AllRegs rises out of the basement and lands in the front office: A look into the past with a glimpse towards the futureMortgagePress.comAllRegs, regulatory compliance, Fannie Mae guidelines, Freddie Mac guidelines, FHA guidelines, AllRegs Academy, LendingPatterns, HMDA data, Lender E-Source
The AllRegs team of Jeffrey H. Hoerster, president and COO;
Dan Thoms, senior vice president; Frank Preese, chief technology
officer; and Glenn Ford, chairman and CEO
Eagan, Minn.-based AllRegs,
was founded in Glenn Fords household 10 years ago as an
entrepreneurial endeavor to supply mortgage lenders with a
convenient and comprehensive source of Fannie Mae, Freddie Mac and
FHA guidelines. Since its inception, the company has steadily grown
its revenue, customer base and services. Today, AllRegs supplies
federal and state loan guidelines to more than half of the mortgage
industrys lenders. In addition to being the exclusive publisher of
Fannie Mae and Freddie Mac information, AllRegs has established
relationships with many large companies, serving as their exclusive
loan guideline publisher.
AllRegs is run by an executive management team selected by Ford,
now chairman and CEO, to cultivate and grow the organization.
Jeffrey H. Hoerster serves as president and chief operating
officer, overseeing the company and its long-term goals. Frank
Preese serves as chief technology officer, providing AllRegs IT
leadership. Dan Thoms is senior vice president, managing and
overseeing strategic corporate initiatives, the sales and marketing
divisions, and the new education division.
The company has witnessed market downturns before, and has
transitioned into a larger force providing mortgage industry
professionals essential products and services, considered necessary
or highly desired, to conduct business. The company has expanded
from one main flagship product to more than 50 products and
services. One new product, a comprehensive FHA training course, is
specifically designed to help mortgage originators and lenders
capture more business in a declining market. When we caught up with
Glenn Ford and Dan Thoms, we confirmed AllRegs growth and success
didnt suddenly arrive overnight. In addition to providing us with
some colorful history, we wanted to learn about how some of their
new products will help the industry.
The Mortgage Press: Can you give us some history about
the inception of AllRegs?
Glenn Ford: In 1988, my wife and I came up with
the basic idea of AllRegs and providing federal loan guidelines. I
thought it was a viable idea and researched the number of lenders
in the United States to determine if the market was large enough.
Afterwards, I called 20 lenders in the Minneapolis-St. Paul area to
determine whether the idea would actually translate into a purchase
by a lender. All but one lender signaled they would want to
purchase such a product. So, we bought an IBM-AT computer and
taught ourselves to use it. Using BASIC programming language, my
wife created a relational database, and I spent three months in my
basement entering a five-foot high stack of manuals of Fannie Mae,
Freddie Mac and FHA selling guides into the computer. As you can
imagine, that task really improved my knowledge of the
guidelines!
Our first customer was Ralph Mozilo at Countrywidehe made the
decision to purchase after only one discussion. We were producing
the product on 5-¼-in. diskettes with hand-typed labels. We
garnered 10 customers very quickly. In those days, it would take me
all day to update information for those customers. We moved to
3-¼-in. floppy disks, then to a completely online,
Internet-based model.
TMP: What was the perception of AllRegs in the early
days versus today?
GF: In the old days, no one knew who we were, and
we had to explain the product in detail for potential customers to
understand exactly what we were selling. Today, we are fortunate to
enjoy name recognition, and when people dont know what products we
sell, at least theyve heard of us.
One thing I have not mentioned is that selling our product in
the early days was like pulling teeth. Our database of information
required 20 megabytes of disk space, and back then, most computers
only had 20 megabyte hard drives. Our product practically required
a dedicated computer to run the program. When computers began using
larger hard drives and processing speed increased, we experienced a
spike in demand because businesses had an easier time handling our
sizable databases.
TMP: How has the technology and processes
changed?
GF: We started out by sending
eight to 10 diskettes to customers, and if one of them was faulty,
that required sending a completely new batch of disks for the
customer to install. Updates were done monthly and could be
problematic. Today, updates occur almost instantaneously, and we
provide information in real-time.
TMP: How did you keep up with federal guidelines when
you werent affiliated with the government?
GF: I would visit HUD on a regular basis and
could wander around unobstructed because back then, there was less
security in the building: You could just walk right into the
building and wander the halls. Through my constant contact with
personnel at HUD, I built strong relationships across departments
that distributed content. Ultimately, I convinced them that it was
in our mutual interest to distribute their information in
electronic form to customers. HUD had astronomical distribution
costs and was printing paper manuals that required constant up-keep
by a customer. AllRegs was providing the same service, but in an
electronic format. After educating HUD, they allowed AllRegs to
distribute information on HUDs behalf, which reduced their costs
and made it easier for customers to access the guidelines. Today,
we work very closely with HUD and get changes in advance so that we
can distribute information as soon as updates are announced.
