Episode Transcript
[00:00:00] Speaker A: The ultimate hub where the hidden stories behind the mortgage industry come to life. This is season four where we say, every mortgage has a story. I am Michael Kelleher.
[00:00:11] Speaker B: And I am Michael Zhao.
[00:00:13] Speaker A: And together we dive deep into the entrepreneurial spirit, the strategic insights, and the breakthrough innovations that build the world's greatest mortgage companies and banks. And today's stories are going to be more impactful, more meaningful because of the guests we have on today. Nikki Bialka has been in the mortgage industry, I believe, since 2009. She is currently VP of Community Lending Strategy for Fifth Third Bank. She works with affordable housing, equitable lending, and a long, long laundry list of ways. She has really leaned into this position and become an expert and a voice in. In what we really need to be talking more about. I just came back from D.C. at the National Advocacy Conference, and we say our audience when we're speaking to you is the mortgage industry who maybe can't always make it to these conferences. The loan officer, the underwriter. Whether it's cost, whether it is, you're so talented, they don't want to get you out here. But we want to bring you the type of people you would see at these conferences, the type of subjects that we are talking about at these conferences to show you that even though it's a big industry, it's actually really small. And most of our leaders are very approachable. So today we're going to dive in. And if you are advancing your career or you're scouting for industry leaders like Nikki, or just exploring opportunities in fintech, prop tech banking, you're in the right place. So let's get ready to unlock the story behind every mortgage as we dive in. Nikki, I wanted to take you to that day where Jay Plum came, I guess, into your office and he said the words, are you doing what you're supposed to be doing? Can you just talk about that day, like, and walk us through it a little?
[00:02:08] Speaker C: Yeah. I first was like, oh, God, what am I supposed to be doing?
[00:02:12] Speaker D: What?
[00:02:12] Speaker C: What do you mean, what am I supposed to be doing?
And then, you know, as I started to learn more about the opportunity in this space and how it really overlapped with some of my passions and in what I now look back on is really how I define my purpose and all of the things that I've learned along the way and why I've learned all of those things, why did my career go that route? And I truly believe it was to position me for an opportunity like this. It was a moment of. I had never really thought about It But I also don't think when people think about the mortgage industry in general that they think about, like you said, you actually started it when you, when you opened up. Mortgage land is actually really small.
[00:02:58] Speaker D: Right.
[00:02:58] Speaker C: Like mortgage land is, is really small. But what that means to me is there's a lot of opportunity to influence and drive innovation in mortgage land because it is pretty small. So there's a group of leaders that are driving these different initiat and things that are important to the industry. And I never really recognize the impact that you could have with a purpose focused on the community and how you could drive business innovation and ultimately more market share.
[00:03:26] Speaker D: Right.
[00:03:27] Speaker C: Because at the end of the day there are a few goals that you need to hit as a business and market share is probably one of those. Yeah.
[00:03:32] Speaker A: And I, before I ask my question to tell others, I do want to point out to our listeners the background in sort of how you got to that day. It wasn't just like you were the right person at the, the right time. The laundry list I was talking about.
[00:03:47] Speaker E: Is it seems like you had always.
[00:03:48] Speaker A: Put yourself in the right position for this pathway very early on, maybe you didn't know you were going to stay in banking. And then more and more meaningful things started popping up that got you there. And so we say in season four, every mortgage has a story. I think it's so important that your story started by reading the stories of others, the hardships of others. And it really gives you context that I think some people don't, don't always have in this industry and maybe could learn from that. Can you just talk about how starting off by reading hardship letters helped the pathway of where you are today?
[00:04:23] Speaker C: Yeah, absolutely. And thank you for that because I think it's really important and it's one of those things that I kind of look back on. I really didn't intentionally place myself in these roles, but there are themes that stood out to me from solutions that I was able to drive in those roles. So what you're talking about is 2009, I was in loss mitigation. And so this is where I actually started on the phones and I was counseling people that were calling in who were losing their homes.
[00:04:57] Speaker D: Right.
