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The housing market contributes approximately 18 percent of the U.S. GDP. With so much at stake, a recent Treasury report on the U.S. financial system is recommending extensive mortgage lending reforms.
The U.S. Treasury Department states that regulatory requirements have significantly and unnecessarily tightened the credit box for new mortgage originations, denying many qualified Americans access to mortgages. In addition, regulations have significantly increased the cost of origination and servicing activities, which, when passed on to borrowers in the form of higher mortgage rates, have decreased the number of Americans that can qualify for mortgages.
 
Hello HMDA
Included in the mix of industry transformations is the January 2018 deadline to collect much more fine-grained loan data about borrowers and loan costs under the Home Mortgage Disclosure Act (HMDA).
 
The new HMDA rule requires reporting on 48 data fields—including 25 new data fields mandated by the Dodd-Frank Act, as well as fields required by the CFPB under its discretionary authority.
 
Some of the new HMDA fields include:
 
►Age of borrower and credit score
►Combined loan-to-value (CLTV) ratio
►Borrower's debt-to-income (DTI) ratio
►Points and fees
►Discount points
►Lender credits
►Loan term
►Prepayment penalties
►Non-amortizing loan features
►Interest rate
►Rate spread for all loans
 
According to the Mortgage Bankers Association, this new HMDA rule will bring major challenges to the residential mortgage industry, including:
 
►Extensive implementation costs for systems and business process changes immediately on the heels of the implementation of the TILA-RESPA Integrated Disclosure (TRID) rule.
►Privacy and data security concerns, because the new data set contains confidential information—such as credit scores—which if improperly released could cause significant harm to borrowers' claims against lenders, and even undermine homeownership.
►Increased litigation risk. HMDA has been a major source of fair lending claims in the past, and the new data will allow greater analysis of application and loan data to evaluate impacts on protected classes. While HMDA's purpose is to shine light on lending practices, data can be misused to present unfair claims—forcing costly litigation defense, and/or settlements and causing significant reputational harm.
 
FinTech solutions transforming mortgage industry
Burdened by regulations and the need to manage collaborations and communications with dozens of ancillary financial service providers, the mortgage industry needs a reboot!
Fortunately, fintech solutions are evolving to deliver advanced lending process automation. New solutions exist today that simplify and streamline mortgage servicing, such as appraisal, verification services, valuation, flood zone determination and more.
 
First, let’s look at the progression of financial technology platforms.
 
Vendor portal
The stand-alone vendor portal allows for ordering products from an individual loan originator, usually involving just one product, but may include a several mortgage servicing products. Users login to each of their stand-alone vendor portals using a user name and password. This process is difficult to secure from individuals outside your organization when your employees share their user names and passwords.
 
The stand-alone vendor portal generally returns the order fulfillment to the user in the portal to manually use as part of their mortgage servicing and business operational procedures. The financial services provider then sends a monthly invoice to the lender for all orders.
 
Point-of-sale
The next generation of product is the point-of-sale solution, which typically features two or three products with limited event types, such as place order, cancel order and receive order. The point-of-sale solution is typically integrated into a commercial loan origination system (LOS), such as Encompass or LendingQB, usually not requiring the user to login to each vendor’s point-of-sale solution.
 
Basic assembly line
The next generation of product to emerge is the basic assembly-line technology that integrates into the lender’s proprietary loan origination systems. This platform can support a larger variety of product types. The major benefit is the ability to support the lender and mortgage banking operational workflow for higher levels of productivity and processing large numbers of loans in an assembly-line style process.
 
One draw-back with assembly-line technology is that customization and integration with mortgage lenders’ existing systems can be time-consuming and expensive.
 
Lending process automation
The most advanced fintech allows lending process automation, including dashboards that can be customized for banks and mortgage lenders’ needs.
 
By automating the mortgage servicing process, manual inputting errors and redundancies are minimized. Fewer people can do more work. Once information has been captured for a particular loan, subsequent product orders will automatically prefill the forms. Duplicate orders are identified to help lending institutions to contain costs. Banks, credit unions, lenders and financial institutions reduce processing fees and gain greater productivity.
 
Let’s take a closer look at how lending process automation fintech accelerates the mortgage loan process.
 
1. Repetitive and time-consuming tasks will be eliminated.
Mortgage service team members will be freed up to focus on more profitable, higher level work–such as prospecting and communicating with borrowers.
►The fully automated lending process will include background checks, contracting, and legal review through contract e-signed or wet-signed.
►Lenders’ rules and guidelines are stored in the system ensuring mortgage service providers comply with requirements of the banks and financial institutions.
►Electronic capture of all compliance documents, including all policies and procedures, licenses, insurances, bonds, and pertinent plans.
►The automated system minimizes errors, manual inputting and duplication of efforts for superior loan processing speed.
►The streamlined system eliminates charges for reprocessing of orders with errors.
 
For example, when the borrower initiates payment for a property appraisal, the system can automatically schedule the appraisal at the same time, minimizing steps in the process. A typical appraisal can take as long as 60 to 70 days. By automating the process, mortgage lenders could decrease the time to 10 or 15 days and assist in closing more loans.
 
2. Using a modern order management platform, banks, credit unions and all financial institutions involved in mortgage lending, can interface with multiple financial services providers–from appraisal management companies and title providers to employment verification, flood determination and more.
The communications, documentation and each step in the process are saved in the system, including credit verification, automated valuation model, property titles, location maps, photos, comparable property information, inspections and other reports. With all documentation in one easily searchable database, communications between lenders, banks, realtors and financial services providers are simplified, facilitating transactions.
 
3. A dashboard and customized reports on the performance of financial services providers gives mortgage lenders the ability to evaluate the loan process at every milestone.
The dashboard will include metrics offering lenders additional insight into operational performance with alternate options to sequence and time their orders. Armed with this information, financial institutions can make decisions to finalize mortgage loans faster.
 
The system can also conduct compliance checking and invoice reconciliation for lenders, calculating each provider’s monthly invoice, as well as management of the dispute process.
This level of transparency allows banks to take advantage of preferred pricing, volume discounts and better manage contractual terms to control costs.
 
4. The most advanced fintech solutions also provide comprehensive security and redundancy.
Modern architecture should be expandable in AWS with full disaster recovery capabilities. The technology will be stable, reliable and easy to integrate into existing systems. With advanced protection against attack and intrusion the platform should include advanced denial of service (DoS) safeguards built into its architecture.
 
In an industry facing expanded regulations, smart mortgage lenders and financial services providers are exploring fintech solutions to maintain a competitive advantage. Lending process automation simplifies communications and order management and speeds loan completion, while managing transaction costs. Savvy financial institutions that embrace the most advanced fintech solutions offering comprehensive mortgage lending process automation will be more productive, profitable and offer enhanced customer service.

James V. Luisi is Chief Information Officer/Chief Technology Officer of KeyStoneB2BJames V. Luisi is Chief Information Officer/Chief Technology Officer of KeyStoneB2B. He has more than 30 years of experience in business and IT focused on integrating diverse systems to best serve customers, shareholders, business and IT stakeholders. For more information, visit KeyStoneB2B.us.
This article originally apeared in the September 2017 print edition of National Mortgage Professional Magazine.

 
A graduate of the University of Delaware and nationally-recognized 34-year mortgage industry professional, Michael Borodinsky has funded more than $4 billion in residential mortgage loans to 12,000-plus customers over the course of his careerMichael Borodinsky
Facebook: Facebook.com/MikeBorodinsky
LinkedIn: LinkedIn.com/in/MichaelNewHomeMortgage
Twitter: @MikeBorodinsky
Web site: MichaelNewHomeMortgage.com

A graduate of the University of Delaware and nationally-recognized 34-year mortgage industry professional, Michael Borodinsky has funded more than $4 billion in residential mortgage loans to 12,000-plus customers over the course of his career. He has been honored as the top producing loan officer at Bank of America, Wells Fargo, MetLife, Sun Home Loans and at Caliber. He has been awarded the 5 Star Professional Designation, which honors the best mortgage lending officers via customer service rankings for the past five years. He has been ranked amongst the top originating loan officers nationwide for the past 15 years.

Kevin Brungardt serves as Chairman and Chief Executive Officer of RoundPoint Mortgage Servicing CorporationKevin Brungardt
LinkedIn: LinkedIn.com/in/KevinBrungardt

Kevin Brungardt serves as Chairman and Chief Executive Officer of RoundPoint Mortgage Servicing Corporation. He has more than 22 years of broad executive leadership experience.
 
