Episode Transcript
[00:00:00] Speaker A: Hello, everybody, and welcome to a highly anticipated show of season four of the Mike Duck show, where every mortgage has a story.
This is the ultimate hub where the hidden stories behind the mortgage industry come to life. I'm Michael Kelleher and good morning from.
[00:00:16] Speaker B: Where I am Michael Zal.
[00:00:18] Speaker A: And in every episode for our listeners, we dive deep into the entrepreneurial spirit, the strategic insights and the breakthrough innovations that build the world's greatest mortgage companies. So whether you're advancing your career, scouting for industry leaders. We got a great one here. Or exploring opportunities in fintech and prop tech and how it fits into mortgage, you're in the right place. So let's get ready to unlock the story behind every mortgage. Let's dive in.
Ap we like to focus on for our listeners who maybe one day can become the next big company.
Can you take us into the walls where you started to realize where you and your partners were, making that leap and becoming the. The name brand that you guys are across the country?
[00:01:02] Speaker C: Well, appreciate you guys. Welcome to the show.
[00:01:04] Speaker A: You're like, yeah, yeah, you're a cool guy. Anybody who watches your show, I don't want to get in too serious. Thank you for everything you do for the industry. I think you've created a vortex of where people can come in, consume yours, and then. And then talk about it, which is very cool. Kind of what was so great about Barstool sports, which was originated out of my town, but it became popular in Boston because people had the same, like, blog they could talk about during the day. Everybody kind of knew. They all read it. I feel like your Corona, California is good. You can have conversation in the industry and knowing that we've all watched and I think everybody's thankful at this point. I always say outlast people. You have outlasted everybody trying to do a daily weekly show. I think it's twice a week. So thank you for that. And knowing that before those shows came about, you obviously had to build a base with a. With a great company and you're in multiple channels. Can you just take us? We always like to start inside the walls or some sort of story where you kind of knew things were going well.
[00:02:03] Speaker C: Well, appreciate it. Glad to be here. You know, you and I have been on the road bouncing around, having cocktails for years, and so it's about time we got together on this thing.
Yeah, I'm not, you know, I always say, live from Corona. I'm never actually live, which is kind of funny. But right now we're actually live. It's like live From Newport Beach.
I don't know if anybody ever picks up on that when I say live, no one's ever called me on it. But it's live when I tape it. So I feel like, you know, I have to say that. And everybody knows the rules. One slice, one bite. So shout out to barstool.
You know, I, I really, I really connected with the founders of PRMG, Paul Rozo and Robert Holiday.
I think probably about 15 years ago at this point I had, I was kind of looking for my next move.
I was part owner of a company called Northstar Lending. And we were coming out of the financial crisis and it was tough, especially if you were a seller servicer with Fannie or Freddie or Issuer or Ginny. Like, I mean the network requirements were pretty tough. And so it was, it was just a hard market, especially doing, you know, wholesale in South Florida. Like the entire industry hated wholesale, hated Florida, hated South Florida. And that's like, I'm like, that's what we do, you know. And so I needed to find a good solid home.
[00:03:23] Speaker D: And Paul and Robert, you know, the, the company is built by originators for originators. And so these guys originated and to this day, you know, 24 plus years of existence, these guys are in the weeds. I mean, you wouldn't believe the stuff that these guys do.
[00:03:37] Speaker C: And so I just really hit it off with them and I had this whole team that had been with me for two companies at that point and I wanted to find them a home so we could put bread on the table for them and their families. And the timing worked out great. PRMG was doing about 125 million a month. My company's doing about 55 million a month and now we're billion a month. And so we've had a good run together and know we had a nice wholesale team and we did a little bit of retail as well. And PRMG didn't have any east coast presence. And so you know, we were, it was just kind of, you know, life's about timing and, and it really, you know, was a cultural fit.
They're privately owned, they're well capitalized, they had gotten through the crash. I asked them a lot of questions because I had just owned a, an IMB myself and I'm like, you know, how'd you escape all the buybacks? Who are your warehouse lines with? What's your cash position? Da da. And they're like, whoa, slow down turbo. We just want you to help build the east coast. So I was like, okay, no problem. So that More that morphed into actual partnership and they, they brought me on about, well about 10 years ago we had a conversation about coming to California and being their partner and then that actually materialized about, you know, nine and a half years ago.
So it's been a great run. We have a lot more to do. We're all in. In case you haven't seen our branding, we're pretty excited.
All three channels are, you know, we've got some heavy investments in tech in all three of our channels.
Technically four if you want to split correspondent into nondel and delegated. But we are, we're really excited. We're pumped up, no debt, good cash position servicing portfolio to fall back on. We're profitable last couple years, profitable this year even more volume's up this year.
We're feeling good about where we're going.
Always want to knock on wood every time I say that because you know how life is. It hit you with a right cross just when you let your guard down.
But we, we, we taking some punches.
[00:05:37] Speaker D: We.
[00:05:37] Speaker C: I got the, I got the bro. The broken nose to prove it. Yeah.
[00:05:42] Speaker A: And that it feels like you obviously are in a good position in just leveling up in all, all the different channels.
What's it like balancing those CH channels? Like is there one you start with first or like if you were recommending, I guess for other people, do you find that it's easier to start with one and then the, the other or vice versa?
[00:06:02] Speaker C: Well, you know, when we say built by originators for originators, we mean all originators. And it's still, it's, it's very hard to be a multi channel lender now. We don't do consumer direct.
We've still always thought that that is the biggest conflict of interest for originators.
[00:06:20] Speaker E: Right.
[00:06:20] Speaker C: Like, you know, having you know, a consumer direct channel that steals business straight outta the community from the originators you're serving. That's maybe that's an old school thought because a lot of people don't really seem to care.
[00:06:34] Speaker E: Right.
