Page 1

Issue 045 April 2011


Times 10 Turbulent 20The Foreclosure 2007 to 2011


Margaritas & mayhem.

Crisis Causes & consequences.

28 New York CEMAs

What are they and how do they save money?

Up 58 Bringing The Rear Ex-Assistant Treasury Secretary Herb Allison and HAMP.

Checked Your Trash Lately? Not having FHA approval is NOT a reason to turn down business The reverse mortgage industry is growing at an incredible pace. If you’re not doing business in this niche market or you’re turning away reverse mortgage loans, you might as well be throwing away money. EVEN IF YOU’RE NOT AN FHA-APPROVED BROKER, we can help. We’re Reverse it! – one of the largest and certainly the most respected wholesale lender for reverse mortgages in the country. Our business is simplifying reverse mortgages, and nobody does it better. Want proof? Send us the application. We do all the work including closing the loan. You get paid. Easy enough? We have all the tools to grow your business in this rapidly growing product line – including free software and polished, professional, turn-key marketing materials to help you close reverse mortgage loans faster and more efficiently than anyone else.

Visit us at, and learn how hundreds of licensed mortgage brokers from coast to coast are growing their business with Reverse it!

Reverse it! is a subsidiary of Urban Financial Group, Inc. – A Knight Capital Group, Inc. Company

If your appraisal data is scanned or extracted from PDFs, talk to us. Before it’s too late. In 2011, the GSEs will require lenders to submit full appraisals in MISMO XML 2.6 format. If your process uses PDF extraction to get data, it will fail. It’s not a question of “if” PDF data extraction and scanning will fail. It’s how often, and how much it costs you. And the answer isn’t good. Do the math: The URAR form alone has over 1000 fields. Even at 98% field-level accuracy, 20 or more fields will be corrupted. Some of those will be critical, and so your pipeline will stop due to bad data. You might not notice it today, because PDF extracted appraisals aren’t subjected to rigorous data analysis. But they will be, and many won’t pass. The solution? Demand “Native XML” appraisals. No conversion, no extraction, no excuses. Just clean XML straight from the appraiser’s desktop software. Then you get exactly what they typed, even on every kind of odd form or addendum. PDF extraction just can’t do that. We’re certain, because we create, transmit, analyze, store, and manage more appraisal data than anyone on Earth, including the GSEs. So when we tell you there’s a problem with PDF extraction, believe it. Protect yourself by downloading the free “MISMO XML 2.6 Appraisal Checklist” from our website. It’s a vendor questionnaire that helps you set policy now for the coming regulations. Whether you use an AMC or manage appraisals inhouse, it ensures a 100% native XML process free of pipeline problems — without changing vendors, or even paying us a dime. Why? We’d rather have you thank us later, than call us later.

Download the MISMO XML 2.6 Appraisal Checklist from the web, at Native XML is just one of our compliance and workflow solutions. Call us today for more.

Mercury Network 1-800-434-7260

AD CODE: MANRMN0311 a la mode and its products are trademarks or registered trademarks of a la mode, inc. Other brand and product names are trademarks or registered trademarks of their respective owners. All prices, terms, policies, and other items are subject to change without notice. Copyright ©2011 a la mode, inc.


Exceeding Expectations

ThE VAlUE oF A PArTNErShiP wiTh BANk oF iNTErNET liES iN oUr FlExiBiliTy AND crEATiViTy To crAFT

Jumbo / Super Jumbo Loans to $5 Million

morTgAgES wiTh AFFlUENT cliENTS’ FiNANciAl mANAgEmENT NEEDS iN miND. ExPANDiNg yoUr ProDUcT PorTFolio wiTh oUr iNNoVATiVE liNE oF JUmBo Arm SolUTioNS iS yoUr oPPorTUNiTy To ExcEED ThE ExPEcTATioNS oF ThiS groUP oF ExPEriENcED homEowNErS.

Portfolio Lender • Jumbo / Super Jumbo loan amounts – High and Low rise – No HUD Approval required

• Foreign Nationals – No credit score required

• Unique property – Excess Acreage – Hobby Farms – Co Ops

• Asset Depletion Underwriting – Amortized to age 85 or term of loan (30 yr) – Assets verified not pledged

• Pledged Asset Program – Allows for dollar for dollar pledge if funds transferred to BofI – Funds in cash accounts 1:1 Borkerage accounts 2:1

• Vesting in Entities – Trusts, LLC’s Partnerships, S-Corp

For More Information, Please Call Wholesale / Correspondent Lending


Power Your Business with Sierra Pacific Mortgage Banking

Now Accepting Partners Nationwide! Over 20 Years’ Experience in Retail Branching Partner in Mortgage Banking with Custom Rates and Incentives Volume Bonus Program Local Account Executive and Regional Manager Support Ranked Top 25 Tech-Savvy Lender Experienced HR, Compliance and Accounting Resources

