Episode Transcript
[00:00:00] Speaker A: Hello and welcome to the Mic'd Up Show. We are here in season four with a great lineup of guests and we always say in season four where every mortgage has a story. And our guest today, David Licken, actually talks about the story of a mortgage being his. Why? And we appreciate him coming on to the Mic'd Up Show. We are the ultimate hub where the hidden stories behind the mortgage industry come to life. I'm Michael Kelleher.
[00:00:27] Speaker B: And I'm Michael Zao.
[00:00:29] Speaker A: And in every episode we dive deep into the entrepreneurial spirit, the strategic insights and the breakthrough innovations that build the world's greatest mortgage companies. You have some entrepreneurs here, you have some top producers, and you have David Licken who has a background of actually buying, creating, selling mortgage companies. He has advised and coached some of the larger IMB leaders as well as advised some of the largest lenders I know have had a huge trajectory and he has been along their side consulting. I know him originally from about 2013 when he had his before the Word podcast. It was a dial in if you wanted to talk, but you could go on the web probably Internet Explorer was the big one back then and you could listen to him every week. And I had a feeling this was going to be huge. Not him, he was already the number one, not just in mortgage, but it, it transformed over to real estate, which is why his audience is six figures and, and why he's been on some of the TV shows which we'll get into and we're very excited to have him. So on this show, whether you're advancing your career or you're scouting industry leaders and who to reach out to or exploring opportunities in fintech prop tech, you're in the right place. So get ready to unlock the story behind every mortgage. Let's dive in.
David, thank you for coming on. I know at one point, and there's always a funny joke about when Randy Moss first heard from Bill Belichick that he was going to be on the team, it was in the club. And he kept hanging up on Bill Belichick thinking it was Frank.
I think you never knew you were going to be in, in front of people. You were sort, sort of thrown into the fire. But can you tell us about the time your phone rang and you went from behind the radio to now your face is going to be in, in front of TV screens.
[00:02:29] Speaker C: That's, that's a great. I always say be careful that you're not hanging up on your future destiny. And I tell people, you know, if you look at the robocalls I, I, they're getting so many. And so I can get the idea that I have a tendency to turn them down. But in this case, this was before robocalls were the real big. And I got a phone call from New York City, and I have a lot of friends in New York City. I work with a lot of Wall street people and I love playing jokes on people. I love being a jokester. I love to laugh and have fun. Well, paybacks can become with that. So I'm getting a phone call and the guy identifies, hey, this is Eric Spinano, a Fox Business want to have you as a guest. And I go, yeah, right. And I go, I don't know which one of my friends in New York is playing a joke on me, but I don't have time for this. And I hung up on him. The phone rang right back again. He says, this isn't a joke. Write down this phone number. This is Eric Spinal. I'm one of the executive producers here. I don't appreciate being hung up on when I'm trying to get you in front of millions of people. I go, well, guys, that's kind of an attitude. But yeah, it turned out to be a great friend. But anyway, so I took the call and I called him back. He says, fox Business. Now do you believe me? Let's quit screwing around. Let's get you on television. And so that, so I always tell be careful that you don't hang up on your, on your future destiny, because I don't know how many people have, but it's not an uncommon experience. So that's how I got into national television. They read an article that I had been published on or quoted in, and they wanted to get my perspective on television. So yeah, I went from the microphone and being not visible to all of a sudden, I'll never forget it. Michael and Mike, what happened was, is they, they mic you up. You go into what is a remote studio. They mic you up and they go, uh, they walk through checking you into audio and New York audio. So they check me in and then goes camera. And I go, and I checked with audio and I said, do you hear that beating and, or that, that thumping? He goes, no, I don't hear. I said, why, where, where is that coming from? I said, it's coming from my heart. I'm going on national television. I've never been on before. I thought for sure my heart was beating so loud, I thought for sure I was going to, that was going to come through in the microphone. They said, oh, he Laughed. Don't worry, you're only going to be on with about 8 million people. And then my heart really started beating. So anyway, yeah, we, we. You never know where things will go.
[00:04:44] Speaker A: No, you don't. And you obviously with Transformational Mortgage Solutions, you help people create their story.
You've been love helping story people create.
[00:04:55] Speaker C: Sorry. That's one of my passions. I mean, because most people don't tell their story well. And that's why I think I applaud what you guys are doing and the fact that you're diving into stories as you do. Kudos to you guys for doing this.
[00:05:06] Speaker A: And you're helping lenders understand that they need to use data to tell stories. But we'll get into that. I wanted to rewind before licking on lending on every Monday, you decided when your dad said, go work at the bank balance a checkbook. Right. Like you decided.
[00:05:24] Speaker C: Yeah, yeah.
[00:05:25] Speaker A: That mortgage might be something I want to get into at that moment when you first help somebody get into a home. Can you tell the story about Herb Kelleher? My. Oh, I. Not related. But what he does at Southwest and how you feel since COVID and working remote. Maybe some of these leaders need to get back to seeing what you first saw in their customers getting into their homes.