[00:06:35] Speaker C: And maybe that's kind of goes back on my own feelings about an abundance mindset versus a scarcity mindset.
Or maybe it's just because it's just something we're unfamiliar with. We don't want to go there.
[00:06:49] Speaker D: Although I think a lot of AI.
[00:06:51] Speaker C: Technology is going to make consumer direct.
[00:06:52] Speaker D: Esque activities a lot easier.
[00:06:54] Speaker C: I'd rather arm local originators with AI.
[00:06:57] Speaker D: To compete with any platform in any channel by the way. And so yeah, they all have their benefits.
[00:07:04] Speaker B: Right.
[00:07:05] Speaker D: Each platform has their benefit.
[00:07:07] Speaker C: For certain things.
And not every originator is the same. Not every originator. I mean, I know some people who are like, man, I absolutely love PRMG retail. Like, I'm never going anywhere. Like, I can get all the deals done that are tough. And I have relationships, all the underwriters and the coo, the founder, and I can make all these things happen. And when I pick up the phone, the. They picked up the phone, we get stuff done. They're building tech. They're so, you know, tech forward, da da da da. You know, and then you got people in the broker channel, like, how could you ever work for an independent mortgage banker? I'm my own boss. I got my own thing, I got my own op. You know, like, it's just funny. It's like, it's so I gotta be like, Switzerland. And I like being like Switzerland because I like, I like to be, you know, a servant to anyone and all their needs. And, you know, I just sit back and kind of internally laugh when, you know, people get like, downright mean about other channels. I'm like, really? Just, just go build your business, dude. Like, go build your business. Do your thing. No one's, no one's, you know, going through your entire life and everything you do, right or wrong. Like, and I love it though. Like, I will say this, the brokers are better thing never really bothered me. I know it bothers some people, but.
[00:08:18] Speaker D: You have to understand, like, in 2010, brokers, brokers were, it was really tough. You know, HUD took away the mini Eagle and so like that non del core outlet all went away. So you only had to work for a lender at a full Eagle. And there weren't a lot of wholesale lenders out there that were championing the broker, you know, so if you're an independent broker shop, just a couple people on your shop and you're sitting in Paducah, Kentucky, who's your champion? Who's your advocate? Who's asked, who is putting you on a pedestal? Who do you look up to? And there's a big leadership vacuum there during that time.
[00:08:55] Speaker C: So I really like what, you know, UWM comes to mind. They did a great job of just.
[00:08:59] Speaker D: Picking them as a winner.
[00:09:01] Speaker C: And so, you know, there was a, there was a, there was a lack of leadership there.
But that, that doesn't need to be at the expense of, you know, retail independent mortgage bankers who do a phenomenal job. I mean, you look at Sean Bonozian, he's not a broker. He's been number one for like, Six, seven years.
[00:09:18] Speaker E: Right.
[00:09:19] Speaker C: So there's something to be said about scale that you simply cannot replicate in every channel or every lender. And so they all are great in their own way. And so you know, I, I just, I don't like to sit here and say well this one's better than the other. Like you guys want to rally around.
[00:09:36] Speaker D: And have a cry.
[00:09:37] Speaker C: Go for it dude. Like it's, it's great to, to have.
[00:09:40] Speaker D: Someone that has your back. PRMG has your back in all three channels, that's for sure.
[00:09:44] Speaker B: What type of technology do you think the average, the smaller broker can use right now in order to leverage themselves to say.
Because right now there's a lot of newer brokers that have gotten smaller unfortunately by default because of the rise of interest rates. However, it looks like that there's a potential of it coming back. So if you're smaller now, how do they leverage AI or any technology and specifically through PRMGs technology. Now to the next level to say I'm small now but I'm going to go to medium and then I'm going to go to large. How do we do that?
[00:10:19] Speaker C: Yeah, news flash. Rates are the lowest they've been all year, so that's good.
So they're back like they're back now.
[00:10:25] Speaker E: Right.
[00:10:25] Speaker C: And I think the propensity to only get better as the Fed continues to bend the curve. As far as technology, I will say there, there is, you know, if you're, if you're a smaller shop it's hard to have the money to set aside to develop and, and, and to, to be quite honest, like enterprise level technology is not offered to brokers. It's just not. So then, so then you have to rely on your lender to invest in enterprise level technology to give to you as a smaller broker shop because I mean most broker shops don't even have enough money to pay for one epo, right? Get a, you know, or, or, or you know, epd. And so it's just, they're just not cash rich and that's okay. I mean that's not, that's not the model, right. And so you have to rely on lenders that have your back.
Now the best tech I've seen obviously gets, you know, afforded and handed to.
[00:11:26] Speaker D: And pitched to all the larger lenders.
[00:11:27] Speaker C: And you go down the line right and in, and you know, but there's.
[00:11:32] Speaker D: A balancing act there, right? Like are you buy the technology for the technology or you buy the service in the portfolio for the servicing portfolio. Are you buy the hedge fund for the hedge fund or are you built by originators for originators. And I think you have to look at what the priority is at every lender. And I think that's what differentiates us, you know, from a lot of other lenders as far as technology.
[00:11:57] Speaker C: You know, we've, I mean I probably spend more time building technology in our retail channel than, than, you know, our other channels combined for years. Having said that, we did just roll out a new portal for our wholesale channel and that's called LEO Loan Express Originator. I've had that name for years. It's my dead dad's name. So if you ever see LEO out there from prmg, just know that that is Lone Express Originator. We have the booth and the T shirts to show for a couple years now and we made a big splash over a year ago and it was lovingly named after my father.
So, you know, and that will roll out in our correspondent channel. And you know, you know, I would also say, you know, in the retail channel, you know, we have other things that we're rolling out for them as well. You know, a lot, a lot of, you know, I see the question there about, you know, what brokers cannot get. I mean, you know, I don't want to go down the list, but there are technologies that simply don't deal with brokers. They just won't because it's too hard to manage.