[00:04:57] Speaker C: And so I was dealing with raw emotion. It was sad, mad, confused. It was all of these emotions that my job was to counsel them and to help them to focus on what they could control. And that was what is the next step in getting you help. And so that next step in getting help did start with them having to submit a Request for services. And every file started with a hardship letter. And that was, uh, you know, even for people to have to write that hardship letter was an emotional thing that connected me to that human. Knowing what it took them to write all of this down on paper, knowing that there was a lot of, you know, they're losing their dreams in many cases or so desperately trying to hold onto that dream of homeownership. And so it really stuck with me in every workout that I did. I was underwriting, you know, providing forbearances to give people time to get their situation corrected. But what had happened in the market, there were many people that couldn't. There were many people that had to short sale or deed in lieu of foreclosure their homes. And so being able to not only be there on the good end where we could modify it and keep you in that home, but also helping people as they had to let go of that dream and they had to let go of that home. But really help them understand how this is the best route to position you for homeownership again down the road.
[00:06:25] Speaker D: Right.
[00:06:25] Speaker C: We, if we can get you a short sale or a Dean Loo, while it has impacts, it's not the same a foreclosure and we can get you into another home down the road. So I think it's always been trying to fill the gap and solve for whatever was going on with my customers at that point in time and what was happening in their world, that has now expanded a little bit. Now it's a little bit broader for my entire customer base and what's happening in the world around us.
[00:06:51] Speaker B: I find it interesting because money's not emotional, people are. And when someone has the opportunity to own a home, a lot of times, what I've seen in my past origination career with people who had some problems, it wasn't that they actually inherited the house. They took over their mom and dad's house because the house had been in the family for a certain amount of years. And the challenge for them was balancing their own budget just to make the mortgage payments. And. And I see, I can see that balancing the budget. You think, you know, common sense would come into play, but actually it becomes an emotional decision. Some people hide out of their fear. Some people are prideful, so they don't want to learn. Right. And so what does it take in order for you to move that to. I'm going to be able to help one person at a time, but that's not really moving the needle. How does someone now go to A position, because that's what we're doing. Right. That's what originators do right now. They help one person at a time. What do you do differently that helps the industry to originators to say, you know what, yes, you can help them one at a time, but this is what we can do also so that we're going to provide not only education but actionable situational circumstances to help you not only originate, but educate more.
[00:08:09] Speaker C: Yeah. So I think it's it, it's twofold. First off, I think it's understanding, look, there's no national solution for this and that's what makes it so tricky. There's not even solutions at an MSA level. So at a market level or at a city level, it's at a neighborhood level.
[00:08:28] Speaker D: Right.
[00:08:28] Speaker C: And if you think about the neighborhoods that you live in, there are different, unique challenges by neighborhood from housing stock to the population and the challenges within that community, the investments in that community. So I think first and foremost it's making sure that your teams are skilled at what are the products and programs that are getting the masses through in your local market. Is it an hfa? Is it a stackable program?
[00:08:55] Speaker D: Right.
[00:08:55] Speaker C: And this is why it's so nuanced. Because when you get into helping the masses through, you have to find out what are those programs and products that are out there today that can get this group through. Oftentimes those might have limited, they might have expiration dates or they might have a limited budget. And so you've really got to be a subject matter expert at what are those programs and tools that are around you at a local, state and at a lender level. As a lender.
[00:09:27] Speaker D: Right.
[00:09:28] Speaker C: How can I stack these programs and be a subject matter expert? And I think it's making sure that everybody knows it's their job. It's not just a CRA mortgage loan officer. It's not what is, what is everybody's individual business plan to make sure that they are serving the community.
And what I've seen and found successful in the past is the first time homebuyer space.
[00:09:53] Speaker D: Right.
[00:09:53] Speaker C: I have a few of our top mortgage loan officers across the bank. We're our top producing special purpose credit program loan officers. And you think about when these rolled out, this was especially the Freddie Mac and the Fannie Mae. It was during the time where depositories had to pull back on their lending. We were being told that we needed to hold more on our balance sheet and we had people that pivoted in. The special purpose credit programs had just emerged And I have, I mean, my top sales leaders are the top in that program. And so that's an example of taking advantage of the market today and what is out there, because you don't know what's going to be out there tomorrow. So staying on top of your toes, making sure that you know those products and programs and then don't just put it in one person's group. Try it. If you're a mortgage loan officer that is out there listening today, if your business isn't diversified and you're not looking to get into this space, try it. You need to try it. These are the biggest you, you put a first time home buyer in a home and their church knows about it, their cousins know about it, their family knows about it, people at Kroger know about it. So it's a space that if you're not tapping into the space, I encourage you to do it. It might not be easy, there might be nuances, but find a product, become an expert and maximize your, your capabilities with it.
