My Perspective

By now, reading my thoughts here in my own personal Blog, I’m quite sure you can tell my attitude towards a lot of things in our industry. I bet – whatever the topic or issue – you could most likely guess what I would say about it, most of the time, couldn’t you?

Today I’m asking you to please let me know which organizations, industry supplier vendors, etc. which you feel would enjoy the ‘endorsement of Secret! University’ (again, you probably know who/what I would favor already). Maybe you work for one of them, or you work closely with one or two, that would be good candidates for us to consider.

You could have them contact me directly, or let them know and I’ll contact them (and give me the individual’s name to reach). It’s all together possible, perhaps we could do something reciprocal with them.

I had a new idea this past week-end, one which I haven’t seen in any other website, nor have I heard about in any of the several webmaster newsletters I frequently read.

Since I have a forward looking/pioneering type brain – I have been on the Internet bandwagon for nine (9) years now, and how best to utilize it for business purposes (when I first built our own mortgage lending/brokerage operations site). Matter of fact, some of you may know, initially I developed Secret! University as an off-shoot of my original 6-year old Live class on Website & Internet Originations, back then mortgage website SUCKED and even today most who have one, don’t make use of it like I know they can.

Today’s new concept has a potentially sizable draw back, in my opinion however. And, that is my own long held believe that sending a website visitor off your own site (by providing them with a link on one of your pages) to visit elsewhere is plain foolish! They might never come back!

Even with that in mind, plus the fact that SE key word/phrase rankings are dynamic and can change at a moments notice … here’s the concept.

This paragraph is now incorporated inside the main index page of our website: “In mortgage industry education & training we’re Number One in Google, Yahoo! and Ask.com ….”

On our available Services & Materials page, this sentence is now predominate: “Google says we’re #1 in certified mortgage professional classes – the link also appears on our CMP course page as well.

The indivdual page for our Website & Internet Origintions Live class, now says: “Go ahead and Google internet originations – you’ll discover this class is Ranked #1.”

This may prove to be a great idea. OR it could drive potential future students to more easily locate our competition! We’ll see … I’ll keep you posted as I figure out how it goes over an extended period of time.

Today I wanted to follow-up with you for our upcoming Master Seminar here in Southern California, which I offered you last Monday. So far, we have not received checks in the mail for this very special live event from any of my Blog readers.

First off, let me please tell you my comments (2000+ words) come from reading this 75,215 word HUD proposal (to modify a rather small section) of RESPA. Thankfully my head didn’t explode after three (3) readings.

Although the font size is the same on our Discussion Board vs. this Blog, the area to read is much wider (so it wouldn’t be sooooo long), I stuck it over there – click HERE and you can see it in all of it’s mellifluous splender!

Now, just a minute. Who do you think you are anyway ??

Over the years, we have enjoyed a loyal readership of our monthly newsletter, The Mortgageland Journal; in fact I will finish up the April 1st edition probably this afternoon. I also enjoy a nice group of folks, that I consider Friends of Secret! University (that’s YOU), who follow my more personal thoughts and developments on this Blog.

I want to tell you who I think you are. I think you’re a true industry professional looking to improve your own career, with good morals, sound ethics and admirable integrity as you engage in your activities here in the consumer residential real estate mortgage lending industry (or you wouldn’t read my stuff). Further, I’m reasonably sure you and those who read our newsletter, joined my industry since August 1998 (did you catch I said MY industry?).

Given your years in the business, being raised somewhere along the timeline and the environment of the Aug.’98 to Dec.’05 cycle … that gives you certain characteristics which differ from the people who grew in the cycle before that time – the ‘88 to ‘98 one, or those of us who entered the industry well before that (BTW, I hope you saw the September ‘07 newsletter, it contains one of the best pieces I feel I have written about my eye-witness account of the last 4 ‘corrections’). Right now, you’re enjoying the initial cleansing period, a sort of punishment phase of today’s cycle – late Dec.’05 to …. (my guess 10 years in length) – the harsh punishment portion of this new cycle should be over shortly, BTW.

Therefore considering your entry and exposure to both ‘conforming’ and ‘non-conforming’ loans during that period, your ‘take’ on the subprime niche is far more limited than say, mine. I’ve put some industry statistics together, along with certain empirical evidence and my own observations … all mixed together to form the lead article in our April newsletter – Future of Subprime – be sure you read it, it will clear things up for you about that important subject.

