With slow growth on the horizon of an

industry that has strong demographic

support behind it, one figurehead in

the forward mortgage world is making

inroads into reverse. But rather than

ramping up by adding employees or

experimenting with new marketing

techniques, the company is focused

on one key area: training.

C2 Financial, based in San Diego, is the

largest mortgage broker in California,

and counts itself as the second-largest

mortgage broker in the nation. With a

network some 500 strong across nine western states,

C2 counts roughly 400 loan officers in California alone.

The company is not new to the reverse mortgage

industry. Under the leadership of the late

Monte Howard, C2 launched a reverse mortgage

division in 2013. It has since grown with the

participation of C2’s Scott Harmes and his

daughter Christina Harmes, both Certified

Reverse Mortgage Professionals, as well

as Operations Manager Frank Theveny.

But with a new training initiative under

way, the company plans to make major

inroads through its existing network of the

originators and prospective broker partners.

ReverseMortgageDaily

Largest California Mortgage Broker Eyes Reverse Expansion Through New Training

June 7th, 2017 | by Elizabeth Ecker

Scott HarmesReverse Mortgage Manager

C2 Financial Corporation

“Our population of loan originators

are senior originators. They are

typically 45 to 60 years old with a

very developed portfolio of clients

and long-term influence,” Scott

Harmes, manager of C2’s reverse

mortgage division tells RMD. “That is

important because this is essentially

the planting ground for our growth in

reverse.”

A step-by-step approach

C2 has partnered with several large

reverse mortgage lenders to develop

training courses that are available to originators online.

Once originators complete the entire training and pass

C2’s reverse mortgage loan originator certification exam,

they receive access to the company’s “blue door” portal

where they can draw on marketing materials and lender

resources to effectively originate in the reverse mortgage

market.

“The reverse space is not a sales space,” Harmes says. “It’s a consultative relationship space. That relationship is based on knowledge and expertise.”

The knowledge and expertise currently

offered by C2’s training program includes

a Reverse Basics 101 course, created in

“When you have that impact on a senior’s life, you are a hero to their entire

family,”

collaboration with Liberty Home Equity Solutions; a 201

level course on the advanced nuts and bolts of reverse

mortgages, created in collaboration with Reverse Mortgage

Funding; and most recently, a 300-level course offered

in collaboration with Finance of America Reverse, which

covers knowledge implementation. The 200-level course

includes analyzing a borrower’s income, credit, equity, and

the math behind the HECM at a “near-underwriting level”

to equip originators for working in the field, Harmes says,

while the 300-level “Grass Roots Marketing” is knowledge

implementation, taking this training to the market.

The entire online program is available on demand without

any cost to originators. Each week during the training,

C2 offers a conference call to dissect and amplify what

the originators have learned, and to offer a question and

answer session led by Christina Harmes, C2’s Reverse

Mortgage Assistant Division Manager, and C2’s Reverse

Mortgage Operations Manager Frank Theveny.

In order to complete the program and receive their reverse

certifications, brokers need to pass the 100- and 200-level

courses; the 300-level course is open only to those who

have gone through the first two programs and have earned

certification.

“We don’t want beginners purporting to be experts,” Scott Harmes says. “In order to get C2 Reverse on their business cards, we want them to know what they’re doing.”

Reverse Mortgage Dai ly

4809 N. Ravenswood Suite 111 | Chicago, IL | 60640

Initial successTo date, 53 originators have received C2’s reverse

certification, and the company has risen in the industry

ranks by volume in the last several months, according to

Reverse Market Insight data.

But C2 is less focused on volume at this point, and

remains committed to continued training and building on

its current program.

“We have just barely gotten started,” Harmes says,

attributing the early success of the program to support

from the company’s lender partners as well as C2’s

executive management.

In addition to relying on its current network of originators,

the company plans to incorporate generational lending

into its approach, leaning on C2’s somewhat unique

model, which allows originators to also sell real estate.

Between traditional mortgage lending, reverse mortgage

lending, and real estate sales, these “three legs” of the

stool serve as a strong and balanced platform, Harmes

says.

“When you have that impact on a senior’s life, you are a hero to their entire family,” he says. “Then you have a great opportunity for doing business with their kids, their friends—that entire family.”

