From the Editor
By Jim Davis
Jim Davis is editor of Scotsman Guide Residential Edition.
Reach him at (800) 297-6030 or firstname.lastname@example.org.
Optimism can be found even in disconcerting times
As the calendar flips from January to February, spring is suddenly within sight. With that comes the homebuying
season, during which crowds across the country flock to open houses.
With the industry becoming increasingly dependent on the purchase market, mortgage originators can’t be
blamed for being a little wary. These are unsettling times.
Interest rates are inching upward. Stock market volatility is on the rise. Headlines are giving a daily dose of tumult,
both at home and abroad. For many, the pain of the last economic crash still seems fresh, even if it was
more than a decade ago.
That’s why it’s so reassuring to read the article in this issue of Scotsman Guide by Ralph
DeFranco, global chief economist at Arch Capital Services Inc. On Page 37, DeFranco
takes a dispassionate view of the state of the housing market. Interest rates have chilled
sales and prices across the country, but don’t expect a housing bust any time soon,
DeFranco writes. The underlying economy is strong enough to prevent a rerun of
the last recession.
On Page, 57, Laura Brandao of American Financial Resources writes about niche
lending and how it can boost originators’ business. From specialty-lending
programs to manufactured homes to renovation loans, there are many areas to
explore to generate new business.
Technology continues to cause ripples throughout the mortgage industry. Robert
Clennan of Mortgage Solutions Financial writes on Page 69 that originators continue to
offer value to homebuyers, even as the industry embraces technology.
Mountain West Financial’s Tonya Todd tells us on Page 75 about an all-too-often overlooked federal
assistance program that can help first-time homebuyers get the keys to that new home. Originators who direct
buyers to this program can build a lasting relationship with borrowers, she explains.
On Page 82, FICO’s Joanne Gaskin writes about the Federal Housing Finance Agency’s (FHFA’s) review of
alternative credit-scoring models. For years, FICO credit scores have been the standard for the industry.
FHFA recently drafted a proposed rule that opens the door to incorporating additional credit-scoring options
into the homebuying process.
On Page 108, RPM Mortgage’s Dick Lepre writes about a storm cloud on the horizon: debt. Individual
households, corporations and state and federal governments are racking up too much of it. Lepre explains
what this debt could mean for the housing industry in the not-too-distant future.
American Liberty Mortgage’s Leslie Heimer writes on Page 116 about millennials, many of whom are the
rising stars on sales teams across the nation. She discusses how best to motivate this group of people.
Heimer also reflects on what sales managers — who are often a little older than millennials — can offer to
these up-and-coming originators.
Enjoy these articles and more in this edition.