INNOVATING YOUR PRODUCTS TO SOLVE HOUSING LITERACY, AFFORDABILITY, & COMMUNITY, W/ DAVID BATTANY

Mike & Michael talk with David Battany, EVP of Capital Markets at Guild Mortgage, about how affordable housing and innovative products help to create strong communities, and how lenders can close the homeownership gap

Affordability is more than just a catchy buzzword in our industry - it's a cornerstone of community development and economic stability in every neighborhood. As home prices continue to rise faster than incomes, the time is now for mortgage pros to focus on creating and promoting products that make the dream of homeownership more accessible for all.

To industry veterans like David Battany of Guild Mortgage, this issue is crucial when it comes to building financial, and even emotional, stability for families. Affordable housing initiatives do more than put a roof overhead, they contribute to the wellbeing of entire communities. Read one for more of David’s thoughts below!

SERVING “COMMUNITY” MEANS SERVING ALL COMMUNITIES

It’s no secret that minorities have historically been victimized by disparities in access to housing. Important initiatives like the Black Homeownership Collaborative and other advisory councils have done amazing work to bridge these gaps. But they need our help.

When I was a volunteer rookie policeman in Pasadena in the 1990s, there was a lot of crime and a LOT of tension in black communities between residents and police. They were never happy to see us. One day, I was interviewing a black man about a nearby crime and he was giving me lots of helpful information. When I was finished, I asked him, “Why are you helping me? Nobody in this neighborhood ever talks to me.” He pointed at the house we were standing in front of and he said, “I just bought this house. I’m the first man in my family to ever own a home. And I want to do whatever it takes to make this work, so let’s make it work.” Homeownership is more than a place to live. It’s about building that sense of community. It’s about quality of life. It’s our duty to help everyone make that dream a reality.

12:40 - 13:03 -- "I think, at the highest level, we have a huge issue in front of us for affordable housing. And it's actually as simple as the fact that home prices have been increasing faster than people's incomes. So it's like standing still and trying to get on a moving train that's going faster and faster. And that first step just becomes harder and harder for each new generation of first-time homebuyers that come into the market."

INNOVATION LEADS TO AFFORDABILITY

The affordability of housing is a multi-faceted problem that screams for innovation. Many first- time buyers struggle during the initial years of homeownership. Maybe they feel like they bit off more than they can chew. Maybe unexpected expenses like car repairs or medical bills pop up. We need to come up with products - like down payment assistance programs - that address these challenges and support homeownership for the long haul.

Sponsors: Sapiens Decision Silverwork Solutions Aster Key Keepingly? Alchemist Solutions Inc.

CLOSING THE GAP THROUGH KNOWLEDGE

Financial literacy is essential in closing the homeownership gap, especially for minority and low-income families. Many potential homeowners have historically been unaware of the different available products or how to qualify for a mortgage, either because lenders didn’t care or the information was actively kept from them. This is a perpetuation of the wealth gap and disenfranchises families from their housing rights. Literacy and counseling resources can significantly improve a borrower’s ability to purchase a home, and mortgage professionals should be at the forefront of these initiatives. It’s not about ticking boxes, it’s about doing the right thing.

15:53 - 16:14 -- "I think in terms of how you buy, a lot of it is just education. I mean, people - a lot of people - still think you need 10-20% down. So let people know there are programs out there that you can go as little as 3% down, and some of the Housing Finance Agency products, you can go with zero down now. So sometimes, the education of the process is helpful."

THE GIG ECONOMY: LENDING’S FUTURE?

Like it or not, the rise of the gig economy is reshaping the way people earn income, and that means new challenges for traditional lenders. As more people engage in freelance or contract work, they may have multiple streams of income rather than the steady paycheck that we typically expect.. The current credit models, which rely on W-2 income and long-term employment history, simply do not adequately reflect the financial stability of these workers. So how do we address this? As always, through evolution. Lenders should consider alternative credit models that better capture today’s financial reality. ‘Learning’ tech models can analyze banking data and provide a real-world view of a borrower's financial health, like consistent income over time, even if it comes from various sources. That way, we can make informed decisions and extend credit to those who may otherwise be excluded by traditional models.

NEXT WEEK:

THE PHILOSOPHY OF GREATNESS & UNLOCKING YOUR POTENTIAL, W/ APM CHAIRMAN BILL LOWMAN!

OCTOBER 2024 MIKE KELLEHER AND MICHAEL ZAU

WWW.MIKEDUPSHOW.COM

BE FLEXIBLE, BE AHEAD OF THE CURVE, BE EMPATHETIC

Things like minority homeowners, ignored communities, and the gig economy are not passing trends or annoyances that laws force us to deal with. They represent important segments of the population who deserve a fair shake. Our industry needs to be proactive in developing products that cater to these demographics, and ensure they have the same opportunities for homeownership as anyone else. It’s not just about selling homes - it’s about creating lasting stability and opportunity for individuals and communities. This isn’t a pipe dream. We really can help close the gap and contribute to a more equitable society. Lenders and their teams have an obligation to support and help the vulnerable and underserved, and we can do that through education, innovation, and compassion for our neighbors.

16:27 - 16:40 -- "There's no shame in talking to someone. And as they go through the discussion, they may say "Hey, you're not quite ready today, but here's the things you could do to help put you on the path to be ready in the not-too-far future.""

Mike Drop

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