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Reprinted from Scotsman Guide Residential Edition and ScotsmanGuide.com, November 2017

All originators know that working on purchase loans can be tough. The buyer, seller and respective Realtors are relying on the origi-

nator to come through and to be on time.This means lots of e-mails, texts and after-

hours phone calls to update all parties on the loan progression. One wrong move can cause the deal to fall apart, so the stakes are high.

Because of the high stakes, Realtors will, of course, only trust certain originators to handle their transactions. It’s those origina-tors who end up getting the referrals, and it’s those originators who have long-term career stability, regardless of what’s happening with interest rates.

So, what should originators do to make sure Realtors have the confidence to refer deals to them?

Sell yourselfThe top quality a Realtor looks for in an orig-inator actually often has little to do with the originator. It’s the originator’s processor that is key. So, the first step an originator must take is selecting an elite processor.

Realtors must know the originator has a solid processor with an efficient and accu-rate tracking system so purchase files move smoothly through the system, from origination to funding. The processor must be knowledge-able and proactive to deal with speedbumps that arise during the transition.

While speedbumps will always arise, Real-tors know they can be mitigated by working with an originator who knows industry guide-lines frontward and backward. Therefore, it also is critical that originators demonstrate they are A+ students of the mortgage business.

If originators aren’t on top of procedures, rules and regulations, they are unlikely to win an argument with the underwriter, and that could be the difference between funding and fall-out. The best originators can get on the phone with an underwriter and clear that speedbump the majority of the time. Realtors want an originator of this caliber in their cor-ner if they are to be successful.

Showing Realtors your depth of knowledge first-hand is very powerful, but you still need to constantly reinforce your reputation. How is this done? Follow these five steps to reinforce your reputation when meeting with Realtors: ■■ Compile a list of testimonials from past clients and Realtors. ■■ Give Realtors the list of questions asked during your “fact-finding” interview with the client. This helps avoid surprises later on that can derail a loan.

Cultivating Realtor RelationshipsTake the steps necessary to make yourself an attractive referral partner By Brian Kent

Brian Kent is general manager of C2 Financial Corp., an award-winning mortgage broker/banker based in San Diego. Kent worked at The Scripps Research Institute out of college and then transi-tioned into the business world, eventually being hired as a branch recruiter by a mortgage company in 1997. Kent moved to C2 Financial in 2008 and worked his way up through the company. He was named general manager in 2011. Reach Kent at bkent@c2financialcorp.com.

Continued >>

■■ Show Realtors your system for keeping all parties up to date. These days, many originators use systems like Floify.com or HiMaxwell.com.

Illus

trat

ion

by D

enni

s W

unsc

h

All rights reserved. Third-party reproduction for redistribution is prohibited without contractual consent from Scotsman Guide Media.

Reprinted from Scotsman Guide Residential Edition and ScotsmanGuide.com, November 2017

<< Continued

■■ Include material and flyers about your company and what you provide that other companies do not. ■■ Display any awards or recognition your company has received.

Establish a routineTo stay on top of purchase transactions, originators must not get bogged down with unnecessary meetings and tasks. The most effective originators set up daily, weekly and monthly routines to prevent them from get-ting sidetracked.

Your morning routine, for example, might consist of the following: ■■ 9 a.m.: Hold a 15-minute “pipeline” meet-ing with your processor. ■■ 10 a.m. to 11 a.m.: Make calls to prospec-tive borrowers. ■■ 11 a.m. to noon: Set up appointments with Realtors in your area.

As part of your weekly routine, you might set up a caravan with Realtors every Tuesday. Meeting with prospective Realtor partners is a key part of a weekly routine. Top originators say they meet three new Realtors (or other potential referral partners) per week.

For your monthly routine, you should plan to run your monthly production reports on the first of the month to monitor your pro-gress. Print up these routines, and put them on your bathroom mirror so you see them every morning.

When meeting with Realtors, never come empty handed. You don’t want them to think you’re only there because you want their busi-ness. Bring something of value that can be

When business is good, set aside money to continue doing marketing when business is bad. It’s particularly important to market yourself when business is slow because that’s when others are pulling back. It must be a consistent and concerted effort day in and day out. This concerted marketing effort is key to ensuring a steady stream of incoming referrals.