[00:11:16] Speaker A: A very strong trait of yours will say is change doesn't happen through title. So you are VP of Community Lending, which is great. And the programs you're mentioning, you know, they have title. It really takes the grit, the gumption, the ability to get out of your comfort zone. And it sounds historically like you get up in the morning and you go to these opportunity zones where this is happening and you're able to get a better understanding of why it's working, how it's working and how adjustments can be made. Whether it's showing up to an event that is not your event, to show the community. I know that's important to you and you teach others to do that, like do something that, that is not specific to you so that they can see that you want to be there. Even I heard you've shadowed praisers and that is a going to advocacy year after year with the, the pave that came out, you know, that's a real thing. So I think to make change you have to go in and, and understand what you're actually changing. And I commend you for that. Can you say how we need more of that in our industry? Whether it's small or big, people getting into the streets.
[00:12:29] Speaker C: Yeah, thank you for asking that. Actually, I, I think that you have to pick a thing, right? Because there's a lot that's out there. You have to pick a thing so that you can be intentional about showing up. When you're talking about affordable housing or equitable lending.
[00:12:48] Speaker D: Right.
[00:12:49] Speaker C: You're Talking about communities. So how do you show you're a part of a community? It's not just by showing up one time or cutting a check. It's by showing up to volunteer for a rock the Block day to come and clean up the streets. And showing up being giving of your talent. So are you helping these groups organize and using your leadership and your thought leadership to help them move progress, whatever ever it is that they're moving forward? I think it's showing up and being intentional about where you're showing up. And it's not just a one or done. If you're looking to get involved with a housing counselor, a nonprofit, trade associations, any of these groups at a local level, trust you me, they are used to when it's time for checks to be cut, sponsorships to be made, and people to show up at a dinner or a lunch. Where people don't show up all the time is at a homeownership training where maybe two people show up every week, or these things that don't get all of the, um. You know, again, it's that resilience, it's showing up, it's. It's really pouring yourself into that thing. And I guarantee you, when you authentically pour yourself into it and you give to it, you'll naturally start to see that business reciprocate to you.
[00:14:02] Speaker B: There's a lot of originators out there that are more in the broker space than the banking space right now. For example, like, I wouldn't doubt if you talk to someone and say, oh yeah, you know, I'm a loan officer at XYZ FDIC bank and I specialize in cra. You know, CRA is such an underutilized product as it already is, that they don't even know, you know, census tracts and, you know, certain incomes and even specialized communities that are specific to CRA and so on and so forth. I think that, I don't know if I should say there's a lack of education, but there, but there definitely is something within the industry itself that there aren't originators that understand that segment. They know there's down payment assistance and they also know that there's maybe grants available. But when you go across that space as a retail originator, whether you're a retail broker or a retail loan officer, I still think that there's not as much readily accessible information in that space.
It's definitely available. I mean, the Internet will definitely provide it if you look for it. But just like anybody else, they don't know how to ask the right questions. Is there a better way that that in. In our industry that we can learn how to ask better questions to achieve grants, down payment assistance, specialized programs for first time homeowners working. Where can we look as an industry? If I don't know, how do we get that out there so more originators can find out? Not only is it good for originators to originate new business, it's also good for the potential new home buyers.
[00:15:40] Speaker C: So are we talking like down payment programs in general? Like how do you. So for originators there are, there are several tools that are out there even for consumers that you can use. And you're right, there is so much information out there that it's like what tool do I go to to understand this? So Down Payment Resource Portal is something that we use. I know that, you know, Rob Crate and his group have done a great job at really emerging as the one to kind of aggregate all of those programs. Again, so nuanced, right? Like you're talking county programs, state programs. All of them are. Have different cycles, different fundings, some of them have different requirements. Using a tool like that so that you can first identify them and then secondarily, I think, and that's for the broker side. How do you get the awareness? How do you understand it? But you also have to have those disciplines built within your organization. So your processing teams, your underwriting teams, your disclosure teams, your disclosure team needs to understand how do these need. These programs need to be disclosed up front. So it's not only your broker or the mortgage loan officer talking to the customer, identifying it up front, understanding do they qualify. It is then your entire team understanding how to foster these through and make sure that any of these nuances aren't stopping major milestones to get us to close on time. So how do we proactively?
