Episode Transcript
[00:00:00] Speaker A: Hello and welcome to the Miked up show, the ultimate hub where the hidden stories behind the mortgage industry come to life. I'm Mike Kelleher.
[00:00:08] Speaker B: And I am Michael Zhao. Hello all.
[00:00:11] Speaker A: And in every episode, the Mike's together 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 or exploring opportunities in fintech prop tech, you're in the right place. Get ready. Unlock the story behind every mortgage. Let's dive in today with Roy George, please. He actually is one of our celebrated people who have been on the show before. But we have a new in season five revamped opportunity to dive deeper into the journey of everybody in mortgage and specifically where they were, where they are now, maybe where they're thinking of going.
Roy, you are a great example of this. You are a cmb, but you're also one of the more and I was able to find this out with you on a long drive to the Red Sox game and a great day with you.
Other cmbs I think were in the car too or at least one other and find out you're very involved in the vetting process and the vetting process is actually one that encourages people to, to get their cmbs but at the same time make sure they're qualified.
You have the background of Wall street, which people in mortgage certainly are attracted to or I always joke when I was a mortgage loan officer, you know, there's some insecurities being a finance major, it's like I want to call myself a financial advisor. But hearing you and Michael Zhou talk, it's okay to be a loan officer if you know your loan products really well and then entrepreneurial. So you've started your own company. We're going to get into president of more Lending and it's a growing company, multiple channels like listen up. It has everything from broker opportunities to turning from broker to different channels and. And you're living it now. You're in the scene and then you have the better days where you were part of like really a fintech startup. So you have it all. And I kind of just painted the intro but this is everything culminated into one person and one intro. So thank you for coming on the show. We're going to make this a big one.
[00:02:25] Speaker C: Thank you very much. I appreciate being here. Always a great time. Talking to both of you when you
[00:02:30] Speaker A: were young is kind of like the cliche going over the career. I just explained, I know you were collecting mortgage payments While you were in college, so you had a little mortgage experience.
But everything I was going over like, what did the young man believe success would look like? Was it wearing a mortgage coat? And then throughout the process, you know, has it always sort of shifted from where you thought it would be?
[00:02:57] Speaker C: Wow, I think you used the word collector. Haven't heard anyone call me that a really long time.
You know, at that time of my life, different part of my life, different chapter of my life. I was in college, I needed to pay for tuition, I worked at a, a mortg company in, in early default. So true collections, 30 day, 60 day collections.
And my viewpoint of what success was at that moment in time was making enough money to pitch in on the
[00:03:30] Speaker D: keg of pbr, right, or, or get,
[00:03:33] Speaker C: or get Molson Triple X instead of pbr. And that was like a big win.
So that might have been my version of success in 1995.
So, you know, I can say, however, I had no intention of staying in this business when I was working that job and going to college.
[00:03:53] Speaker D: I went to college to become an architect.
[00:03:56] Speaker C: So I had no intention of staying in this business from this aspect. And I know architecture could be 100% is related to housing in general, but I never thought I'd be on the housing finance side of the world.
So success to me at that time was just graduate, go find and you know, go find an entry job somewhere at an architectural firm in the city, hopefully in New York City, and you
[00:04:22] Speaker D: know, figure it out from there during
[00:04:25] Speaker C: my level of what, or my viewpoint of what success should be changed drastically through the years.
[00:04:30] Speaker B: But yeah, was there someone when you're in collections or as you, as you progress further into it, that saw the potential in yourself and then, and then he saw or she saw more than what you saw, if that even sounds right, and just looked at the bigger picture and said this is where you could be if you just reframe the narrative for yourself.
[00:04:55] Speaker C: Yeah, well, I mean, I guess the first person that would have ever told me that was my mother and that's probably when I was a little kid, you know, but if I'm thinking about
[00:05:07] Speaker D: just my career standpoint,
[00:05:11] Speaker C: I gotta tell you, happened at two different points in time. And I can remember both of them vividly.
First one was with, was with a gentleman by the name of Gary Hernandez, who actually I think might have even thrown me out of the doors of the company we worked at when I tried to resign at one point and you know, remains a friend of mine until this day, but was my boss
[00:05:38] Speaker D: or actually my boss's boss.
[00:05:40] Speaker C: In 2002, I believe that happened.
And then another point in time where I think there was, there was just other people looking at me like, hey, there, there's more. Here was when I was at Merrill and I was an FA and I think they knew I didn't want to do it. I was just doing it because the industry had changed. I wanted to maybe think about changing careers, but I knew housing and mortgage so well that they were like, hey, you should try this. And I actually ended up doing that and it actually helped to bring some promotional options to my career track.
[00:06:27] Speaker A: The you saw, he saw.
Your career is kind of like a seesaw, it seems. You go up, push yourself up to the top and then decide to almost start in a new company and work your way up again.
Architect is an interesting word as you were saying it, because it can mean an actual profession. It could be a title, it could be a degree. Right?
The title. And mortgage seems to tell us like where you've arrived or when you arrive.
And you've had unbelievable titles throughout.
What is your view on the outside in mortgage industry's view on titles? And now you're like inside out view on titles and mortgage.
[00:07:16] Speaker C: So, you know, I feel like if you're in the banking space or if you're in the corporate environment space, especially at the big banks, there's some level of authority that comes with a title or a change in title. What I've realized in the entrepreneurial world is it's so irrelevant that it doesn't even make sense that we use them.
[00:07:41] Speaker D: I've met people who call themselves CEOs
[00:07:44] Speaker C: who can't get on a stage and have a conversation with an audience.
[00:07:48] Speaker D: And I'm like, CEO of what?
