successful direct mail campaign is as simple as following a few guidelines: Find a reputable vendor that has the experience, capabilities and insight to handle all aspects of your campaign in-house (data lists, advertising design, printing, mailing and postage). Create a data list with criteria for your target market. Your advertising firm should have the experience to help you select the best possible cri-
teria for your target. Allow your direct mail provider to guide you to the best type of mail piece for your target market. Ask to see other successfully proven mail pieces. Why settle for less when youâ€™re choosing a company to market your business. Donâ€™t send a message in a bottleâ€”send your message using a proven technique that gets results. Justin Restaino is vice president of Titan List & Mailing Services Inc. He has been with Titan List & Mailing for more than 12 years, specializing in targeted data and direct mail campaigns primarily for the mortgage industry. He may be reached by phone at (800) 544-8060 or email email@example.com. 43
By Justin Restaino
Leading Intelligent Marketing Solutions tXXXMPZBMUZFYQSFTTDPN
â€” the industryâ€™s leading marketing company.
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the Industry with
When the economy was Mass mailing isnâ€™t the booming, everyone was â€œAs a rule of thumb, key to a successful direct willing to spend money the majority of sales mail campaignâ€”targeton advertising to stay ed campaigns are. Why can be attributed to ahead of the competition. spend money marketing marketing efforts. But when the economy to every homeowner, So why would a began to slow, the most company cut back on when you could be marcommon cuts were in the the one thing that has keting to the exact bormarketing and advertisrower who needs your made them money ing budgets. Do the deciservices? Most direct in the past?â€? sion-makers now undermarketing companies stand the impact of the marketing will have you believe that, in order to efforts on the bottom line? Maybe get the results you want, you should some donâ€™t! Whose responsibility is it send bundles of mass mailings until to educate them? While these are you get the response rate you are valid questions, the real question that looking for. They want you to think should be addressed is: Where has that the more mail you send out, the most of the business in the past three better response you will get. While years come from? this has some truth to it, keep in mind As a rule of thumb, the majority of that it is also important to target the sales can be attributed to marketing market that needs your services and efforts. So why would a company cut then mail to that targeted demoback on the one thing that has made graphic. them money in the past? With less The success of a mailing is directly marketing, the competition can start correlated to the quality of the data gaining more traction, and potential list being usedâ€”quality is more customers will be lost to those who important than quantity. Letâ€™s say have been pounding the advertising you need a Federal Housing channels during slow months. Direct Administration (FHA) borrower who marketing is one of those â€œneed to has a 620-plus FICO and no delinhaveâ€? portions of a marketing budget. quencies on their loan. Some vendors Unlike other forms of advertising, will sell you a list that they say meets such as radio, TV or online marketing, your target criteria, when in reality, a direct mail campaign can focus on you are getting a list of college stutargeted data lists that are narrowed dents located in Boston. Counting on down to your optimum client. your data provider to ensure your list
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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 • www.terracemortgage.com 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 www.veros.com • @verosres (Twitter) 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.
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 www.nwecorp.com 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 firstname.lastname@example.org for further details.
Call 888-409-9770 ext. 4
NATIONAL MORTGAGE PROFESSIONAL MAGAZINE
CBC National Bank 3010 Royal Boulevard South, Ste. 230 Alpharetta, GA 30022 888-486-4304
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 www.bayeq.com
If your ad was here, you would be seen by 191,181 Mortgage Professionals looking for resources to help them in their business.
NATIONAL MORTGAGE PROFESSIONAL
calendar OF EVENTS
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 email@example.com. FEBRUARY 2012
Thursday, March 29
Tuesday-Friday, February 21-24
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 MDMtgPros.org.
The Mortgage Bankers Association’s 2012 National Mortgage Servicing Conference & Expo Orlando World Center Marriott 8701 World Center Drive Orlando, Fla. For more information, call (800) 793-6222 or visit MortgageBankers.org.
Wednesday-Thursday, April 18-19 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 MBANJ.com.
PENNSYLVANIA MORTGAGE PROFESSIONAL MAGAZINE
Wednesday, March 14 Florida Association of Mortgage Professionals Broward Chapter 2012 Annual Trade Show Broward County Convention Center 1950 Eisenhower Boulevard Ft. Lauderdale, Fla. For more information, call (850) 942-6411 or visit FAMB.org.
Sunday-Tuesday, March 18-20 2012 National Association of Mortgage Brokers (NAMB) Legislative & Regulatory Conference Capitol Skyline Hotel 10 “I” Street, Southwest Washington, D.C. For more information, call (972) 758-1151 or visit NAMB.org/LegConference.