 
 
 

Katrina Cole is the Business Development Manager for the Grand Rapids, Mich. office of Inlanta Mortgage Inc. Katrina Cole
Facebook: Facebook.com/Katrina.B.Alexander
Facebook: Facebook.com/CompleteMarketer
Business Facebook: Facebook.com/TheArnoldTeam
LinkedIn: LinkedIn.com/in/KatrinaBAlexander
Twitter: @RealEstateHub
Web site: MichiganHomeLoanSolutions.com

Katrina Cole is the Business Development Manager for the Grand Rapids, Mich. office of Inlanta Mortgage Inc. She has been in the mortgage industry since 2002 earning numerous awards and accolades, focusing in all areas of the business. Katrina’s efforts enforce long-term initiatives that support brands to build lasting relationships with strategic partners and create lifelong clients. She strives to empower others to shape a strong business with superior communication by not focusing on what others are doing, but by what they are not doing.

Marcel Deitrich has been an Originator since 1998, and changed his business model to adjust with technology and social mediaMarcel Deitrich
Facebook Business Page: Facebook.com/GuaranteedRateMarcel
Facebook Personal Page: Facebook.com/MortgageTexas
Intuitive Loan Finder: LoanFinder.GuaranteedRate.com/#/?LOID=13093
LinkedIn: LinkedIn.com/in/Marcel-Deitrich-08ab001/

Marcel Deitrich has been an Originator since 1998, and changed his business model to adjust with technology and social media. Thirty percent of his business is directly generated off relationships and referrals off Facebook and LinkedIn. He leverages every transaction and success magnifying social proof to increase his business.
 

Marc Demetriou has been the top producer every year since 2006 at Residential Home Funding CorporationMarc Demetriou
Facebook: Facebook.com/TheMortgageExperts
Google+: Plus.Google.com/+MarcDemetriou
Instagram: Instagram.com/MarcDemetriou
LinkedIn: LinkedIn.com/in/Marc-Demetriou-01989b1
Twitter: @MarcDemetriou1
Web site: RHFBloomingdale.com
YouTube: YouTube.com/Channel/UC--0PI35jVFrIcEltpdxP7A

Marc Demetriou has been the top producer every year since 2006 at Residential Home Funding Corporation, where he is the Branch Manager in Bloomingdale, N.J. Marc continues to be recognized nationally and locally for his loan origination volume, superior customer service and overall professional accomplishments. Marc was a keynote speaker at the 2015 Real Estate Mastermind Summit, a well-known event featuring world-renowned motivational speaker, Tony Robbins and CBS television’s Shark Tank co-star, Barbara Corcoran. To add to his long list of accomplishments, Marc is now an author, his first book is due out this year, titled Lessons From My Grandfather; Wisdom for Success in Business and Life.

Matthew Demorest founded HomeSure Lending in 2014Matthew Demorest
Facebook: Facebook.com/HomeSureLending
LinkedIn: LinkedIn.com/in/MattDemorest
Twitter: @HomeSureLending
Twitter: @MattDemorest

Matthew Demorest founded HomeSure Lending in 2014, believing that mortgages should be both simple and fair. He leverages his personal social network in order to grow his reach and help more clients purchase with confidence, and refinance with ease.
 

Jason Frazier, aka The Real Estate CIO, is an C-Level industry strategist, CX Advisor, Social Media Evangelist, Speaker, Marketing Creative and TechnoloJason Frazier
Blog: Medium.com/@RealEstateCIO
Facebook: Facebook.com/FrazierCIO
Instagram: Instagram.com/RealEstateCIO
LinkedIn: LinkedIn.com/in/RealEstateCIO
Snapchat: Snapchat.com/Add/RealEstateCIO
Twitter: @RealEstateCIO
Web site: RealEstateCIO.com

Jason Frazier, aka The Real Estate CIO, is an C-Level industry strategist, CX Advisor, Social Media Evangelist, Speaker, Marketing Creative and Technologist. Frazier has a passion for advising real estate and mortgage professionals/companies on how to use the latest trends to stand out in a crowded real estate marketing space. His focus is using experience architecture to design programs using technology, content marketing and social media to enhance their business.
Michael Hammond, President of NexLevel AdvisorsMichael Hammond
LinkedIn: LinkedIn.com/in/MichaelHammond
Twitter: @NexLevelAdvisor
Web site: NexLevelAdvisors.com

Michael Hammond, President of NexLevel Advisors, is responsible for overseeing the daily operations and long-term strategic vision of NexLevel Advisors, where they move audiences, generate leads, drive sales and ignite powerful brand stories for their clients. Hammond now dedicates himself exclusively to helping other businesses achieve extraordinary levels of success.
 
 
 

Kelly Haney is a 17-year veteran of the mortgage business who has worked his way up from call center to managementKelly Haney
Facebook: Facebook.com/KellyTheMortgageGuy
LinkedIn: LinkedIn.com/in/KellyHaney
Twitter: @Kelly_Mortgage

Kelly Haney is a 17-year veteran of the mortgage business who has worked his way up from call center to management. He is very active in industry trade associations, having served as Immediate Past President of the North Texas Mortgage Professionals Association and Board Member of NAMB. He is also a member of the Texas Mortgage Bankers and Dallas Mortgage Bankers. Kelly's goal is to provide true value-added service to partners in his community.
 
 

James Hooper started his mortgage career at in 1998, and since then, he is helping to revolutionize the wholesale and correspondent mortgage industry with his forward thinkingJames Hooper
LinkedIn: LinkedIn.com/in/James-Hooper-53497210
Twitter: @JamesHooper07
Web site: PRMG.net

James Hooper started his mortgage career at in 1998, and since then, he is helping to revolutionize the wholesale and correspondent mortgage industry with his forward thinking. As National Sales Manager for PRMG, James helps Account Executives do things differently in a market that is changing rapidly to help them create value with Loan Officers across America. During his 20-year career, he has led sales teams that have funded more than $80 billion in loan production.
 

David Hosterman contributes his success to the amazing support of Castle & Cooke Mortgage LLC at a corporate level David Hosterman
Facebook: Facebook.com/DHostermanCastleCookeMortgage
Homes.com: Homes.com/Mortgage-Lenders/David-Hosterman/id-5713712
Lender411: Lender411.com/id/DHosterman
LinkedIn: LinkedIn.com/in/DavidHosterman
Redfin: Redfin.com/Openbook/Home-Loans/Denver-David-Hosterman-sp378897
Trulia: Trulia.com/Mortgage-Lender-Profile/DaveHosterman
Twitter: @CCMortgageLLC
Web site: CastleCookeMortgage.com/Loan-Officer/David-Hosterman
Zillow: Zillow.com/Lender-Profile/DaveHosterman

David Hosterman contributes his success to the amazing support of Castle & Cooke Mortgage LLC at a corporate level and his team at the Denver, CO branch. David has been the top producer for Castle & Cooke Mortgage LLC in 2014, 2015, and 2016 and has been recognized as a top producer in the industry nationally. David hosts the following weekly radio shows on AM 1690 KDMT: 11:00 a.m. every Saturday (The Mile High Mortgage and Real Estate Report), and 10:00 a.m. every Sunday (The Rocky Mountain Real Estate Network).

As a #MortgagePro for 19 years, it’s John’s duty to help inspire, coach and mentor every #MortgagePro met to engage within their profession John H.P. Hudson
Facebook: Facebook.com/MortgageYou
Google+: Google.com/+JohnHPHudson
Instagram: Instagram.com/JHPHudson
LinkedIn: LinkedIn.com/in/JohnHPHudson
Twitter: @JHPHudson
Web site: JoinMFS.com
YouTube: YouTube.com/c/JohnHPHudson

“My passion gives me power and I am blessed to work with some amazing folks that have helped make Mortgage Financial Services one of the fastest growing mortgage companies in the country,” said John H.P. Hudson.
As a #MortgagePro for 19 years, it’s John’s duty to help inspire, coach and mentor every #MortgagePro met to engage within their profession to help support every consumer possible fulfill their dreams of homeownership. 
With more than 30 years of experience, Dominic Iannitti is a perennial mortgage technology innovator and well-known leader in the industryDominic Iannitti
Blog: Blog.DocMagic.com
LinkedIn: LinkedIn.com/in/Dominic-Iannitti-2a405342
Personal Web site: DominicIannitti.com
Twitter: @DocMagic
YouTube: YouTube.com/User/DocMagicInc

With more than 30 years of experience, Dominic Iannitti is a perennial mortgage technology innovator and well-known leader in the industry. He constantly evangelizes the importance of leveraging mortgage technology to ensure that lenders operate efficiently, compliantly and cost-effectively.
 

