Friday, May 25, 2007

Mozilo: Sacrificed to the gods of consumer media

Here's a quiz: Who's slogan is "We Report; You Decide." If you answered Fox News, you'd be right, which is not to say you'd be right about using this slogan to describe their service, necessarily. But you can be sure this slogan is never uttered on the newsroom floor at Yahoo! News.

Now, I've worked in a bull pen like that before, around trade journalists that are, to this day, the best in the financial services industry. There may be some unspoken law that I've forgotten about not calling other news organizations onto the carpet, but if you've read the recent coverage of the MBA's Secondary Market show in New York on Yahoo! News, you know that I'm justified.

Just look at this story.

Now, I know for a fact that Angelo Mozilo, oft-quoted leader of Countrywide Financial Corp., has about a dozen snazzy head shots floating around the industry at any given time. In every single one of them, he looks every bit the information age tycoon that American capitalism is famous for. So how long do you think the editors at Yahoo! had to look before they came up with this doozy, which was obviously taken from Mr. Mozilo's Sling Blade audition. And I have never, ever heard of him "perching" before.

Read a couple of graphs into the story and you'll see why they chose the photo, and it doesn't have anything to do with all the useless headroom in the shot. The reporters (and editors) want you to know who is responsible for the trouble we're seeing in the subprime mortgage market. They have decided for you that it is the mortgage industry, a highly regulated and documented business that is already held accountable to just about every agency that exists at every level of government. Be that as it may, the good folks at Yahoo! News have found the enemy and it is us, or you (I'm just a lowly reporter myself). There is no need for the gentle reader to waste valuable brain power thinking about this issue. They can remain in the same frame of mind they were in when they signed the closing docs for that ARM loan.

Now, I don't know Mr. Mozilo. To my recollection, I've never even interviewed him, though I've written a lot about his company and spoken with some very smart folks who work for him. I seem to recall that he was on the front page of the trades when he announced that Countrywide would never outsource offshore because it was un-American, and that he was there again when he announced that Countrywide was outsourcing certain functions to India because it was good for the shareholders. I was in New York earlier this week when he spoke to the audience at the MBA conference, though I didn't sit in to hear him speak. I figured I'd see it on the front page soon enough. But I was expecting to get a straight story.

I spoke to a lot of folks at the show who did hear Mr. Mozilo speak. They each told me about different parts of his presentation, the ones that pertained to their area of the business. That's not bad reporting, that's just giving it to me from their perspective. Hard not to do that. But that's exactly what reporters are called on to do. (As a blogger, I don't hold myself to that high standard in this space, but when I freelance for industry publications I do).

I don't know the folks who worked on that story for Yahoo! News, but I don't think they're real reporters. But maybe it's me who has the warped view of things. I'm opening this post up wide for comments. I'd love to hear what you have to say about this story and Mr. Mozilo's presentation, if you caught it in New York.

Saturday, May 19, 2007

PushMX: Automating CRM

PushMX, a Santa Clara, Calif.-based workflow vendor, has in mind to automate the Customer Relationship Management process for mortgage brokers.

"Our basic conclusion is that CRM in and of itself just does not measure up,"said Dean Haritos, founder and CEO of PushMX. "CRM is a flat database that onlydoes something when you have a human interacting with the software. We're about creating automation without the need for human interaction," he told Anthony Garritano for a story that appeared in this week's Daily Briefing Weekend Edition from Source Media.

I met these guys last year at the National Association of Mortgage Brokers' annual convention in Philadelphia. At the time, they were a little miffed by the fact that software reviewers in the mortgage space didn't operate the same way they do in the mainstream computer trade press. They felt their tools weren't getting a fair shake.

In this market, the actual users are the reviewers. I suspect the company will find this an excellent market in which to attract willing test clients, as brokers work harder to stay in touch with past customers. But can a computer really take over that job for the broker?

I've been writing about automation for a long time and I've seen it used to speed up cycle times in areas many thought could not be automated. Subprime underwriting is one case in point. But there is a difference between automating the marketing function (sending out postcards to a list when certain conditions are met) and turning your customer relationships over to the machine.

Relationships spring from conversations, two-way communication that is customized to meet the needs of both parties. Anyone who has ever encountered a sales message while on hold knows that one-way communication is not the same thing. I'll be interested to learn more about how this software tool helps brokers maintain good relationships with borrowers. And if it only reminds them to make that phone call, I'll want to know why it's better than ACT!

Tuesday, May 08, 2007

Mortgage Cadence: A great new hire

Leading companies in any space know how important it is to build internal experts, not just in terms of training people to be top executives, but in promoting those folks to the industry. I know a number of PR firms that have made expert creation a huge part of their bread and butter. It's that important to companies that hope to be leaders in their industries.

That's why I'm always impressed when I see a company that successfully recruits an executive that is already viewed as an industry expert. They succeed two ways: (1) they get a fully-trained executive ready to lead, and (2) they get an industry expert that raises their credibility with the rest of the industry. It can be expensive to pull this off, but a real boon to the company that can do it.

Recently, Mortgage Cadence, Inc., Greenwood Village, Colo., a leading provider of enterprise lending solutions (ELS) for the financial services industry, accomplished such a feet. I have to admit, as much as I respect this company's leadership, I was surprised.

The company's newest executive is Gabe Minton, formerly vice president of the Mortgage Bankers Association and a pioneer in the establishment of technology standards for the mortgage industry through MISMO, which he helped to create and actively managed over the last seven years.

Gabe will be responsible for the core architecture of the Mortgage Cadence ELS product, overall
strategic marketing and licensing, and strategic initiatives. Together with the architecture team, he will assist in further strengthening and expanding the foundation of the product, the company said.

CEO Michael Detwiler has already assembled an excellent team. Adding Gabe to the mix is bound to have exciting consequences for the company.

Disclosure: I have been hired by the company as a freelance writer in the past. I am not currently retained by Mortgage Cadence, nor was I paid for this post (nor any other post on this blog).

Thursday, May 03, 2007

PMI: On the upswing

The Associated Press published a story recently on the increase in popularity of private mortgage insurance. The article appeared on Yahoo! News.

The reporter was probably trying to tie to the story closely to the problems associated with what he calls "exotic mortgages" (which used to be called innovative mortgages back when they were putting more renters into their own homes and before they started going into default), as he spent most of the article talking about how with the market changing, MI is back in favor.

The story includes an interesting anecdote about Manuel Santa Cruz, a Tuscon, Ariz. homeowner who wants to secure a fixed-rate loan.

Near the very end of the article, the reporter admits the fact that since private mortgage insurance is now tax deductible, some borrowers are being attracted to it.

In truth, mortgage insurers did not have anything compelling to sell loan officers until interest rates rose, certain second mortgage options disappeared and MI became deductible. Now, they can make money by selling that to borrowers and the business shifts. It's nice to read stories about real people sometimes, even if it means burying the lead.