[00:17:08] Speaker D: Right.
[00:17:08] Speaker C: What does that look like? So making sure that your processing teams are trained, making sure that your conditions and things in the systems are set right, making sure that you've got skilled underwriters that handle some of these programs. Not having it very broadly spread out, but having again specialized teams that know how to foster these through. They know that nuance, they've dealt with it before. Oh, I know that. I know what they need. I know exactly how we need to satisfy this condition. So it starts up front with the awareness and education as you're talking with consumers. But you've got to have that connectivity on the back end so that you don't have service disruptions because of that product. Because we know that our brokers when you get those disruptions, you, you're not going to hang on very long. You're going to give it one or two times and if it messes up your deal for your consumer, you're going to move on to another product. Right.
[00:17:57] Speaker A: And going back to the previous answer you had, I think it's so important that leaders are making it known to their workers to encourage them to get out and get into the community. You know, when we're going through a down cycle, at least in the mortgage on margin, people are afraid of their jobs. It may be afraid to spend two hours out in the community, not behind their desk. It you can have signals off on what you're trying to do.
On the note of signals a listener that when, when Jay came and said, are you doing what you're supposed to be doing? I'm sure that happens a more often than we think and the person that's being asked didn't pick up on it and gave up on or missed out on an opportunity to really pivot or, or change the trajectory of where they're supposed to go. Do you have any advice as a successful businesswoman in our industry for the up and comers to make sure that they're not missing it? And especially as a woman in mortgage, I bet there's less of those opportunities. So when they come, you, you do have to make sure that not only do you see them, but you raise your hand, you say, yes, I, I want that. Right?
[00:19:03] Speaker D: Yeah.
[00:19:03] Speaker C: First off, you better know your stuff. You better know your stuff. Take some time to truly understand what are the problems that we are trying to solve for in a responsible, effective manner, the challenges of our community today.
So things like alternative ability to repay.
[00:19:25] Speaker D: Right.
[00:19:25] Speaker C: Like those are things in the system that we need to work on to change, to say there are other ways and other models and things that we can adjust and still do this in a responsible manner to prove someone's ability to repay. So I think that's first and foremost is know your stuff. Understand what challenges you're trying to solve for this might mean you need to dig into history. You need to understand what were the barriers that were created, what solutions have been put in place, which ones are working and which ones aren't and do we need to advocate for. So number one, know your stuff. Number two, I love data and numbers because numbers don't lie. So know your data. Mike, you brought up, you know, all this data that's out there, tell the story, build a business case and show this as an opportunity and market Share opportunity for you to go and get that, that market share.
[00:20:23] Speaker D: Right.
[00:20:23] Speaker C: Use the data in a way that is inspiring to get people to go and diversify their business as opposed to a regulatory requirement. That's, that's the wrong way of going about it, in my opinion. You show the opportunity, you create the environment, you create the culture. As a leader, it wasn't just me driving with an appraiser. J. Plum was also alongside of me with an appraiser. He's the head of the consumer bank.
[00:20:49] Speaker D: Right.
[00:20:49] Speaker C: Like that is not, it's when, when we are out there doing it, then our mortgage loan officers and people in the market naturally think, well, I should be doing that as well. So you're right. It stems from the culture. And I think driving that culture, you have to have a strong business case. You have to have the data to support it. You've got to show the opportunity. And then lastly, I would say you've got to tell the stories when there's, you know, this environment can, can shift in and get very political. And I think that when we ground ourselves in the stories and when we take a step back and we think about what homeownership is and how it's a part of the American dream and how it is a part of the American dream for all, I think showing some of those stories can really drive inspiration for people to want to get involved as well.
[00:21:37] Speaker A: Yeah, Senator Warren did a good job on that particular piece. Of the three main reasons homeownership builds the American dream.
[00:21:45] Speaker E: We're just over halfway.
[00:21:46] Speaker A: We're going to take a quick commercial break. And on the other side, we do want to dive a little bit into this Zillow rocket world digital and why that can lead to opportunities where they, they can't fill some of these gaps. So looking forward to talking about really transitioning or translating policy like you're talking about into possibility. Let's see our two great sponsors. We have Adium and Mortgage Connect. We got Flowify coming up next week, so there's a, a nice shout out for them too.
