When Amy Brandt took over as President and CEO of WMC Mortgage in 1997, only one other mortgage company at the time had a woman at the helm.
“It never entered my mind this isn’t something I can do or my gender should stop me. I just didn’t think like that,” Brandt recently told Mortgage Media’s SA Ibrahim in Frisco, TX. “I think you just really have to want it and believe that you can do it. I know that sounds like a platitude, but it all has to be underwritten with a fierce tenacity.”
Today, Brandt is President and CEO at Docutech, a technology business that provides digital solutions for mortgage companies in what she calls the the tougher part of the business – the back end, closing and settlement. “My signature on that is creating the culture at the company to make it happen, and really focusing on how can we make these businesses just better for the consumer, for the people that work at them, for everyone. Because mortgage, I think, still has a ways to go with that.”
Q&A with SA Ibrahim and Amy Brandt
SA Ibrahim: Good morning Amy. Thank you for joining us this morning. We’re going to be sharing a little bit about who Amy is, and your remarkable journey and success in the mortgage industry with some of our viewers.
Amy Brandt: Well thank you, SA, for having me today. I’m very happy to be here.
SA Ibrahim: There’s so many things one can talk to you about, because you’ve had a remarkable career in so many aspects of the mortgage industry. But let me start off with the most traditional. You were, to my knowledge, one of the earliest female mortgage company CEOs and you worked for a very demanding private equity company. So tell us about that.
Amy Brandt: Yeah, it was a little bit surreal. I did start pretty young and, you’re right, I was one of the … I think I only knew of one other female CEO of a mortgage company at the time. There may have been others that I just wasn’t aware of but it certainly wasn’t the norm. And when you’d go to conferences or industry events I just didn’t see that many women. And I was young as well. So it was kind of a double challenge there, being youthful and female in a little bit more male dominated and, of course, usually older executives. It was an interesting time. Luckily our private equity owner, Apollo, is comprised of very forward-thinking guys that are just really focused on results. They felt like I could deliver results and they didn’t care what age I was, what gender I was, what color I was, as long as I got the job done.
SA Ibrahim: That was wonderful. So just continuing that thread because I think your advice can be very valuable to women in the mortgage industry … not that I want to focus only on the women’s angle in this industry. But my observation is over time, there’ve been more and more women in this industry, and it my impression they may even outnumber men if you look at the entire staffing in the mortgage industry. But few of them make their way to the top ranks, let alone CEO ranks. And why do you think that’s the case when they outnumber men overall in the industry?
Amy Brandt: That’s actually something I’ve thought quite a bit about. And I look back and wonder how that didn’t impede my success, how I still continued to move forward. And I came up through the sales ranks. So that’s a very meritocracy driven part of a business. You’re either selling more or you’re not. So it’s not really subjective. It’s a fairly objective measurement of success. And I think that was helpful for positioning to get me to the top because I was clearly succeeding with whatever I was doing, was making me a top producer. And then as I became a leader and a manager of other sales people they were successful. So that was a fairly objective measure. How other women come up through different channels, there’s a lot of female processors, underwriters, operations managers, all the different roles in the industry. And when you walk a floor in a mortgage shop you do see a lot of women. And I’ve wondered why are they not making it to the top. And I think it has to do with exposure and being in more rainmaking type roles sometimes get selected for the top seats because the owners feel like this is a person that knows how to continue to sell or to grow the business.
SA Ibrahim: So for a young woman either starting out in the mortgage industry or being early in their career and having the aspiration to rise to the very top, what advice would you give?
Amy Brandt: You have to be really tough. There’s just no way around it. There’s a lot of platitudes you can provide and things you can say like never give up and follow your dreams and believe in yourself, but at the end of the day I think you really have to be very tough. And then sometimes I look back and go, “Gosh, I’m glad I was as young and naïve as I was when I made those climbs,” because I felt like nothing could or should stop me. So I would overcome anything. I would run through any wall that anybody put up, not thinking about if I was going to severely injure my head running through that wall. I’d still do it anyways. And I feel like you kind of have to do that. And there’s a certain value to youthful exuberance in believing that you can just get it done. And, really, I think success comes down to who wants it more and who will do what it takes to get there. And it definitely takes tenacity.