[00:07:50] Speaker C: I've met chief technology officers who can't speak very well about AI in today's environment.
[00:07:58] Speaker D: And I'm just like a CTO of what.
[00:08:01] Speaker C: And I see that a lot, especially when I'm looking at the startup spaces or in the early stage companies.
But when I think back to times where I worked at the bank, which know a couple decades ago, and understanding the, the movement from tenure from a secretary was actually a title, a treasurer was a title. It didn't actually mean you might have done a treasurer's job, but that was a title, right? Then you got vp and then you know that that was like a big deal. And you, you got it because of tenure, you got it because of, you know, you were the person in that area. Not necessarily 100% on merit.
You Know, a lot of it had to do with time on the job,
[00:08:48] Speaker D: especially at the banking spaces.
[00:08:50] Speaker C: So, you know, when I look at titles from the inside out, I know depending upon the institution, there's some validity to what it actually brings to you. And when I'm looking at titles from the outside in, you know, coming from an entrepreneurial space, I start realizing that I could have called myself janitor for all 31 years of my career and
[00:09:15] Speaker D: it would have made no difference.
[00:09:17] Speaker B: That sounds like an old subprime thing. I remember when I first started out in the business and like, I don't care what you call me, call it, call me the janitor, get me paid. And that was a very popular quote amongst a lot of originators, at least out here in Southern California between 96 to 22,005.
And. But it wasn't just about getting me paid. There was a certain type of mentality, a certain type of discipline and a certain type of follow through that also came through with that, with that mentality of I don't care what you call me, just get me paid. What has changed in, on Wall street and what has changed or what has changed in lending about that type of discipline? Because when you say just get me paid and it also meant that person's willing to do the work.
So what is the work and the labor and the attitude that has changed over the last 30 years that you think that we have missed, but we can actually move forward?
[00:10:22] Speaker C: So that's interesting question.
It would almost require me to almost beleaguer a group of people to answer it. But the truth of the matter in my opinion is I don't think the
[00:10:39] Speaker D: hard work workers have disappeared. I think they exist.
[00:10:42] Speaker C: I think there may be a lot more visibility to LOS in the world today than there was in 1996. You can see them online, you can
[00:10:53] Speaker D: see them on your socials.
[00:10:55] Speaker C: And so you get a, you, you
[00:10:57] Speaker D: automatically get a stigma in your head
[00:10:59] Speaker C: of that's what it is.
Where in fact that person who's on socials doing a million videos may not
[00:11:06] Speaker D: actually fund any loans. Right?
[00:11:09] Speaker C: Not to say that that's the case for everybody, but it could be very different than 1996, 97, you know, 2002, where there was little to no social. I mean, you had a Facebook account or a Friendster account and you know, you had minimal interaction there and you know, you probably were working 9 to 9 on your business and truly working on your business.
So it doesn't really mean that there isn't.
[00:11:38] Speaker D: There is a huge difference in who's
[00:11:40] Speaker C: working hard, who's not working hard?
[00:11:41] Speaker D: I think just working hard has changed
[00:11:44] Speaker C: from 1996 to 2002 versus, you know, 2015 to today.
[00:11:50] Speaker D: Working hard today you have to incorporate
[00:11:52] Speaker C: things that may not mean funding alone, but it is long term what's going to allow you to fund loans.
So I, I don't, I don't know that I see a major difference between working hard.
[00:12:10] Speaker B: What kind of time management does it take for a leader to display to its origination team that just because you're in social media does not mean you're talking to more people?
So how do you manage that space to where you can be online and also talking, like literally picking up the phone or physically meeting with someone as a leader, how do you manage the difference between the two so that you can convey that to marketing and then to sales or to both?
[00:12:45] Speaker C: I think that's really about, you know, setting the vision for how it should work from the time you are starting out as an LO to the time where you can actually have some of your time back as an lo. Maybe you've built a team and you're able to utilize that. So, so in the beginning, I coach everyone to do both, right? Like, hey, you have to be online, you have to do in person, and you're going to work more hours than the person who has a team who can be out there doing business development all day and enjoying that part of the business while they're sending loans into a team of loan officers that they have that are actually doing the work of, you know, pricing and structuring and
[00:13:29] Speaker D: all of those things.
[00:13:30] Speaker C: So I think, you know, this person over here who's been in the business for a little bit longer can be on social and be present in a, in a one on one or one on 20 personal way versus this person over here can do that same thing, but they have a lot more hours they've got to put in to accomplish it. This person's got a virtual assistant, this person's got a assistant, they're setting up the appointments. This person is just driving or going to a zoom call or wherever they need to go. And so their time is used differently. They may feel like they're in a easier space.
And the guys who are guys and girls who are just starting out may feel like, wow, am I supposed to
[00:14:16] Speaker D: work 12 or 14 hours?
[00:14:18] Speaker C: You know, I honestly feel like the most successful ellos are going to be those that are putting that kind of time in the front end and working their way into building a team. That allows them to have a, you know, a 12 to 3, not a 9 to 5.
And I mean 12 in the afternoon. Three in the afternoon.
[00:14:36] Speaker A: To piggyback on kind of the last two questions Michael asked, you have a unique background. You've ran compliance from for two of the largest mortgage companies in the country. And at the same time, you are leading in the field from podcasts and participating in podcasts and building your team up by doing it with them.
And you're structuring loans and getting into non QM fix and Flip and not just finding the investors and the warehouse lines, et cetera, et cetera, but you're actually out there talking and finding opportunities.
Benjamin Graham wrote, the essence of investment management is the management of risks, not the management of returns.