TMP: Can you describe how information is delivered to
your customers?
GF: When new information becomes available, the
first thing we do is publish the information online. Then we send
an e-mail, called an E-Alert, to subscribers wishing to get this
type of information alerting them to the updates. Individuals
opt-in to receive the information they are interested in. The
headline of the e-mail describes the update, the body of the e-mail
gives a synopsis of the change, and a link within the e-mail takes
a subscribed user to the full text.
TMP: AllRegs has a knack for solving problems within the
industry. Do you recall solving any problems that benefited the
industry?
GF: An innovative solution we implemented
involved managing the myriad of multiple updates that HUD was
applying to their manuals. You never knew if what you were reading
was the most updated material or had been superseded by new
material. We put in a feature called related revisions that alerts
readers to recent changes which has solved this problem.
TMP: Can you elaborate on your management
team?
GF: After buying out my partner in 2004, my first
task was to hire a professional manager to run the company. I knew
that my forte was not managing people. I also knew that this task
was the first step toward building a management team that could
take AllRegs to the next level. I started at the top and hired
Jeffrey Hoerster, a former customer, as president and chief
operating officer. Jeff has 25 years of mortgage experience.
Next, I wanted to strengthen our IT and product development
group and hired Frank Preese as senior vice president and chief
information officer. Frank spent 11 years as the chief technology
officer for a public company, Plato Learning, providing IT
leadership. Lastly, I needed a performer in the sales and marketing
department to strategize future growth and increase sales. I hired
Dan Thoms as senior vice president of sales and strategic
initiatives. Dan formerly led the education and business
development activities for the Mortgage Bankers Association. We
leveraged our management team when we decided to add an educational
division, AllRegs Academy. Both Dan and Frank have experience
building and delivering educational services to consumers.
TMP: Tell us about your new educational division,
AllRegs Academy.
Dan Thoms: We are unique in the educational space
in that we can utilize the timely information that AllRegs delivers
on a daily basis to our mortgage courses. No one else is able to
wrap their education around Fannie Mae, Freddie Mac or FHA
guidelines quite the way we can with our in-depth knowledge of
current information. People dont want to be educated on old
content.
TMP: Among your mortgage industry course offerings, the
Fraudulent Document Recognition Online Course stands out. Who is
the course designed for and what is the training
objective?
DT: The course gives mortgage companies, banks,
title and closing companies the tools needed to stop or prevent
giving money or assets to someone isnt who they say they are.
Students are taught what a drivers license, birth certificate,
passport, Social Security card, etc., should look like, along with
how to use any embedded security features present within those
documents.
TMP: The news has exposed some diverse, and sometimes
unethical, procedures used by some mortgage lenders. Can AllRegs
help the industry in this area?
DT: We just completed our mortgage fraud
conference in Las Vegas, conducted in conjunction with MortgageFraudBlog.com,
which provided mortgage professionals with two full days of
education to help them improve their operations. We also have a new
tool called LendingPatterns that analyzes HMDA data in-depth. With
this tool, lenders can identify activities taking place in the
industry. For example, they can view spreads and determine how
business is being conducted in the mortgage banking industry by
geographic areas.
TMP: If more than half of lenders use AllRegs, why isnt
the other half using your services?
GF:TMP Well, some lenders view the guideline and
compliance information we provide as a luxury, when in fact its a
necessity. In my opinion, time is money. One of our taglines is
Fast reliable answers. Some lenders use the Internet to gather
information for free; however, that tends to be a longer and
non-standardized process versus ours. I think organizations
sometimes forget the value of time and convenience.
TMP: AllRegs recently acquired Lender E-Source. How has
this acquisition benefited AllRegs? Do you anticipate any other
acquisitions?
GF: This acquisition provides information that is
a perfect complement to fill out our library of information. The
addition of the correspondent lenders, loan programs and
underwriting guidelines fits nicely with our state and federal
guidelines giving lenders a broader view of lending products such
as loans sold in the secondary market. We do not anticipate any
other acquisitions.
TMP: What does AllRegs offer that will assist Mortgage
Brokers in this slowing market?
DT: We can help a Mortgage Broker pick up their
business with our FHA origination training, giving them a new
product to sell. FHA loans are becoming hot and we offer a
comprehensive instructor-led online course designed to teach
Mortgage Brokers how to immediately begin processing an FHA loan.
We are also offering an underwriter-in-a-box concept that lets
brokers see exactly what an underwriter sees in order to help them
better match people with loans.