Regional Underwriting and Funding Centers Nationwide Bay Area: (925) 686-0980 Fresno: (559) 222-7400 Orange County: (714) 689-9757 Sacramento/No Nevada: (916) 932-1700 San Diego: (619) 220-6100 Corporate Retail: (916) 932-1700

Pacific Northwest: (503) 291-6900 Southwest: (602) 889-1103 Midwest: (630) 691-6900 Southeast: (214) 451-3950 Northeast: (508) 380-9026 Mid-Atlantic: (410) 953-8600

Sierra Pacific Mortgage is an equal-opportunity employer. NMLS # 1788. | (800) 696-4471


Issue 045


April 2011

The Foreclosure Crisis Causes & Consquences

Peter Hébert


pg 48 pg 48 pg 49 pg 49 pg 49 pg 49 pg 50


10 28 30 32 35 6

Turbulent Times 2007 to 2011


Justine Assal Owner, acm financial Margaritas & mayhem.

The Niche Report The Niche Report talks with Lisa Schreiber, Executive Vice President of Wholesale Lending.

New York CEMAs Richard Pisnoy Silver Fin Capital Group LLC What are they and how do they save money?

Center Stage with TMS Funding


EDITORIAL / CONTENT MANAGER Kristen Moser ACCOUNTING MANAGER Shawna Ingram Advertising Director Jessica Grizzle Advertising sales Heather Bopp


note from the founder

Production Manager Henry Suchman

Aime Wills independent loan processor


man on the hill

Production Assistant Dawn Exner

Creating a Commission Free Sales Force


APPRAISER sound off

Cartoonist Martin Bradford




What's your mortgage IQ?





Do You Have the Lending Yips?

Tim Davis Mortgage Marketing and Sales Coach Go from generating leads to receiving referrals.

What Price Education? BJ BOUNDS Sr. Marketing Communications Specialist, Calyx Software April 2011

COLUMNISTS & Contributing Authors Martin Andelman Justine Assal Lamarr Banks BJ Bounds Tim Davis Karen Deis Peter Hébert Stewart Mednick Richard Pisnoy Marc Savitt Aime Wills

It takes 5 seconds of your time to have us donate on YOUR behalf.

Published monthly by BODA Publishing, LLC PO Box 494, Bentonville, AR 72712 Phone: 866.964.2695 Fax: 703.991.2362 Email:


Help Us Help You!

This publication is intended for real estate finance professionals. If you are a mortgage broker, lender, loan officer, or real estate professional and you do not currently receive The Niche Report, please go to An annual subscription is $47.95 (twelve months/twelve issues.) For additional copies being mailed to the same address please call 866.964.2695 or email us at for multi-copy discount. Send address change requests to Remember to include the old address. To opt-out of receiving The Niche Report, please send your request, including name, company name, and address to


Like our Facebook page and help us get to 8500 “Likes” and we will donate $1,000 to National Association of Independent Housing Professionals lawsuit on YOUR behalf, our facebook followers. The sooner we get to 8500 “Likes” the sooner we will send a check to NAIHP on your behalf for $1,000.00. Go ahead and

us on Facebook!

Once you “Like” us please “Share” with others by clicking the share button from our FB page at bottom left. Thank you! The Niche Report

To inquire about advertising in The Niche Report, please call 866.964.2695, or send an email to Visit our website, to download a copy of our Media Kit.

EDITORIALS / ARTICLES To submit an article for consideration in The Niche Report, please send an email to or call 866.964.2695. We are interested in original writings relevant to mortgage brokers and other real estate finance professionals. If you have a comment or question about an article or editorial published in The Niche Report, or if you have a suggestion for a topic you would like to see featured in a future issue, please send an email to

THE NICHE REPORT POLICY The information and opinions expressed by contributing authors and advertisers within The Niche Report do not necessarily reflect those of BODA Publishing, LLC employees and should not be considered as endorsed or recommended by BODA Publishing, LLC.