Next … I finished my first read of the dreaded RESPA change proposal put forth by HUD this week; you should take a look, it’s fascinating to see what and how they think, and especially the extent of the studies and research they conducted to come up with this. I like it. If passed, it will be very good for your career. Any day, you’ll start to read opinions from everybody about it. Over the week-end I’ll give you my initial thoughts on key areas in it (after I read it again today and tomorrow).

The long awaited RESPA rule was published day before yesterday along with the new 4 page good faith estimate, HUD-1, and the sample scripts the settlement agent will use at every closing. There is a 60 day comment period on the proposed rule. Below are links to the new GFE, HUD-1, the closing scripts, closing instructions, and the proposed rule in its entirety.

I frequently read a handful of industry discussion boards, and post on some of them from time to time, as some of you know. I see this particular question being asked and discussed often, so I thought I would take a stab at it this morning for you.

Based upon what I read, the conventional wisdom seems to be that it will ‘come back’ (like it was the last several years) and that it will probably take a dozen years or so to do that. That ‘conventional wisdom’ I speak about, looks like it’s coming from people who joined our industry during the last industry cycle Aug ‘98 to Dec ‘05, so they lack a clear picture in the broader context of the business, my view.

I want to give you some of it’s history, so you’ll have a well-rounded view of the horizon. Subprime, formerly called B/C paper and/or non-conforming, began in 1914 (with my initial industry employer and others). As an eye witness, I know it was a around in 1966 when I started as a twenty-something LO. Fannie Mae and her snot-nosed step half-brother Freddie Mac (labeled ‘conforming’) began in 1972 and BTW, I went to their baby showers, etc. and drank a lot of beer!

Since then, Fannie (FNMA) & Freddie (FHLMC) – let’s call them by the initials they like to use these days “GSE’s” – during their history have stumbled badly a couple of times and ONLY because they are Government Sponsored Enterprises, they haven’t exploded all over everybody like ‘non-conforming’ has a couple of times (but been real close).

The way in which ‘non-conforming’ was done – ‘originate to distribute’ – during the last 20 years (not before that), and especially the reckless way it was handled the last decade, is at the core of what it’s going through, and what you all have seen recently.

It will not be back, like it was during the ‘98-’05 period (ever again), but IS back (if you thought it left) right now … only YOU don’t know who the players are, and who the big-shot players are going to be (nor do I) … because they are starting/building/growing/developing, etc. right as we speak. It’s my sense they will operate nearly as they did during the period immediately prior to the start of the last cycle in August ‘98.

BTW, you can take this assesment to the Bank … and you’re more than welcome to quote me!

I mentioned previously my friend Paul Muolo, writer and reporter for the industry’s premiere publication, National Mortgage News for the past 25 years or so, is writing a book on the history of Subprime (which he’s interviewed me about several times so far). He had a synopsis in his on-line ‘What We’re Hearing’ column on there main website this past Friday, about his front page piece in the paper yesterday “B&C Vanishes as volumes Fall to 7-Year Low” where he says “subprime originations were virtually nonexistent. ” In a nutshell, his synopsis Friday said in part “… In Q4 lenders funded just $6 billion in subprime mortgages. In 2005 — the peak year for subprime production — the industry originated $807 billion in A- to D loans. It’s safe to say that the subprime industry has been wiped off the face of the map ….”

To that end, and as a remark to him, I suggested he should be comparing recent stats not as against the biggest boom years for Subprime in all of history, but more accurately more like a usuable comparison to 1998 (the final full year of usual/normal production before the boom in the industry during the ‘98 to 12-05 cycle), as those numbers are more real-world (vs. the dream numbers of that ‘easy-street’ cycle period) and probably the levels of subprime’s future production going forward.

I’ve asked him to get me those stats – which I’ll report to you – since it is my belief they will reflect what you can expect for the next several years. Hopefully, he’ll consider my opinion and write more with this viewpoint; I sure will.

We have held these get togethers here in Southern California off and on for more than 6 years, always on the same week-end as our $1,500 Website & Internet Originations Live class.

The Master Seminar’s usual fee is $125 per person. Until April 17th, I am offering you an Early Bird price of $100! This price is not reflected on our website, so you’ll need to mail us your check (address bottom of the page).

I hope you’ll attend, it will be my pleasure to do all I can to help you with your mortgage lending industry career.

Peter

PS: If you happen to be interested in our (next day Sunday) Website & Internet Originations Live class, you can get that one via check also until April 17th, while you’re here for $1,150.