[00:05:49] Speaker C: Yeah. I actually had the privilege of meeting Herb. He was having. He always had breakfast at this one restaurant up in Dallas, and my friend lived in neighborhood, said, would you like to meet Herb Keller? I said, oh, my gosh, I'd love to. He said, well, come on, we're going to go have breakfast with him. And so, sure enough, he's sitting at that booth now. Herb enjoyed start drinking a little early. So he was feeling no pain already by breakfast. But that was just his lifestyle. But he was a phenomenal leader. And there's so many lessons that you learn from the book Nuts. It's a book that's been out for a while. If you don't have that book, go get it. Everyone should read it because it talks about the unconventional approach that he took to a very stodgy industry, the airline industry. It had been operating in a particular way for a long, long time. And Herb took a unique approach, a very unusual approach to the airline industry. And so I had the privilege of meeting him. I had a lot of questions and where did he come from, all those ideas. But the thing that was most impressive with Herb is that he was a relationship man. And this is the part that is so parallel to the mortgage industry. Our industry is a lot of process and a lot of details and a lot of aspects of that. So we have that element, as does the airlines. But he recognized what the number one job was, and that is to connect with his employees. He said, my people are the employees. And this showed up one time. You know, everyone's famous, and the stories at Southwest are really famous for the flight attendants come on. And they do the normal safety check, and they usually do it in a funny way. And some aspect of it. Well, there was this really, you know, persnickety type person who didn't think the flight attendant was taking it seriously, and. And she recorded the flight attendant doing it in a funny way and so turned it into Southwest as a complaint. We don't think that flight attendants take it seriously. I think comp. Safety is being compromised. Also sent it over to the FAA as a complaint. That's pretty serious when you do something like that. So Herb went and looked at the. He and his security, I mean, his team, operational team, looked at the video and they go, you know what? He checked all the boxes. That flight attendant checked. Every single box covered security perfectly. And what he did in that doing. So he did it in a way that got people engaged, did it with humor. And so Herb saw this.
You wrote the employee, his number one customer, his employee. He wrote him and says, thank you for taking such good care of our customers and wrote the customer who wrote the complaint. Sorry that our airline doesn't fit your approach. We recommend a number of other airlines. We will miss you. But when you can come back and appreciate what we do and the way we go about it here, we would love to have you back, but we're not changing said goodbye to the customer. How many CEOs would go out and grovel to get that one customer back and piss off a whole bunch of their employees who are just having fun and doing their job well?
Yeah. I also love the fact that Herb went out and he schlucked bags. He worked at the counter. I mean, and there's some leaders in our industry that have followed that example. I could give you some examples of that if you want. But, I mean, that is. Those are the kind of things that we need to be thinking of as leaders. What are you doing to get out of the executive suite and get out and go where the. The. Where the tire meets the road, where the relationships are happening.
[00:09:19] Speaker A: Do you have an example?
[00:09:20] Speaker C: Oh, I have a favorite one. One of my favorite ones. I had the privilege of Matt Ishbia's dad, Jeff, retain me to come in to work on some capital Markets matters that they had going on at the time. And while I was there, Jeff, Jeff said, would you go talk to my son Matty? He is, he's in there for the summer working as an intern, doing some work. I needed some help. I'm trying to get him to get into the mortgage business. So I went and met Matt Ishbia when he was in there just for a summer job.
And he said, no, I'm going to be out of here. I'm going to go. I really want to go professional. And this came out of my mouth. I can't believe it was fortuitous as it was. I said, matt, if you come in and do this well, you're going to be able to buy and own a basketball team, not just coach one.
[00:10:06] Speaker A: Wow, that's seeing the future.
[00:10:08] Speaker C: Wasn't that. That was one of those things that came out of my mouth and they had no idea how, you know, prophetic. That was the thing that impresses me when I was back there. So as a result, I'm very blessed that anytime I'm in town, Matt hears I'm in town. He invites me into his office, we talk. So anyway, I was in there a few years back and we were sitting and visiting. He had, he found out I was in the building, said, dave, come on up to the office, I would love to talk to you. And had me sit down. And so we had our meeting. We talked about things very graciously. The time as Nora knocked on the door, he says, it's time for your next meeting. So Dave, we need to be done, shook my hand, we left. And then I went into the men's room and using the facilities and there's this guy, it was happened to be an African American guy carrying a roll of paper that goes in the hand washing thing and was refilling that and he was whistling, had a smile on his voice and just had the best attitude. I looked at him and go, well, you're having a good day. He says, how could I not? I work for Matt Ishbia. And he told me that if I keep these bathrooms clean, I get to be an opener someday.
And I looked at that and I'm going, he knows Matt Ishbia. So I mean, he tells his story and he, he worked there with pride. Now you could tell where he came from. He had some teeth missing. The way his language, you could tell he had come from the. Probably the other side of the tracks. And that's not being demeaning. We all start somewhere. Some, we, some of us are Bo the right side and some on the left side of the tracks. But he saw the opportunity and Matt honored him. It doesn't matter where you're at in the organization, that's number one. So I got so enthused about that story, I went back to Matt's office thinking his meeting was in his office. So I went into the office and knocked the system. He said, well, he's not actually here. He's, he's in another meeting in the other part of the building. I said, well, where is he? He said, well, he's in the meeting. We can't really bother him. I said I need to tell him this story. And I, I, I, I, I'm sorry, it'll be just, just a minute. I gotta give this guy kudos and Matt kudos for how he leads to inspire a janitor in his building. And so they said, well, okay, we'll tell you the truth. He's sitting down answering phones in the phone center at the receptionist area. I said, he's what? Yeah, he works down there every day or some regularity. He's in answering phones. So I, they, she, she took me down there. I went in, it was just private room. There's the receptionist and then there's a room where all the phone calls come in. Sure enough, Matt is on at a cubicle answering phones. And so they handed me a splitter and I got to listen in on a call. And, and so the, a phone call came in and it goes like, yeah, how can I help you? And he, Matt answered the phone? Yes. And he didn't say it was Matt. He says, yes, how can I help you? Well, I've got this situation. Situation. He said, man, has anyone told the caller said, man, has anyone told you you sound a lot like Matt Ishbia?