Consistent marketing also creates expo-sure that shows current and prospective Realtors that you’re in the business for the long term. The last originator a Realtor wants to work with is someone who is not commit-ted to their business.

If you’re not the best self-promoter/ marketer, you should take action immediately because this is critical for generating new business from Realtors. If you don’t have the budget to hire a marketing consultant, get a business-savvy friend to help you put together a plan to promote and market your- self, attend a webinar or seminar about marketing or read a book, like “Guerilla Mar-keting,” to get some ideas or inspiration.

A college student studying marketing also might be able to provide some good advice at a good price. Young people are probably the best resource for social media know-how. Perhaps you can even be some marketing student’s school project. Many schools allow professionals to post jobs on their online job boards.

Do whatever it takes to get the job done. If you’re not promoting yourself, by default, you’re demoting yourself. ■

discussed over lunch — an article, resource, book, website, lead source, etc. — something they can benefit from. Then show them your typical client presentation.

In addition, take a good look around their office while you are there. Some Realtors may have the perfect office or cubicle you can rent. It can be tough to break in, but once you do — and you prove you are better than their in-house, big-bank lender — Realtors won’t be able to get enough of you.

Of course, this works the opposite way as well. One screw-up gets around the office fast, which is, of course, why you should not rent desk space until you are 100 percent ready to roll. And, of course, when doing Realtor busi-ness, only use account executives who you know are reliable to get the deal closed.

If you will be in the office, show Realtors and potential clients that you’re a professional by dressing the part in a properly fitted suit. There’s nothing worse than an outdated, tight, or baggy suit. Like it or not, people judge you from the second you step in the door. Of course, if you’re meeting with a client who surfs, perhaps showing up in board shorts is the way to go.

Demonstrate commitmentBeing part of a Realtor’s office can be a real game changer for your business. Top origi-nators, however, never forget that the key to marketing themselves — whether in print, online, at seminars or in person — is consist-ency. Giving a flyer to a Realtor once won’t do much. In fact, that’s likely a waste of money. You must commit to presenting a consistent series of flyers.

As San Diego Home Prices Continue To Rise, Some Mortgage Lending Eases

Friday, August 4, 2017 By Susan Murphy

Above: The median price for a single family home in San Diego County in May 2017 was $612,000.

If you applied for a mortgage last month and didn’t quite qualify, you might want to try again this month. Some lending standards have been eased to allow more people to get into the market.

Government controlled mortgage giant Fannie Mae is allowing borrowers to have higher levels of debt and still qualify for a home loan. Previously, the debt-to-income ratio was capped at 45 percent. Now it’s at 50 percent, making room for a larger house payment.

For example, for a household making approximately $7,000 in gross income a month, with a few hundred dollars in debt payments, it could mean a significant loan increase, said Mark Goldman, senior loan officer with C2 Financial Corporation and real estate instructor at San Diego State University.

“Their ability to afford a home with 10 percent down went from about $455,000 up to about $540,000,” Goldman said.

Freddie Mac has allowed a 50 percent debt ratio since 2011, but on a much smaller scale.

Another big change is self-employed borrowers are able to qualify for a mortgage loan with just one year of tax returns instead of two.

“So someone who had a big increase in their income in the last taxable year can qualify for a Fannie Mae loan,” Goldman said. Goldman said the changes should help the region’s affordability.

“One thing we look at is can a family with a median income qualify for a median priced home in San Diego,” Goldman said. “This will help that.”

San Diego’s median price of a single family home in June sold for $620,000 — nearly three times higher than the national average.

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Mortgage brokers are often re-ferred to as “mom and pop”mortgage operations. That isbecause the average mort-

gage brokerage is very small, having onlyone, or just a few, originators. But C2 Fi-nancial is not your typical mortgage bro-ker and it’s a place where the words“mom and pop” do not apply. With morethan 500 originators closing well over $1billion in loans annually, C2 Financial isone among the largest mortgage brokersin the U.S.

Among the leadership team of this bro-kering behemoth is Brian Kent, the firm’sgeneral manager. Brian was selected asNational Mortgage Professional Maga-zine’s Mortgage Professional of the Monthafter being nominated by United Whole-sale Mortgage (UWM). We recently had achance to sit down with Brian to learnsome more about him and C2 Financial.