It feels lately, or maybe for a long time, it could be a lot to do with Fannie and Freddie, but it feels like the street feels if they can magically qualify for a mortgage, like a mortgage is almost a privilege that comes with being here and they should automatically get it. And they get one chance to take that chance on buying, assuming they qualify.
But what I'm getting at is there's very little mention of risk. And I think it's been more polarized, obviously, with social media and these Bed, Bath and Beyond SOFI platforms are only going to make it more sensationalized that yes, if it says green light, go buy a home, buy a.
What's your view on both sides of that?
[00:16:12] Speaker E: Like the.
[00:16:13] Speaker A: The street side, but also knowing that there is a large risk management that goes with this.
[00:16:21] Speaker C: So I'll tell you, I said this on stage at Housing Wire, like two years ago at the Dallas conference that they do.
[00:16:30] Speaker D: I forget the gathering.
[00:16:32] Speaker C: And I remember hearing another person who runs a much larger institution than mine saying he, he's. He's crazy for saying that on stage, in public. And what I said was, I don't care what regulator shows up on my door. I'm gonna go through the audit, I'm gonna fight what I need to fight, and I'm probably gonna come out of that audit with a win, or at least what I would consider a win on my side of the.
[00:17:01] Speaker D: My side of the equation.
[00:17:03] Speaker C: And I might not have said it as eloquently as I just said it. I might have said a little bit
[00:17:07] Speaker D: more crass on purpose, right?
[00:17:09] Speaker C: Because there was a physical audience in front of me and I was like,
[00:17:12] Speaker D: listen, I'll just punch him in the face.
[00:17:14] Speaker C: But, you know, metaphorically, that's exactly what I meant.
[00:17:18] Speaker D: So when I think about risk from the street or Wall street.
[00:17:22] Speaker C: And then I think about, you know, what Main street is kind of, you
[00:17:28] Speaker D: know, dealing with or seeing.
[00:17:29] Speaker C: I, I kind of apply my career metric to it, right? Like I walked in the gray so long where I wanted the.
[00:17:39] Speaker D: I knew that the companies had to
[00:17:41] Speaker C: be profitable in order for my job
[00:17:44] Speaker D: to exist, everybody else's jobs to exist.
[00:17:48] Speaker C: And so I couldn't just throw regulation after regulation at everything until nothing worked. I needed to mine through regulation to
[00:17:56] Speaker D: say, hey, how do I actually make
[00:17:59] Speaker C: this work for what we do?
And so, you know, when I think about Wall Street, I think about, hey, there's an end investor somewhere. There's a percentage of, you know, dollars that need to be made from an investment perspective to whoever has bought a
[00:18:17] Speaker D: pool of loans or a tranche of
[00:18:18] Speaker C: loans or whatever of loans that there is. There's multiple investors on every single loan that goes out. Whether you talk about the front end and the, you know, the loan being here and the MSRs being over there, or you talk about, you know, a
[00:18:33] Speaker D: pool of loans and then multiple pools of loans and whatever it is, right. If there's a pension fund underneath it somewhere, that's the actual recipient of the value or the gain on it. These people have to think about that. There's numbers, there's risk to assess when
[00:18:49] Speaker C: they're thinking about that and where it's being delivered. But for Main street, you know, I
[00:18:54] Speaker D: think the part that gets lost is
[00:18:57] Speaker C: they just want to buy a house, man. They just, they just want to buy a house. They want somewhere to live and they don't see that side of it. And honestly, it doesn't feel like this side of the house cares too much about that side of the house.
[00:19:10] Speaker D: You might, you might see others say
[00:19:13] Speaker C: other things like we're trying to pass X legislation or we're trying to get
[00:19:18] Speaker D: this going, but I mean, honestly, at
[00:19:20] Speaker C: the end of the day, you read the legislation deeply enough and, you know, nothing's going to come of it.
It's an unfortunate way to say that, but that's actually my true opinion is
[00:19:29] Speaker D: many legislations pass and nothing in the industry actually changes.
[00:19:32] Speaker C: You know, you get these minor changes that don't move the needle in any direction. So when I look at, you know, a Main street buyer and they're looking back at all this. Yeah, all they've got is hopefully a great educational coach in an lo that's going to guide them through whatever they've got to do. And then they've got social media that's telling them you know, you can do X, Y and Z, which may not be true.
So, you know, I'm looking at both sides of the fence and I'm thinking to myself, wow, it's such a polarized opposite of what they're trying to achieve that there's no synergy in it. And I personally don't think that the industry does a good job of, you know, bridging the gap between all that. Not to say that anybody needs to do that, but I think if you really want to have customers that stay with you forever, then explaining how you get from the street to the back end of Wall street brings you a customer that never leaves you one.
[00:20:28] Speaker A: One micro question just while it's on the top of my head, on the street, on the main street buyers that you're seeing, which we mean as customers, by the way, just ordinary people trying to buy homes. Are you seeing a shift of people going to Uncle Johnny or aunt May to ChatGPT yet, or is that mostly just certain computer?
[00:20:51] Speaker D: No, actually I do see that often.
[00:20:54] Speaker C: As a matter of fact, barring age demographic, I see that happening from multiple generations. Whether it's older age demographic or younger age demographic. They are going to chat GPT first and then they're coming to an LO and saying, hey, I know I can do X, Y or Z. What do you think about that? Right? And then it's the LO's job to be able to really maneuver around what chat Claude perplexity or anybody else told them first.
But yeah, I see that on a regular basis.
[00:21:25] Speaker B: You mentioned that sometimes that we'll have some kind of legislation, whether it's the dismembering or dismantling of the CFPB or other types of regulations that may happen.