It's too hard to have a bunch of instances for 4,000 broker shops. They would rather deal with Rocket or UWM or Freedom.
[00:13:18] Speaker D: And then it's up to those lenders to then filter it down to brokers. And so, you know, and it's a great question that was just asked in there. I mean, I'm just, just, there's technology that just is not going to go to the brokers ever because it's just too hard for them to manage. And so they build stuff that's built to scale. And the good news is is lenders like us and other lenders can decide and pick those enterprise level technologies to then create a better experience for all their originators, including third party originators.
[00:13:49] Speaker C: And so, you know, whether it's CRM, AI voice, agentic AI, you know, I just had a meeting down the peninsula with a company that is taking call transcripts from AI voice and curating it and looking for, okay, this borrow hung up the phone when this was set or this borrow was their, their needs were not met. And you know, we think a better way to approach this is doing it this way. And so an AI that could look at, you know, millions of transcripts at scale in an instant and give actionable insights to then say, here's how you coach your salespeople to be better now, you know, like that company's not going to go to the one man broker shop or the 20 man broker shop. They may go to some of the mega broker shops.
You know, shout out to Mike Cordes and the team at Nexa. They rolled out a technology that I've been looking at for over a year called Tidal Wave.
I think it's set, it really makes the point, right?
So you know, as a company scales, they have more money to invest in tech and then the tech companies are the ones that are looking for companies like that that can scale together with them and have more money to scale. And so it's just, it's just economies of scale, right? And so it's not, you know, it's, it's, it's not a bad thing, you know, and so I, I think that brokers are going to continue to win.
[00:15:22] Speaker D: They still have great tech out there.
[00:15:24] Speaker C: But again, they just don't get all the options and opportunities because they aren't, they aren't the target audience.
[00:15:29] Speaker D: So anyway, we could talk about tech forever. It's really like, I mean, I'm on the road half my life. I know like almost every tech vendor out there and if I don't know them, I find out about them as soon as there's some buzz about them or I've heard about them. It's kind of my job to know what's going on in the industry and then, you know, connect the dots. I do a lot of venture capital investing. I sit on Rice Park Capital's board.
[00:15:52] Speaker C: You know, I, I, you know, it's.
[00:15:54] Speaker D: You know, I host and co host together with our great team at the California mba, the Mortgage Innovator Conference. It's a whole tech show geared around tech implementation that is innovative. We do it every May. We're down at Huntington beach and we have vc, we have equity, private equity, we have tech vendors that come in there and it's a great show. And you know, and so how do.
[00:16:18] Speaker C: You, how do you get these companies together and brainstorm and talk about. Everyone's been talking about AI since ChatGPT came along. But like we're implementing it now. We have use cases now we have actionable insights that we can curate and make better. And it's a brave new world. But then it's also same as it ever was, like get on the Phone with the client and, you know, provide.
[00:16:37] Speaker B: Value and service for what PRMG is doing right at this moment in AI or in any type of technology, what can the smaller broker do to become the next prmg?
And in other words, which tool can they use that you guys are currently offering so they can, they can grow their volume in units and in dollar?
[00:16:58] Speaker C: Well, I will actually say it's really not tech driven. I mean, if you want to be a lender, you have to actually underwrite files.
So all the risk transfers to you when you take on credit decisions. So that's when you're an actual lender.
And so they used to call them mini Eagles and mini Core or whatever. There's all these different variants of it. But once you take on the credit decision, you have decided to leap into a completely different world. And it is profitable if you do it the right way, but then you go through bouts of unprofitability as well.
[00:17:36] Speaker E: Right?
[00:17:36] Speaker C: And so it's a whole different animal. Yes, there's technology and underwriting, yes, there's a lot of AI that's in underwriting and there's a lot of enterprise tools to help you make credit decisions. That's what lenders do. And so anyone that doesn't make a credit decision is not a full blown lender. Doesn't mean they're not a lender of some nature. But it has been improving for years.
So, you know, I don't know if that answers your question, but you know that, you know, there's so many different types of technology, like what, what are you using the tech for? You know, and there can totally be like paralysis to analysis. Like I'm vetting out this one thing that I want, right? And so, you know, so, so to answer your question about, you know, does a broker want to become the next PRMG or become a lender, there's actually a lot of basic blocking and tackling. It's hiring underwriters, hiring an operations staff, learning to make credit decisions. How do you take risk? Do your counterparties believe you're a good risk? Do you have money to offset the losses that you will inevitably take when you know, a broker sends you fraud? Like we had a broker in oklahoma send us 12 straw buyer deals, okay? It's the most fraud we've seen in six years, including Covid. So one broker shop in Oklahoma sent us a nice little $3 million bomb, okay? Because you know, they're a fucking asshole, right? And so everyone's like, oh, the CFPB is going away and all the state, 50 states are going to step in. How about the CFPB put that guy in handcuffs? And the realtors and the title companies. How about you do that?
Because that's. That's where I see losses, okay? Fraud is where I see losses. And to be honest, the cfpb, the.
[00:19:15] Speaker D: Last four years, they just wanted to make headlines on different initiatives, and they.
[00:19:19] Speaker C: Never wanted to go get the bad actors that are losing us millions of.
[00:19:23] Speaker D: Dollars and putting them in handcuffs. So I got to refer everything to.
[00:19:26] Speaker C: DOJ and the Office of Inspector General.
[00:19:28] Speaker D: And the CFPB has nothing to do with that. And they're, you know, they come around and we would do a CFPB fair lending exam.
[00:19:34] Speaker C: You know, they want to make sure that minorities aren't getting worse pricing than white people. And we pass that exam, and that's great. I'm like, hey, by the way, we've got this guy in Oklahoma, you know, who just committed fraud. Would you like to know about that? Oh, yeah, just file a suspicious activity report.