SA Ibrahim: So talk about your latest venture. And you mention the name of your newest company and how you are combining your knowledge, expertise and connections in the industry to create success in where you want to take your current business.
Amy Brandt: So my current company is called Docutech. It’s been around for 25 years providing mortgage documents and financial services documents. It has a dynamic engine that integrates into company’s technology and generates the documents that consumers need to sign to either have their disclosures or close a transaction. It doesn’t sound that exciting at first. Like, okay, we’re creating documents, how fun could that be? It doesn’t sound that fun. But the reality is that those documents are what drive the transaction all the way through. And one of the biggest conundrums in our business has been to figure out how to an eClose. And there’s various regulations that cause challenges with that but there are more digital ways of achieving the objective of getting a loan close than are widely implemented. So what we’re doing is focusing on making the transaction what we can as “e” as it can be, which is goofy I know. But what it means is if you can’t go all the way digital to the very end, do as much as you can. Make it as easy as you can. Digitize the pieces, the parts, and improve the experience and make it an iterative process over time. An evolutionary process, if that’s what it needs to be.
SA Ibrahim: So is there something in your personality or family background or other interest and your enthusiasm that really defines, Amy, that contributed to your success?
Amy Brandt: I think my mom will tell you from the day I was born I was very independent. I was her firstborn, she wanted to cuddle her baby and I wanted to run around and build toys and do things. So I was very busy child. My father was a pro athlete in the sense that he raced off-road cars professionally. And I think he was a risk taker. He never had sons and he treated all of us girls like very gender neutral. We learned how to work on cars, we learned how to do any and everything. So we just never grew up feeling like there was limits. And I think that does help because it never entered my mind this isn’t something I can do or my gender should stop me. I just didn’t think like that. And so that helped, again, with that run through any way without really realizing people don’t really expect me to do this or they don’t really maybe even want me to do this, but I’ll just do it anyway. So I think you just really have to want it and believe that you can do it. I know that sounds like a platitude but it all has to be underwritten with a fierce tenacity.
SA Ibrahim: Now I think you’ve lived in many different parts of the country. And when I first met you just before you became CEO you were in California. And I always assumed you were from California. Where did you grow up?
Amy Brandt: I did grow up in California. I grew up in the north part of Los Angeles. When I was a kid though, it was pretty rural. To the point where I rode my horse to the general store and tied it out front, and went inside and got a soda and rode it back. And my dad wouldn’t let me ride my bicycle because that was dangerous. But the horse was fine.
SA Ibrahim: That’s fascinating. So tell me what you’re doing now and how are you making what you do different by putting the Amy print on it?
Amy Brandt: Well, I think careers evolve. And you start to, as you learn more within an industry and as you mature in your career, you start to develop specific interests. And I really became interested over time in technology. One of the conundrums of the mortgage business was the labor intensity of it. And I always hated that when volume went up you had to hire a lot of people and when it went down you had to let people go. That’s heartbreaking. And that cycle’s heartbreaking. So I’ve been interested in ways to make things more efficient and effective, ultimately creating a better customer experience but also creating a more durable business environment that has less ups and downs and volatility. So I very much focus on technology. So right now I’m working at a technology business that provides very much a digital solution for mortgage companies in the tougher part of the business, the back end, the closing, settlement, all the parts that have still gotten pretty paper intense and messy. And my signature on that is creating the culture at the company to make it happen and really focusing on how can we make these businesses just better for the consumer, for the people that work at them, for everyone? Because mortgage, I think, still has a ways to go with that.
SA Ibrahim: It’s very interesting to hear you talk about technology because you are talking about technology from the perspective of somebody who grew up in the nontechnical, non-technology part of the business but is embracing technology having come from an operational, sales and other background. So you really know the user side of it. Do you think that makes you more efficient at deploying technology in a way that works? Because in the industry we hear of billions of dollars collectively that have probably been wasted in developing the wrong technology.