And it just seems to be like, okay, that happened. And then there's much ado about nothing really is what happens. So as a leader, what are the.
What do you do differently or what are the actions you think could be done by a compliance leader who enables responsible growth from one who's just. They're in fear, like, oh, well, all these things are happening and they're more reactionary. And so how do you create that in an environment? As a leader, what do you do differently to create that growth versus someone who is reactionary to the fear of what has just happened? Because I've seen that one of our past, a number of our past guests.
[00:22:20] Speaker C: So relationships within the group that you call your peer group is highly important. I think that's the case for any organization and any organization type that you work at.
I've always done my best to maintain really great relationships with those that are
[00:22:39] Speaker D: in different parts of the organization so
[00:22:42] Speaker C: that I can ask questions, I can get a feel for what they need or want. And so that when I have to apply, you know, the rules of a regulation and change a policy or change
[00:22:54] Speaker D: a procedure or request a change of a procedure based off of a policy
[00:22:58] Speaker C: change that I've already got the buy
[00:23:01] Speaker D: in of my peer group, which then,
[00:23:03] Speaker C: you know, will trickle down as it needs to across the different departments that may be affected. So I think from a leadership perspective, that type of communication and that type of relationship building is paramount to being able to win. As a compliance leader. You have to be able to say, I'm not a closed off compliance leader. I'm the kind of compliance leader who has an open and honest relationship with everyone that is a decision maker at my organization.
I think I find all too often compliance leaders are like, hey, this is the regulation that happened, this is what we have to do. And you know, nobody's going to tell me different and you know, it's not the case for everybody, but it does happen.
[00:23:48] Speaker B: Are you okay with people talking back to you?
[00:23:51] Speaker D: Absolutely.
People talking back to me? Is that what you said? Yeah, yeah.
[00:23:57] Speaker C: Why shouldn't I give you a great example?
When I was, when I was at my last employer, I remember way back in the beginning of starting there, their
[00:24:09] Speaker D: chief revenue officer had also just started there about a month before me.
[00:24:13] Speaker C: And it was in the middle of an executive board meeting. You know, the president was there, the, the head of operations, accounting, the whole gang was there and myself and that at the time, capital markets. But today I think he's chief revenue officer.
We got into an argument in front of everybody and just kept going and
[00:24:40] Speaker D: it kept going all the way out of the room. We, we. I actually was like, dude, stop talking
[00:24:45] Speaker C: to me, I gotta go. And I use that as an excuse
[00:24:48] Speaker D: to walk into the restroom.
[00:24:50] Speaker C: He followed me right in and we continued the conversation at the urinal while I'm going to the restroom. That's how bad the argument was. And so, yeah, I don't mind anybody talking back to me because today I actually still hang out with that guy. We're actually figuring out if we can go see Spider man together when I visit the area. So yeah, no, he actually became a
[00:25:10] Speaker D: friend based off of that.
[00:25:12] Speaker C: That was our first interaction.
[00:25:15] Speaker A: I'm sure the environment causes either more or less of those. You were part of the early stage of better and its early growth obviously backed by a large amount of capital or the idea of raising capital.
But there's a lot of M&As going on today of IMBs consolidating.
How different is it creating a compliance organization versus inheriting one? And which one do you think is more difficult?
[00:25:48] Speaker C: I think it's much, much more difficult to inherit any type of organization. So whether we're in the middle of M and A, whether, you know, it's my company today buying a smaller company, whether it's a large startup, you know, starting from scratch, or whether it's a billion dollar organization buying another billion dollar
[00:26:08] Speaker D: organization, the inherited piece is the hard one.
Creating it is easy.
[00:26:15] Speaker C: I, in my opinion, okay, I've written policies and procedures numerous times throughout my career. I've made them apply to the individual
[00:26:24] Speaker D: organizations that I work for.
[00:26:26] Speaker C: But trying to meld two different compliance organizations together is probably one of the most difficult things I've ever had to do and does not yield great results.
You've never seen compliance people argue with each other more than when you see them do it through an M and A, because one compliance officer's opinion of
[00:26:49] Speaker D: how to interpret a rule may be vastly different than another's, or maybe it's just slightly different, but that nuance is enough to change a procedure within the
[00:26:58] Speaker C: organization or how they've done business.
And that could be, that could be, you know, quite a tumultuous interaction may
[00:27:08] Speaker D: lead to exits, which could also be a hindrance to the organization as a whole.
[00:27:12] Speaker C: You know, so it's much easier to be able to do it from scratch.
[00:27:17] Speaker A: It goes back to that early title question. It's tough to have two chief compliant officers, two COOs, and I think this company's going through it right now. And it's.
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[00:31:16] Speaker A: And welcome back and thank you again to our sponsors. We couldn't do it without them.
Just some great new sponsors popping up and obviously as we're seeing AI is popping up, everything is moving faster when you were and you do a lot of AI. So we want to let you get a chance to really pitch what more lending's doing and how loan offices are really attracted to your new platform. Want to have you up there in New England talking about it for the Adopt the Brand Day, September 16th in Newport, Rhode Island.
But you also had a seat in leadership at Taylor Morrison. And I just asked this because you're controlling multiple locations.
And even if it's a very enterprise driven model, there's different interactions based on different divisions of homes and the type of salespeople, understaffed, overstaffed.
Do you think AI in that world is even harder to release or is it easier? Or right now is just. AI is sort of difficult in every area from an enterprise rollout standpoint.
[00:32:35] Speaker C: So just to clarify, I, I was at Home Funding, which is the mortgage
[00:32:41] Speaker D: arm of Taylor Morrison.
[00:32:42] Speaker C: So I wasn't.