Scott Justice started in the mortgage business in 1990 as a Collector, and has been in the industry ever sinceScott Justice
Facebook: Facebook.com/EdgeUser
Instagram: Instagram.com/Inky_Scott/
LinkedIn: LinkedIn.com/in/Scott-Justice-7b86491
Twitter: @RedsDjEdge

Scott Justice started in the mortgage business in 1990 as a Collector, and has been in the industry ever since. During this journey, he has been a Loan Officer, Processor, Branch Manager, Operations Manager, Regional Vice President for a top lender, Due Diligence Auditor, Front Line Underwriter and Direct Endorsement Underwriter. Scott also worked part-time for The Cincinnati Reds and Cincinnati Bengals for more than 20 years in scoreboard operations. “The contacts I have made via social media are priceless,” said Scott. “Get out there and play ball!”

JP Kelly is a long-time veteran of the industry who possesses a diversified backgroundJP Kelly
Blog: Blog.OpenClose.com
Facebook: Facebook.com/OpenCloseSocial
LinkedIn: LinkedIn.com/in/JP-Kelly-4230b32
Twitter: @OpenCloseSocial

JP Kelly is a long-time veteran of the industry who possesses a diversified background—owning both a full-service mortgage bank and an enterprise-class mortgage technology software firm. He is a well-connected executive and constant innovator of contemporary, completely Web-based technology that helps lenders operate more efficiently.
 
 

As the Senior Vice President, National Director of TPO Sales at ResMac, Greg Lutin leads a national wholesale and correspondent sales teamGreg Lutin
Facebook: Facebook.com/Greg.Lutin
Instagram: @glutin
LinkedIn: LinkedIn.com/in/Gregory-Lutin-ab914348

As the Senior Vice President, National Director of TPO Sales at ResMac, Greg Lutin leads a national wholesale and correspondent sales team, providing all aspects of sales development, including recruiting top talent, establishing key sales initiatives, and serving as the interface between sales and operations. Before joining ResMac in 2014, Greg spent 18 years with Flagstar Bank, where he held various positions ranging from Account Executive, Regional Sales Manager, Divisional Sales Manager, and EVP/Director of National Sales. Drawing on his many years of experience in mortgage technology, Greg works closely with the IT developers at ResMac, as they continue to develop a best-in-class technology platform. A big believer in community, Greg supports various charities on both local and national levels.

Carl Markman began his career in the mortgage industry more than 24 years ago as a Loan Officer Carl Markman
Facebook: Facebook.com/CarlMarkman
LinkedIn: LinkedIn.com/in/Carl-Markman-b257439

Carl Markman began his career in the mortgage industry more than 24 years ago as a Loan Officer and quickly moved through the ranks to lead a significant team at one of the largest financial institutions in the industry. He now holds the title of Director of National Sales for one of the nation’s top mortgage lenders, REMN Wholesale.
 
 
 

Allen Middleman, an Accredited Mortgage Professional and Senior Vice President at Freedom Mortgage CorporationAllen Middleman
LinkedIn: LinkedIn.com/in/Allen-Middleman-b8433652

Allen Middleman, an Accredited Mortgage Professional and Senior Vice President at Freedom Mortgage Corporation, is an innovator, professional networker and widely recognized by his 17,000 LinkedIn followers. Allen has significantly impacted Freedom Mortgage Wholesale’s business processes and the sales success of their Account Executives and brokers through technology enhancements. His latest venture includes heading up the Wholesale Division’s InTouch sales team, a nationwide broker outreach group.
 
 
 
 

Bubba Mills is the Owner and Chief Executive Officer of Corcoran Consulting & CoachingBubba Mills
Facebook: Facebook.com/CorcoranCoaching
Instagram: Instagram.com/CorcoranCoaching
LinkedIn: LinkedIn.com/in/BuMills
Twitter: @CorcoranCoach
YouTube: YouTube.com/Channel/UCmcFtLYC2KiDp4HKTk3gDfg

Bubba Mills is the Owner and Chief Executive Officer of Corcoran Consulting & Coaching, whose clients are recognized as some of the most successful and influential professionals in their respective fields. Bubba has spent decades in the business world, crossing industry boundaries with the goal of transforming teams and revitalizing business culture by raising the bar on how you see your company, your clients, and the market around you.

Eric Mitchell, Executive Vice President for Gold Star Mortgage, develops innovative purchase market strategies proven to revolutionize the way Loan Officers and Realtors partnerEric Mitchell
Facebook: Facebook.com/EricMitchell0513
Instagram: Instagram.com/EricTMitchell
LinkedIn: LinkedIn.com/in/EricTMitchell
Twitter: @EricTMitchell
Web site: Eric-Mitchell.com

Eric Mitchell, Executive Vice President for Gold Star Mortgage, develops innovative purchase market strategies proven to revolutionize the way Loan Officers and Realtors partner, generating their unprecedented success and market reach. Using Gold Star’s award-winning application technology, Eric creates highly sought after state-of-the-art lead generation platforms that have delivered sustainable growth for the thousands of sales professionals he has coached across North America. A Certified Master in Neuro Linguistic Programming, and industry-leader in Marketing and Business Development, Eric is a frequent presenter at national events.

Eric Mitchell, Executive Vice President for Gold Star Mortgage, develops innovative purchase market strategies proven to revolutionize the way Loan Officers and Realtors partnerAndres Munar
Facebook: Facebook.com/AMunar727
Facebook: Facebook.com/MunarMortgage
Instagram: Instagram.com/Mr.Munar
LinkedIn: LinkedIn.com/in/AMunar
Twitter: @MunarMortgTeam
Web site: KeystoneAllianceMortgage.com
Zillow: Zillow.com/Lender-Profile/YourCentralPAMortgagePros

Andres Munar is the Co-Founder of Keystone Alliance Mortgage. He is committed to serving his clients, referral partners, community and team members by being a servant leader. Social media is one of Andres' favorite outlets to connect with friends, family, past/present and future clients. Andres believes you can have everything you want, if you just help other people get what they want.

Robert Padron is President of the Miami Chapter of the Florida Association of Mortgage Professionals Robert Padron
Facebook: Facebook.com/1stFinancialMiracleMile
Instagram: Instagram.com/1stFinancialMiraclemile
LinkedIn: LinkedIn.com/in/RobPadron
Web site: 1stFinancialInc.com

Robert Padron is President of the Miami Chapter of the Florida Association of Mortgage Professionals and Branch Manager for 1st Financial Miracle Mile and 1st Financial Brickell.
 
 

Nathan S. Pierce has been active in the mortgage industry since 1993 and is the Communications Committee Chairman and Board Member of NAMBNathan S. Pierce
Blog: NathanPierce.Social5.net
Facebook: Facebook.com/NathanSPierce
Facebook Business Page: Facebook.com/NathanSPierceAdvancedFunding
Instagram: Instagram.com/NathanSPierce
Twitter: @NathansPierce
Web site: NathanPierce.com

Nathan S. Pierce has been active in the mortgage industry since 1993 and is the Communications Committee Chairman and Board Member of NAMB—The Association of Mortgage Professionals, and President of NAMB+. He is also a Board Member of the Utah Association of Mortgage Professionals. He is a Certified Residential Mortgage Specialist (CRMS) and President of Advanced Funding Home Mortgage Loans in Salt Lake City, Utah. He was recently honored with the 2016 Mortgage Professional of the Year Award by the Utah Association of Mortgage Professionals (UAMP).

As a dedicated leader in her field, Kelly Lindsay Rogers is one of the premier experts on mortgage lending in the Houston areaKelly Lindsay Rogers
Facebook: Facebook.com/KellyRogersTeam
Instagram: Instagram.com/KellyLindsayRogers
LinkedIn: LinkedIn.com/in/KellyLindsayRogers
Web site: KellyRogersTeam.com

As a dedicated leader in her field, Kelly Lindsay Rogers is one of the premier experts on mortgage lending in the Houston area. Together with her team, she successfully determines solutions for each of her clients’ financial needs. They ensure a straight-forward and efficient approach to the mortgage process for all parties to the transaction.
 
