Mar. 2: How to evaluate LOs; Chocolate & banana prices; Climate lender conference; Classes for men; Saturday Spotlight: BondXN
If you say that there’s nothing new out there under the sun, you’d be wrong. How about a song from a pizza slice? Many of us enjoy a good slice of pizza, or nearly anything with chocolate in it. Measures taken by the U.S. Federal Reserve can influence the inflation rate, but the Fed can’t set commodity prices, like cocoa. The raw price of cocoa has nearly tripled, with prices per metric ton rising to $6,000, up from $2,600 per ton this time last year, and drought and disease in West Africa will mean prices can only get worse. Some good news, especially banana bread makers such as myself (yes, I add chocolate chips), is that bananas are one of the rare grocery store purchases that don’t induce inflation-driven sticker shock. The average price of bananas hasn’t risen above 80 cents per pound since 2004, IMF data shows. What’s keeping prices low is a combination of huge plantations with good growing conditions, low labor costs, trade agreements, and the need for sellers to move the fruits fast before they’re brown and only good for banana bread. I seem to remember sensationalist headlines some years ago about the #1 banana variety going extinct. So much for that… Let’s move from inflation to mortgages!
Saturday Spotlight: BondXN
“Engage the market with confidence!”
In 3-5 sentences, describe your company (when was it founded and why, what it does, where, recent growth and plans for near-term future growth).
BondXN is a fintech company founded in 2018 with the vision of creating an electronic trading and analytics platform for Securitized Products. The platform delivers a cutting-edge digital network that is transforming the $3.5 Tn Specified Pool Market. It aggregates market and trading data that helps facilitate liquidity sourcing, price discovery and best execution. Users can seamlessly communicate and transact with multiple counterparties, in real-time, over a secure network.
BondXN provides an all-encompassing solution for the full market ecosystem – buyside, dealers and originators.
Historically, originators sent out BWICs in all different formats, with no standardization. Dealers wasted time deciphering the nuances of lists, rather than producing timely, competitive bids. Bids were managed with pen and paper, referencing manual spreadsheets.
BondXN standardizes key BWIC information, distributing lists in a format that is easily digestible for dealers. Furthermore, originators no longer have to manually enter bids; the platform aggregates bids from dealers electronically and via email, streamlining the entire BWIC process, from creation to striking. Dealers can quickly redistribute BWICs to the buyside, gathering stronger customer bids. BondXN improves originators’ productivity while connecting them to their counterparties in an efficient way, without eliminating dealer relationships.
Tell us how your company maintains its culture in a work-from-home environment, or how you plan on bringing employees back into the office, if applicable.
In the start-up world, we wear many hats, and have different experiences. Cultivating a communication style is key, especially since our employees are across the country. Trust is implicit! Fundamentally, we all have a sense that we have a common goal, and we all utilize our unique skillsets to inch closer towards that goal every day. On the sales side, especially, it’s critical that we accurately articulate our clients’ needs and concerns to the developers – we know the best ideas come from our clients, so we need to ensure their voices are heard!
Things you are most proud of that don’t have to do with sales.
The quality and depth of knowledge on the developer side of BondXN. And our deep experience in Securitized Product markets. Our developers are well-versed in the nuances of Securitized Products and do not take a one size fits all approach to solutions we introduce to the market.
The background of our team is diverse, but applicable to our goals. We have traders, FinTech sales and video game architects! Despite our various backgrounds, there are certain traits we share: a passion for solutions, a high degree of integrity in what we produce, and an insatiable entrepreneurial spirit!
We host an annual beer pong tournament. Last year, the interns won.
(For more information on having your firm’s extracurricular activities, employee growth, and your charitable side featured, contact Chrisman LLC’s Anjelica Nixt.)
Does climate impact anything lenders do?
Of course it does, regardless of the source. If your borrower can’t obtain homeowner’s insurance, or an investor won’t buy the loan, it impacts your business. On the topic of climate change, manmade or natural, Ryan Kingsley writes, “Lots of leadership in this industry are trying to wrap their minds around this issue: Buyer Beware: Unpriced climate risks the housing market’s bubble in the bloodstream. Anyone in California, Florida, or Texas, three states near the top of any list in home lending and in natural disasters, understands. In April leadership from nearly every government housing finance-related agency is gathering in Maryland, alongside housing/finance leaders, climate scientists, data analysts, and various thought leaders to collectively address this issue. The costs of owning are already outpacing the costs of buying in some markets.