I had a dotted line role to reporting at the home builder, but I
[00:32:48] Speaker D: work for the mortgage side of the
[00:32:49] Speaker C: house or the finance side of the house.
And the answer is this, right?
I don't think most legacy mortgage companies, anyone who's been around prior to the last six or seven years can really
[00:33:06] Speaker D: or truly efficiently deploy AI and in
[00:33:10] Speaker C: a manner that doesn't cause a hindrance for them. Internally, I think it's really difficult. I think people play a big factor into that. I got lucky with what we did here because I had nothing to work off of except for a small framework of loan officers that were producing some level of volume.
So I get to build everything from scratch.
[00:33:36] Speaker D: Whether that was policy procedure, whether that was the tech stack, whether it was
[00:33:40] Speaker C: the initial use of AI five years years ago to what we're doing today with the use of Isla and you know, the new API connections that we
[00:33:49] Speaker D: have into Lending Pad, these types of things that we do today actually foster
[00:33:56] Speaker C: the LO being able to take their time back. And it gave me the opportunity to build something that didn't require dismantling something else. Right. So earlier we were talking about, if there's two companies that are coming together,
[00:34:11] Speaker D: which tech stack do you keep?
[00:34:12] Speaker C: Right. But in most of those cases, you
[00:34:15] Speaker D: got to run parallel until the conversion
[00:34:18] Speaker C: is over and only then can you move to one or the other. And if you want to go to
[00:34:22] Speaker D: something completely new, you still got to
[00:34:24] Speaker C: run three different items parallel until you can wean the other two off.
[00:34:29] Speaker D: That makes it triple the cost or double the cost for an extended period of time until you're able to move down to that just one.
[00:34:36] Speaker C: I know that for a fact because I've actually moved companies off of Encompass before and it is a parallel run for X amount of time until all of a sudden, you know, there's only one bill and vice versa, I've moved
[00:34:49] Speaker D: the company onto Encompass.
[00:34:50] Speaker C: So you know that, that, that's there. So, you know, for me, I think when I look at my company and I think about how I've done it a little differently is I was able to use AI early when a lot of people were telling me not to. Kind of like when I got into crypto, you know, 11 years ago when I was buying crypto and everybody was telling me, you know, the tulip story from Holland, and I was like, okay, whatever. I mean, I'm not trading it, I'm just gonna buy it and hold it. And here I am all these years later and I'm like, well, I spent seven grand on this. Now each one of them is worth sixty something thousand dollars.
[00:35:28] Speaker D: Right.
And so that was a big deal. Same thing with AI.
[00:35:33] Speaker C: I went in early, I started to
[00:35:34] Speaker D: build out what we could build out
[00:35:36] Speaker C: utilizing CHAT prior to anybody else doing it. And I mean, yeah, we made a lot of mistakes, right? I mean, I was probably one of the first people to say, hey, we
[00:35:45] Speaker D: can replace the use of Aus with
[00:35:48] Speaker C: ChatGPT and we can replace the use of tax, tax return review with ChatGPT.
Yeah, there's an extra manual step in there where we have to, you know, eradicate or, or make sure that we don't have public information showing. But as long as we're just using the, the income numbers, we still get a return of calculated income without having a paid service.
[00:36:15] Speaker D: Right.
[00:36:16] Speaker C: And that was one of the first things we did when we started using AI.
[00:36:19] Speaker D: Slowly cut out vendors one at a
[00:36:21] Speaker C: time by mimicking their service through, you know, the AI services out there. Now we have agentic tools and other things that are there that we didn't have before.
So, you know, very different play than being at a, being at a large institution or even any institution that's been
[00:36:40] Speaker D: around for a while that just can't easily move into that.
[00:36:44] Speaker C: And, you know, one of the biggest things you ever got to think about is, hey, I'm going to make this run through AI.
And that scares people.
[00:36:51] Speaker D: Once the people get scared.
[00:36:53] Speaker C: Now, maybe you're not getting the best work output out of them and you're taking a loss on both sides.
[00:36:58] Speaker D: You got a slower worker because they're
[00:36:59] Speaker C: worried about their job, they may be looking for something else and you're not ready to implement whatever you were trying
[00:37:04] Speaker D: to implement in the first place.
[00:37:06] Speaker B: The coach of Indiana football built its current team from basically a perennial losing team into the national champion in this past season.
And prior to that he had coached at James Madison University, where basically he had nothing at almost a Division 2 school. But it really was Division 1 and then built them. And then he has taken that. He took the James Madison team and built it to be better and then going to another team and then eventually going to Indiana and making it its national champion. And in creating the national champion team, what he did is recruited players from other universities in order to play within his system and as a result help create a national champion. And in his hope he'll be doing much better. Although it's hard to want to go to Indiana as an opinion of mine, but. And I think when it comes to creating a mortgage company and in leadership, what you're talking about in using technology, it's talking about how you can utilize technology. You understand the functionality of each role almost as if technology becomes an employee in itself.
And so when you're bringing aboard people or using your current staff in order to develop them, when, how do you make the differential decision to start developing people versus developing technology because you want to, because the people is actually the most important part in developing the business. And do you treat the technology similar to a person just with no emotion versus the person who actually needs to be developed and fostered and to, to someone to be the quarterback of your team?
[00:38:51] Speaker D: No. 100%. I'm still, I'm still a 100 believer
[00:38:55] Speaker C: that the people matter more than the tech.
[00:38:58] Speaker D: The only difference for me is that I just don't need as many people right what, what a larger institution needs,
[00:39:06] Speaker C: you know, 20 or 30 people to do.
[00:39:08] Speaker D: I'm doing with two.