 

Shashank Shekhar is one of the pioneers in using social media in the mortgage industryShashank Shekhar
Blog: LendingExpertBlog.com
Facebook: Facebook.com/ArcusLending
LinkedIn: Linkedin.com/in/ThisIsShashank
Twitter: @ShashankTweets
YouTube: YouTube.com/ArcusLending

Shashank Shekhar is one of the pioneers in using social media in the mortgage industry. By leveraging his blogs, he has built a massive following that has helped him with client acquisition, conversion and retention.
 
 

Adam P. Smith is President and Founder of The Colorado Real Estate Finance GroupAdam P. Smith
Facebook: Facebook.com/AdamPSmith
Facebook: Facebook.com/ColoradoRealEstateFinanceGroup
Instagram: Instagram.com/AwesomeMortgageGuy
LinkedIn: LinkedIn.com/in/TheAdamPSmith
Twitter: @AdamPSmith1
Web site: CoreFinanceGroup.com
Web site: AdamPaulSmith.com
YouTube: YouTube.com/TheAdamPSmith

Adam P. Smith is President and Founder of The Colorado Real Estate Finance Group, a commercial and residential real estate finance firm. He started the company in 2005, and during his career, has helped thousands of clients, both individuals and corporations, in their goals regarding real estate finance, as well as both personal and corporate finance and has personally written billions of dollars in mortgage and finance deals.

With more than 30 years in the business Thomas Smith still gets excited about helping borrowers achieve their dreamsThomas Smith
Facebook: Facebook.com/Mortgagesandbs/?ref=aymt_homepage_panel
LinkedIn: LinkedIn.com/in/Thomas-Tom%E2%80%8B-smith-612-386-7672-251b6aa
Twitter: @Omsiguy

With more than 30 years in the business Thomas Smith still gets excited about helping borrowers achieve their dreams, whether they are a first-time homebuyer or a seasoned veteran of buying homes. Thomas makes sure that the borrower is well-informed and well-educated about the entire mortgage loan process, something he feels is key to a successful loan.
 
 
 

John Stevens is RPM Mortgage's Growth VP and serves the mortgage industry as President-Elect of NAMBJohn Stevens
Facebook: Facebook.com/JohnGStevensUtah
Facebook: Facebook.com/JohnGStevensNMLS512252/?fref=ts
Google+: Plus.Google.com/+JohnGStevens
Instagram: Instagram.com/JohnGStevens
LinkedIn: LinkedIn.com/in/JohnGlenStevens
Pinterest: Pinterest.com/JohnGStevens
Tumblr: JohnGlenStevens.Tumblr.com
Twitter: @JohnGlenStevens
YouTube: YouTube.com/Channel/UCZRVeBfo7aKAz2BjIV7O_Fw

John Stevens is RPM Mortgage's Growth VP and serves the mortgage industry as President-Elect of NAMB—The Association of Mortgage Professionals, connecting lenders with lawmakers online and in person to help all consumers safely achieve the American Dream of owning a home.
Scott Stoddard is a recognizable figure in the mortgage industry, specifically in enterprise-level servicing technologyScott Stoddard
Facebook: Facebook.com/Quandis-Inc-278354345558367
LinkedIn: LinkedIn.com/in/Scott-Stoddard-37092a4
Web site: Quandis.com/About/Recent-News

Scott Stoddard is a recognizable figure in the mortgage industry, specifically in enterprise-level servicing technology. He was the Founder and Chief Executive Officer of LenStar, completing a successful acquisition to London Bridge where he then served as Group Executive. He co-founded Quandis in 2003, and has since grown the company into one of the leading default management software firms in the mortgage industry.
 
 
 

Ed Stojancevich has been in the mortgage industry for more than 10 years, and every year, finds the industry more exciting and innovativeEd Stojancevich
Blog: HomeTips.Blog
Facebook: Facebook.com/TheRockstarCloser
Instagram: Instagram.com/RockstarCloser
LinkedIn: LinkedIn.com/in/EdStojancevich
Twitter: @HomeFinanceNWI
Web site: TheRockstarCloser.com
Web site: EShomeloans.com

Ed Stojancevich has been in the mortgage industry for more than 10 years, and every year, finds the industry more exciting and innovative.
“I utilize social media to build my brand, build relationships and help my real estate partners grow their business,” said Stojancevich. “With my background in public relations, I focus on three main things: Consistently giving my clients amazing service, exceeding the expectations of my realtor partners, and constantly learning. My mission statement is very direct and precise: ‘I help people buy the home they want, with programs that destroy my competition and with service that is second to none.’”

Jon Tallinger is Vice President of Sales and Marketing at Class Appraisal, a Michigan-based nationwide appraisal management companyJon Tallinger
LinkedIn: LinkedIn.com/in/Jonathan-Tallinger-70624b2

Jon Tallinger is Vice President of Sales and Marketing at Class Appraisal, a Michigan-based nationwide appraisal management company. Jon has been in the appraisal business since 2002 when he started his career as a state-licensed appraiser in the state of Michigan.
 
 
 
 

Having served his entire work life in the financial service industry, Godwin Tsui has a passion for helping people manage their financesGodwin Tsui
Facebook: Facebook.com/Gowintx
Instagram: Instagram.com/Gowintx
LinkedIn: LinkedIn.com/in/GodwinTsui
Twitter: @Gowintx
Web site: GotWealth.com

Having served his entire work life in the financial service industry, Godwin Tsui has a passion for helping people manage their finances.
“The mortgage is a very important part of any family’s financial composition and should be carefully managed and reviewed along with a comprehensive financial plan,” said Tsui.
 

Carl White’s podcast is the top podcast for loan officers in America, he has the largest Facebook Fan Page for LOs in all of FacebookCarl White
Facebook: Facebook.com/MortgageMarketingAnimals
LinkedIn: LinkedIn.com/in/MarketingAnimals
Podcast: LoanOfficerFreedom.com
Web site: MortgageMarketingAnimals.com

Carl White’s podcast is the top podcast for loan officers in America, he has the largest Facebook Fan Page for LOs in all of Facebook, and has the most recommendations in LinkedIn of anybody in the entire mortgage industry, all while running one of the most successful mortgage marketing training programs in the U.S. for top-producing loan officers that teaches the strategies that loan officers in his own mortgage branch use today.
 

Mark Wilkins is a 10-plus year industry veteran serving as Meridian Bank’s Team ManagerMark Wilkins
Facebook Business: Facebook.com/TheMortgageMark
Facebook Personal: Facebook.com/MortgageMarkPA
Instagram: Instagram.com/TheMortgageMark
LinkedIn: LinkedIn.com/in/TheMortgageMark
Twitter: @TheMortgageMark

Mark Wilkins is a 10-plus year industry veteran serving as Meridian Bank’s Team Manager. Mark’s focus and engagement on local social media networks has paid dividends for his team and himself. He was voted “Best of Bucks 2017,” Top Mortgage Lender on the Bucks Happening List and is a seven consecutive year winner as a Five-Star Professional in Philadelphia Magazine.
 

 
As of May 15, 2017, mortgage brokers and lenders in Virginia have been required to post a mortgage surety bond in order to get licensed. This requirement was introduced as part of an amendment of the Rules Governing Mortgage Lenders and Brokers (Chapter 160/161 of Title 10 of the Virginia Administrative Code) introduced by the State Corporation Commission.
 
In addition to the surety bond requirement, the Commission has also introduced further requirements for mortgage brokers and lenders in the state to help regulate the industry.
 
Read on for an overview of the new requirements and how, as a mortgage broker, you can comply with them.
 
Changes to the Rules Governing Mortgage Lenders and Brokers in Virginia
The main changes introduced by the Commission to the Code of Virginia to regulate the work of mortgage brokers in Virginia include the following:
 
►A requirement to post and maintain a mortgage broker bond
►A requirement to maintain books, accounts and records, and a mortgage loan transaction journal
►A requirement to file quarterly mortgage call reports through the Nationwide Mortgage Licensing System and Registry (NMLS)
 
Mortgage Bond Requirement 
In particular, mortgage brokers in Virginia must post an initial surety bond of $25,000. Mortgage lenders are required to post a $50,000. The latter requirement also applies to mortgage companies with dual authority (mortgage lender and broker authority).
 
The $25,000 and $50,000 bond requirements are minimum bond requirements and will be adjusted by the Commission on a yearly basis depending on the amount of residential mortgage loans originated in the previous year. Bond amounts can range between $25,000 (for mortgage brokers) to $150,000 for loans over $100,000,000. Bond amounts in-between are $100,000, $75,000, and $50,000.
 