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[00:23:42] Speaker A: My morning writings are a lot about Rocket and Zillow and I I don't really care if people push back on me because I don't I'm sticking with what I believe is right facts and they really do have down systems where they can hear signals and they're about five or seven years ahead of other signals is the ability to know when that customer is doing something that actually will turn into a deal versus we know like they're doing something. We haven't figured it out yet.
I start to think though these underserved communities, these opportunity zones, I think they lack signals. You know they might not have the checking account that gives off the signal, they might not download these apps and therefore they are going to miss out on some of the digital friendly ways to get into homeownership. But on the other side, this is an area where many loan officers wondering how do I compete? I don't think you make a better press a button. You, you start to learn how to be different and you start to learn how to be more like the community that you're in. If you play their game, you're, you're bringing a knife to a gunfight. If you play your community game you have a shot of becoming and branding yourself as a resource. Can you as you see this landscape Nikki and and you can take this question anywhere you want but what is big digital data like this fork in the road now of these two monsters coming in, what are they going to miss out on in communities and what kind of keeps you up at night in that area?
[00:25:11] Speaker C: I think it's there is always going to be a need for a trusted advisor especially in communities that don't trust the system might not trust banking, might not for very good reasons.
[00:25:26] Speaker D: Right.
[00:25:26] Speaker C: And so I think having a trusted advisor that can help not only answer that specific question, it might be a question about apr, but in reality it's helping foster them emotionally through the process, helping prepare them for that next step in the process, making sure they're informed. Right. You can only do so much of that digitally. Look, there are some people that love it. They'll do it all that way. They don't want to talk to anybody. These communities want to talk to people. They want to understand what decision they're making.
Because historically, when they don't have that connection, there have been things that have happened and discrimination. Things that have happened. Right. So I think that what you're losing is that connectivity. You're also losing that. Like I said earlier, when first time home buyers or home buyers or someone that, that never thought that they could become a homeowner, when they become a homeowner and realize that dream, they tell everybody and they don't say Fifth Third bank did it. They say Cam Carry at Fifth Third bank did it. They says Angela Preston at Fifth Third bank did it. They name out that person, they invite you, they bring you here, they. So I think what you're missing out or what will be missed out is it's going to turn. There's going to be that transactional side and the relationship side is going to be the gap to fill.
And that's kind of how I like to look at it. Even with, with, you know, things that are going on now, where are the gaps that we can fill for the community?
What is the gap that you can fill? Is it a, is it that they need to know what's going on next in their loan? Is it a. They don't, they want to explain the appraisal deeper than, than, you know, there's concerns around appraisal. So can you really walk me through this and explain it deeper? That is what's going to be missing is the relationship side. And so look, I look at it as opportunity. How can we be there, show up, fill the gaps and continually be there?
[00:27:25] Speaker B: Nikki, there's a saying that says the enemy of my enemy is my friend. Right. And I think that when we look at Zillow and Redfin and what's been going on in the, in the state of lending, if originators look at them not as like enemy per se, but really just in, in practice of their business, there's actually a potential friendship from competitor to competitor. So for example, if you're, if someone's at Fifth Third bank and they want to go to. And they need some advice from XYZ broker, for example. And XYZ broker says, you know what? I can't do cra.
[00:27:59] Speaker D: Why?
[00:27:59] Speaker B: Well, because I'm not a bank.
And there's no. And maybe in that part of their community, they don't offer the CRA because they don't have any wholesale relationships with an FDIC insured bank that can offer that product. So I think that there's, not only is there a lack of education, there's also a lack of synergy from banks to brokers and vice versa. You know, hashtag all of us for that. Right. So I think that if we look at the, our current state of lending, we're, we're looking. Each individual originator is more in the state of lack than they are in abundance. Do you think that the, the broker community can do better in serving itself with bankers, in working with the banks, the FDIC insured banks? How does that happen? So that brokers can say, you know what, I need my enemy, the banker, big bad banker. Actually, I need them to be my friend. How can we encourage more brokers to actually speak to bankers, to work in lockstep, synergistic ways for communities to actually win overall for homeownership?
[00:28:59] Speaker C: Yeah, I think it's understanding what gap your lenders in your market feel for your consumers.
[00:29:06] Speaker D: Right.
[00:29:07] Speaker C: And I think it, it starts as easy as I was saying before. Show up to some of these things. Show up to some of these. A lot of cities have affordable housing committees that are working on. You got to show up to understand who's at the table and those should be your partners. It shouldn't just be anyone who's really doing it, who's really leaning into the community, who has creative products.