And he goes, he goes, yeah, I get that a lot.
And so anyway, if you've heard the story, I don't mean to believe.
[00:13:03] Speaker A: I haven't, I haven't. I just thought that was the, the best line that was.
[00:13:07] Speaker C: I mean if it's, I, yeah, I get that a lot. When he started. So he pressed into the business now, but how can I help you? He, that guy caller came back, says, you are at Mattish be, aren't you? He goes, yes, I am. And how can I help you?
He drilled into it and it brought me back to Herb Keller. Herb took the time to meet with people at the gr, at the, @ the ground floor. It didn't matter if you were a grease monkey mechanic or schlucking Bags. Herb did it in his suit, take his suit off, take his tie off, and he'd get in in the heat and pack bags. That's the kind of leadership we desperately need. People can say a lot of things about, you know, UWM and the competition between them and Rocket and things like that. Let me tell you this. I celebrate good leaders. I don't care what the company is. I happen to respect UWM and Rocket. They both have great strengths, great visions, but it comes down to leadership. So the number one walk takeaway from this is whether you're a loan originator, don't hang up in your future, number one. Number two is don't stop serving. No matter where you are at in the hierarchy of your company or how successful you are, don't become full of yourself, get out and serve.
[00:14:21] Speaker B: Why do you think that when it comes to leadership at the CEO, at the presidential level, that we actually, outside of our shows, our podcasts and these shows, we know who they are at the C suite level, if you go to Housing Wire, maybe the economic summit and maybe some of the NBA shows. But if you're on the ground floor and you're just in your ll, even if you're a medium producer doing four, four to eight loans a month, it's not so prevailing to see leadership. Why do you think that is? That they're not out there doing more. More podcasts or more more or they're.
[00:14:56] Speaker C: Great question, Michael. Great, great, great question. You know, you don't want to be honest with you. The truth is, first of all, I think they have lost a sense of what it takes to do those jobs at the lower ranks and. And they become afraid to reveal their lack of knowledge. And so when you get operating in the C suite so much, you can forget how to process loan, how to originate a loan, and you get detached from people. That's why Herb Keller would go in and he never forgot how to pack the plane with luggage. You find guys like Matt Ishby are willing to get on the phones and answer phones. I wonder if the. How many executives listening to this have gone in and answered phones at their switchboard? How many of the janitors do they know in their building? And then what are you doing to motivate people? So I think what the number one thing is, and I think if you start you getting puffed up a little bit about yourself, you. There's also all the insecurity that's right behind it. Some of the biggest leaders in the industry are some of the most insecure people I met. And I don't mean that to be speak disparaging. It's because they haven't taken the time to go back to where they started and make sure that they have that knowledge. Well, yeah, they said, but the skill sets, Dave, to be a good CEO is completely different than what I had as an originator. I said, oh, really? Oh really? You think so? I don't think so. I think some of the best CEOs, I mean some of the best originators run their business like they are the CEO and they have the attitude we see this evidence is the best originator goes, no, Mr. CEO of the mortgage company that I work for, you work for me. And if we forget that a relationship I'll have someone else who values me and sees that you're here to help me do my job.
[00:16:38] Speaker B: Do you think that comes from a fear, a fear mentality versus a confidence mentality? Because it shows up in the shows up.
[00:16:44] Speaker C: They're one of the same, Michael. They're one of the same. If you think about it, fear or confidence, if you're not operating in confidence, you're either. There's a fear of component operating in the background somewhere in there. I think a lot of it has to do is we don't take the time to go talk to people that a rake could file to find out what their issues are. And it changes. I mean I've been doing this for 51 years. Started in September of 1973. I've been doing this for a long, long, long, long, long time. The basic mortgage originations hasn't changed that much, but how we go about making the sausage has changed some. And so a lot of us have gotten away from those, those details. And I strongly recommend advise people. When was the last time you sat and got in and worked this process yourself?
[00:17:26] Speaker A: You talk about how you now see vows as almost a catalog of betting against your destiny like you create. I vow not to do this. And then you don't know that it possibly closed the door of where you were supposed to go. Could that happen too where they say I when I become leader, I'm not going to do it this way. And then they forget that.
[00:17:47] Speaker C: And that's, that's the case of weak leaders is they forget and, but strong leaders, you know, I don't think they ever forget that. I think, I mean I had the privilege. When Casey Crawford was considering starting his mortgage company, he googled how to start a makeovers company. I was the privilege to come up at the top of the list and he selected me and I helped him do that. And we still have a great friendship and working relationship to this day. And the one thing that Casey never forgot was he saw the source of his income was always in the originator and he focused heavily on that. And anytime someone, a Casey is type person who has a charismatic personality that speaks to the originator. If any of them pull away from that at any point in time, you can watch the business start going down. We do not want to forget about the importance of operations. And it's got to be a good balance. We need to honor operations as much as we do anything else. But we definitely need to make sure.
Make sure. Aren't sure that we know who is bringing the business in the door and talk to them.
[00:18:52] Speaker B: What do you think leaders can do right now to talk to more. More originators and more support staff? Because we've been through this very tumultuous time and instead of. And you know, I know you talked about cutting costs in the past.
One of the things that I. I would like to propose to talk more about is instead of cutting the cost is investing more into the. The people. Very similar. Not if not in, if not in money, then in time. Very much like Matt ISHB did with the janitor and what he does down answering the phones. How do leaders make more investment instead of thinking about the cost cutting, but the actual investment in the people in time and in energy.