We'll get back to you. Call our tip line. So. So, yeah. And so, and by the way, the, like, all 50 states are going to step in. Yeah. Maybe seven will step in that are as harsh or more harsh than cfpb, but we're in one of them. We're in California. So we already deal with them. And to be fair, like, they're all underfunded. They don't have the enforcement teams. Will they get there at some point? I hope so. I want them to get fraudulent actors out of the business and put them in handcuffs and put them, you know, on the front page of Housing Wire or the Mortgage Scoop or on your podcast. This SOB committed fraud. Did you ever do business with them like that? That, to me, is where the rubber meets the road. And honestly, this industry and all the regulators have failed at that.
[00:20:37] Speaker A: Probably a. A form coming with AI. I would. I would guess that there's going to be an easier way to get Rod past the ones that aren't looking for it.
[00:20:47] Speaker C: So your superpower volunteer Baby Palantir.
They're doing it. They're doing it for Fanny. They're doing it for Fanny.
So, you know, please go sign a contract with them. My. My $8.60 stock price would appreciate it.
But yeah, they're. They're the AI. You're right. AI is getting into qc. It's getting into looking for bad actors. So sorry to cut you off, but, yeah, there's a lot of buzz around that.
[00:21:11] Speaker A: Yeah, just the ability to use ChatGPT to make a fake bank statement is like you've never been able to do that before. And so, and the level of education to do it makes the access to fraud easier. And, and so there's that risk. Right. And sometimes it's easy to just some people just would rather sell and be a, be a broker and keep selling. You're, you're always so curious. I'd say that's your superpower. You rarely, you never judge people. You're out on the streets, you're always hearing obviously you, you have your ear on the, the tech side. What is the sentiment right now with loan officers? Seems like we got some momentum in rates. Seems like everybody's now, I mean it's been since what, 2022. So there's been a good Runway now of, of opportunity. What's the sentiment going into the end of the year here and next year for the loan officers, originators as you.
[00:22:01] Speaker D: Call them, you know, that you're talking to?
[00:22:03] Speaker C: Well, it's always a grind.
So trust me, we feel it every day.
Brent Gleason is a Navy seal. He's spoken at our leadership conferences. He says, I like to say in the seals, the only easy day was yesterday, so get used to it.
But having said that, it is nice to get some easier loans that come through the door when there's a rate drop. And so that is a nice way to, to give yourself a break, to give your underwriters a break, to give your bottom line a break and get some money to invest or do whatever you want to do with it.
So lower rates do help and they do matter.
Look at Rocket stock. It's been taken off ever since.
Wall street has sniffed out that we're on a lowering rate environment.
And so I think the second half of the year is always challenging, right.
[00:22:58] Speaker D: Just seasonally, just because there's less purchase business.
[00:23:01] Speaker C: But I do feel this year is a little unique. It's kind of like last year, you.
[00:23:05] Speaker D: Know, when you have elevated rates, you have some pent up demand that surprisingly pulls through in the back half of the year and it did last year.
I, I don't know that we will see as many rate cuts or from the Fed like we had, you know, 100 basis points of rate cuts from September 18th on through December last year. I don't know that we'll get that this year. We might get 52 25s. But what I feel is different this year is I feel like it'll be a sustained lower anchoring of rates.
So even though there's not as many Fed rate cuts. I feel like the rates will stay at a lower level for longer because.
[00:23:47] Speaker C: I think the, I think what the bond market is sniffing out is that like we are having more sustained lower growth with sustained higher inflation. And the job losses in the jobs market is actually at a much lower and lower sustained rate, ongoing.
Whereas last year we saw some spikes in job growth.
October, November, December. And so then rates actually went up. And so I don't see that right now. Like, I don't see 250,000 jobs created every month for like three or four months in a row like we did last year. So, so the psyche of the, of the borrower, when they see rates not going up and down and shooting every day, I mean, if you, you know, Barry Habib does such a great job having Dan and their team, they show this chart over like the last couple years, your windows of opportunity for refinance were like sometimes a day, maybe a couple days, maybe a week at most. And if you didn't strike and have your strike right and your com. Strike rate and your conversation set up and you're teed up and ready to go.
So when it happens, you and the com, you and the bar are on.
[00:24:47] Speaker D: The same page as opposed to having.
[00:24:49] Speaker C: A thousand conversations in 24 hours.
[00:24:52] Speaker D: You were ready to go. And so that volatility does kind of hurt the psyche of borrowers. And to be fair, like half this nation hates the Trump administration and they're still freaked out about the volatility of tariff uncertainty. We're getting more tariff certainty, we're getting less volatility. We're at all time highs in the stock market. People are feeling wealthy if they're in the stock market, they're feeling wealthy if they own a home.
And then if rates are sustained less volatile and are staying low, the conversations about house hunting can take on a different kind of nature and they can materialize. And so I'll say what I've been saying since 22, 23, 24, this is your fourth last, best good chance to buy a home.
I said it every year since 22, I said this is your last, best good chance. 23, second to last. 24th, third. This is your fourth last, best good chance to get a good home price.
[00:25:50] Speaker C: Because home prices just keep rising, they just keep going up. And when rates go down, they go up even more. We're still structurally unsupplied, under supplied. And, and so these conversations take some time to materialize and with nice sustained lower rates.
The psychology of the borrower is, is, is really Benefits the local originator. That is a first time home buyer hunter or maybe an existing home owner that wants this like something like 75% of existing homeowners when they sell a house they're buying another one and they've got a lot of equity to trade up and so they would take a 6.25% rate or even a 6 and a half percent rate trading in that equity and the payment is about the same to level up to get the better house. Because of the 70s, right? Deployment. Deployment. Diapers, Diamonds actually we say diamonds first hopefully then diapers, debt, you know, divorce, downsizing, death, that stuff never stops.