[00:29:31] Speaker D: Right.
[00:29:31] Speaker C: We do have a portfolio. We do have different things that we can do. And so I think it's finding out in your market who's doing it and who's doing it for real, who's really leaning into this work that should be your partner. Get alongside of them, help that. And also in this space, I'll say that this. We just, we did an event with the Ohio Mortgage Bankers association last week in Columbus. It was a homeownership symposium. And I've actually done this in a couple of different cities across our footprint, and we're going to a few more in our intent. And when I first started doing this and said, yeah, we want to bring in the other lenders, at first there's like, people don't understand that I remember I called Greg Sher and said, hey, I'm doing this in Tampa. I want you guys, you know, bring your team. I want Jane to come and have a table and be a part of it. And when I reached out to Jane, she said, you're just giving us a table? Yes. Yeah, we need you guys there. I need you guys. I need a part of that, a part of us showing up together for the community as well. You guys is that trust factor. We are in it together for you. It is about you, the consumer, the customer, not me, the MLO or the broker. There is power in that. And I think that when you show up to those types of events, you know who's at the table with you and you know who's authentic and doing it.
[00:30:53] Speaker A: Yeah. We were talking quotes. Representative Lisa McLean spoke at. She's a Republican congresswoman out of Michigan. She said a great quote that I think applies to the mortgage industry and probably applies to the, the way the appraisal world has, has worked for years, which was if you always do what you've always done, you'll always get what you got. And it just seems like for anyone watching, when you go to get a mortgage, typically they send somebody that has to walk through your home. And if you're this perfect borrower that lives in a picket fence where, you know, it's not a big deal. But we were talking about the Pave report earlier. They were able to identify whitewash, like if they whitewashed a house and it comes down to like pictures in the wall type of hair product and they changed it over to make it look like a white person's home. The values were coming in. I know in Texas and some other areas higher, 30,000, 40,000. So everybody's all excited about this new data and I don't know much about it, but there's obviously this new way we're going to be able to access data more on appraisals from the FHFA so that we don't have to have people going through the house as much. But does. Do you think this guardrails in place yet? For the fact that it's built on an architecture that was traditionally bias?
Is that is appraisal still something that is going to be very prevalent for the next 10 years? Are we supposed to think that the data is going to take that out?
[00:32:29] Speaker C: No, the data is going to tell us what to do next.
[00:32:32] Speaker D: Right.
[00:32:32] Speaker C: I think that this is a good start. All of the changes that are coming to the, to the forms.
[00:32:37] Speaker D: Right.
[00:32:37] Speaker C: The forms are changing and the goals ultimately to bring it up a level are to drive transparency and to drive some consistency and take out some subjectivity from an individual person level.
[00:32:51] Speaker D: Right.
[00:32:51] Speaker C: So how can we take out some of the subjectivity? And it's just the opinion, even though, and it's a tricky thing to say with appraisers. Look, I, I have a lot of appraiser friends, so this isn't a, this is a how do we fix the, the issues? And so I think that the changes that are coming are great. I think that the PAVE initiative and how it brought to light what you mentioned, the whitewashing and these stories that really hit the headlines. We had two of those in Cincinnati, I'm based in Cincinnati, Ohio. And what the data told us is homes are being valued less in black and brown communities than they are in white. So why, what are things that we can do to understand that?
[00:33:33] Speaker D: Right.
[00:33:33] Speaker C: And so what the changes that are coming are really designed to bring clarity to that and what that does for you as a lender, you already should have checks and balances in place to ensure that that value is coming in accurately. Right. What is your reconsideration of value process? Do you have a clear reconsideration of value process? Do your consumers understand how to submit a clean and a good reconsideration of value process? But most importantly, do you have tools and checks and balances in your QC process to mitigate any under explained or overexplained value for that matter? It's really, when you can't explain it as an appraiser, when you can't explain it as a lender, why is it valued? And so I think what the changes will allow the industry to do is to use data in a more proactive manner to seek out unexplained undervaluations or unexplained over evaluations? So I think that there, there are some good changes. I don't think it stops there. It's not the silver bullet. There are many things that go into adjusting, you know, how we do things from the old way of doing things to how we do things as we move forward.