Wednesday-Friday, March 21-23 National Association of Hispanic Real Estate Professionals (NAHREP) 2012 Real Estate & Policy Conference Four Seasons Hotel 2800 Pennsylvania Avenue Washington, D.C. For more information, call (858) 922-9046 or visit NAHREP.org.
2012 National Policy Conference Hyatt Regency on Capitol Hill 400 New Jersey Avenue Northwest Washington, D.C. For more information, call (800) 793-6222 or visit MortgageBankers.org.
Sunday-Wednesday, April 22-25 2012 National Technology in Mortgage Banking Conference & Expo Arizona Biltmore 2400 East Missouri Avenue Phoenix For more information, call (800) 793-6222 or visit MortgageBankers.org.
Sunday-Wednesday, April 22-25 2012 National Fraud Issues Conference Arizona Biltmore 2400 East Missouri Avenue Phoenix For more information, call (800) 793-6222 or visit MortgageBankers.org. MAY 2012
Sunday-Wednesday, May 6-9 2012 National Secondary Market Conference & Expo New York Marriott Marquis 1535 Broadway New York, N.Y. For more information, call (800) 793-6222 or visit MortgageBankers.org.
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 MBAG.org.
Sunday-Wednesday, May 20-23
2012 Commercial/Multifamily Servicing & Technology Conference Hilton Anatole 2201 North Stemmons Freeway Dallas For more information, call (800) 793-6222 or visit MortgageBankers.org.
Wednesday-Saturday, July 11-14 Florida Association of Mortgage Professionals (FAMP) 2012 Convention & Trade Show “Stay on Track” The Grand Hyatt Tampa Bay 2900 Bayport Drive • Tampa, Fla. For more information, call (850) 942-6411 or visit FAMB.org.
Sunday-Wednesday, May 20-23
2012 Legal Issues/Regulatory Compliance Conference La Quinta Resort & Club 49-499 Eisenhower Drive La Quinta, Calif. For more information, call (800) 793-6222 or visit MortgageBankers.org.
Monday-Wednesday, September 10-12 2012 American Mortgage Conference Raleigh Marriott Crabtree Valley 4500 Marriott Drive • Raleigh, N.C. For more information, call (919) 781-7979 or visit NCBankers.org.
Sunday-Wednesday, June 3-6
Sunday-Wednesday, October 21-24
Mortgage Bankers Association’s 2012 Chairman’s Conference The Breakers 1 South County Road • Palm Beach, Fla. For more information, call (800) 793-6222 or visit MortgageBankers.org.
Mortgage Bankers Association 99th Annual Convention & Expo The Hyatt Regency 151 East Wacker Drive • Chicago For more information, call (800) 7936222 or visit MortgageBankers.org.
continued from page 16
UCDP and UAD compliance Lenders, specifically those with significant volume, are focused on ensuring they have a defined path to deliver compliant appraisal data to the government-sponsored enterprises (GSEs) via UCDP for the March 19, 2012 deadline. Today’s top platforms provide: The ability to convert appraisals in a first-generation PDF format into compliant electronic data; The ability to resolve UAD compliance issues and automate exceptions surrounding UCDP review prior to appraisal submission; and The ability to track and evaluate appraisers or organizations whose performance or product is lacking.
Moving ahead In closing this article series, I want to emphasize the need for efficiency and quality in making valuation decisions. Organizations that understand the importance of automation have a clear advantage over those that are slow to embrace it. These systems have been tested and proven to provide benefits that are immediate and long-lasting. Today’s lending, servicing and investment managers are tasked with doing more with fewer resources. They must increase volume, while ensuring that risk oversight and review controls are in place and consistent. It can be a daunting task, but one that can be accomplished through the power of the valuation management platform. David Rasmussen is senior vice president of operations at Veros Real Estate Solutions. For more information, call (714) 415-6300 or visit Veros.com.
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 .
www.Fmbranch.com 800.220.9498 Info@Fmbranch.com 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.
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 are derived from delivering customer 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. I 90-Day Seller Seasoning Not Required I No Credit Qualifying – FHA Streamlines I DTI Subject to DU Findings I Appraisal Transfer Accepted I FTHB Allowed for Non-Owner Transactions
I 125% DU Refi Plus – 620 FICO – Unlimited CLTV I Maximum 10 Financed Properties Allowed I 640 Minimum FICO for FHA I 1 Year Income Required (with DU Findings) I 6 Months Seasoning NOT Required for Cash Out
For additional information regarding Conforming, Jumbo, FHA and VA lending, call us at
888-247-4207 or visit us at www.iconwholesale.com See guidelines for any product restrictions.