[00:19:30] Speaker C: Yeah. And what is the biggest investment we can make? It's not necessarily money, Michael. It's time. And it's taking the time to go know people, take the time to go meet people, to interact with people. That's the biggest investment.
It's always said people don't quit companies, they quit bosses.
And what we fail to do as bosses is stay connected with our people. So the number one investment, it does not cost money. Well, you say time is money, my time is money. Yeah, but if you think that your time is so valuable that you don't need to go talk to the grassroots of your company, I think it's a big mistake. Especially the ones that are making the money.
Looking at some statistics, we could talk about some of the statistics. The business intelligence is one of the most important things we need to be focusing on in this new season zoo area. We can get to that in a minute. But who is making you money? You should be talking to them, but you should be talking throughout the organization, inspiring them. And so I like doing investing in people when I tell the story quickly that at one point in time I became a top, top originator at a company and it got noticed by someone and another company came to offer me the president's job of a new mortgage company that they were starting. And they wanted me to come in and they wanted strong sales. So let's make the guy the president. Sad thing was I wasn't ready at that thing. So the good news was my bank that I was working for helped me see that. They pulled me aside and they said, well, congratulations on getting this opportunity. There's no surprise to us that you are getting these kind of opportunities. But Dave, we need to ask you, do you really feel that you're ready for this responsibility? Do you know this? Do you know this? Do you know this? And they asked questions, not in a. They didn't say, Dave, you don't have a clue about how to do this or that or manage a warehouse line or how to understand the capital markets. I didn't have that deep of understanding at the time. Had some understanding. I thought I knew what it was. But they didn't speak down to me, Michael. What they did is they spoke to me in the form of questions, causing me to do the self examination myself rather than saying, Dave, you don't have a clue about this, you're going to fail at this. They didn't approach it that way. They could have and have been totally legit, but how do you think I would have added to it? I would have said, I'm going to go prove you wrong with that attitude. Prove me wrong, I'll go do that job. But what they did is they asked me the question, they said, dave, if you'll stick around your two more years, I will prepare you to run a mortgage company. So when the next opportunity comes, you're going to be able to do that and you'll be able to do it well and we will invest in you. All I ask is for a two year commitment. They didn't have to pay me a signing bonus because guess what they were doing? They made a commitment to invest in my future.
[00:22:14] Speaker B: It takes some humble pie to do that. Do you see that very often with top producers? I know.
[00:22:19] Speaker C: Oh, it's, I'm gonna say on the.
[00:22:20] Speaker B: Producer level, the originator level, on the ground floor. Do you see that very much on the ground floor?
[00:22:24] Speaker C: Yeah, we do. I mean, we see a lot of people getting. Everyone's trying to recruit the top producers all the time.
That's without question. So what are they being promised? I mean, I think less and less that's being offered a president's job of a new mortgage company. It was a group of realtors that come together that were my customers. They wanted to get into the business. So that was the unique situation there. So it was my realtor base forming a new mortgage company and they had a builder that was help funding it. So they said this is, this guy's really good so we'll bring him in to run it. So I think those opportunities. But they're going to show up in different ways today Michael, that we have. But again, people are going to be more involved with or going to stick around more when you invest in their future. But do you even know what their future, their goals and plans are? Maybe it's just to do more volume. Some people should be challenged to go open their up company, especially the complainers, the ones that are complained the most. You say, oh man, it sounds like you really want to run your own company. Yeah, I think I do it. I think I do a heck of a lot better job than you do. I mean that arrogant attitude, just say, you know what, you probably could but, but let me help invest in you to help you achieve that goal. All of a sudden you go like wow. Because it's a servant's heart. You come in and willing to serve that ego and you help eventually help them remind him he doesn't have a clue what he's talking about running his own company. And if you help them get there, guess what, I know one particular company that was all retail and they developed a really good job of recruiting people and guess what? They went out and they started getting losing people to other companies getting hired away. And so what he said is Dave, he called me, he says dave, you got a strategy for this? I love strategy. Again, name of my company is Transformational Mortgage Solutions. I like bringing solutions to problems. I go, yeah, why don't you ask these people that are getting recruited away, some of your top producers if they'd like to start their own company someday, give them the option. If you stick with me, I'll help you train you up. So they opened up a broker division, a wholesale division off of broker wholesale division, synonymous in my language. And they started helping their top producers open up their own mortgage brokerage operations. They still captured the volume because now they're running their own business but they're broken into the company that they left. And guess what, the mortgage Banker want just 1 of the volume did it have me love to have it when it's coming from his own loan officers. But if they're going to grow up and Go away. He helped them create their own future. Someone went on to be bankers, so he formed a correspondent operation. He continued to get the loans from the originators that were in the business and he did it in such a way as to help them grow. And he got that. He kept getting their loans. Isn't that interesting strategies? It is.
[00:25:13] Speaker A: And I think our industry brings out interesting strategies because there is no residual income which the consumers probably don't even realize because they're paying a monthly payment. Right. And so it's either money that drives you or maybe freedom of schedule. And there could be somebody above you that's not giving you that. We are able to do what we are able to do because of our wonderful sponsors. So I have a question for you David, on the other side, but real quick, we're going to hear from two of our sponsors, Mortgage Connect and Admit.
[00:25:42] Speaker D: Want to take your business to the next level? As a longtime trusted mortgage service provider, Mortgage Connect works with some of the largest lenders, servicers and institutional investors providing cutting edge solutions for everything from title, closing, escrow and default to capital markets and risk solutions. Mortgage Connect brings it all to the table, redefining mortgage lending with innovative digital solutions that can elevate your bottom line.
