Oct. 16: Lender LIBOR transition update; advice for those in our biz; vendor M&A and new products; Saturday Spotlight: BeSmartee

At the MBA’s annual conference some would say that a year like we had in 2020, and the first half of 2021, is surprising, but not as surprising as, say, Christopher Walken dancing. (Yes, he was a dancer early in his career.) Sure all the predictions from early in 2020 were dead wrong, and of course we all heard the term “unprecedented” until we were nauseous. In San Diego, besides attendees happy to see one another, the talk seems centered around the possibility of CRA for non-bank lenders, margins and volumes, changes due to the change in the presidential administration, jumbo underwriting moving to DU & LP, and where 2022 will take our industry. Let’s hope that predictions of the labor, especially lower-skilled, returning to the workforce come true. Last year we had the “Great Resignation.” But it appears that ‘Boomerang employees’ who quit during the pandemic are starting to ask for their old jobs back. (Subscription required.)

Saturday Spotlight: BeSmartee, delivering a complete digital mortgage experience

In 3-5 sentences, describe your company (when was it founded and why, what it does, where, recent growth and plans for near-term future growth). 

BeSmartee was founded in 2006 by mortgage industry veterans at the onset of the housing crisis. As one of the original mortgage point-of-sale platforms, the founders recognized that the mortgage process could be improved by utilizing source-data and automation in order to streamline the consumer experience, increase data integrity for lenders and lead to a day where a consumer could enter fulfillment in minutes.


Our mission is to make mortgages easy, fast, and transparent for both consumers and lenders. We plan to expand our technology offerings beyond the front-end to continue to help consumers and lenders go deeper into the mortgage origination process, faster.


Tell us about what type of volunteer work employees are encouraged to engage in, or charities your company supports, and why. 

We always encourage our team members to volunteer with organizations that they are passionate about. More recently, some of our team members have organized volunteer efforts with the Boys & Girls Club of Santa Ana, and Girls, Inc. of Orange County.


What does your company do to help elevate your employees’ growth? Describe any mentoring programs, outside classes or training, in-house training. How does the company help people develop? 

BeSmartee is big on education. Leadership always encourages their teams to enroll in courses that will help further their career. We have quarterly mortgage-specific training and we’ve recently launched a new product training program led by our new Director of Engineering!


Additionally, BeSmartee has partnered with Orange County-based coding bootcamp, LearningFuze, to launch a scholarship and mentorship program for women in tech. This collaboration allows our developers to mentor, encourage and support women pursuing careers in coding.


Tell us how your company maintains its culture in the office, or in a work-from-home environment if applicable. 

Our team has an ownership mindset, which is central to creating an efficient work-from-home environment. We also host fun, virtual company events. 🙂


Things you are most proud of that don’t have to do with sales. 

We are proud to have cultivated a resilient, engaged and team-first culture. Our people have helped us build a forever company, one where we have the responsibility to be:


1. Fearless in the opportunities and challenges we pursue.

2. Selfless with our knowledge, contacts, and time to help others.

3. Committed to our company, clients, team, and ourselves.

4. Excellent in how we approach our art and craft.


Fun fact about BeSmartee. 

The BeSmartee vision was born before Instagram and the automation boom.

Advice for those entering our biz

I asked people of color and women in the industry about their early careers & advice for new entrants, and appreciate the time they spent responding. I will happily circulate more responses if you care to write, and have more already to publish. “What do you think the best advice you can give those starting out in the mortgage industry?” or “What is the boldest move you made that helped advance your career?” or “What do you wish someone would have told you about being successful in this industry?”

Anne Elliott, author of Mortgage Risk: A Blueprint for Smarter Origination, remembered, “I started in mortgage banking as an administrative assistant and worked up to Senior Vice President. In between I learned to distinguish between loans likely to perform and unlikely to perform, and also about working well with others.

“First, educate yourself. My transition from clerical to management was aided by my employer’s tuition reimbursement program and resultant enrollment in every UCLA Extension class pertinent to origination including classes in lending principles, real estate law, appraisal and (the most boring) mortgages, trust deeds and security agreements. Second, educate yourself outside your immediate area of expertise. Exposure to second liens, super-jumbo loans, and hard money lending in jobs early in my career came in handy long-term.

“A beginner understands how, an expert understands why. If you want to advance, tackle the whys. Find a mentor and later on be a mentor. Expertise is not always learned from manuals and training classes. Mentoring can also result in long-term friendships.