Maintenance of Records and Journal
According to 10VAC5-160-25 of the amended rules, the records that brokers and lenders need to maintain are defined as all those specified in Chapter 16 as well as by the amended Chapter. In terms of maintaining a loan transaction journal, licensees in the state need to include the following information in the journal for each application they receive:
 
►The name of the applicant
►The date of application
►The address of the property
►The amount of the loan requested
►The lien position
►The license name as well as the license or Registry number of the mortgage loan originator
►The address of the office that originates the loan
►The name of the lender
►The status of the application
►Further information that is relevant to the application and may be required by the commissioner
 
Once the retention period for such records expires, these need to be destroyed in a secure manner through incineration, shredding or other means.
 
Filing Quarterly Mortgage Call Reports 
Mortgage brokers and lenders are required to post quarterly mortgage call reports through the NMLS. Such reports need to detail the amount of residential mortgage loans made, brokered or originated (depending on the licensee) during the preceding quarter. These reports need to be in the right format, and contain the information required by the Registry.
 
The dates to submit such reports are announced by the Registry. Brokers and lenders who fail to submit their reports by such dates may have to pay a provisional fee which will be determined at the time of submitting their report.
Finally, the amendment also specifies the duration of the licensing period. Licenses for mortgage brokers and lenders in Virginia will be valid for the duration of each calendar year, and expire at its end. Accordingly licenses will need to be renewed at the end of each year along with the mortgage broker bond.
 
Why is the Mortgage Broker Bond Necessary?
Surety bonds are agreements made between the bonded party or principal (the mortgage broker or lender), the state of Virginia (the obligee), and the surety company that issues the bond. These agreements are put in place to provide protection to the clients of brokers and lenders and, by extension, to the state. Their purpose is to protect against such principals who violate the state laws and regulations for mortgage brokers and lenders and, as a result, cause harm, losses and damages to their clients.
 
Surety bonds guarantee that if such a violation occurs, parties that have suffered losses can file a claim against the bond and receive compensation by the surety company. This compensation can be as high as the amount of the principal's mortgage broker bond - i.e. somewhere between $25,000 and $150,000. If compensation is extended by the surety, the bonded broker or lender must then repay the surety. Surety bonds guarantee that businesses comply with the law and stick to the best business practices.
 
If a claim does occur, bonded persons or businesses are typically advised to work closely with their surety to resolve the situation in the best possible way, and minimize the possible cost they will have to carry.

Todd Bryant is the president and founder of Bryant Surety Bonds. He is a surety bonds expert with years of experience in helping business owners get bonded and stay compliant.

 
A key 2017 business trend, as reported by Forbes late last year, is that organizations restructure to focus on team over individual performance—something my company did around the same timeframe. While individuals have their own career agenda, companies are now structured with teams because high-performing teams will enable them to compete for the future.
 
Let’s consider a mortgage industry example. The leadership team at American Financing saw an opportunity to create a more streamlined mortgage experience with direct communications from one primary contact. So, we capitalized on it. We identified the importance of communication styles between teammates and chose to play matchmaker. Rather than expect each mortgage consultant to get to know 45 processors, we paired it back. Aligning smaller teams of mortgage consultants with small teams of processors really created team unity and understanding. It eliminated unnecessary internal follow ups and phone calls, providing a more enjoyable and accountable employee experience.
 
A change this simple has a lot more to it—of course, starting with knowledgeable employees. Consider these key industry stages as a checklist for successful employee development:
 
Pre-licensing education
The NMLS is programmed with federal pre-licensing education (PE) and continuing education (CE) requirements as required by the SAFE Act.
Ultimately, completion of these general mortgage, ethics, and law courses will prepare the individual for the federal exam. But keep in mind—these courses are specific to new loan originators, so an understanding of the presented materials may be lacking. To address this: Consider on-site testing where students are near subject matter experts in the event they feel overwhelmed, yet are separated enough there are no distractions.
 
Tailored trainings
We’re in an industry that takes education seriously. And as a national mortgage banker with more than 300 employees, my company delivers information in multiple ways. Our approach is to provide a blend of classroom (onboarding, mandatory continuing education) and online (compliance, optional continuing education) trainings—delivering material in the most understandable and well-received way we can.
 
Of course, there’s no right answer in the discussion of online vs. classroom training. You do what you need to adapt. Adapt to the content, adapt to the student. For some employees, self-paced learning can be challenging. It’s an attractive benefit to be able to learn on your own time. Yet, it can be harder for the student to pay attention, specifically if the content is new information. Webinars—often middle ground—provide the same flexibility, but include the added benefit of interaction.
 
Classroom training has proven most engaging to our team. The ability to ask questions continues to be crucial to student’s success. It’s most beneficial when the trainer has experience in originating and underwriting loans. This allows for some of the most relatable examples and makes the limited time for our business to commit to the classroom well spent.

Experiential learning
Wikipedia defines experiential learning as: “the process of learning through experience” and, more specifically, “learning through reflection on doing.” The individual is encouraged to directly involve themselves in the experience and reflect on it using analytical skills. This way, they gain a better understanding of the new information and retain it longer.
 
My recommendation: Hiring industry experienced employees allows less time spent on a computer. Complete systems training and a quick debrief with the trainer, so you can move on to job shadowing. This last stage is particularly important for us as our mortgage consultants are tasked with customizing a loan program for each customer. It’s a key learning experience for new hires that really forces analytical skills to kick in. Plus, it’s the best way to prepare them to take calls.
 
Better technology
As technology advances, operational efficiency can increase. Utilizing an industry leading CRM, auto dialer, a robust LOS, and automation have boosted employee productivity. And, by giving clients access to our Customer Portal we allow client documents to be added straight into our LOS. It’s a customer benefit that has also eliminated busy work from employees’ already full plates.
 
Job aids
The TILA-RESPA Rule, Loan Estimate Disclosures, Closing Disclosures … the training process can be daunting having so many important guidelines to understand. No matter your experience or education, there’s often a limit to how much information a person can obtain. Providing easily accessible job aids and compliance guides can make retaining education so much easier.
 
Not to mention they help bridge the gap when process change is needed to meet industry mandates. Pair job aids with a brief in-person training session—to address the upcoming change—and you can get back to business as usual in little time. Even going so far as including Webinars or how-to-videos on intranets or even Wiki’s—it’s a great way to deliver pertinent information that’s easily available.
 
Coaching and feedback
Once it’s time to work alone, weekly check-ins are important (until no longer needed), along with a performance evaluation 90 days out. You have to keep new hires engaged, informed, and appreciated—regardless of how much experience they bring to the table. No two loans are alike, and there’s always room for improvement.
 
Incentivizing is also key. Bonuses are expected in sales. So, it’s more important to verbally acknowledge and reward key players. Spend additional time with them to ensure you understand their career path and can work with them to help them advance.
 
To illustrate … in the past year alone, my firm has promoted 28 employees—half of these people had been working as a mortgage consultant, processor, or underwriter prior to the promotion. They have proven to be key contributors to our business success and now make a difference in the mentoring of new hires.

Customer focus
As training and continuing education go on in the background, the customer remains top of mind. We all have the same strategy: do what’s best for the customer. Most all of us have a tried and true approach to how we deliver the best possible customer experience. We expect our mortgage consultants to forge deep, personal bonds with the customers they serve and deliver a memorable experience. We deliver happiness by fostering it internally.
 
No matter what your approach to business, the best way to sustain growth is through a strong foundation, strategic leadership and experienced employees. I believe in this model because I’ve followed it. Our company doubled in size in 2015 and are up another 50 percent over the past year. In that time, we’ve set company financial records and watched our people achieve their own personal milestones—the latter being what’s most important.
Damian Maldonado is an American entrepreneur and businessman of Puerto Rican descent, and Co-Founder of American Financing Corporation, one of the most successful privately held national mortgage companies in the U.S.

This article orignally appeared in the August 2017 print edition of National Mortgage Professional Magazine. 

 
This month, the Mortgage Action Alliance (MAA) is gearing up for our 2017 Action Week, taking place from Oct. 2-6 this year. Action Week is a week-long event dedicated to helping real estate finance professionals learn how to become more engaged in political advocacy that supports our industry. Why should you get involved? Because MAA is a non-partisan nationwide grassroots lobbying network of real estate finance industry professionals that allows our industry to speak to our elected officials with one voice.
 