[00:26:17] Speaker E: It's time to use AI to revolutionize the way you do marketing in 2025. With ADM Intelligence, we have access to 5,000 consumer data points and proprietary AI technology that helps you understand who is in your database. What's the likelihood of people to do a real estate transaction?
Also who they are. 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 327 or go to our website thinkadium.com, love to walk you through a custom demo of how AI can supercharge your marketing this year.
[00:27:03] Speaker C: Both of them, both of them are outstanding. I know Spencer really well. I love the guy.
[00:27:08] Speaker A: Yeah. And people have been writing down what's this data. And then on the Mortgage Connect side you have Gabe Mitten, you have Kim Hoffman, you have Christy Ward, you just have these stalwarts of information and you need information at a time like this.
I was going to ask you. So I first went on your show in 2013, which was a really big deal because at that time we were considered outsiders and I think I noticed the industry is a lot more welcoming these days. Back then you had different groups and most of the tech innovation came from within the mortgage industry or in that leadership. So you really bet on me in the beginning. You got to see from there really a meteoric rise. We were doing 5 billion and 200 CEOs now were using me. And then sort of a fall where Simple Nexus and Encino and now we kind of say we're back here because it seems like there's an opportunity for a lower cost mobile solution with Rocket and Zillow Jones super apps with all that I heard you talk about as you advise in your coaching part of Leaders. You call it the widget, an acronym for six geniuses. What genius did I miss out on where I where I wasn't able to stay up there at the top, right?
[00:28:27] Speaker C: Well, it's not necessarily a genius you missed that you have to possess. I think what we need to do is recognize what our geniuses are and then surround ourselves with complementary geniuses. So if you we'll run through it real quickly the word widget. Again, this is the six working geniuses. Patrick Lencioni championed this or came up with this concept and it's brilliant and I think it solved more problems than anything else. And I recommend people to check this out. Go do assessment. It costs $25. Go do the assessment. It'll give you so much insights now it's nice to have someone like myself who's gotten certified with them and be able to part of Capa Pro there for a long time and be able to go in and help interpret the what's going on. But yeah, thanks for putting that up there. So six Working Geniuses by Patrick Lencioni and you can Google that and it'll come up. Take the assessment. So here it is. So the first two is for the. The word widget is an acronym. First two stands for wonder and invention. Wonder is, is the genius of creating something out of nothing. People who sit around think about, I think about this, the, the iPhone. Stephen Jobs. You know, it's not totally quite accurate, but in essence Stephen always wondered about why do we have to do this? Why can't we do this? I mean it's the people that invent something out of thin air that never existed before. The people with that's a gift or the genius of wonderment. The gift of invention is Someone and a gift. Genius of invention hears someone with the gift of wonderment, and they start thinking of ways, I think we could do it this way. I think we could. They invent the way to create the product or service that the person with wonderment does.
The D of dub. So that wi. The D in widget is discernment.
Now, how many good ideas have come to any of us that are terrible? The gift of discernment, the genius discernment helps us do something stupid. And so we need to either have the gift of discernment or more importantly, in our case, my case, I have the gift of innovation or invention.
I can create ideas, but I need to have someone with discernment around me. Is this a good idea? The service you're bringing out does it. So it's either yes, no, or not now. So there's sometimes the not now is a timing issue. So some ideas should never come to market. Some ideas should come to market now. And then comes the next. The G as galvanization. The genius of galvanization is someone who creates inertia for an idea that had never existed before. A new phone with no buttons. How's that going to work? They create excitement. That's. That's my other. So my top two working geniuses is invention and galvanization. So I am looking at ways to stir up energy or on a concept, an idea. A lot of people come to me. That's why I found you, Mike. Early on, I saw your potential. I saw what you're doing. I saw more important. What I loved about you, Mike, is your heart to serve. That was the most important thing might you have. And anyone listen to this, you need to go study and model Mike's heart to serve. It wasn't about how much money I was going to make. It was about I want to serve the community with this service, with this product. And that really caught my attention. I thought, but this guy's going to. This guy's going to make it. So I wanted to have you on my podcast early so I could have that bragging rights. So I had him back on. I had Logan Motashami of Housing Wire on before he was there. He was back at a loan officer, loan originator, way, way, way, way back when. There's so much fun, fun. To see him now at the Housing wire and at the economic summit was really brilliant. So anyway, one of the things, so the discernment one is the gift of being. Figuring out galvanization now makes things happen. I look at it, a flywheel they start and getting. So an object of motion stays in motion. An object at rest stays in rest. Galvanizers create motion when there is none. They just have a genius for that. Then those are the two. And those are. The first two are the ideation gifts. The second two are the validation and momentum gifts. Then comes the get or done gifts. The E is enablement of the word widget and T is tenacity. Enablement sets up business processes consistently creates a process by which this can get done. And then tenacity is the group that works in the red zone. They how many people create a great idea? Hits discern, they get momentum going, they get it, they're starting to generate, but it just doesn't get traction. That's the, that's the genius of tenacity. The tenacity group is the one that goes in and drags it across the finish line. Just sheer grit, gut force makes it happen. So here's the thing. Well, Patrick's, when you did test it, you're going to find out which of those widgets, which of the letters, you know, wonder, invention, galvanization, discernment, galvanization, enablement. Tenacity. What are two that you have as your genius?