Other things like the appraiser Development initiative, how do we get more appraisers into the, into the industry, more appraisers that look like all of us, so that when appraisers are going into neighborhoods, there isn't already intrinsic bias. We all have bias. We all have bias. So, you know, we've done a lot around training appraisers on bias. There's all, you know, all that kind of training that's out there. But the other lever is also making sure that folks in, in appraisal land look like the community that we're serving. That should be all of our goal.
[00:35:25] Speaker A: Yeah. And I think statistically, like for anybody that's watching that isn't in the mortgage world is like normal. And then the appraisers statistically are just way all the same. Right.
[00:35:36] Speaker B: You know, when, when I saw the FHA changed their guidelines on the itin, borrowers ITIN are not, are. They don't start as citizens, but they eventually get a tax identification number, hence it. And what I was concerned about that not just because of the elimination of that product from fha, but I was actually more, I'm actually more concern about the potential domino effects that it comes first it starts with the ITIN and then, and then it moves downward. And I think when I look at that, I said, oh, that was more of a knee jerk, not necessarily completely emotional response, but somewhat fear based response based upon potential future foreclosures. Right. I think that's one of the potential reasons why they may have that. Ginny put that into play. And I think that really, I look at it now, I'm like, well, we have less than a 4% default rate right now. You're really punishing all of everybody else in order to try and mitigate another what, 1 2% of other borrowers that haven't even happened yet.
When I talk about the fear based mindset of where the agencies are at right now, they're actually from a banking independent mortgage banker and an FDIC insured bank. There actually is an education level that they can provide to the GSEs and to Ginny so that they can actually say, okay, you know what, maybe we made a mistake, they can still reverse. Is there anything that, that do you think that we can do as an industry better to, you know, we talk about informing and educating communities, but do you think that we can also educate the government organizations so that they get more confident in our economy, in homeowners and for home ownership futures?
[00:37:25] Speaker C: Absolutely. I think right now though, like you even said it, you're guessing as to why the change was made. So. Right, like so we're guessing so. So if we don't even understand why the change was made, how do we mobilize around saying why it shouldn't have been made?
[00:37:44] Speaker D: Right.
[00:37:45] Speaker C: And so to your point, not going down that fear based, it's, it's. I think what we should be advocating for right now is Understanding why. We need to understand why some of these challenges or changes are happening, number one, so that we can figure out how to fill those gaps. Because at the end of the day, you guys, like, we're all, we're all hearing changes daily and adapting and adjusting to them, but guess who else is hearing about changes daily? Our clients and our communities. And they don't know what that means. So the quicker that we understand what it means and we know what do we have to fill this gap? We have to, we have to clarify these things for our consumers as well. So I think it starts with we need to advocate, to seek to understand first and foremost.
Once we seek and we understand why the decision was made, then we need to build a business case. And as an industry, we need to get alongside of those different housing groups, immigration rights groups, any of those advocacy groups. And as an industry, we need to lock arms and say, this is the why. So having the data to support it. And then again, storytelling is so important at times like this because what I think the missed opportunity is, is you people don't even know the words to use. The immigration process is so. It's spaghetti, right? It's got all these noodles in it, in. And it's. So it's just a tricky, very politically driven topic. And so I think for the industry, we need to first seek to understand, understand what it is and how it negatively impacts the mortgage industry and the growth of the industry. And then we need to align with some of the groups that are working on this from the immigration side and figure out how to mobilize, organize, collaborate and make the business case for, you know, the, the regulators to listen to us.
But like I said, I'm very much in the. Trying to understand the why There's a lot of assumptions and that leads down the path of fear.
[00:39:54] Speaker A: Wonderful answer about the consistency because, for example, the Massachusetts Mortgage Bankers association, every year we have a HMDA Affordable Lending Summit. And CFPB is always there. Fannie ready. You know, they're just, we don't know yet right now. They're not communicating right now whether they cannot or whether they don't know the answers. So all we can do is consistently have that voice. Nikki, like you said. So when they're ready to listen or able to listen, the general public sees that we locked hands in hand and bought for really anybody that wants to buy a home. But obviously the programs do need to be available. So I think, I think you hit on the head. Just if our industry is consistently saying the right voice, we'll be ready when, when the regulators are ready to listen. But I just want to let you know, Mike, things are changing very quickly in D.C. and everybody's trying to process the information right now.
