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SubPrimeTime
Dud?


Joined: 19 Jun 2008
Posts: 11
Location: Portland

Saving Banks ans CUs while everyone makes money.
PostPosted: Fri May 28, 2010 7:50 pm Reply with quoteBack to top

I work for a small Retail branch for a Mortgage Bank in the NW.

We discovered a way to help out these struggling banks and credit unions that tend of have a lot of second mortgages on their books.

Since January we've helped a small credit union get $4M of bad debt off of their books and we anticipate generating about $250k in revenue per year for the next 5 years or so. Result: we get business, CU gets healthier and offers members better services and increased retention, and savings or loan benefits.

The solution involves a variety of factors and when done properly it is amazing. From what I can tell we're the only company in the country that's figured it out.

Our discovery of the solution came at the right time as a buddy at a local credit union contacted us about a job b/c his CU might close down in 6-12mo. Instead we told him we had an idea and we needed him to help present it to CEOs. He helped, it worked. Result for this guy was: Promotion, raise and a bonus. We weren't planning on this but the CU hired us outright to take over their mortgage department.

We're helping this credit union get a lot of it's bad debts off the books. We're refinancing the first and second mortgages as needed. Some LTVs, CLTVs are 180%. These are not subprime deals we're writing. We found about 3 loopholes I guess you could call them in the guidelines. And we're using about 5 variations to help any clients we can.

Each deal is a case by case basis. Some people we can save $1000/mo some people do not qualify. But in 5 months we've knocked out nearly 25% of what this credit union identified as bad debt/loans.

We're not doing any sub-prime deals or anything like that. We're not doing workouts or mods.

I'm not going to describe in detail the solution because I've signed a confidentiality agreement. If anyone at CU or small bank would like to see the presentation I can set it up. It's about 15-20 min power point and you'll be asked to sign confidentiality agreement.

This has been great recruitment tool for our branch. It's been a great way to generate business. 1 of 10 referrals are actually the solution-type deals. 3 of 10 are regular refinances and 6 of 10 have been purchase referrals.

The state auditor that reviews financial well being had given the CU 12months to turn things around and reach certain benchmarks. After review of what we were doing she extended their grace period to 5 years based on the revenue generated for the Credit Union.

Thought it was pretty cool. I'd love to work with more CUs or regional banks.

Oh yeah, it's important to have in-house operations, processing, UW, docs and funding. Speed and fluidity is key to success and delivery. If the wrong company tried this (many are notorious for sucking) it wouldn't work. They might achieve it but it wouldn't be the same and could eventually cause friction with the CU or Bank.

I don't check this site often. Just thought I'd cruise the forums and see if this issue has been brought up yet.
I'll set a reminder in OUTLOOK to check back with this forum next week and I'll try to address any replies or questions that do not break confidentiality.

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It's not the results I achieve that are impressive. It's what I'm not doing to achieve them that is.
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SubPrimeTime
Dud?


Joined: 19 Jun 2008
Posts: 11
Location: Portland

Clarifications and Typos
PostPosted: Sat May 29, 2010 3:17 am Reply with quoteBack to top

I realize I had some typos or grammar errors that might change meaning. So I wanted to clarify.

We're generating on average $250k/yr for the credit union in Revenue through TPO agreements. That's not my fee income. But it has been a huge boost to business.

Many members of the credit union benefit from savings and lower rates. They're also super loyal and we help make the CU look awesome and they write great testimonials on our behalf.

None of the loan officers that we've recruited were able to figure this out on their own. They gave up and signed confidentiality agreement to see what it is. I doubt you'll figure out how to do it. Not being cocky. You just have to be forced to find the answer.

At first, the UW on the initial file that gave us the idea said it couldn't be done but we kept asking them to show us where it said that in the rules. The deal made sense. The deal eventually closed.

We presented our findings to our entire company... the VP of operations or similar said 'we couldn't do that it's not in the guidelines.' like many of us would normally do at first.

The next slide in the presentation was the Final HUD showing the loan funded in our name and we could and did in fact do that. Kind of cool (makes up for a lot of times when an obscure rules messes up your deal).

_________________
It's not the results I achieve that are impressive. It's what I'm not doing to achieve them that is.
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