What are two that have as your working frustration, and what is your working competency? Let me explain. A working genius is that which gives you life. When you are working and you're a working genius, you come home, you want to hug the kids, you want to hug your wife or spouse, and you want to love on everybody. If you're working and you're working frustration, you come home, I don't ever want to go to work. You just let me go to my room. You want to kick the cat, kick the dog, you're not interested in talking and engaging with your kids, and your wife goes, wow, what a grump. That means you're working in your working frustration. The working competency is the middle one. That is where you're working in something that doesn't suck the life out of you, such as the working frustration, but it doesn't necessarily bring you life. How many people are working in jobs and they've been in that job for years and years and years because they're. And they're. It's their working frustration. It's sucking the life out of them. They usually die early because of health issues.
How many working in the working competency?
It's kind of meh. Those guys can't get to wait to get to retirement because they, I mean, doesn't bring them life. But then there's guys like me who's working in my working genius, which brings me life. I'm 74 years old and I, I got more energy guys than you can possibly imagine. Pick up, pick up on my enthusiasm here in this, in our conversation today. And so find the thing that is you, that is your genius and how, where you. That, that is and work in it.
I'm a podcaster. That's galvanization consultant coach. That's innovation. I love solving problems. A lot of people go, when you bring me a problem, they go like, ah, I want to run out of the room. You give me a problem, it's like, oh, good, bring it on, bring it on.
It brings me, you know, I read.
[00:35:21] Speaker B: A lot on LinkedIn, especially lately. Like, this is the news about what's going on with the guidelines with, you know, fha can't do xyz, FHFA says you can't do it. PDQ or whatever it would be. If you're an originator or if you're a leader of a leader of an origination team, then what are you taking to make the mouse trap? You have this mousetrap. Instead of thinking, what do I not have?
What can I create to make, make it better? If you're an originator, you know, I know you've talked a lot about, hey, just go get more Realtors, go make four phone calls. Maybe. But you know, everybody's doing that. And in the past about fiscal literacy with the, you know, Baron Habib would talk about this a lot in the past. Yeah. What, what would you tell an originator today? Hey, I'm already making 20 phone calls a day. And out of the 20, I'm picking up four appointments. But with my team, we can do more. What are we doing to think out of the box with the programs that we do have instead of what we don't have?
[00:36:14] Speaker C: Sometimes I think it's like it's, it's less about the program, certainly not about the rate. The rates are what they are. We're all selling the same rates, not within a certain bandwidth. And everyone wants to have the lowest rates. I always say to the ones that have one of the lowest rates, if I have the lowest rates, why do I need you? I'll go price myself in. And I don't need salespeople because I'll just go out and be the low cost leader and bring in the volume. So I think, I mean, I interviewed Brian Hale yesterday. I respect him tremendously. He says, I always price myself in the bottom, top third of Interest rates. In other words, I was not the most aggressive, but I was in the bottom third of where that rate cycle is because I don't want to be the cheapest. I'm giving up too much margin. So I think what the key is, what you're talking about, Michael, is I'm telling everybody to use Business Intelligence. In 2024, there was just under 2,000 real estate agents.
Only 1,000 were 2 million. 2 million. Only 1 million. 81,690 wrote one transaction the whole year, 50%. And then the statistics get really interesting. And I want to give Steve Winans, co founder and CEO of Redder, the credit for these numbers. He was out there giving me some of these numbers. We were just talking before we got on here. It is staggering. It's not Prado's law, which was the 80, 20. It's way worse when it comes to realtors. So then I asked, who are you calling on and why are you. Do you even have any business intelligence? Do you have any logic? If you have a salesforce and you're managing a salesforce and you're not asking your people who you're calling on and why, or more importantly, point giving them the tools, like there's all these wonderful tools out there that help point you and where you should be making your sales calls. If you're calling on that 1 million loan originators that didn't do any. I mean, realtors are not dinners a single transaction, what do you get? I don't care. You're selling the best. Now here's what's really interesting Steve brought up of Redder, CEO of Redder. He says what you don't want to ignore is the new entrants. There's a lot of new agents coming onto the market every single year, and those are the ones. And it's discerning which one of those are that are going to rise to the top. It's also interesting to see the number of agents that exit the industry each year for whatever reason, and they may be some of the top ones. So I think we need to be using business intelligence tools, Michael, to be able to select who we're going to target. And that needs to get constantly reviewed. And then the other thing is get to know them. When are you going to come through the door? What are you going to come through the door with that's unique, your unique value proposition? So there's so many strategies on that, but I'll put a. I have a tendency to go on and on. So let you guys.
[00:39:09] Speaker A: Yeah, I'LL I'll tie it in. So I also saw one of these intelligence tools. I don't know the exact one, but a staggering point that if you took the bottom 50% of loan officers in 2023, less than 1% of them actually made the top 50% in 2024. So it goes against every idea that you can actually make more money if you just coach all your people to do for, go from one unit to two units if you don't have it. And I spoke to somebody today who said, at a large bank, have, have you ever originated? I said, yeah, 12, 12 years. So, you know, either have it or you don't. And it's very hard to have it.
[00:39:47] Speaker C: So.
[00:39:47] Speaker A: But with all that said, the new entrants kind of stand out to me. Dave, you had mentioned on another podcast, a book, I think it's called Sulliman's the Coming Wave that you're really into. So, yeah, I think that Mustafa.
[00:40:00] Speaker C: Suleiman.
[00:40:00] Speaker A: Suleiman. So I think that underscores the dual impact of the technology disruption coming and then maybe some parts of this rapid monetary policy changing and unpredictable. When you put those two together, who do you see as the next new entrance? Actually, better question, at what point is a good time to come to your advisory solutions to make that, that step where they're, they're ready to go and rise versus go and sell out?
