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Gaining the Slight Edge in the Southeast. Jennifer Massey, Highland Commercial Mortgage Carolyn Whatley, Beech Street Capital. “ If you see a light at the end of the tunnel, it’s the light of an oncoming train”. --Robert Lowell. Now we know …. Reasons for restructuring :
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Gaining theSlight Edgein the Southeast Jennifer Massey, Highland Commercial Mortgage Carolyn Whatley, Beech Street Capital
“If you see a light at the end of the tunnel, it’s the light of an oncoming train”. --Robert Lowell
Reasons for restructuring: • Sustainability of program – 60% or more eligible for retirement; • Inability to continually fill positions with qualified individuals; • Continuing record of applications received; • Budgetary issues – maintaining 50+ Offices – management & staff for each office; physical infrastructure for each, etc. HUD RESTRUCTURING
Implications & Timing: • Reorganization will take over 2 years to implement. • Business is business; but also very personal. 900+/- people may be impacted. Time of mixed emotions. • Buy-out, Early Retirement and/or Relocation. • HUD will most likely be working with a shrinking workforce during implementation. • Natural to expect change in attitude by all HUD staff. HUD RESTRUCTURING
Goals of restructuring: • Create sustainablestreamlined infrastructure. • Deliver more consistent service to industry. HUD RESTRUCTURING
Very simple….change how WE do business or reap the consequences. What consequences? • Delivery time will only worsen during period of implementation. • Fail to retain quality borrowers who have come to the program due lack of alternate financing in recent years. Now What?
Written by Jeff Olson. • Impact of doing little things consistently; and • Impact of not doing little things consistently • Slow down to go fast. If you didn’t have time to do it right the first time, when will you have time to do it over? • Creates a ripple effect – for better or worse. What’s The Slight Edge?
Show up – Attend training & share knowledge. • Be consistent – Consistency yields results. • Have a good attitude – Every truth passes through 3 stages before it is recognized. Ridiculed; Opposed; Self-evident. –Arthur Schopenhauer. • Be committed for a long period of time. • Have Faith and a Burning Desire • Be willing to pay the price. • Practice Slight Edge Integrity – What you do when no one is watching. 7 SLIGHT EDGE PRINCIPLES
Slow & Steady Wins The Race. Not really. Steady wins the race. Slow will only make everyone mad. SLOW DOWN TO GO FAST
ACTIONSBECOME HABITS Source: The Slight Edge, Jeff Olson
Originators • Underwriters, Analysts, & Processors • Market Analysts • Appraisers • Environmental Firms • AEC Firms • Closers • Lender’s Counsel • Borrower’s Counsel What are you willing to do?
What are we willing to do? • Personal & professional growth – Training & share with others. • Lessons Learned – quantify time impact; quantify cost impact. • Format of Reports - carry-over data does not remain. • Automate Reports - adjustments among unit types are consistent. • Lender’s Counsel – MUST review closing package exhibits prior to submitting. Meeting a submission deadline only to cause weeks of delay is counterproductive. • Implement & enforce a quality control plan. SMAC Community Covenant
What will we ask HUD to do? • What’s Working and What’s Not? • Suggestions & issues to be discussed with HUD – establish “parking lot” of issues to address with HUD. SMAC Community Covenant
FHA Programs vital to multifamily and healthcare industries. • Consistently there during times of financial crisis when other lenders fled the landscape. • Restructuring is necessary to ensure the future. FUTURE OF FHA PROGRAMS
HUD likely moving to structure of approving lenders, rather than underwriters. • Accountability. • Poor quality – face limitations in program participation and higher level of scrutiny. • Better quality – rewarded with faster processing. LENDER’S FUTURE
Don’t complain about what you allow or cause. • Kaizen – Plan, Do, Review (Ready, Fire, Aim) = Continuous Improvement. • A simple positive action. A simple error in judgment. Either way, it’s the Slight Edge at work - working for you or working against you. • Leadership grows organically out of the natural rhythm of learning. Take Away Points….
RESULTS OF HABITS • Source: The Slight Edge, Jeff Olson