I. As you go through all this, Nikki, and you have a son kind of getting old enough to maybe understand the mortgage industry a little bit, is this an industry that you would encourage him to go into or is this an industry because very few people actually end up in it on purpose? Right? So is it like, let him go do something else and if it's meant to be, he's supposed to fall into it. Otherwise he can't go on a podcast because he won't have the fall into story. But you guys, we gotta change that.
[00:41:29] Speaker C: We gotta. I want, I think, like, it's so cool and I, I feel like I, I'm like, either I have turned into a geek and I am no longer cool, or it's really cool. And I used to think I was pretty cool.
[00:41:38] Speaker D: It.
[00:41:39] Speaker C: It really is cool. It is the intersect of changing lives and building communities. Housing is the cornerstone of, of the community.
[00:41:48] Speaker D: Right.
[00:41:48] Speaker C: Your home is the cornerstone of your family. I don't think that people recognize or realize the impact that you can have on the lives around you in the community around you by doing this work. So actually, to answer your question, he would actually prefer to be the CEO of my company. He would like to be Tim Spence when he grows up. Tim, shout out to you.
He said it has something to do with the salary difference between what I do and what my CEO does. So I, I told him he's a smart boy.
[00:42:19] Speaker A: Well, yeah, I'm sure he sees like, Ishbia owning the Suns and he's like, boy, I'd like to own the Cavs. Or, or yeah, Gilbert on in the Cav. He's like that. That'd be pretty cool.
[00:42:27] Speaker C: You nailed it. You nailed it. Yeah. The endless opportunities as a CEO. No, you know what it was is he, he got his, he got his first suit. I got to take him to a lymphomia leukemia society gala and he wore his first suit. And when he put that suit on, you guys know this feeling. He, his little shoulders went back. He really, he was walking around there like he was a CEO.
But no, I, he, he. Now he sees all of this. He comes to homeownership events with me. He team leader at the event in Columbus that. We did these events. We, we really, what we do that's different is we create an experience for the family. So we have child care and not just babysitting and coloring books. We had performers come in, we had face painting, we had balloon art, we had those big bubbles. We, we really go all out for the kids and try to instill that dream of homeownership early. The activities are around home ownership and he was a team leader for that this weekend. So he watches, he sees, and we'll see what he ends up doing.
[00:43:31] Speaker A: That's great. Mike, do you want to take us.
[00:43:33] Speaker E: Home with a question or a comment?
[00:43:35] Speaker B: Yeah, because I. I have three kids, two of them who have already graduated from college, one about to graduate, and none of them wanted to enter into the mortgage industry because nobody wanted to work on weekends because I always tell them money never sleeps. But I think that one of the things that it's exciting about today's industry for those who are just entering into it is that the. That with the older people, we may have been disenchanted. Those who are seasoned and I say season over 15 years, we're disenchanted by. By what has already happened based on what we think we knew to be true in the early 2000s. However, the newer state of lending today actually allows us to be much better lenders in the mortgage industry. Qualifying features, investment properties that actually will debt service itself and those types of products are now make sense lending versus 20, 25 years ago. It was, let's just do whatever we can to put the productivity onto the books. I appreciate that there are definitely many more programs out there in order to provide affordable housing, affordable financing and opportunities of collaboration. When you have the confidence either as a mortgage lender at a bank or as a mortgage originator, as a mortgage broker, to actually collaborate, collaborate more. Because there are definitely products at the banking space that mortgage brokers will never have accessibility to. And for that opportunity, I think more brokers should be collaborating with the bankers themselves, not just looking at them as a. As like, oh, they're just at these f. FDIC insured bank. I would encourage anybody who's in business to collaborate more with your own colleagues, if not in the sales capacity as an originator, but also with the realtors, get them involved and have their teams collaborate more. When we have the confidence to work with each other, hashtag all of us, we would also have the confidence to produce more business collectively as well. I appreciate Nikki bringing. Bringing us home aboard on everything with having the financial tools to thrive in this market as an originator and fully knowing that not only are our companies working with each other and also for the communities to be able to be educated so they can produce more homeowners within our communities as well.
[00:45:57] Speaker E: Thanks Mickey thank you for joining us on this journey into the heart of mortgage innovation. Remember, every mortgage has a story and we're here to help you write yours. If you enjoyed today's insights, please subscribe, share with your network and connect with us on social media. Until next time, keep pushing the boundaries and uncovering the stories that drive our industry forward.