[00:40:33] Speaker C: That's good. Yeah, it's a really good point. I think there's, there comes a point in all of our life cycles, especially if you're out working, you're working competency, you're working frustration. When things change, you're frustrated, you want out. So you're probably going to sell and exit. When we start seeing the kind of shifts and changes that are happening, we're at the place right now where we're not just having a change, we're having a complete Teutonic shift, shift, almost a polar shift and how business is going to be done. And I recommend the book the Coming Wave because AI is going to dramatically shift and change how our business is done being done. It's already happening. Some of my, I mean I have true. AI is one of my advertisers, Angel. AI is one of my, the sponsors as well. And I, they're one of my clients as well. I love seeing the new, new coming. The question a lot of times happens to be, when is it going to happen? They say, you know what, Dave, I'm all for getting on board, but I don't want to be on the Bleeding Edge. There's a great book called Crossing the Chasm. I've got it up here on my shelf I'm looking at.
And it's the they in the book it talks about the early adopters.
The early, early adopters, which is just, I think it was like three and a half percent. Then there's the, there's another one that's just a little bit where people start coming in and then there's the early majority and the late majority and the laggards. And I think where a lot of our industry has been is they've been late majority, late to the party. You need to be an early adopter. There's the cutting edge and the bleeding edge. I like being on the cutting edge of things. And the bleeding edge is there's a lot of mistakes being made. And so you have to use some wisdom on that. But what's real clear when you read the book, the Coming Wave, interestingly, he's now the president of AI. Suleiman is the president of AI at Microsoft. Became that after he wrote the book. And what's so interesting about that is that it is revolutionizing virtually everything and it's to our advantage in the mortgage industry. What is the mortgage industry really about? Yes, we have all these process, we have all these things we have to do, but that's where AI performs extraordinarily well. AI comes in and takes all the busyness out of the processes and does it automatically. And it frees us up as humans to relate. You say, well, I'm an underwriter. I mean, I did all those details really, really well. Well, wouldn't you rather be who is your real customer? Do you find your identity and be able to do the ratios really quickly and do the analysis and underwrite the loan? Or are you here to help instruct the loan originator to become more effective in selling out there? I think every rigid underwriter should see their customer as originator and help them grow, use the technology, use artificial intelligence. We've had au, I mean we've had DU and LP for around for a long, long time. So we've got those tools. But the new AI, like what specifically what PAVAN is doing at Agel AI, you can get an approval as soon as the documents are up, but usually within minutes. And if it's a little more complicated, a little bit longer, no more than 2, 3 hours.
Get a fully underwritten approval with Pavan's personal guarantee that if that loan isn't saleable, he will buy it.
[00:43:55] Speaker A: Wow.
[00:43:56] Speaker C: That's how Confident he is on his technology.
[00:43:59] Speaker A: If you took all of that out David, what are the cat like? What are the things a leader of 100 Loan Officer 200 Loan Officer IMB shop would need to know to be a leader or they shouldn't get into the industry. Is it. Does it just come down to capital markets and being able to sell or what?
[00:44:15] Speaker C: Well I think capital markets you can always hide there the capital not markets knowledge you can always do that. It's really do you have inspirational skills? Because you're either going to be inspiring the realtor to start, you're going to be inspiring the loan originator and or you're going to be inspiring your growing organization.
Go back to Casey. He's one of the most. He's probably the poster child for being inspirational kind of guy. And. And I think so the number one thing is do you what have you done to develop this the skill set to inspire I one of the one of my clients, Bobby Nicely over at Alcova Mortgages a great guy. He consumes books like you cannot believe the rate at which he consumes books. He is constantly working on his game and it's to inspire his people. And I love hanging around people like that. You just can't get enough of these people that are hungry to grow that are constantly insatiably curious about what is out there. There's a book out there. Thanks for the feedback. That's one of the books that had been recommended to me. But Unusual Hospitality was a book that that Bobby Nicey read and it's about a restaurant business, the number one restaurant in New York and how it became the number one restaurant in the world and what he the principles that are in there they go why. Why would I as a business, a mortgage banking owner want to read a book from a restaurant owner? What are the parallels? You'd be shocked.
Uncon Unusual Hospitality.
[00:45:58] Speaker A: It is my favorite book and if I was going to be advising industry leaders it would be everything out of that book.
[00:46:05] Speaker C: Are you familiar with the book?
[00:46:06] Speaker A: We can go into it on another episode but I don't think there's a better book to read on customer what you should be doing for the customer to separate yourself.
[00:46:15] Speaker C: Yeah. And I think so. You asked me what should someone who's coming up what are the solutions if they're going to work with beyond. First of all, I think people the reason people come to me is they will come because they have an idea but they know what they don't know. And I got 51 years I've owned three mortgage banking companies. I've had a number. I've had a software company, one of the first loses in the market that went public, that product went public.
So I'm an innovator in that standpoint. What I do, the first thing I do when I start working with someone, as I look at, is, what is your God design? You know, you're going to get religious on me. No, no, no. I mean, I happen to believe in God. I am a strong Christian, but I come back to this. What is your God design? What is your creator design? How are you uniquely designed? We start there because there's too many people trying to be Michael Keller or Michael Zo or Casey Crawford. We're imitating. You don't become successful imitating someone else. You become successful at polishing and honing your skills to be good at what you do in your unique way. No one can compete with that because there's only one of you. There's only one of me.