Our goal this year is to get 1,000 MAA App downloads and surpass 20,000 MAA members. Last year, we had about 60 companies participate and signed up just over 2,400 new MAA members. We are hoping to surpass those numbers this year. We'll be recognizing all participants at MBA’s Annual Convention and will be spreading the word on social media.
 
If you aren’t an MAA member, you can join for free at MBA.org/JoinMAA. To download the App, visit MBA.org/MAAapp or search for "Mortgage Action Alliance" in the App Store or Google Play.
 
Your participation makes a difference, and the MAA App couldn’t make taking action any easier. During Congress’ August Recess, more than 2,500 industry professionals contacted their elected officials, sending 6,500-plus letters to Congress about key issues, including GSE reform, transitional authority to originate mortgage loans for experienced MLOs transitioning between federally-insured depositories and non-depositories and across state lines, and reauthorizing the National Flood Insurance Program (NFIP).
 
A big thank you to the three companies with the most individuals taking action in August: New American Funding, with 894 employees taking action; FBC Mortgage, with 146 employees participating; and Union Home Mortgage, with 108 employees contacting their elected representatives.
 
The more MAA members we have, the stronger our voice will be as we play an active role in how laws and regulations that affect the industry and consumers are created and carried out. Help us reach our goal by enrolling your company to participate and running a MAA membership campaign within your office. For more information, visit MBA.org/ActionWeek
MBA.org/ActionWeekGene M. Lugat is chairman of the Mortgage Bankers Association’s Mortgage Action Alliance. Gene is executive vice president, national industry and political relations for PrimeLending Inc.

This article originally appeared in the September 2017 print edition of National Mortgage Professional Magazine.

 
HLP has named Larry Gilmore, a former HLP Chief Executive Officer and Founder, to HLP’s Board of Directors
Although the non-QM segment of the mortgage industry is still in its infancy, steady growth and positive performance have led to an evolution from wholesale to correspondent lending demand. As interest rates rise and home sales slow, large mortgage companies may need to grow non-QM volume or risk losing both production and customers. To that end, pioneers of the non-QM wholesale space are now expanding into the correspondent arena, offering mainstream originators the opportunity to partner with best-in-class investors.
 
Although today’s non-QM loans–with their traditional manual underwriting–have enabled thousands of reliable homebuyers to obtain loans, large numbers of mortgage professionals remain skeptical or unaware of their growing importance to the industry ecosystem. Spurred by AAA ratings of the senior tranches of recent non-QM securitizations, more correspondents are entering this arena. The solid performance of these loan pools and the proliferation of correspondents may convince industry leaders that their path to long term success is narrow if they rely only on agency lending.
 
Because non-QM wholesale and correspondent lending is relatively new, let me summarize its history before discussing how and why non-QM correspondent lending will be increasingly vital to the residential mortgage marketplace. The 2014 “Ability-to-Repay and Qualified Mortgage Rule” issued by the Consumer Financial Protection Bureau (CFPB) set stringent guidelines for which borrowers could qualify for agency loans.  These rules shut out as many as 30 million otherwise creditworthy Americans, who may be self-employed, living off non-income assets or had a damaging financial incident.
 
To meet that need, leading edge investors began marketing, underwriting, funding and servicing non-QM loans. Assuming total risk, these financial industry innovators developed thorough processes and procedures including manual underwriting and ability to repay standards. In addition, these loans require significant down payments and full documentation of income and assets. These alternative loans have performed so well that warehouse lenders are increasingly accepting them, in turn convincing a wider range of originators to develop their correspondent abilities.
 
The non-QM correspondent appetite is evolving in many ways. Some brokers are converting to non-delegated correspondents. Mortgage bankers are expanding to offer correspondent products. Internally, larger aggregators have begun to adopt formal strategies for non QM product approvals. In most of these situations, those who are transitioning to non-delegated underwriting must rely on an outside entity, a cooperative partner, that can provide advice and expertise, or even a full range of technologies, services and personnel.
 
This marketplace evolution is important to everyone in the industry. Demand for non-QM loans has typically exceeded supply, because most originators have preferred to focus on agency lending. That is already changing. It was expected that originators would need new markets as the refinance market slowed. Surprisingly in 2017’s third quarter, there has been a downturn in home sales. Whether this is a trend or just a short-term variance, non-QM lending—with its largely untapped audience—may offer mortgage professionals their best opportunity for growth.
 
Though the upside is great, those entering the correspondent arena need to know that non-QM loans are different. To successfully manage risk, lenders need to utilize best practices, systems and processes that have been perfected by leading non-QM organizations. Potential correspondents should partner with a company whose track record in the space is proven.
 
When aligning with an investor to become a non-QM correspondent, carefully review the company’s track record in the industry. This partnership is essential to establishing your competence in handling details of non-QM underwriting, compliance and operations. A top-notch correspondent investor will provide these and other services.
 
Your correspondent partner must be more than a deep-pocketed investor who can enable you to move loans to the secondary market. As the non-QM industry is still young, your decision to become a correspondent seller probably comes after much discussion and consideration. You have learned that you will need a savvy, trustworthy correspondent affiliate to advise you on building strong, sustainable non-QM lines of business.
 
Here are some of the questions you should ask the investors pursuing your correspondent portfolio:
 
►Does my current warehouse provider allow for non-QM loans on my line?
►What is your onboarding or orientation program?
►What kind of support do you have available to our executives, loan officers and operations staff as we ramp up and learn to be non-QM experts?
►What kind of compliance technology do you employ and why?
►What is the strategy and performance record of your operations function?
►How will you handle loan-level underwriting exceptions?
 
A large percentage of non-QM loans may require exceptions, but there are just a few experts in field. You must work with proven professionals.
 
You will want to select a correspondent investor who will offer flexibility in the quantity and value of loans. Those of us who have pioneered these non-QM correspondent offerings know that few lenders can yet deliver multi-million portfolios each month.  You will want to do business with an investor who is willing to invest in only a few loans at a time as you build your non-QM business. You want to do business with a company that will invest in both your loan production expertise and your potential to master the non-QM space over the long run.
 
Anytime a totally new product is offered in a mature, highly structured industry, widespread adoption is going to be gradual. In the case of non-QM loans, which were launched just three years ago, two factors caused brokers and lending institutions to remain unaware or uninterested for some time. For one, most originators did not need them to fill their pipelines because low interest rates resulted in an abundance of prime borrowers seeking to buy or refinance. Also, non-QM loans wrongly carried the stigma of the subprime loans largely responsible for causing the Great Recession.
 
This year, wariness and reluctance by mortgage executives has given way to serious interest, if not loud enthusiasm. This past July, Angel Oak Capital Advisors completed its largest ever securitization of non-QM residential mortgages, $210 million, backed by loans sourced through Angel Oak Mortgage Solutions and our sister companies. This further legitimized the credibility of non-QM industry leaders to perform respectably for lenders who want to pursue correspondent programs.
 
Until now, growth of the non-QM correspondent sphere has been steady but measured. However, originators who wait to offer these products may have quite a bit to lose. We know that there are millions of non-agency borrowers who are underserved by the mortgage industry, many of whom can prove their ability to repay through traditional (and eventually automated) underwriting. We also know that interest rates are rising and home sales are slowing. The latter may result from too few alternative products being available. Are you positive that you can maintain profits and retain your best originators by relying only on agency lending? If not, the best alternative is to become a correspondent lender aligned with a top-rated investor. 

Sean M. Marr is Director of Correspondent Lending for Angel Oak Mortgage Solutions. Prior to Angel Oak, Sean has served the mortgage industry for 25 years in various sales and sales leadership roles, with organizations such as HomeSide Lending and Citibank. He may be reached by e-mail at Sean.Marr@AngelOakMS.com or call (904) 521-4511.

This article originally appeared in the September 2017 print edition of National Mortgage Professional Magazine.

 
Joanne Mucino is a Sales Executive with Ticor Title of Nevada and the 2017 President of the Board of Directors of the Nevada Mortgage Lenders Association (NMLA)
Joanne Mucino is a Sales Executive with Ticor Title of Nevada and the 2017 President of the Board of Directors of the Nevada Mortgage Lenders Association (NMLA). National Mortgage Professional Magazine recently spoke with Joanne regarding her work with this trade group.
 
How did you first become involved with the Nevada Mortgage Lenders Association? What was the path that led you to your leadership role in this organization?
About three years ago, one of my co-workers invited me to join the organization. I was brought in on the Events Committee, and after some time, I became Events Vice President. People who have a Vice President position become part of the Board of Directors. From there, I was chosen to become President.
 
