Loan Think

All month we've talking about the little things that combined help you convert more prospects into closed deals. You know the subtle things that attract clients to you and then make them want to do business with you.

Monday's bankruptcy filing by commercial mortgage banking giant Capmark Financial lists dozens of individual shareholders who hold common equity in the company. Those shares, arguably, are now worthless. The largest individual shareholder appears to be Dennis Dammerman, chairman, of the Municipal and Infrastructure Assurance Corp., a financial guaranty insurance company that was formed earlier this year. Mr. Dammerman is best known for his management career at General Electric where he served as chairman and CEO of GE Capital Services. Another common shareholder is Scott Shay (92,764 units) who has been associated with Signature Bank of New York...

As a reverse mortgage specialist, you probably have a marketing plan and strategy that you can rely on that provides predictable results. If not, we need to talk! I'm sure you use a mix of tools that position you as the local expert and that you can track the effectiveness of each.

In today’s marketplace websites need to be built faster and easier so that companies can deliver more content to their prospects and clients. Whether it is potential borrowers going online to shop rates, collect information or actually begin the origination process, consumers are online looking for answers. The same can be said of lenders searching online to find the next fraud solution, compliance update, or workflow automation tool. Today’s buyer expects to obtain information online where and when they want it. The challenge is in finding an easy and fast way to deliver and constantly update content without extensive IT resources.

Will Bank of America soon start unloading its massive portfolio of nonperforming residential loans -- and will it be in time to help save some of the mortgage vulture funds that were set up to bottom feed on the product? (We're hearing that some of those funds may be shutting down -- and have returned seed money to their investors.) Time will tell, but the situation is heating up -- or so we're told by some of the executives who plan in the NPL (nonperforming loan) space. Meanwhile, we assume the publicly traded PennyMac soon will release third quarter earnings. In trading Tuesday its stock fell to $18.40, which is a 52-week low -- a tie for its 52-week low, that is. PennyMac was created to invest and service NPLs...

Be careful about what you, your employee or even your customer tweets about your company or you could find the Federal Trade Commission on your case. That is a word of warning from a Los Angeles-based attorney.

I read the Scott Rasmussen affidavit over the weekend. Scott is the chief performance officer of Lend America which won its court case against the Department of Justice and Department of Housing and Urban Development and is now cleared to continue writing FHA loans. In the court filing, he notes that the company spent $100,000 on an outside audit of its loan practices. That audit led to several changes at the lender including a reorganization of its sales department in July of this year. As part of that reorg the "personal use" of cell phones "on the premises" has been prohibited. Lend America also increased the size of its quality control group to five from one. In July its chief credit officer -- who is unnamed in the affidavit -- retired. And one last item: between January and August of this year 14 employees were fired because of what the Mr. Rasmussen called "improper loan origination activities." HUD's problem with Lend America centers around $14 million in loans it funded out of a total origination book of more than $1 billion...

There's at least one detail about BB&T staying in the warehouse lending business that readers might want to know: for new nonbank customers the bank is limiting its lines to mortgage lenders that are located in its "footprint." That would be the mid-Atlantic and selected other states, which means if you're a nonbank based in California you might be out of luck. As you might recall, this past summer BB&T took over the warehouse platform of Colonial Bank when that institution failed. The North Carolina-based BB&T was already in the warehouse space. In other warehouse news, we continue to hear scattered reports that the "credit crunch" facing nonbanks is beginning to thaw somewhat but the industry is hardly popping champagne. Meanwhile, in other news, Lend America executive Michael Ashley told Newsday last night that his firm's problems with the FHA stem from an employee in the Inspector General's office at the Department of Housing and Urban Development having a "vendetta" against him. He declined to name the employee. Lend America is a nonbank that depends on warehouse lines of credit. It ranks 18th nationwide in terms of GNMA issuance, according to the Quarterly Data Report...

Wow, what a week. I just completed a nine-day trip to see business partners and to participate in the second Credit Repair Boot Camp sponsored by my friend Mike Citron at Dispute Suite.

What is it with Long Island, any way? It's the home of Joey Buttafuoco and Amy Fisher. (Remember them?) You ever hear of the Good Rats? The parking lot that is called the Long Island Expressway? And don't get me started on the real estate taxes! Twenty-five years ago I remember visiting with my mom's boss (a Sears manager) at his house on the water. Back then his taxes were $10,000 a year. I grew up in Nassau County, the South Shore where all the working class folks lived. (Billy Joel and all the rich folks live on the North Shore.) I was raised in a Levitt house that cost my parents about $9,000. My dad was a GI returning from the war. He would regale me with tales of his 3% FHA loan. OK, he didn't regale me but I do remember that my parents had an FHA mortgage and the rate was about 3%. (This was back in the 1950s.) Where am I going with all this? FHA and Long Island? Lend America, that's where. The nonbank from Melville was in the news this past week after it beat back a court injunction from HUD that would've prevented the lender from continuing to fund FHA loans. (FHA is its only product so you can imagine how important it is to them.) For now, Lend America is still open and operating and that's good news for its 700 employees. Is this just a case of a misunderstood businessman (Michael Ashley) and an overzealous HUD looking to make an example of someone (Ashley) over $14 million in loans? (Ashley, by the way, has a bit of a "history" but that was almost 20 years ago.) The matter is far from over. The judge wants to see more evidence from the government. As part of its case, Lend America filed an affidavit from Scott Rasmussen, its chief performance officer. He's worked at the company for less than two years and says (in the filing) that since early 2009 its product process is entirely paperless which results in "significantly increased control and accountability." He adds that the company can tell "exactly when any document or records have been altered." (Its software vendor in this regard is Interthinx.) This, I assume, speaks to loan quality at the firm. The Lend America case is going to be one to watch. For the full story see the Monday (paper) edition of National Mortgage News. Don't subscribe? Call 800-221-1809...