[00:47:25] Speaker B: If AI can create so much efficiencies, do you think that with, let's say, underwriting or ops, should they be with the sales teams, the originator teams? Because AI can create, you know, if you want an underwriter to have so many types of touches internally, right. AI can create deficiencies, but every time the originator goes out into the field, the realtor doesn't say, oh, yeah, I got this deal with 20% down with great credit scores and $1 million in the bank. They go, you know what? I got this one buyer that, yeah.
[00:47:53] Speaker C: You know, this goes back to what. How do you capture the sense of a small company? Remember when we were a real, real small company, we had our underwriter, processor, and everyone's sitting in the same rooms, oftentimes in the same cluster, and we overheard each other's conversations. Michael. So if an underwriter or a processor overheard their loan arranger talking to someone struggling with it, they tap on the shoulder, say, and they give an answer.
So what I now believe, and so I'll never forget. Todd Scream. I can. I can share this with you because he shared this. Todd. Todd Scream. He's a good friend, a client. And I had the privilege of working with him for a good number of years and advising him and coaching him. I love coaching. The best of the best. And I put Casey and Todd and all these kind of people up there, Matt. At that level, I love coaching the winners, but I had the privilege, and I brought this concept of pods up to Todd Screamer, and he goes, pods, that's the worst idea. I'VE ever heard. He pushed back on it. We've got to have all our underwriters in one room and around one thing, and they got to be around there, and they share their ideas there. I said, it's a good idea. I understand that, but it works much better. Finally, one day he came along and tried it. And I'll never forget that phone call, one of those rewarding phone calls. He goes, licken. You know how much I thought that was the stupidest idea you've ever come up with? I am now designing my whole company around it. The pod concept works.
And the nice thing about it, back then, we didn't have AI, Michael. Now we have AI Making the decision kind of in the central back room. The underwriters, the processors, we're all here to create a great experience and fill in the blanks that AI Leaves, because the AI is as good as it is, still doesn't have all the answers and everything. So we still need the humans filling the blanks. But the job of the underwriter, the processor, all the operation is let's make our salespeople better, find out what they do well, and you fill in the blanks, supporting them well.
[00:49:51] Speaker A: This is a masterclass on what our audience is, which is those aspiring loan officers and aspiring underwriters or real estate agents. Somebody saying, I think I could get into mortgage, and I think I could lead a great mortgage company. Well, you're sharing with us a lot of wealth of knowledge. I want to thank you for coming on the show. Before I take us home, Michael's out. Do you have any final questions for David to sum this up?
[00:50:18] Speaker B: No, I. I think this, this, this was amazing. Thank you, David, for coming on our show. I didn't say thank you before, and. And I think that the. Again, masterclass going down on how to use AI, how to create efficiencies, and even more so, how to look at ourselves, how to be introspective in a positive way, to not just look at us and go, oh, woe is me. But to be positively looking at us going, this is. These are. This is the skill set that I've been blessed with. And other people also have been blessed with different skill sets. And I need to be able to acknowledge that and then. And then run with that ball with that type of acknowledgment. And so it's that type of acknowledgment that we have in the business that we don't get enough introspection is not just to look at us in a negative way. Introspection is looking at thinking and knowing what are our strengths so that we can also help others glean that and then we can use it for productivity in our, in our business.
[00:51:13] Speaker C: And I think that's where a third party like myself can come in and bring value to someone is sometimes you look at the same mirror all the time. You look at their face, you go like we get, we get a little used to our way we look at or the way we behave and how we act. I think a third party, for example El Coville Mortgage was really frustrated with their operational staff. They, they didn't have the six working geniuses. They were frustrated. Why is it that we always have to come, we the own always have to come up with all the new ideas around here. I said that's what we took the test. The six working Jesus. Well guess what? The owners 3am the three owners of Alcova Mortgage are all gifted in innovation and innovation and wonderment and innovation. They countered. They subconsciously hired people on the other end. The enablement tenacity to get that done.
What brings them life is coming up with new ideas. What gets the operational team excited is getting things done. What frustrates the operational team is become asked to come up with new ideas. When they came up with that they all of a sudden they're going oh my gosh. We've been asking people that are not even wired or designed to come with new. I think the ideas to come up with new ideas. It was revolutionary.
[00:52:23] Speaker A: Yeah, you need as somebody on the wonderment side you definitely need those executioners and you want them in, in the world of loan quality. Right like that's where want them. So all along they had the right people in the right spot. So they didn't honor them.
[00:52:38] Speaker C: They didn't honor them, they didn't understand it. And when we get a grid for that that's what gets so exciting.
[00:52:44] Speaker A: And you do need an outsider to be able to tell you these things. And I, and even if you're going to go in and work with the, the employees, they're going to tell an outsider like you, David, that things that they're not going to tell their manager like oh, I actually keep you know, notes over here when I'm processing the loan. So it's like we told you not to do that but they're doing it for a reason. Something's inefficient and that's why you need an outside person to come in and fix those things. So thank you again. They can find you where can, where can everybody find Licking on Lending? It's every.
[00:53:23] Speaker C: Well, the free the free consulting you get by Licking on Lending is a website. Go to licking on lending.com last name l y k a e n on lending.com they can go there and that's free. It's all that information. We just give it away. We have to thank our sponsors for providing that, helping to provide that for free, help cover the cost of that. And then if you want to get into the coaching, executive coaching and consulting, then you go to Transformational Mortgage Solutions or TMS Dash Advisors. Either one of them will get you to that place.
[00:53:52] Speaker A: We'll get those in our show notes. Thank you for joining us, David thank.
[00:53:57] Speaker D: 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.