[00:39:10] Speaker C: And I'm still doing it in a format where they work 9 to 5 and go home in time for dinner or the gym or whatever.
[00:39:16] Speaker D: If people visited this office, they would,
[00:39:19] Speaker C: I'm in my Miami headquarters location, by the way.
[00:39:22] Speaker D: If they visited this office, what they
[00:39:25] Speaker C: would walk into is people coming in whenever they want, people exiting whenever they want, middle of the day, leaving for the gym for two and a half hours.
[00:39:36] Speaker D: I'm 100% about, hey, let's make sure
[00:39:40] Speaker C: we get the job done, but let's
[00:39:42] Speaker D: develop our people to utilize the tools, not let's develop the tools to replace the people.
[00:39:48] Speaker C: I love having the tools and I
[00:39:50] Speaker D: think they're 100% benefit to me.
[00:39:53] Speaker C: I think I've proven that for the
[00:39:55] Speaker D: last five years with double digit growth every single year.
[00:39:59] Speaker C: But I think it's also important that
[00:40:03] Speaker D: the people feel like, hey, this is
[00:40:06] Speaker C: the place I want to work because I'm learning how to use AI, I'm learning the mortgage business, I'm getting a benefit out of it. And at the same time, Roy's never sitting around talking about how AI is going to replace my job. I'm just not hiring 50 people so that I have to lay off 30 later.
[00:40:27] Speaker A: Yeah, I think it's important we focus on more lending.
What we're trying to say, it's a culmination of Roy's experience, his leadership in what he was able to do. And then building a mortgage company that has product, built product almost before everybody else started building product has the AI.
And I just think it's a lot of the same out there. And loan officers really need a great story.
This is one I'm. I'm passionate behind because it's. It's authentic, it's real. It is a huge differentiator. I don't know how you as a loan officer couldn't walk into the walls of what you're able to offer and say, this is better than over there. And over there is a lot of different. The sames.
[00:41:13] Speaker I: And.
[00:41:14] Speaker A: And I think just if your mantra could be shop, you know, like, they have a dealership up here. Shop us last, you'll love us. But it's like, come into Roy's and you'll never leave. So I guess my question is, you know the famous Roosevelt saying the man in the arena. So he praised the person who is actually in the arena.
[00:41:35] Speaker D: You.
[00:41:37] Speaker A: You spent years advising people about what could go wrong. You built different procedures to make sure things don't go wrong. What was it like to finally become the person in the arena? I don't think your company would get to where it was today if you didn't actually participate in it.
And do you just enjoy that you can own decisions that not just succeed, but can fail forward, too?
[00:42:03] Speaker D: Yeah.
[00:42:03] Speaker C: So, you know that. That's harder for me to answer.
[00:42:11] Speaker D: Here's, here's, here's why. Right.
[00:42:13] Speaker C: I.
I've always looked at myself and
[00:42:17] Speaker D: said, do it the way you would
[00:42:20] Speaker C: do it if this was your organization. I think that's part of my success, is I never went anywhere and said, all right, I'm just part of the machine. I'm a cog over here that does X. I always looked at everything like,
[00:42:34] Speaker D: hey, this is where I work.
[00:42:35] Speaker C: This is my company. This is how I'm going to do it, and this is how I'm going to advise everybody. And, you know, in some cases, it was a detriment. I remember one very particular moment in time where one of my bosses said to me, I just feel like you're nipping at my heels. And I was like, well, yeah, I want your job one day. And, you know, if you feel like that, then that's your insecurity, but whatever.
And now, listen, I'm sitting here, I make the decisions. I make the, the, the, I guess the strategy on what direction we go in. I used to do it alone. Now there's a team of people here that do it. Yeah, we got to.
We'll cross the billion dollar barrier in
[00:43:21] Speaker D: the next seven or eight months, which
[00:43:23] Speaker C: is insanity considering I bought a brokerage that was doing $20 million four and
[00:43:29] Speaker D: a half years ago.
[00:43:32] Speaker C: You know, I've been able to really be the man in the arena and
[00:43:36] Speaker D: say, hey, I see everything going on
[00:43:40] Speaker C: around me and I have really figured out how to utilize all these years of cycles and watching stuff happen to avoid it, move around it, use it to. To grow my business. And I think, you know, one of the things that I see from, from an LL perspective when I'm recruiting people or when the team here is now recruiting people, you know, once a year,
[00:44:07] Speaker D: I invite a small handful of LOS from various companies.
[00:44:12] Speaker C: Anybody who reaches out, I invite them
[00:44:14] Speaker D: to our sales rally. We keep them off of all of our social, we keep them off of all of our video recording.
[00:44:20] Speaker C: They're not in anything, but at the same time, they get to come in, they get to check it out, they
[00:44:28] Speaker D: get to see what our pricing looks like, our rate stacks look like. And when they leave from here and
[00:44:34] Speaker C: their questions are finished answering or being answered, I mean, within days I get a call back going, dude, I just want to exit where I am. I can't believe what I saw. I can't believe you can do that.
I was never privy to the fact that that could even be done.
And the fact that I used to
[00:44:52] Speaker D: be a chief compliance officer really helps
[00:44:55] Speaker C: to tell that story and show them
[00:44:58] Speaker D: like, hey, this is why you can do it. This is why you thought you couldn't do it.
[00:45:03] Speaker C: And let me help you go from, you know, making 100 grand and doing X amount of loans to making that, doing 10 loans.
[00:45:16] Speaker B: I think there's a fear as developed by the increase in rates from a few years ago, to create a transparent statement of cash flows. I won't say balance sheet, but to create a transparent statement of cash flows by an independent mortgage banker. Only because there have been losses over the, over the last three years by a lot of them. And I would be confident to say almost all of them. But although I haven't seen all of them.