Looking at employees the right way
From California, CrossCountry EVP Hunter Marckwardt penned a note about employees and productivity, and how managers should evaluate individuals. “If you’re responsible for anyone else in our industry right now, you have to acknowledge it’s a challenge. I just looked up, ‘How many loan officers have left the business?’ The source suggested 37 percent of all loan officers have left (I thought it was higher) and then it also gave me this. ‘According to data from Ingenius, tens of thousands of loan officers exited the industry in 2023. In October, 67 percent of current LOs produced less than one unit of closed loans in October. An additional 21 percent closed 1.5 units per month and only 12 percent closed greater than 2.5 units.’ Those are crazy numbers. So, if you’re a branch manager, a regional, a divisional, or an owner, how do you figure out where to help? The truth is, most LOs need help right now.
“Our team has been working on a quadrant to help identify who needs help, how to help, and how much time to allocate to help. Like T charts which help make decisions, quadrants help identify and clarify. Stephen Covey came up with Urgent, Not Urgent, versus Important, Not Important. Every quadrant I’ve ever come up with comes from that thought.
So here is the quadrant we’re working to help identify loan officers working with us: 1) Positive and producing, 2) negative and producing, 3) positive and not producing, and 4) negative and not producing.
“Any company will have different definitions of what they consider “producing” or “not producing.” But there aren’t any reasons why a lender wouldn’t want to bucket team members in these 4 groupings, and in turn ask LOs what bucket they think they’re in. Our thought around this project is to make sure we’re helping each quadrant ‘move up the chain.’
“I think any good human/leader wants to help everyone they can, but it’s not possible. You must be aware of where you allocate the time to help, and you can’t do that without understanding who deserves the most help, and who wants it! If I was asked to describe the personnel inside each of the four buckets, this is what I think they’d sound like
“’Positive and producing.’ ‘This market is hard but I’m gaining market share, it’s a grind but I’m growing, and I appreciate the challenge. My efforts today will pay off down the road. My business partners and clients believe they’re better off with me as their lender and I’m gaining traction. I’m looking for advice/input, I’m listening to others for what is working and what is not, I’m open minded.’
“’Negative and producing. ‘Thank God I have the will power to grind it out even though I can’t stand this job or this business right now, I’ve been around long enough where clients still come to me, but I’m burnt out. I maintain a positive face but any chance I have to complain to someone else, I’ll take it. I’m close minded and not interested in what others have to say, my job is a necessary evil.’
“’Positive and not producing.’ ‘I’m hopeful I can survive this business, I like what I do, but I’m not sure what to be doing on a daily basis to succeed, I’m drifting through my days trying to figure out how to work with business partners and clients, I probably need to spend more time executing on what I need to be doing vs. thinking about it.’
“’Negative and not producing.’ ‘This business sucks, my company sucks, the people I work with suck, no one has any good ideas, and I’m not willing to try anything, I take no advice because I know it won’t work, and I know more than anyone. I’m completely closed off.’
“It would appear I’m only talking about sales above, but I’m not. Ops are going into the same quadrants; you can replace the words “producing and not producing’ with “helpful and not helpful”. Just line people up in your head, I can identify loan officers and ops team members that fit in all 4 buckets.
“The goal is not to scare everyone, but to take an honest assessment of where you think you fit. I can guarantee this: there are a lot of people that think they’re in box #3, when we would consider them in box #1. From my perspective, when you see these quadrants, we start to figure out where we allocate our time to help. Every manager is different, but if I went off of percentages, I’d allocate 50 percent of my efforts to helping box 1, 30 percent for helping box 2, 19 percent for box 3, and 1 percent for box 4. I want to make sure I’m clear: ‘negative’ is very different than challenges you have to work through, and I’m not suggesting everyone needs to be ‘Pollyanna’ to be in categories 1 or 3.