[00:26:53] Speaker D: And there's pent up demand and people.
[00:26:54] Speaker C: Want to get into houses. Yeah it's.
[00:26:57] Speaker A: And then I think Barry says like if it, if we're lucky enough it goes three or four weeks and it hits that news cycle then it's really going to take off and we haven't had that luxury in a while.
And then when it does you will need that tech. And so this is a great chance for us to break and show you a little bit of our sponsors that are very tech heavy that help different lenders throughout the market and then we'll have some questions for KP on the other side. So stay tuned and check out these sponsors.
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Also who so for example, someone who's 50% likely to transact the next six months, who's a first time home buyer, should receive very different content than someone who is, let's say not as likely to transact that already owns a home. And of course our content team will provide you with all of that turnkey out of the box to market to everyone in your database. So to learn more, come find us at ICE if you're there. We're booth number three to seven or go to our website thinkadium.com, love to walk you through a custom demo of how AI can supercharge your marketing this year.
[00:30:29] Speaker A: Thankfully we have some amazing sponsors that allow us to get amazing guests. Kp, you are for many somewhat the face of of mortgage and it's an omnichannel approach. So you have your impressions on LinkedIn and then you go to a lot of conferences so people get to see you in person.
When you look at the industry like what brings you joy? How how are you able to get up every morning and run this big company but then also fly out here then see your sales team represent them.
Have time at night to be live from Corona, California.
[00:31:05] Speaker C: Espresso.
[00:31:07] Speaker A: Nepresso, right.
[00:31:08] Speaker C: The big I mean it. I I'll take it in any form.
It's funny because when I'm on, when I'm at trade shows, you know, people just walk up like do you want to get you an espresso? They know like at 9:30 and 2:30 Pacific Time like I am, I am on, right? And so it helps. I don't sleep much. I'm gonna die early because of it. That's okay. I don't think I want those last 20 years, but.
And I got the whoop band to, to prove it. Adds me every day. Did you have sleep debt? Yeah, yeah, yeah, I know.
You know, I. We have such a great team and my partners are amazing. Paul, Robert, Gary Malice from Strategy and Cap Markets. He's such a good dude that we just, we're a very experienced team. We've been in this business a long time and we have other leaders in our senior management board that are incredible. And, and so, you know, I, I kind of joke like, so, like in the retail channel, okay, P and L management, we say RPM recruiting, profitability and management, right? So they go, they go, they go through the P. Ls with all the branch managers in retail, okay. So there's a branch manager, there's a lady that does that for a company and puts those together and puts all the content together and she's amazing.
Then we have two people that run the retail channel and then our CEO.
Do I need to be on that call it. I mean, I mean, not to, like, it's kind of funny, it's kind of glib, but like, it's just math, right? Like, you know, I took calculus in college just for a fun elective to get an A. Like, it's just math. So. So to me, you know, I don't need to be on that call now. If someone asks me something, I'm available, right? And so you've got to let your leaders do their thing and trust that they're going to be good. I think the hardest thing for most businesses as they scale is to trust your people because every business owner has this mindset. No one's going to do everything better than me.
[00:33:11] Speaker E: Really.
[00:33:11] Speaker C: You're going to underwrite files? You're going to build a website? Yeah, I'm going to pick up this book and hire someone to build a website.
[00:33:17] Speaker E: Right.
[00:33:18] Speaker C: You just put five incredible vendor sponsors up there.
[00:33:21] Speaker D: They're all great.
[00:33:22] Speaker C: I'm familiar with all them. They're all amazing. And so, you know, let them do what they're a specialist at.
[00:33:28] Speaker D: Right?
[00:33:29] Speaker C: So, you know, you have, you have.
[00:33:32] Speaker D: To, I don't want to say delegate because it makes it sound like I'm lazy and I don't work. I work my ass off, right? So at the office till 1am the.
[00:33:39] Speaker C: Last two nights, you know, so, you.
[00:33:42] Speaker D: Know, it is, it allows me to travel. I work from my phone. I have the poor distance vision to prove it because I squint at my phone for years, you know, and team Android, let's go.
And you know, I, I think that's it. It's just having a good team around you to lock arms side by side, not behind you, not for you, not below you.
[00:34:07] Speaker C: Literally.
[00:34:08] Speaker D: Like when we define the originator, the.
[00:34:11] Speaker C: Account executive, the branch manager as our client, that's who everyone in our company serves. Like our CEO and founder eats shit sandwiches every day, you know, and so, you know, we, we serve them and you have to, this is a service, it's the financial services industry and I think a lot of people forget about the service part. No one's here to serve you. I mean if you're, if you're an owner like you are serving your team, what are you doing to tee them up? What are you doing to serve for success? As Chris Sorenson, our retail channel likes to say. And so, and you're a multi channel lender. We've got Herb Lewis, director of wholesale and Jay Bond, our director of correspondent. We've got a great team and so I think that's what allows, you know, me to kind of have the leeway to do what I do. And you know, I'll toot my horn for a second but you know, I work 24 7, I don't sleep, I work at a high level. When I'm on the road, I'm having conversations with people in the industry and I'm learning, I'm listening, I'm curious.
I, I have a mindset session with Steve Scanlon from Rewire every other week and we talk about my mindset and I try to be curious, I try to listen, I, I try not to judge.
And you know, yeah, I, you know, I was talking at a level 10 earlier when I get fired up about fraudulent originators, but I try and be a six. Like I'm talking now, you know, people don't like to be talked at. It's very off putting. So I apologize earlier if I off put anyone on here. But I get a little fired up when there's people that cost my company $3 million for committing fraud. Feel like, you know, in Texas they should be shot for stealing horses, but in America they should just be arrested and I can't even get that. So anyway, I, you know, I think you got to continue to build your team around you. You look, Paul and Robert took me.