What is the length of your term as President of the Board of Directors?
It is a one-year term. But I was talking to the Chairman of the Board of Governors recently to see if it would be possible to make it a two-year term. I feel that I am just getting started. This is really, really fun and rewarding, and I feel that I can do more good work.
 
How does your organization approach the legislative and regulatory environment?
NMLA has a Lobbyist, Marcus Conklin—a former majority leader of the Nevada Assembly—who gives us a voice in fighting for what is acceptable for lenders. The legislative and advocacy agenda is maintained by the NMLA’s Board of Governors. I am on the Board of Directors—you have to be a lender to be on the Board of Governors.
 
What do your duties entail?
I run the day to day operations. I’m mostly responsible for holding events, getting the word out on the NMLA. At some of our recent events, we had the FBI come in to talk about fraud, and a former local broadcaster who is also a financial consultant did an amazing presentation of how lenders have been affected by having Donald Trump as President. A couple of years ago, we did a mixer with candidates who were running for office, and that was a great forum for people to ask direct questions of their current and potential elected officials.
 
Can you tell us about NMLA’s membership?
We used to be two organizations. In January 2015, the Nevada Mortgage Bankers Association and the Nevada Association of Mortgage Professionals merged to become the NMLA. We have three levels of membership: Individual Membership; Affiliate Membership, which is available for all mortgage affiliates and industry providers; and Corporate Membership for residential originators and servicers. There are thousands of voices in our membership.
 
Are you seeing young people coming into the industry in pursuit of mortgage careers?
When I am out at lending institutions, I see a lot of young people. In my field, the title industry, we are very, very diverse. I am happy to see all ages represented there.
 
What is the housing market like in your state?
It is an amazingly active time in the state of Nevada. Overall sales are up, and there is a new housing boom again. I don’t know what the future will bring, but the year 2020 will be exciting when the Raiders will be here.
Phil Hall is Managing Editor of National Mortgage Professional Magazine. He may be reached by e-mail at PhilH@MortgageNewsNetwork.com.
 
One of the phrases that boils the blood of a learning leader is when a manager nonchalantly states the reason for failure is that “it’s a training issue
One of the phrases that boils the blood of a learning leader is when a manager nonchalantly states the reason for failure is that “it’s a training issue.” When probing further, discussion proves that the root cause is many factors which may include ineffective training, but most commonly they include not setting clear objections and expectations, struggles with tools and technology, and lack of ability to demonstrate job fit. At the end of the day, declaring that it’s a “training issue” is an attempt by many managers to have training “fix it.”
 
In 20 years as a training leader, I have counseled leaders on how to create an effective training program. Training has a big role in executing the plan, but it takes all involved to ensure the process is sound. I use the ADDIE Model (Analysis, Design and Develop, Implementation, Evaluation) to create training, focusing on more than just the training event.
 
The ADDIE Model
The ADDIE Model breaks out each step of creating training. By following this model, you will create a program that is focused on the needs of the business, designed for adult learners with metrics in place to achieve success with your training. If any part of the process is broken, your training initiative will most likely fail.
 
Conducting a Needs Analysis is the beginning of the process. In this stage, the learning leader/trainer meets with the business owner to determine what needs to be trained. They discuss current state and expected future state. They are very focused on the specific behaviors when creating objectives.
 
Speaking of creating objectives, make sure they are clear and actionable. For example, “the salesperson will understand product guidelines” is not actionable … how do you prove whether they “understand?” A better objective might be “the salesperson will analyze a case study to identify whether or not it meets the product guidelines.” If you need help creating solid objectives, research “Bloom’s Taxonomy.”
 
Design and Develop are the next two steps. These are critical to planning the session and regularly tying the learning objectives back to the activities. There are a number of critical issues that should be addressed here, including not only the overall flow of the program (including activities), as well as all supporting documentation (PowerPoint deck, Job Aids, Quick Reference Guides, etc.). Instructional Design is a special skill that coordinates the objectives into action.
Implementation is the next step. This is the actual training delivery. The effectiveness of your training rises and falls on the facilitator’s shoulders. For too many years, people have been “promoted” to trainer because they wanted a change, it seemed like less work and the company didn’t know what else to do with them! If this is your approach, please reconsider. If the trainer is not seen as the expert, they have the same effect of a substitute teacher in a bad high school.
 
One of the most common mistakes I see in training delivery is the trainer’s need to be the “Sage on the Stage.” Because the trainer is usually a subject matter expert they tend to lead a one-way dialogue as if they were giving a college lecture. They share their knowledge and expect that through some miracle the knowledge will be transferred. They read slides, manuals and whatever else they have in front of them.
A better approach is to treat the participants as adult learners, those that you share the training experience. This is sometimes called “the Guide on the Side.” The focus is to show we are all in this together. Students have the opportunity to learn in a safe environment, by observing, discussing, and demonstrating desired skills and behaviors. The mood is more conversational, asking questions and identifying roadblocks (kind of sounds like sales, doesn’t it?!?).
 
Even if you have taken these four steps, you still have another one. A big one. The one that the CEO wants to know … Evaluation of results. Did this training increase sales calls? Did this training reduce processing time? Does this training keep the company compliant, lowering the cost of fees or fines?
 
Because measuring is hard to do in some cases, many training organizations simply don’t do it.  When training isn’t effectively measured, it’s just an event. Most companies use the results of a survey when looking at the effectiveness of a training event. “The participants liked the class,” they exclaim, adding “and they thought the trainer was good!” And that tells me almost nothing as a learning leader about the effectiveness of the program.
 
Kirkpatrick’s Model of Training Evaluation demonstrates deeper results, those which should be used to make business decisions. Level One is what I described above: commonly known in the industry as a “Smile Sheet.” This helps identify things that might get in the way of optimal learning (room too cold, instructor not prepared), but in and of itself, usually doesn’t help measure effectiveness.
 
Level Two is demonstrating how training drove behavior changes/process knowledge/technical proficiency and helped the learner meet the training objectives. You can demonstrate knowledge transfer by testing. This can be a written test (product or process knowledge) or observed behavior (teach-back or role play). Testing is most effective when it demonstrates how the learner will use their knowledge to do what they are trained to do.
 
The best measurement of training effectiveness: demonstration of the training on the job (Level III). Unfortunately, this takes time and history, and without focusing on the output, the business priorities can change and we forget to measure effectiveness.
 
For many years, I was the Chief Learning Officer at a large, well-respected mortgage company. Through regular testing and measurement, we identified that those at the “top of the class” in a new hire program were more likely to outperform their peers. And those whose scores put them at the back were not going to produce and were not going to stay. So what makes sense from a business standpoint? Hire more people who can score at the top of the class (or above a set number) and you will achieve more success.
 
We actually updated the hiring and training expectations, identified more ideal candidates and celebrated more production and less turnover due to how well we measured the program. And through regular review of the training results, we had one of the industry’s most successful sales teams. And due to the partnership with sales and the executives, we received many awards for achieving impact.
 
So, is it a “training issue” that you have? Or have you built a training team that has the ability to produce results? Whichever your situation, investing in a strong partnership with training will give you the lift that your business might need … and training will work. 
Nick Mantia is Vice President of Training at Angel Oak Companies, the management company for Angel Oak Mortgage SolutionsNick Mantia is Vice President of Training at Angel Oak Companies, the management company for Angel Oak Mortgage Solutions. In his 25-plus year career, he has contributed as a top retail Loan Officer and has personally trained many of the country’s top mortgage sales performers. He has been recognized by numerous publications as an expert training executive, a passionate leader, a learning professional that “gets it” and is a published author. Nick can be reached by phone at (855) 539-4910 or e-mail Nick.Mantia@AngelOakCapital.com.

This article originally appeared in the August 2017 print edition of National Mortgage Profesisonal Magazine. 

 
It’s no secret that the mortgage industry workforce is aging. The average Loan Originator has been in the business for a few decades now and is approaching their mid-50s. As a result, a large segment of our industry will be nearing retirement in the coming years. Since this older generation has been the bedrock of our workforce for so long, there will be a significant void left in the marketplace if lenders don’t begin planning for the future now. The industry is at a pivotal point where now more than ever lenders need to begin training tomorrow’s workforce today. And who is the future workforce? Millennials. They’re a key part of the industry’s continued success. They’re the largest living generation and they make up the largest share of American workers. Educating this massive age group is vital. Not only do they have attributes that make them ideal for a career in mortgage banking but since this generation ranges from 20 to 36, a good portion of them are entering their homebuying years. In fact, 42 percent of current homebuyers are Millennials, which is more than any other generation. If lenders want to attract this key consumer group, one of the best ways to engage them is by employing other Millennials because you have to have mirrors in the market; people who reflect the demographic you’re seeking to serve. But how do we begin educating Millennials to be our future mortgage professionals? It starts with not simply seeking to train them for a position that meets a momentary need, but rather identifying ways to attract them to the industry for the long haul.
 
