Leaving the Herd

By Douglas Smith

Loan originators are often guilty of following the herd; they hear and see what everyone else is doing and do the same.  This is a dangerous strategy.  The Perato Principle, or 80/20 rule, states that approximately 20 percent of the originators in any market write 80 percent of the loans and that the remaining 80 percent have to compete for the 20 percent that’s left.  It’s no secret that 80 percent of loan originators today (the herd) are struggling and not making much money.  Is that who you want to follow?

In his poem, The Road Not Taken, Robert Frost’s classic line reads: “I took the [road] less traveled by, and that has made all the difference.”  As you begin your journey into a new year, you would be wise to apply his independent way of thinking.  More… Mortgage Originator Magazine

Getting Ahead without Falling Behind

By Rob Katz   

Mr. Katz, president of the San Diego-based mortgage technology provider Del Mar DataTrac, has written an opinion piece on how mortgage originators can manage their operational capacity when volumes ebb and flow. The following are his thoughts on this topic.

Imagine this scenario: The number of loan applications coming in the door drops, so you reduce your staff. That’s a painful event because these are real people that you care about and letting someone go – especially in this economy – makes you feel sick to your stomach. Then the Fed steps in and calls for a secure secondary market. This support makes rates drop below the magic 6% barrier, and a refi boom overwhelms your crew.   More…  Origination News

Appraised Value Inflated 700%

January 15, 2009 – Mortgage Fraud Blog
Two Missouri men are accused of running a mortgage fraud scheme that inflated home values, one property was appraised at more than seven times its real value.
Russell T. McBride, 46 and Robert Wrolstadt, 59, waived their rights to file any motions challenging the federal evidence against them. The pair each face over 500 years in prison for the scheme… more…Mortgage Fraud Blog