[00:36:02] Speaker D: On as a partner. They gave me shares in the company nine and a half Years ago. That's a big step for them to expand, you know, ownership. And to be quite honest, I took a pay cut until 20 and 21. I, you know, I was on a different comp plan being out front, bringing a team here that eventually became 65% of this company's revenue. And they're like, come to California, do it everywhere, whatever you do. And what I did change the day I got here. I mean, I think they probably thought I was going to look at spreadsheets and go through and go this person's account. You know, we can get 10% lift here and there. I was like, dude, our tech sucks.
We, we got a lot of work to do. You know, we have a lot of work to do in all three channels.
[00:36:42] Speaker C: And so I probably, you know, spent a lot of time trying to make us a modern platform that stands the test of time and continues to evolve. And so, um, you know, I could, I could go into that a lot. But I think, I think many leaders in the organizations, no matter how big or small, face the same challenges. And so, you know, you bring up my LinkedIn. I think, you know, one of the main reasons I, I, I got on LinkedIn is I, I really only saw Matt Ishby out there doing it with three minutes with Matt, and I'm like, dude, this guy's putting it out there. I think it's great. And then he called out my company.
So I like, you know, he's like, we, he said, we think it's a conflict to interest that some retail lender hired the president of Nam to help them, you know, recruit. And we hired John Stevens and he was helping us, you know, recruit in the retail channel.
[00:37:35] Speaker D: And I'm like, some retail lender, man.
[00:37:37] Speaker C: We've been doing wholesale since the day we started, you know, and so, so I, I, I consider Matt a friend and I have tremendous respect for him. So I don't mean to, to say this in any kind of bad way, but I felt like he's the only owner that is consistently out there. And what a brilliant thing to do to control your narrative and, you know, tell your story. And so, but you guys know, I don't really, you know, I don't, I don't promote PRMG out there. Like, I wear the T shirt and I talk about some things that we're doing to give insights. I freely give away some of our thoughts and what we're thinking on shows like this and on my LinkedIn, but I hardly ever talk about, oh, PRMG. Like, you won't See me out there like that. And I think it's great that there are a lot of leaders out there that do that, but there aren't enough leaders that are owners and shareholders that put their face on camera and talk.
And I think that's probably why my LinkedIn, you know, resonates out there. And I apologize in advance for listening.
[00:38:37] Speaker D: To 10 to 15 minutes of rambling twice a week.
[00:38:39] Speaker C: This week's three times a week. It's a really busy week. We're closed Monday. So I figure out there's something for people to chew on in a long weekend on Friday.
[00:38:47] Speaker D: There's a lot of, A lot of.
[00:38:48] Speaker C: News coming out tomorrow.
[00:38:49] Speaker D: So I did one last night. There are a couple weeks every other month, every month, every six weeks where I'll do three videos Monday, Wednesday, Friday, as opposed to just my normal cadence, which is Monday, Thursday. But I think people want to hear.
[00:39:01] Speaker C: What ownership is thinking because we all got challenges, we all have problems, we all have battles and fires we put out every day. And this again, the only easy day was yesterday.
But, you know, I, I'm, I'm an abundance mindset guy. I'm a collaborative guy. I, I, I love hearing what, you know, Matt doesn't have to go out there and, and do his three points and put out what his thoughts are. He doesn't have to do that. And he willingly gives some thought leadership away. It's brilliant.
And so I think more owners should do that more often.
[00:39:39] Speaker B: I have a question for you because you talk. One of the things that you really well is stay curious.
I recently am going through a book called Retirementality, and one of the things the author goes and writes about is that when people retire, they get bored. This is what. Oh, they worked all their life and they get bored. However, the trait that you remain consistent on is curiosity. Curiosity in the markets, curiosity in what to do, curiosity to be the better version of yourself.
If you were to have one question for a leader, an originator, or for ops, what is the question that each leader, salesperson, or OPS person should be asking themselves to stay curious on so that they can grow within their own company or their trade?
[00:40:27] Speaker C: Do you have kids?
[00:40:29] Speaker B: I do. I have three adult kids.
[00:40:31] Speaker C: Yeah. You're not retiring anytime soon? Yeah, you're. Well, adult kids has actually gone this. Maybe you are retiring. We have four kids here in Newport beach, and I'm gonna work till I die at my desk. Unfortunately, you know, I, you know, one of the things I talk about with the guys at Rewire is I, you know, I Agree with them. I think coaching and mentorship in our industry is generally bad. It's very sports esque, right? Like I played soccer and baseball and you know, I've been yelled at, you know, and so make 50 phone calls today, go out, do more work, just go, you know, sell what you got. Like, okay, great. That's very, that's very tactical and in the moment, you know, and I get it, there's a place for that, right? Like, like, dude, like you didn't put your glove down the ball and the ball went between your legs. How many times have we done this blocking and tackling drill, you know, get down on one knee, put your glove down and you won't. And yeah, okay, if the ball bounces, it hits you in the nose and the teeth, whatever, you know, but at least didn't get past you and give up another run. So there's a time and place to correct mistakes in that sports way. But I think if you really dig deep into people's, you know, their why, as Simon Sinek says, you know, what is it that gets people going? Most of the time it's family, right? And so that's why I ask you about your kids. Most of us are really working for, not necessarily legacy, because that's kind of ego. It's like, you know, let me extend myself forever, you know, but, but you want your children to have a better place in this world. And man, with AI, like, what's this world going to look like? I'm not fearful of it, but I mean, we're going to have universal base income. And so, you know, I've talked about the haves and the have nots quite a bit. And if you look at Europe, there are many countries in Europe where the middle classes is pretty thin.
