Tag: compliance
So I have a soft spot in my heart for small business. After all, they don’t come much smaller than my own little shop. I don’t necessarily consider myself an entrepreneur, but rather, a bit of an opportunist. There aren’t many who are willing and able to handle marketing communications for our little industry. I am. Hence…opportunity.
The past year (hell…the past seven years) has been trying for businesses of all sizes in the mortgage, title and real estate industry. We’ve gone from the subprime meltdown and consolidation to the great REO wave to the rise of the CFPB. 2014 has brought QM, ATR and, for the title industry, the spectre of increased costs necessary to meet new lender demands in the name of compliance. Mortgage brokers have all but been purged from the earth. Small businesses are being swallowed by larger firms. Compliance firms are thriving. All the while, opinions, indicators and analysis have been readily available suggesting simultaneously that the market has crashed; is crashing; is about to crash; is rebounding; has rebounded or is treading water. Depending on who you talk to, of course.
The only thing we really know about the housing market right now is that, well..it’s uncertain. That’s a tough climate in which to do business for anyone, but especially for the little guy, the small business–the company without the volume or cash reserves to stay afloat when revenue dips.
I don’t have an easy answer as to what to do. I’m a PR/marketing guy, you see. And I suspect a self-supporting pitch to hire a PR guy right about now won’t go over real well with a company just trying to keep the lights on. I do strongly believe however, that change always brings opportunity somewhere. Again, my little business will never be mistaken for the Apple or Google of title/mortgage marketing. But I can say that it has been successful–in spite of the market and economy over the last five years. Much of the reason has been my ability (or luck, perhaps) to spot the next wave and ride it. More or less.
Consider this a vote of confidence for the small business owners in our industry. In many cases, YOU are the innovators. YOU are the ones who don’t go “by the book” when the market shrinks. YOU are the ones who show the rest of the industry new ways to do old things. YOU are not (always) driven by fear, but rather, opportunity. This will get better. Keep it up!
We’ve all been hearing about consolidation, “the new normal” and other varieties of the end-of-the-world-as-we-know it now for about six years. There’s no doubt that the mortgage industry (including its satellite in the title and settlement services world) has changed. We have a new sheriff in town with a much bigger sidearm. We’ve got a lot more attention focused on us. And we’ve had a market turbulent and inconsistent enough to make most of us believe that “upheaval” would be a calmer state than what we see now.
And yet, through it all, I’ve seen a tremendous number of players sticking to their guns, playing the game the way it has always been played.
Until this year.
Ok. Maybe it’s not THIS bad. But it never hurts to prepare…
Although you’d have to be living under a rock, lodged under a larger rock in the back of a cave, not to have heard about the changes happening now (ATR, QM, soft market/impending purchase market) and in the future (possible GSE “reform,” RESPA/TIL disclosure form change), there do seem to be some cave dwellers out there when it comes to compliance. That’s not meant to be disparaging. But it’s the truth. I’m hearing things like “August, 2015 (the date the RESPA/TIL forms become reality) is a long way away. I have to find a way to stay in business until then, first.” A good number of title professionals I talk to are paying attention to the regulatory changes affecting their operations and doing their best to comply. But they’re much, much more focused on where the next orders will come from. Compliance is affecting the market. And while the CFPB or any state regulator can put you out of business for failure to comply, a lack of orders will put you out of business. Period.
Which leads me to believe that maybe, just maybe, we’re not dealing with cave dwellers after all, but rather, reality.
It’s tough making a living in the title industry these days. Compliance is not an optional course, but if you’re struggling to keep the lights on, preparing for next month or next year’s rule may not seem realistic.
This is the point, of course, where I should be telling you that now’s the time to figure out how to cut costs. There’s great tech out there, legitimate outsourcing and other ways of optimizing your business to ensure you’re not wasting a dime. Most of this, however, can be expensive and/or painful in the short term. One doesn’t just snap one’s fingers and awaken to a whole new way of business. Then again, the alternat
However, it appears to me that, this time, a “new normal” really is emerging. Hunkering down no longer seems to be an option. While the mortgage lending industry will indeed stabilize eventually, it won’t be going back to the way it was in 2006. And those who survive will really be those willing to make some life-changing decisions now.
Admittedly, I’ve offered some strong opinions here recently about the government’s new take on the mortgage and real estate industry. I stand behind those and remain cynical that anything leaking out of our nation’s capital under the guise of a “solution” is really that. more
Editor’s Note: I don’t do this very often, but today, I’m pleased to turn my little corner of the Internet over to Kevin Breeland. Kevin is the general manager of Residential Mortgage of South Carolina, and the current chairman of RESPRO. He’s also a dedicated champion for compliance and innovation in the mortgage industry. I’ve attended the RESPRO conference he speaks of, and it’s a must-attend for anyone interested in knowing what the blizzard of reg/leg changes means to the industry. Kevin, take it away! more