So how do you go from, I'm afraid to show Open up the kimono and show what's underneath it to, to people that are outside of your company because it's it.
I, I'll say kudos to you because I find it hard to show my balance sheet and statement of cash flows. But here you are willing to show pricing where it is, compliance. I mean, first question is why.
But you just explained it. But then how do you develop the, the skin to be able to show that?
Because other leaders might not want to.
[00:46:26] Speaker C: So, you know, is making that comment about what I said on the stage at HousingWire a couple years ago, because I'm not afraid of anybody. I have no fear of wherever, whatever comes at me in this industry.
[00:46:39] Speaker D: So opening the books and showing you.
[00:46:41] Speaker C: I got to do that for a regulator. If they really wanted to ask that question anyway.
[00:46:44] Speaker D: Right.
[00:46:45] Speaker C: Most of them don't come in and go, let me look at your books.
[00:46:47] Speaker D: They want to look at your loans.
[00:46:49] Speaker C: But if that happened, it's not like I could say no.
So why shouldn't the teams here be
[00:46:55] Speaker D: able to look at it as well? Why shouldn't the people that are potentially going to be hired be able to look at it as well? And at the end of the day,
[00:47:02] Speaker C: here's the differential, the winning comment.
You work so hard to bring all
[00:47:08] Speaker D: this business in for what?
[00:47:10] Speaker C: To pay my salary? Look, that's my salary. I make nothing off of it until there's 50 of you, and then I make something off of it versus everybody else who has to build margins into
[00:47:25] Speaker D: place to play to pay X amount of salaries. And when loan officers see that, they're
[00:47:31] Speaker C: like, wait, I make more money than you.
[00:47:34] Speaker D: And I say, you absolutely do.
[00:47:36] Speaker C: They. They automatically are like, that's the guy I want to work for.
One of my loan officers said to the woman he was going to marry,
[00:47:44] Speaker D: he said, she asked him the question. She said, why do you work at
[00:47:48] Speaker C: this, you know, small little company when
[00:47:49] Speaker D: you could go work at this place or that place?
[00:47:51] Speaker C: And he goes, I never met a guy who said he wants to make everybody else a millionaire, you know, before caring about what he's making at the company. And yeah, man, you know, I have
[00:48:03] Speaker D: an advantage on a lot of people
[00:48:04] Speaker C: because I'd already made my bones and
[00:48:06] Speaker D: made my bed and I had all of that already.
[00:48:10] Speaker C: So, yeah, I can do something that a lot of other people cannot do.
[00:48:15] Speaker A: But you also do something that a lot of people could do that choose not to. So, I mean, let's especially probably the ones you're going up against.
When a loan officer comes to you and they want to make that million, right? Or you can tell they're money driven.
Do you allow them to be money driven? Or is there a tickler in your head to try and start them out in like the Florida mba or tell them what a CMB means on that logo of yours? Or is it, is it one of those just people are either into it or they're not and you try to.
[00:48:56] Speaker C: Yeah, no, I try to get everybody that's here to get involved in trade associations or chase, you know, designations that may matter to them. Listen, I'm not going to win that battle with everybody. I do have loan officers throughout the country that have been in the business longer than me and they're not interested.
[00:49:14] Speaker D: Right?
[00:49:14] Speaker C: They are doing what they're doing. They do it to make a living.
Or I have one guy who I think he just does it because he loves it because I can clearly tell he doesn't need to make a living anymore. But you know, there's that group and then I have another group of under 35s and there's a lot of them that I actually do mentor into.
[00:49:35] Speaker D: Why trade associations matter.
You know, when we were just a broker before we had our lender license,
[00:49:41] Speaker C: it was really hard for anybody to look at us and go, why do you participate in the NBA? Right?
[00:49:46] Speaker D: That's the Mortgage Bankers Association.
[00:49:48] Speaker C: Why would you be there and why are you not going to this broker event? And I would tell them, I say, you know, I do go to broker events. I'm more interested in the, you know, in the advocacy piece when I'm at a broker event because that's what I really care about. Like, hey, how do we affect change for people from an advocacy perspective? You know, yes, I know what I said before. Legislations happen and nothing happens, but doesn't mean that I shouldn't keep trying, right? And the same thing happens on the NBA side. I just feel like the NBA has
[00:50:20] Speaker D: a larger and stronger foothold when it
[00:50:23] Speaker C: comes to dealing from, from a legislative perspective. And I, I push people in direction and then there's the young professional programs within a lot of these, these places
[00:50:33] Speaker D: where they get to learn from peers and other people like that.
[00:50:36] Speaker C: And then I mean, you know, in
[00:50:38] Speaker D: this location, I sent three people to School of Mortgage Banking one last year
[00:50:43] Speaker C: because they see that on my wall and they're like, what's the cmb? What does that mean? And you know, I tell them about it or CMBS will come by here and visit and you know, we'll talk and then they'll Ask me questions about who is that? What do they do?
And I say to them, I say, hey, listen, you guys aren't ready yet. Your time in industry doesn't, you know,
[00:51:02] Speaker D: equate to you being able to do it. But you should head up the school. You should hit up the School of Mortgage Banking.
[00:51:08] Speaker C: Do you know, somb 1, 2, 3 and you know, really start learning and go after these things.
[00:51:15] Speaker D: Because I do truly believe that there
[00:51:17] Speaker C: is benefit in achieving those designations and taking those classes.