Got Clients? 29 Low Cost (even free) Marketing Ideas

Email us comments or questions to


Note from the founder

By the time you read this the deadline for the Federal Reserve’s loan officer compensation rule will have been enacted (April 1st). The NAIHP and NAMB have both filed lawsuits in order to try and put a halt to this over zealous rule that would ultimately force many originators to leave the business. Why? Who wants to work five times harder for the same pay? You might as well order up your mortgage at the nearest DMV. Yep, let’s think about that for a minute. Almost as soon as the lawsuits from NAIHP and NAMB were filed, the Fed requested that they be combined into one. Which leads me to my next point – Why isn’t NAIHP and NAMB working together on this and pooling together their resources? It seems obvious to me that they would serve our community much better united than divided. Any hoo, I would like to invite our readers to join us on Facebook and “Like” our page. We have made a commitment to donate $1,000 to the NAIHP legal fund to help support their lawsuit on your behalf once we receive 8500 “likes” to our Facebook page - We’ve decided to help Marc Savitt and NAIHP for a couple of reasons (beyond the obvious fact that we are association members). One, he is a pitbull with ferocious tenacity and he loves this industry for the right reasons. Two, NAIHP filed first. Three, Marc is not afraid to address any misconceptions or questions regarding who he is and what NAIHP stands for. And finally, to be quite frank, NAMB has never come to us and asked for support. I’m not even sure who to talk to over there. Don’t read into that last statement too much. I like NAMB and I think they serve a purpose, it’s just that I get a feeling they don’t want our help – so be it, that is fine and dandy, no sweat off my back. With that said - get on Facebook and HELP US HELP YOU! Once our goal is met, $1000 will go towards your cause on your behalf. With every issue that goes out each month, I get that prideful feeling that each issue is better than the last. This issue is no exception. Along with the usual suspects, we have Peter Hebert with his take on the Foreclosure Crisis. Let me warn you, Peter is one of those industry scholars who performs his due diligence before he tackles a subject. It is a great read and your brain will grow by ten percent. I would also like to introduce to you our new Cartoonist – Martin Bradford. A while back we asked for help (you would know if you had followed us on Facebook!) in finding someone who could provide a political/satirical cartoon to our magazine and website. We had about a dozen submissions and after sifting through them all, Martin clearly popped out as the most talented. Martin is a soft spoken, mild mannered, retired school teacher who lives in Oklahoma. Please welcome Martin to The Niche Report and enjoy his monthly cartoons that will be proudly displayed within the pages of each magazine (pg 26 this issue). Keep up the fight!

Robert Pegg Co-Founder & President




Turbulent Times 2007 to 2011 Margaritas and Mayhem by justine assal


itting on a beach on the West coast of Mexico in July 2007 on a family vacation, came a fateful phone call from the office. It was different from the other four calls I had received from them describing what amounts to normal issues in the daily life of a mortgage company. This one had an ominous feel and had certainly sent a chill through our organization. It was driven home further as I sat in the hotel lobby talking to our office manager and saw the trailers on the CNN screen describing the same news as my phone call. One of our wholesale banks processing the majority of our pipeline had closed their doors and was not even honoring approved commitments. It was unprecedented and in hindsight, the beginning of a long and arduous journey that we are all still taking. Although we realized the gravity of the situation, there was no way to fully comprehend what we were about to embark on and the near collapse of our industry, our finances, our businesses, our livelihood! Life is always about perspective and although our journey is never finished, this period of three years will be etched in many minds forever as a turning point! In many ways, it has had the intended effect of industry reform and economic responsibility but no changes in life are ever easy and this one has been so far reaching that it has resulted in many of us buying stock in hair color to keep gray hair at bay.


April 2011

Mine Fields As I returned to work from my vacation, ever the optimist, I kept assuring everybody that it was going to be fine and that we simply needed to find a new lender to take the files. National news was reporting the fall of the banking and mortgage industry with a lust that is reserved only for events of National and International catastrophic proportions. In the bubble of our office, we had the ability and need to deal with the sheer enormity of the situation by filtration and avoidance. We had files to close and that is where our attention stayed focused; banks and lenders were falling almost daily. We had to navigate the mine fields and try to keep them safe. Thus started the beginning of our new obsessive compulsion – Implodometer! We logged on daily to see who was on the ailing list so that we could avoid sending our loans into a black hole. We rushed to close loans before the program slipped through our hands into a piece of history. It was much like trying to fill a bucket with dry sand with only your bare hands as tools. We still stayed positive, probably more out of denial than fact or reality. The Age of Denial Thankfully, we as humans, have the innate ability to focus only on the facts that support what we choose to believe. We continued to work on the remnants of a once beautiful and abundant pipeline of loans. By now, they were beaten and battered with many casualties along the way. Our pipeline had come under attack and we were now



Take Appraisal Management Into Your Own Hands

FACT - You can manage YOUR appraisal process with YOUR employees. FACT - You can use YOUR own appraiser panel. FACT - Without StreetLinks LenderX™ appraisal software, you WILL fail at self-managed appraisal execution and compliance. Spreadsheets and emails simply won’t stand up to compliance audits and inferior systems lack the features you need to manage the entire appraisal process, including appraiser payables and accounting. StreetLinks LenderX™ helps you do it yourself from start to finish. Our Guarantee: If, after previewing the StreetLinks LenderX™ platform, you don’t agree that it’s the best in the industry, we’ll donate $1000 to your favorite recognized charity.

Call 1.800.778.4947 to talk to a solution consultant today. | 1.800.778.4947

Only subscribers may view the full digital copy. To subscribe, follow the link below: mvc?Store_Code=TNR&Screen=PLST Send us an email to with any questions.

Profile for The Niche Report

TNR - April 2011  

Feature Article The Foreclosure Crisis: Causes & Consequences by Peter Hebert

TNR - April 2011  

Feature Article The Foreclosure Crisis: Causes & Consequences by Peter Hebert

Profile for u7urtp