Tell us how you first got started in themortgage business?I graduated from college in 1993 with amajor in biology, not exactly sure whatdirection I was headed. I took a job inthe laboratory at The Scripps ResearchInstitute in La Jolla, Calif. and workedthere for a few years, but realized the

lab was not for me. Long story short, Icompleted the sales training programat Northwestern Mutual Life (NML) inthe insurance/investment/group ben-efits space. A mortgage companycalled in one day needing assistancewith group benefits and a 401k plan.The owner and I got along well. Heneeded someone to help expand hisbusiness and offered me a recruitingposition at the company and I ac-cepted. That was 15 years ago.

Tell us about C2 Financial.C2 Financial is a mortgage broker-age/banker based in San Diego, Calif. Wemaintain approximately 50 wholesalelender relationships and focus our stateapprovals in the West, including Ari-zona, California, Colorado, Nevada, Ore-gon and Washington, not to mention,we have a great group in Florida andTexas as well. We work with self-suffi-cient, seasoned originators who holdethics and compliance in the highest re-gard, but don’t need or want a lot ofhand-holding. Most of our folks are withus because, other than compliance—which we are strict on—we stay out oftheir way. And because of our volume,we have access to some of the mostcompetitive wholesale rates, and pre-ferred service with our lenders. In fact,when talking with prospective origina-tors, we frequently are asked to do arate comparison. Nine out of 10 times,our rates are superior—and not by a lit-tle. It is the combination of our rates, re-lationships and resources that allow C2originators to provide the best pricingand service to their Realtor partners andclients, which create clients and Realtorpartners for life, critical to a career orig-inator’s success.

Brian Kent, General ManagerC2 FinancialBY DAV ID J . COSTER

NMP MORTGAGE PROFESSIONAL OF THE MONTH

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You believe very strongly in the bro-kerage model. What is your philoso-phy about this model of lending?While we have recently started bankingsome loans, our main focus has alwaysbeen brokering because brokeringcomes with freedom. With brokering,you’re not stuck submitting to a singleentity. At our core, we like the free-mar-ket system where the originator haschoice. We strongly believe that themortgage brokerage model is best forboth consumers and mortgage profes-sionals, and C2 is committed to beingthe best.

Many originators have joined uswho were previously with a bank. Iftheir bank’s rates were out-of-the-mar-ket, or service was lacking, they werestuck with that one option, forced tosell a higher rate, or forced to makeexcuses to their client or Realtor aboutservice delays. With over 50 wholesalerelationships, our originators can sub-mit to the lenders who are providingthe best rates and service at the time.If a lender’s service levels fall during abusy time, it’s not a problem, becausethere are 49 other wholesale lendersto choose from.

What is the overriding philosophy ofC2?It’s easy to get lost in the day-to-daybusiness. But a company philosophy Ithink is critical, so I’m glad you asked.Our philosophy is this, which I’ll para-phrase from our manual: Our titles vary.We are mortgage consultants, we areloan originators, we are loan officers,and we are mortgage brokers. Whatdoes not vary is that, every day, borrow-ers entrust us with one of the most im-

portant financial deci-sions of their life that, ifnot executed properly,can have long-lastingrepercussions as was wit-nessed in 2008 during themortgage meltdown. Wedo not take that responsi-bility lightly. We do whatis best for the client, notwhat is best for our pock-etbook, as some brokersbefore us have done. Weknow by doing this, wenot only are doing what is morally andethically right, but we know this beliefsystem will result in our borrowers re-ferring us additional clients, the under-pinnings of a long-term business model.

What is it about the mortgage indus-try that you most enjoy?Nothing gives me more satisfaction thansolving problems, which results in a bet-ter originator and borrower experience.Creating a solution, a tool and seeingfolks benefit from it is quite a reward.

When I first came into the industry in1998, originators spent hours poringover guidelines looking for a lender thatcould do some obscure niche. Origina-tors were constantly asking us: “Whichlender has what niche?” but we didn’thave the answer. However, we weregood listeners. So I grabbed our Web de-signer and we developed a very simple“Niche-Finder” tool. The AEs would log-in and indicate what niches they had,and our LOs could log-in to easily searchthe lender niches. It was simple, butvery effective. That saved tons of time,allowing originators to focus on market-ing, instead of program-hunting.