[00:51:25] Speaker D: The amount of people you meet, the
[00:51:27] Speaker C: network you build is far greater than just you being in one metro market
[00:51:33] Speaker D: by yourself, doing just whatever happens locally.
[00:51:36] Speaker C: That's great from a customer perspective, but you know, that's not going to help move your career along.
[00:51:43] Speaker D: And it also doesn't give you enough
[00:51:45] Speaker C: from, you know, how do I do something perspective, right? Like when I want to pick somebody's brain, I might call somebody in Seattle versus somebody down the street in Florida just because, you know, they've been here for so long and maybe we've all got group think. So let me get out of my group think and go find somebody that's
[00:52:02] Speaker D: not part of it.
[00:52:04] Speaker B: Are you sending ops or sales to School of Mortgage Banking?
[00:52:10] Speaker C: So most of my ops team is overseas and there's only two or three that are here. I none of them were interested. The three people that did go are
[00:52:18] Speaker D: all salespeople, all MLOs.
[00:52:23] Speaker B: Wow.
That answers the question of if the leaders stop serving, who fills that vacuum? Because I think that the fact that you have salespeople going to the classes at the MBA serves as a testament to, to the potential of what leadership could serve. It may, I think at one time it may have started at a specific company in Southern California and its potential that you may be doing this out of Florida.
[00:52:55] Speaker D: That's true.
[00:52:57] Speaker C: I got to tell you, I sent the three from this location. Oldest 30 years old at 29 at the time and youngest 24 at the time. And so, you know, they're getting ready for SOMB2 next year sometime. We'll schedule that. But I've got a good group that is interested in it.
[00:53:17] Speaker D: They see the interaction and that's, that's
[00:53:19] Speaker C: what they want to, they want to,
[00:53:21] Speaker D: you know, achieve is, hey, I see that action.
[00:53:24] Speaker C: I want to emulate that because somehow this guy got to do what he's doing now and he's doing the same thing I wish I was doing. He's going to the gym in the
[00:53:34] Speaker D: middle of the day.
[00:53:35] Speaker C: He takes calls only when he wants to take them and not when he has to take them and you know, it's, it's.
[00:53:42] Speaker D: If you can make sure you visual,
[00:53:44] Speaker C: you put that out there visually for the people around you, it's leading by example rights, just exactly what that is and you know, you can actually coach them through it. I think you get a lot of good people in your organization and you know, yeah, sure, I might lose one one day, but I think I've built something strong enough where most of the ones that are successful don't exit.
[00:54:08] Speaker A: And thank you for coming on today, Roy. As you can tell, I always light up. I know just how vast and I always call you for advice or question or telling you I have something I think is interesting. I love to see you poke holes in it.
I know what an opportunity it is for a loan officer, but a loan officer that doesn't want to take my word for it.
Do you just want to thank you again for coming on the show, but do you want to take a quick second to what you describe more lending as and why they should come to one of these or visit on site and see what it's all about?
[00:54:46] Speaker C: Yeah, sure.
Listen, more is about you, the loan officer, being able to truly live by that mantra that hey, if I didn't go out there and get this business then this company wouldn't be doing as well as they are. So why am I not taking the lion's share of the revenue generated? That's really what it's about, right.
I think that loan officers today, you know, they get paid in a interesting way. They're very high margins and they can get paid X and, and they do all right. Or they work at banks and they've got to do 30 times the volume that my teams have to do to
[00:55:29] Speaker D: achieve the same income.
[00:55:32] Speaker C: And that's not an exaggeration.
100%. That is true.
So, you know, when I describe the company to anybody, I say this is the kind of place you want to go to when you want to make
[00:55:43] Speaker D: sure that there's nowhere else you need
[00:55:45] Speaker C: to check before you end your career here and make everything you need to make in order to walk away, you know, in a really great position for
[00:55:56] Speaker D: yourself and your family.
[00:55:58] Speaker C: And I always leave that with one example.
I recently took in a hundred million dollar producer and the first thing he said to me was, I'm thinking about pulling back and only doing about 50 this year. And I instantly opened my eyes like why I, I spent time recruiting you because you said you were going to get to X.
[00:56:19] Speaker D: And he goes, yeah, but with the way you do this, I don't have
[00:56:23] Speaker C: to work that hard. And I was like, damn it, I
[00:56:26] Speaker D: shot myself in the foot.
[00:56:27] Speaker C: But at the same time, I'll find another three of them and that volume will be, you know, 50% higher than what he was going to do by himself anyway.
[00:56:36] Speaker B: Or you can mentor or you can have, or you could hire some people to mentor under him to triple that volume.
[00:56:43] Speaker D: Sure, we have those.
[00:56:45] Speaker C: We have those people here too.
[00:56:47] Speaker A: Thank you again for coming on. I think this story has told the answer to, you know, the question, who is Roy? And you obviously were started off as a collector, then Wall street professional compliance executive, now a C suite leader. Now you're that entrepreneur man in the arena, but also you have that mentor and industry servant side of you. And we learned today when the titles are removed, Roy is there to build up the team here at more lending and leading by example in showing through transparency, you will make more than me and you will have a better work life balance in the process. And I hope this inspires some other people growing up in the industry to, when they do get the chance to have the reins, they lead from the, from the back when they need to and lead from the front at times when the industry requires it. So thank you again, Roy. Appreciate you coming on.
[00:57:49] Speaker B: Thank you.
[00:57:50] Speaker C: Yeah, thank you guys so much. Appreciate being here. Always great to see you both.
[00:57:55] Speaker E: Thank you for joining us on this journey into the heart of mortgage innovation. Every mortgage every has a story and we're here to help you write yours. If you enjoyed today's insights, please subscribe, leave a comment, share it 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.