[00:42:21] Speaker D: And either you own real estate and have money and you don't. And, and so America isn't there yet, thankfully. But one of the things that I like to talk about is the mission that we're all on, which is to put people in houses. And it is the single biggest payment we make every month, your average American, and it's 63% homeownership. We're building wealth together. And if you own a home, you feel pretty good. The last few years you built some serious wealth on paper.
And if you're a renter, good news is, you know, you can still get into a home. You just have to have these conversations with local originators and come up with.
[00:42:59] Speaker C: A strategy on how to get the door open and start gaining wealth as opposed to paying Rent and making a landlord rich. And I don't care what Dave Ramsey or anybody says, you need to own a home.
Renting.
Renting only makes sense if you, if you like, I have to live near the beach. Okay, well, maybe you can't afford to buy near the beach. It's pretty expensive, right? Maybe go find a cheaper beach. You can work from anywhere. So, you know, I, I am a huge proponent of asking those teammates, you know, you know, have you thought about, like, a home? Do you own a home? How can we help you get there? You literally are in our business, where we foster the American dream. How can we do it for you? And I think that anchor of wealth creation and building equity over time is a very important conversation to have with anyone on our team. Op sales, third party, it doesn't matter.
And then of course, it's like, all right, now, how can we make your life easier? How do we solve problems? How do we sit down and look at every position in our company and see what they do and make the process continually better every day?
You know, AI is going to change every position in our business and it's going to, it's going to help us scale, be more efficient, get time back, which is the one thing you can't get back. You know, I can't turn back. I can't turn back the clock. Although I think there's some quantum lab that just turned back time one second here on Earth. Seriously, like, I know, like, don't even.
[00:44:29] Speaker D: Get me into, like, the space time continuum.
[00:44:31] Speaker C: The best book I ever read was Dr. Stephen Hawking. I read in high school.
[00:44:35] Speaker D: It's called A Brief History of Time and Space.
[00:44:37] Speaker C: It's very heavy, but it'll make you. If you think you're having a bad day, just start going down the wormhole of watching TikTok videos. Curios is a good one.
It talks about how big the universe is. I mean, it's like 2 trillion galaxies with hundreds of billions of stars in each galaxy.
[00:44:56] Speaker D: You're having a bad day.
[00:44:58] Speaker C: I don't know how to get in that stupid shooter's mind. When I saw his video yesterday, what is it that made that guy snap? You know, life, you know, dealt him.
[00:45:09] Speaker D: A pretty challenging deck of cards, and he felt very small and unsupported. And, you know, it made him want to go kill people, you know, and you watch the videos of him before you went, it's very disturbing. There's a lot of mental health issues out there, and they range from suicidal to shooter to, you know, man, I Just am not motivated today to make a phone call and talk about loans, you know, and so mindset is a big deal.
And you know, you know, sadly, I mean, I, you know, although it's kind of a benefit, people are turning to AI, like an AI coach helps them. You know, like I got this whoop band, it's got an AI coach, it spits out all this stuff in a large language model and it tells me.
[00:45:54] Speaker C: You know, work on this, do this, think about your sleep, think about your health. I do a blood draw with a nutritionist that I hit me up on LinkedIn messenger five years ago that got me on this thing. And then I get custom supplements and I feel better. I measure things every quarter, you know, in my blood. What am I lacking at? He tells me to not drink as much. I'm trying.
So, you know, you know, I, I think mindset and health, I mean, you know, faith, health, family, career, you know, in that order. You know, those are our pillars at PRMG that our CEO likes to talk about. And those are things that, that we have those conversations with.
I'm not advocating, you know, you know, go be a, you know, go be a faith based person. I mean, a lot of people are, but you know, what do you put your faith in? Do you put it in, you know, the spirit of the universe? Do you put it in energy? Do you put it in yourself? Are you a nihilist? Whatever it is, it's still faith in something. And you know, you need to know what drives and, and gives them peace, right. Which helps give them health, which then allows them to focus on their family and then their career to provide for their family and up that chain. And so those are the things we talk about when we're talking to our teammates.
[00:47:11] Speaker B: Yeah, we talked about that last week with Dave Savage. You know, we talked about when your values are clear, your decisions are easy. Right. And so when, when you have faith based type of mechanisms in your life, then you're making easier decisions, whether it's to make the hard phone call or whether it's to say I'm going to do XYZ activities or whatever it's supposed it, you're remaining not only true to your activities, but your faith keeps you grounded to where you need to be versus where you should be. And I think that we, we're able to create cognition for ourselves as a result.
So, you know, it's important that we have these types of views and curiosity seeking, seeking, not only faith seeking, not only value seeking, not only this, but having that. Why within ourselves to say there's actual significance in our lives either to serve a higher power or to, or to be the best version of ourself. Matthew McConaughey has that story where he's at an award show where he's. Yeah, and what he says, you know, he's talking to a friend and he says, you know what, what are you at the best version of your life right now. And it goes no lasting in 10 years. So 10 years from now goes across. You've probably heard the story before. He goes, have you reached the best version of yourself? Oh no, because I'm always going to be chasing that person 10 years from now to be a better version of yourself. And so he goes and to, to say always be chasing to be that better version because now you have someone to chase after, now you have someone to look up to. And, and I think that when we have these types of curious ways of living our, our life, it, it brings off a greater amount of curiosity. So instead of being introspective for our present, we're being in, we're bringing perspective for a reframing for that future. It's something that we, I look up to you Kevin, when you're producing content because it's always looking something to look forward to, to look to chase after.
And I think that that part of your leadership not only for prmg but also for your teammates and for the industry, it leads us into the type of curiosity to figure out number one, why do you have this curiosity? And then number two, thank you for doing that so that we can listen to the type of questions you're asking yourself so you can bring the content to us.
[00:49:36] Speaker C: Well, I appreciate that. Love Dave Savage. Good friend of mine has a house not too far from me and he's a, he, he's got kids are moving to Oregon so you know, he's spending a lot more time in Oregon now. And Matt, Connie's is great. You know, it's a fine line to kind of always be better because then you kind of fall in this trap that if I'm trying to be better, I'm not good enough today.