Network externally and internally. A rapport with an Agency rep resulted in my appointment to an advisory panel. Some work friends turned into close friends and another to my husband of thirty-five years. If you don’t like your job or the work environment, find something else to do. I took a five-figure salary cut leaving a small company where the owner was too frequently a mean drunk after lunch. If you’re a good employee, under normal circumstances you can find a better job.” Thank you, Anne!

LIBOR news

Some institutions have made firm decisions on the replacement index, while others are considering multiple replacement rates. Fannie Mae and Fannie Mae have launched LIBOR transition websites that provide key resources for lenders and investors as the Enterprises transition away from LIBOR.

HUD issued an advance notice of proposed rulemaking (ANPR) on its process for transitioning away from the use of LIBOR for Federal Housing Administration (FHA)-insured adjustable rate mortgages (ARMs). HUD intends to use input from this process to issue a proposed rule that would remove LIBOR as an acceptable index, specify a new index for newly insured loans, and recommend a replacement index for existing loans. Comments will be due to HUD on December 6, 2021. Following review of the public input, HUD plans to issue a proposed rule containing the details of this transition.

You might not care too much, given that MLOs and lenders are not doing a lot of ARM volume these days. But there are large numbers of loans in servicing portfolios, and there are still trillions of dollars of various securities tied to the London Interbank Offered Rate, many that are either composed of adjustable-rate residential mortgages, or that are somehow related. Many of those surveyed have the LIBOR transition deadline on the top of their priority list, since decisions are being made. This is good news since financial institutions will begin new transactions involving a new benchmark lending rate as of January 1, 2022. Some LIBOR rates will continue to be published through the middle of 2023, allowing about two-thirds of outstanding bilateral loan contracts to naturally mature and the rest will need to convert to another rate index.

So the LIBOR index is likely to be discontinued or deemed non-representative at or near the end of 2021. The real estate finance industry continues to move forward with plans to sunset the use of LIBOR in new originations and transition existing LIBOR-indexed products to new indices. Many lenders with whom I have spoken have already moved to indices based on U.S. Treasury rates and are waiting on the “index dust to settle.

Buckley reported that on October 8, the CFPB issued its semi-annual report to Congress covering the Bureau’s work from October 1, 2020 to March 31, 2021. The report, which is required by Dodd-Frank, addresses, among other things, the effects of the Covid-19 pandemic on consumer credit, significant rules and orders adopted by the Bureau, consumer complaints, and various supervisory and enforcement actions taken by the Bureau. But the report notes the issuance of several significant notices of proposed rulemaking related to remittance transfers, debt collection practices, and the transition from LIBOR.

A recent LIBOR transition survey from Crowe LLP focused on community financial institutions where half of the participants said that their banks had chosen a replacement rate for LIBOR. Regarding loans specifically, about half of the surveyed banks said that they were considering the use of multiple replacement rates. Of those considered, 88% are leaning towards choosing the Secured Overnight Financing Rate (SOFR), while Prime was popular with a significant proportion, especially among institutions with assets less than $10B (78%). The American Interbank Offered Rate (Ameribor) caught the attention of 35% of banks, while 23% were considering the Bloomberg Short-Term Bank Yield Index (BSBY).

Unfortunately the debate on a universal LIBOR replacement is hindering the transition efforts. The demise of LIBOR was first announced in 2017. “We do expect a relatively smooth transition, but it is a substantive change that is happening across the financial industry, commercial real estate and beyond,” says Andrew Foster, AVP of commercial real estate at the Mortgage Bankers Association. Like turning an aircraft carrier.

Vendor news

Third-party providers to residential lenders do a lot more than make up company names with letters capitalized in the middle of them. Let’s take a random look at who’s doing what.

Yesterday news broke that SimpleNexus will acquire Lori Brewer’s LBA Ware. The combined company will be known as SimpleNexus and SimpleNexus’ corporate headquarters will remain in Utah. Senior management will consist of Cathleen Schreiner Gates, CEO, Matt Hansen, Founder & Chief Technology Officer, Kevin McKenzie, CFO and COO, Ben Miller, Co-Founder, Lori Brewer, EVP & General Manager, John Aslanian, Chief Revenue Officer, Shane Westra, Chief Product Officer, and Andria Lightfoot, Chief Customer Officer.

Are you attending the MBA Annual in San Diego? If so, stop by the Insellerate booth #720. Insellerate will be revealing its Annual MBA Contact Study and Vendor Lead Analysis Report findings to gain industry insights you can’t get anywhere else. Find out how for every 1,000 prospects Insellerate lenders fund 24 more loans than the competition.