On-the job training
Even though a college education isn’t needed to make it in mortgage banking, companies have to have a solid process for educating Millennials, if they’re going to be viable part of this workforce. Lenders cannot expect them to come equipped with prior training because many of them have never had a background in mortgage banking. That’s why if you want to ensure that your company has a quality team tomorrow, you have to take the initiative today to start building your own workforce.
 
Establishing a robust system to train beginners requires more than just giving them a casual introduction to the industry. It’s important that new recruits have the best chance for long-term success, which means you’ll have to equip them with the right combination of hands-on learning and classroom-style instruction. This next generation will need to have a solid understanding of industry guidelines just as much as they’ll need experience with preparing loan files and skills in dealing with customer objections.
 
One approach for providing this type of well-rounded education that has been highly effective for New American Funding has been to create an entry-level position that serves like a boot camp, giving employees intense on-the-job training. It’s tailored to equip them with real-world mortgage experience like handling customer calls and following up on leads. Once new employees successfully complete an introductory phase, they have the opportunity to enroll in our company’s Launch Lab, which is a newly built educational facility that grooms employees for a specific career path in the industry. The goal? When they’re finished, they should have acquired practical experience, become fully licensed, and be ready to assume a bigger role on our team.
 
Mentor young employees
Although attracting Millennials to your company begins the process of building your workforce, understanding how to retain them is key. That’s where mentorship plays a big role. One of the top three factors in retaining Millennials is providing them with the opportunity to continue learning and growing. Since Millennials care about ongoing professional development so must mortgage lenders if they want to keep them on their team. Many companies offer initial training, which is essential, but it’s the ongoing education that’s the difference maker for most Millennials. One way to provide that progressive education is through effective mentorship opportunities.
 
As employees begin a new position, initially placing them in a supportive role is a good avenue to initiate the mentorship process. It allows them to assist senior staff members with the workflow, which gives new talent the opportunity to take on a measure of responsibility, but it also creates an educational environment where they can still learn from more experienced employees. Additionally, when veteran mortgage professionals serve as mentors, it gives them a hardworking assistant, which frees up some of their time to focus on other top priorities. Ultimately, this learning dynamic creates a win-win scenario for both mentor and mentee.
 
Millennials want ongoing professional development because they want the opportunity to advance their career; therefore, establishing a continuous learning environment lets Millennials know that if they grow, they can move on from an entry level position to more senior level roles. When Millennials don’t see a clear path to move up in your company, they eventually move on to a different opportunity. That’s why it’s important to create a culture where mentorship is commonplace and easily accessible because it not only helps develop future leaders, but it ensures your ongoing success.
 
Understand the Millennial mindset
When you understand the Millennial mindset, then you understand what it takes to keep them on your team. This new generation has grown up in a digital age so they’re nimble with technology; consequently, they welcome work environments where technology is fundamental and it enables them to be more effective in their daily role. That means mortgage banking has to continue evolving. Even though Loan Originators started out using basic tools like a paper application, the industry cannot become stagnant. Companies have to provide intuitive resources in order to attract Millennial workers, who want mobile tools and other advanced technology that make their job easier because they’re expecting a different work experience.
Furthermore, this new generation is unique in that they give added consideration to a job’s purpose over certain traditional factors. They don’t simply want to work but they want to do work that matters. That’s why lenders have to educate Millennials about what it means to work in mortgage banking. It’s more than simply approving a loan; it’s about helping people buy a home, which for many Americans has been a longtime dream. When your company knows your purpose and gets actively involved in making a difference both inside and outside of the industry, it becomes even more appealing to Millennials because they want to be part of a noble cause.
 
Create the right culture
As you create the right work culture, it leads to greater success with retaining Millennials. This new generation is looking for work environments that give them a certain lifestyle. Whether that means having special onsite benefits like car washing and dry cleaning services or simply creating a fun work atmosphere, they want a good work-life balance and they want to enjoy coming to work every day. That means lenders have to find ways to cultivate an environment that’s conducive to Millennials, even when it comes to learning.
 
When my company started developing the concept for its Lab, we designed it with the Millennial in mind. Rather than building traditional classrooms with confined work stations, we converted the 25,000-square foot training facility into a contemporary learning space with polished concrete floors, open ceilings, and mobile work stations that could be easily arranged for team building exercises. It’s configured with screens that descend from the ceiling and podiums that disappear once students finish training. By giving the center a state-of-the-art layout, it creates an environment where Millennials would be excited about learning and growing. Many of them will be drawn to this industry because they have the ability to earn a good living and it’s a profession that provides other rewarding benefits, but what will determine whether they work at your company as opposed to the competition will largely depend on the culture you create.
 
Looking ahead
Educating future mortgage professionals is a very involved process, but it’s a worthwhile commitment. Not only does it provide a gateway for newcomers to enter the industry, but it builds a foundation to continue moving the industry forward.

Rick Arvielo is Chief Executive Officer of New American Funding. In 2003, Rick and his wife Patty began doing business as New American Funding, a 40-employee, refinance call-center. In 2011, Rick introduced purchase transactions to the company’s operations, and in 2012, New American Funding opened their first branch. Their retail division has since exploded, adding 130-plus retail branches and more than 750 loan officers focused on purchase transactions in only four years.
This article originally appeared in the August 2017 print edition of National Mortgage Professional Magazine.

 
Commercial real estate owners and purchasers have a choice to make when it comes to financing their real estate investments. They often wonder “Should I apply to my local bank directly, or should I employ the services of a professional commercial mortgage broker to assist?” In order to answer this question, the following points need to be considered:
 
How many transactions does the borrower handle in the course of a year? Most real estate owners purchase, sell or refinance a very limited number of properties in the course of a year. By contrast, an active and competent commercial mortgage broker will handle dozens of transactions in the same time period. The commercial mortgage broker will understand the current lending environment, market conditions, and underwriting guidelines, all of which are constantly changing as the market goes through its typical cycles.
 
How many lenders does the borrower engage with during the course of a typical year? Most real estate owners have relationships with several local lenders in their market. A commercial mortgage broker typically deals with a wide array of local and national lenders every day. These include: banks, Wall Street investment banks, insurance companies, pension funds, credit unions, hedge funds, agency lenders, government agencies, and private lenders. A good commercial mortgage broker will know which lender is the best choice to handle the given transaction.
 
Is the borrower knowledgeable enough to best prepare the loan submission package for the lender? The typical lender sees far more requests than he can possibly review and approve. A commercial mortgage broker knows how to prepare a professional loan request package that will stand out and gain lender acceptance. A commercial mortgage broker knows what information is key to obtaining a loan approval from a lender.
 
Is the borrower up-to-date when it comes to current deal structures? Many borrowers focus only on the interest rate. A commercial mortgage broker will help negotiate many other deal points, including: Maximum leverage, loan term, amortization period, recourse obligations, pre-payment penalties, closing conditions, post-closing and/or annual requirements, etc. There are many moving parts in a commercial mortgage transaction and a commercial mortgage broker will be able to negotiate the best deals for his clients.
 
Does the borrower’s local lender offer a variety of different rates and terms? A commercial mortgage broker should be able to offer different choices, such as: Five-year fixed-rate, seven-year fixed rate, and 10-year fixed rate options. Additionally, the commercial mortgage broker will usually offer many different amortization schedules. Many local lenders only offer short term loan options (three to five years) and short-term amortizations (15-20 years).
 
Most large real estate investment firms employ in-house financing professionals to source, negotiate and place their commercial mortgage loans. It is often cost prohibitive for smaller firms or individual investors to employ financing professionals on a full-time basis. These investors are best served by hiring a competent commercial mortgage broker to represent their interests on a deal-by-deal basis.

Stephen A. Sobin is the President and Founder of Select Commercial Funding LLCStephen A. Sobin is the President and Founder of Select Commercial Funding LLC, a nationwide commercial brokerage firm. He has more than 30 years of commercial mortgage lending experience. For more information, call (516) 596-8537 or visit SelectCommercial.com.