Hunter’s note finished with, “Why am I sending this? I think it’s worth sharing. I think it’s worth self-reflection for anyone in our business to consider where they currently fit, where they want to fit in in the future, and what it would take to get there. I think anyone that has any type of leadership role also needs to consider the value they’re bringing right now. If that 37 percent is accurate (I had heard up to 60 percent), I believe it will continue to grow. There is nothing easy about this business right now. I only know it’s a very smart exercise to be deliberate on who needs help, who deserves help, what help they need, and how you solve for it. I like the idea of walking around the office with a number attached to you, what number would you be?” Thank you, Hunter!
The CFPB, FTC, and Ocwen (Newco spelled backwards)
Although she “keeps her cards close to her vest,” my cat Myrtle doesn’t seem to be the CFPB’s biggest fan. Does the CFPB know anything about a free market? If your rates or fees are worse than others, your business suffers or vanishes. The CFPB sent out, “Mortgage fees and other costs have risen significantly in recent years, and costs for homeowners are driven up if companies in the mortgage industry can pad their profits with illegal junk fees.” In this particular instance, Ocwen is mentioned. “The CFPB and the Federal Trade Commission found that one mortgage servicer is arguing in court that it can charge people fees for paying their mortgage online or by phone, instead of by mailing a check, even though the borrowers didn’t agree to those fees when they took out their loans and there isn’t any law affirmatively allowing them. We filed an amicus brief to help ensure people can hold covered mortgage servicers and other debt collectors responsible when they charge prohibited fees.
SUMMER CLASSES FOR MEN
REGISTRATION MUST BE COMPLETED BY Monday, April 8, 2024
NOTE: DUE TO THE COMPLEXITY AND DIFFICULTY LEVEL
OF THEIR CONTENTS, CLASS SIZES WILL BE LIMITED TO 8 PARTICIPANTS MAXIMUM.
Classes begin Monday, May 6, 2024
How to Fill Up the Ice Cube Trays — Step by Step, with Slide Presentation.
Meets 4 weeks, Monday and Wednesday for 2 hours beginning at 7:00
The Toilet Paper Roll — Does It Change Itself?
Round Table Discussion.
Meets 2 weeks, Saturday 12:00 for 2 hours.
Is It Possible to Urinate Using the Technique of Lifting the Seat and
Avoiding the Floor, Walls, and Nearby Bathtub? — Group Practice.
Meets 4 weeks, Saturday 10:00 PM for 2 hours.
Fundamental Differences Between the Laundry Hamper and The Floor —
Pictures and Explanatory Graphics.
Meets Saturday at 2:00 PM for 3 weeks.
After Dinner Dishes — Can They Levitate and Fly into The Kitchen Sink?
Examples on Video.
Meets 4 weeks, Tuesday and Thursday for 2 hours beginning at 7:00
Loss of Identity — Losing the Remote to Your Significant Other.
Help Line Support and Support Groups.
Meets 4 Weeks, Friday and Sunday 7:00 PM.
Learning How to Find Things — Starting with Looking in The Right Places
And Not Turning the House Upside Down While Screaming.
Monday at 8:00 PM, 2 hours.
Health Watch — Bringing Her Flowers Is Not Harmful to Your Health.
Graphics and Audio Tapes.
Three nights; Monday, Wednesday, Friday at 7:00 PM for 2 hours.
Real Men Ask for Directions When Lost — Real Life Testimonials.
Tuesday at 6:00 PM Location to be determined.
Is It Genetically Impossible to Sit Quietly While She Parallel Parks?
4 weeks, Saturday noon, 2 hours.
Learning to Live — Basic Differences Between Mother and Wife.
Online Classes and role-playing.
Tuesday at 7:00 PM, location to be determined.
How to be the Ideal Shopping Companion
Relaxation Exercises, Meditation and Breathing Techniques.
Meets 4 weeks, Tuesday and Thursday, for 2 hours! Beginning at 7:00 PM.
How to Fight Cerebral Atrophy — Remembering Birthdays, Anniversaries and Other Important Dates
and Calling When You’re Going to Be Late. Cerebral Shock Therapy Sessions and Full Lobotomies Offered.
Three nights; Monday, Wednesday, Friday at 7:00 PM for 2 hours.
The Stove/Oven — What It Is and How It Is Used.
Tuesday at 6:00 PM, location to be determined.
Upon completion of any of the above courses, diplomas will be issued to the survivors.
Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. STRATMOR’s current blog is titled, “It’s 2024: Do You Know Where Your Servicing Is?” The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).
(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2024 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)