Redwood Trust, Inc. announced an investment in Canopy Financial Technology Partners (“Canopy”) a consumer finance due diligence and third-party review firm that leverages emerging technology to deliver services and solutions for the Residential and Business Purpose mortgage lending markets. The investment was completed through Redwood’s RWT Horizons venture investment arm, which targets early and mid-stage companies transforming financial and real-estate technology.

First American Docutech has integrated its Solex eSignature solution with MortgageHippo’s digital mortgage platform. Now, lenders can enable their borrowers to eSign mortgage disclosures via a single sign-on experience by using MortgageHippo, a consumer-centric no-code/low-code digital lending platform, and First American Docutech. Read the press release for details.

OptifiNow, a provider of custom CRM platforms for mortgage lenders, announced the successful deployment of a CRM solution for Sprout Mortgage’s wholesale and correspondent business channels. The deployment of the heavily customized OptifiNow instance met an extremely compressed schedule, allowing Sprout Mortgage to minimize disruption to its sales and marketing process during a period of rapid growth.

Over the coming months, you’ll notice that LendingHome will start to look different. LendingHome is becoming Kiavi, its new brand name and look that is custom built for the future matching its technology. “Kiavi” comes from the phonetic representation of the Italian word ‘chiave’ which means key. This is a reference to the company’s focus on helping real estate investors unlock the value of America’s aged homes. What will not change is the people, processes, or products customers depend on.

An upcoming Snapdocs solution, Closing Quality Control, eliminates common closing package errors. Using its artificial intelligence, connection to settlement, and LOS integration, Closing Quality Control will eliminate these errors. Snapdocs Closing Quality Control Solution will provide every borrower a closing that’s “done right the first time.”

Reggora, an appraisal software company, improving residential real estate valuation, announced that Envoy Mortgage has adopted its appraisal management system to help process all loans requiring an appraisal. Envoy will leverage Reggora technology to deliver a fast and efficient appraisal, supporting their customers through the home buying journey.

SOLD.com reached milestone growth including a 300% increase in demand for services YTD, a testament to the rising need for alternative modes of home selling and comes on the heels of a recent capital raise that has allowed it to make investments in its technology, human capital, brand, and marketing expansion. an increased commitment to educating home sellers. And SOLD.com is rebranding, key updates include its proprietary matchmaking algorithm that identifies the methods available for the seller to consider and points them to the best options and provides a personal concierge service that assists sellers through every stage of the journey. Also, more educational resources for sellers to learn about both traditional and emerging methods for home selling.

Sundae, the residential real estate marketplace, is transforming the way property investors buy distressed properties. With the launch of its new digital platform, property investors can view available properties, submit offers, and streamline transactions in Sundae’s marketplace. Sundae’s platform, found at https://marketplace.sundae.com/ is the first and only that provides access to exclusive and vetted properties sourced directly from homeowners looking to sell to a cash buyer.

Incenter Appraisal Management rolled out RemoteVal™ technology, dramatically streamlining one of the biggest bottlenecks in mortgage lending: appraisals. Using RemoteVal™, the appraiser takes control of the homeowner’s smartphone camera, and then snaps geographically verified, time-stamped images and closeups while directing the individual from room to room. In addition to photos, the appraiser can remotely capture gross living area measurements. RemoteVal™ has a built-in digital measuring tape, which incorporates 3D environment scanning technologies. These technologies prevent “selective editing,” and transcription errors, helping to ensure the integrity of the data appraisers will use for their final reports. For more information, visit incenteram.com.

The Washington Post’s Style Invitational also asked readers to take any word from the dictionary, alter it by adding, subtracting, or changing one letter, and supply a new definition. The winners included:

Karmageddon (n): It’s like, when everybody is sending off all these really bad vibes, right? And then, like, the Earth explodes and it’s like, a serious bummer.

Glibido (v): All talk and no action.

Arachnoleptic fit (n.): The frantic dance performed just after you’ve accidentally walked through a spider web.

Caterpallor (n.): The color you turn after finding half a grub in the fruit you’re eating.

And the pick of the literature:

Ignoranus (n): A person who’s both stupid and an a$$hole.

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. The current blog is, “Grow Your Business But Don’t Step Over a Dollar to Save a Dime.” The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).


(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2021 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman.)


Rob Chrisman