And people can be self defeating in that. And so, and I mean honestly, like you know, even with my spouse, she can think, well, you know, she's not good enough because I'm always trying to set the bar higher or I'm not.
[00:50:12] Speaker D: Good enough for her.
[00:50:13] Speaker C: We're not good enough for our kids. You know, my 12 year old just.
[00:50:17] Speaker D: Gave us a PowerPoint presentation last night pitching us on why she, she deserves an E bike, which is like a.
[00:50:26] Speaker C: Big thing around here, right?
[00:50:27] Speaker D: And so, you know, like, like, do I want her playing in traffic at 28 miles an hour? You know, and so, you know, it's, it's scary, but it was kind of cool that, you know, she pitched. I was blown away by her.
I mean, the salesman, I mean, you know, Even, you know, 10 years ago would have been like, okay, we're going to buy it right now. But, you know, my 10 year, better version is like, okay, good job.
Delayed gratifications, big thing with child development.
It's not a no or a yes today, but we're going to work on your safety first. I want to ride with you on your new route. She's now in seventh grade at a new school in Ensign Middle School. And so I want to ride with her. I want to inspect what I expect. I want to meet one of her sides is like, I will stop at every stop sign and every red light. I will not be on the phone.
[00:51:15] Speaker C: I will not.
[00:51:16] Speaker D: You know, I mean, she knew all the high points.
[00:51:18] Speaker C: You know, you won't have to be bothered for a ride because I'll be taking care of myself. Like, she, she went, I mean, she had like 15 slides, is amazing.
But I care about her safety, and I don't want to get smoked by some asshole looking at his phone while driving way over the speed limit, right? And so I want to ride with her on her new route. You know, I, like I did with my, my kids when they just went down in the neighborhood, you know, to kindergarten. You know, I would ride with them in kindergarten, in first grade, to make sure that if they want to ride a bike to school, that they know how to get there, they know how to look, they know when to stop, they know the route, they know how to lock their car. And I, you know, and so, you know, that kind of translates into, into our space because you, you want your teammates at your company to feel safe. You want them to feel like, you know, the other part that we talk about, you know, with Steve over Rewire and being a good leader and a mentor is also building trust.
And that's why I love the name of this podcast, right? Growth through Trust.
[00:52:17] Speaker E: Right?
[00:52:17] Speaker C: You, you know, I, I'm trying to build trust with the industry by freely giving away my thoughts without anything in return.
And so, because I think we can all be stronger together.
And, and so I, you know, I, I think there's a lot of room for us to put this industry, you know, on, on a A higher pedestal means it's this little $2 trillion industry that promotes multi generational wealth.
[00:52:46] Speaker D: No big deal.
And it's funny because you get technologists.
[00:52:50] Speaker C: That come in from outside the business.
[00:52:52] Speaker D: And they're like, oh, these mortgage slips, we're going to automate everything. Okay, you can't implement your AI if you don't have my 800,000 contacts.
You look at Apple, they haven't picked an AI winner to boost Siri and their billion person install base or whatever the number is of iPhone users around the world because they have the users, they have the entry point. So when they pick, when they let all these large language models, you know, create some, some parity and some commoditization, they're going to pick a winner and, and then they'll probably do it as good as anybody, if not the best. And so no, no hate on Apple from me, even, even as a team Android guy.
[00:53:32] Speaker C: So, you know, I, I think, you know, it's okay to be a fast follower and, and, or even, you know, you know, behind that you got early adopters, fast followers, and then you have kind of the rest of the cohort. I think, you know, people want to pick the right thing.
[00:53:48] Speaker E: Right?
[00:53:49] Speaker C: I'll give you an example. So we prioritize AI voice because that will help the salespeople drive revenue. Prioritize that over agentic AI that will text and email and collect documents. I'm not in a hurry to put processors and loan officer assistants out of business and put them on the streets, especially not now with agentic AI. But if we do AI first, that corporate responsible decision is to load up the processors, originators and loan officer assistants with business.
Now I can layer in an agentic AI to help them do more and then we'll see who can make that transition. So I'm not in a hurry to save $5,000 per P&L. I'm in a hurry to create 50,000 more in revenue per month per P and L by doing AI voice.
And if some salespeople don't make it who are straight commission, that's a little more of a pill I can swallow as opposed to putting good processors and loas on the street first. And so you have to make these decisions.
Corporate responsibility is a big thing when you think about AI.
Not here to cut 20% of my staff and go, yay, we got AI, we saved the buck. We don't even think like that, but some companies do.
And so that all is kind of part of it and that's part of building trust Right. I think our people trust us when they know that I'm out here openly saying what our AI strategy is. Some companies don't know what their AI strategy is.
[00:55:18] Speaker D: The next thing you know, they're on the streets.
[00:55:20] Speaker C: You know, I just helped implement this.
[00:55:22] Speaker D: Whole thing and now I'm at a.
[00:55:23] Speaker C: I'm out of a job.
And you look at some of these.
[00:55:26] Speaker D: Hyperscalers, some of these tech companies, you know, Meta and Microsoft, you know, they're, they're firing people, right, left with the.
[00:55:31] Speaker C: AI that their employees are helping build.
[00:55:34] Speaker D: And so, you know, I, I think, you know, our, our business is still very grimy and, and very, you know, full of contact, especially with the first time home buyer. So it's hard to automate everything which is, which is actually a good safe haven for both originators, realtors at the local level.
[00:55:51] Speaker A: With you doing all this research and you being so active and then putting it out on content, it's almost like you've been down, you are in that same analogy. You've been down this route before and you can help others at least see where they're going and how to do it. So thank you on that route and.
[00:56:09] Speaker I: 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.