Finally, I would hearabout which lenderswere doing a great job,and which were not.But that is informationthat our other LOsneeded to hear—notme! So we created atool we call “The Good,the Bad and the Ugly”and our “AE Scorecard”on our Web site, allow-ing our LOs to post feed-back on each lender

they used. While the original intent ofthe tool was to recognize the bestlenders for “a job well-done,” these toolshave done wonders for our service levelswith our lenders as there is accountabil-ity. Nothing makes my day more than e-mailing an AE and their boss when a“Good” posting is on the Board.

It seems that your Web site is whatreally differentiates you from thecompetition.We definitely hear from our origina-tors that our Web tools are helpful.The bottom line is that if there wassomething that we could use our Website for to make the lives of our LOseasier, better and more efficient, thenwe did it. Often, we were just good lis-teners. If at our quarterly sales meet-ings, someone said, “We’re havingtrouble with ‘X’ issue,” then we woulddelve into the topic and seek a solu-tion. Many times, the issue is solvedusing a Web site tool. Our philosophyis that if one originator is running intoan issue, others probably are as well,so we’re going to do our best to try tosolve the problem.

“We strongly believethat the mortgagebrokerage model is best for both consumers and

mortgage professionals,

and C2 is committed to

being the best.”

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Would you recommend this industryto young people seeking a career?I think, for the right person, this can bea great career choice. But, it takes a veryunique blend of skills and talents, frombeing tech-savvy, to having an eye formarketing, being a student of loan pro-grams, being good with math, a strongdelegator and excellent provider of cus-tomer service. Most jobs divide up thoseskills. In our business, you have to befluent in all of those areas.

What are the biggest challenges youare facing? How about opportunities?I think the biggest challenges are over-coming misperceptions. There’s been alot of noise about QM, the three percentcap, etc. But by and large, our averagecomp is about 1.75. Most of our origi-nators aren’t impacted by the three per-cent cap, especially since many lendersare “building in” their fees to the rate.We don’t own a title, escrow or ap-praisal company, so none of those feesare counted in the three percent cap.

Certainly, keeping up with the reg-ulations is a challenge. However, weare fortunate to have excellent com-pliance attorneys who keep us up-to-date. They read the regulations, digestit all and give us the bottom line.Then, we implement it in a format

that is originator and borrower-friendly. Many originators who havejoined recently decided rather thandeal with having to keep up witheverything themselves, we can do itfor them, and they can focus on origi-nating and marketing, not worryingabout questions like, “Can the RRA besent out before the ITP, and under thenew QM, does the GFE need to go outwith the BSA or BCA?”

The main challenge is, of course,shifting to an almost exclusively “pur-chase” market, but in conjunctionwith our lending partners, we’ve beendoing lots of sales training Webinarsand seminars on making the shift, forthose who haven’t yet. Additionally, tohelp supplement lost refi volume, inaddition to a reverse mortgage de-partment, overseen by longtime RMoriginator Monte Howard, we’ve re-cently rolled out a banking channelwhich is a nice option.

Where will your firm be in three years?It’s always tough to project, especiallyin our industry, as we’re so closely tiedto what rates and the economy aredoing. However, our long-term plansare to continue growing as we havebeen, adding about 10-15 originatorsper month, and continuing to be proac-

tive, looking for new opportunities asthey develop, adding new states whenwarranted, continuing to add new toolsto our Web site and new resources toour library to make our originators themost efficient, effective and experi-enced in the industry. With the excellentcorporate staff at C2, along with thegreat sense of community amongst ourseasoned originators, we have no doubtwe can reach that goal and beyond.

You were nominated for NMP’s Mort-gage Professional of the Month byUnited Wholesale Mortgage. Howdoes that make you feel?It is an honor and I am truly apprecia-tive. It is a sign of a strong partnershipwith United Wholesale Mortgage and anindication that they value not only whatwe are doing, but also how we are doingit. The relationship between brokersand wholesale mortgage bankers is oneof the competitive advantages thathelps deliver the service and value thatconsumers have come to expect frommortgage brokers in general and fromC2 Financial in particular.

David J. Coster is senior editor of NationalMortgage Professional Magazine. He maybe reached by phone at (919) 559-2171 ore-mail davidc@nmpmediacorp.com.