Amy Brandt: Yeah, so I do think having come up through the ranks from the very bottom, working running my own loans around and paper files on the floors of shops to now where I sit has been a wonderful perspective. Because I think I understand the practical problems that impede sometimes the implementations of technologies that theoretically seem like they would be positive, they would solve problems. But I think that sometimes the people creating those solutions don’t truly understand the nuances of the problem. And that’s a difficult conundrum for the mortgage business because on the one hand you don’t think that all the creativity and technology and good ideas are going to come from people that have grown up in the mortgage business. I certainly wouldn’t expect that. On the other hand, without a granular knowledge of the mortgage business, understanding which tools apply when and how to organize them, is nearly impossible. So you really have to have a confluence of mortgage knowledge and outsider technology expertise to be able to come up with the right solutions. And that is so difficult that I find it extremely fascinating.
SA Ibrahim: One of the things that you make me think of was when I was the CEO of a California-based mortgage company one year we won an award for being the best technology project innovator. And we won it against many technology players. And somebody, a technology magazine, interviewed me and asked me, “How did you go about creating that technology?” And I said, “That was the last thing on our mind. We were trying to create a solution to a problem as a user and technology offered the best solution.” So I’m always delighted to see users using technology as opposed to technologists creating technology they’re pushing at users.
Amy Brandt: I think innovations on the technology side are also recognizing the need for user involvement and the development of agile teams and bringing in users more into the development process. And iterating more quickly is part of that problem that transcends even the mortgage business. This user driven understanding the features really required and getting to a product quickly is a problem across industries. But mortgage has so many distinct technicalities, regulations and parties involved in a transaction that it creates another layer of complexity that you have to solve for. And that makes it even, I think, more challenging but more fun. So I really, I think what I’m bringing to it is I just really enjoy doing this.
SA Ibrahim: You’re a very intense and enthusiastic person. It looks like you put your all into what you do as a profession. Now, where do you draw your energy from outside work? What are some of the things? Is it children? Is it family? Other hobbies that really deal with that other side and give you energy you bring to the business?
Amy Brandt: I used to have a lot of hobbies, but then like any parent I think now my hobbies end up being my children and their hobbies. So my daughter is very much into equestrian riding so we have to spend a lot of time doing that. Once upon a time it was me on the horse, but not anymore.
SA Ibrahim: So one of the most intimidating things about the mortgage business to a borrower is the amount of papers they have to sign. Does your company make it easier for them to do that? And is that where your value added comes? And how do you add value to your B2B customers?
Amy Brandt: No, that’s exactly right. Well, we add value to the B2B customers by making it better for their customers. That’s our job, to make them look good, to help them improve their customer experience. So that’s the value we provide for them, and other things too. But that’s the main one. For the customer, that’s exactly right. It’s a lot of paper. A lot of times maybe this is the first time they’ve seen this kind of document. So in an eClose environment instead of going to a closing table and getting pushed across the table this giant stack of papers and, “Here, sign this,” you can get all the documents early, read them in your own home on whatever device that you want, at your pace, ask questions, be prepared. And then closing can go much more smoothly. And in some cases they can do the entire process remotely and digitally. So just, I think, that relaxation and, “Here you go. It’s not going to be pressure. You have time. You can review these documents,” I think that goes a long way in making it better.
SA Ibrahim: So years ago somebody applied for a credit card and it took them three weeks by the time they signed an application, submitted it, and somebody reviewed the application, the employment history and bank records, and gave them a $2,000 credit line. Now you don’t have to apply for a card. You get that decision, in fact you get offers. When are we going to see that happen in the mortgage industry? And why hasn’t it happened yet? And will it ever happen?
Amy Brandt: Well, certainly a mortgage is a much bigger transaction than a credit card so I understand, of course, it’s reasonable that there would be more underwriting requirements. I think we can compress the timeframes. One of the largest … There’s two really large time sucks in the process. One is for the consumer to get all their documents together. When you do a mortgage there’s things that the underwriter needs to see about income and history and things. And the borrower has to get that together. So creating tools for them to upload them quickly and easily and help them organize and get those as quickly as possible in front of an underwriter, that is very helpful. And I think the industry’s made quite a bit of progress on that front. The other is getting an appraisal. There’s other people involved of course. You have to have the home appraised and that one just still takes a lot of time. And I know there’s agencies working on ways to digitize that so maybe that will make big progress. I don’t know that we’ll see it in an hour like a credit card or instantly, but maybe a week, two weeks.
SA Ibrahim: Which would be fantastic from where it stands today which I believe is 45 [inaudible 00:14:13]. The other thing I’m amazed at is from a lender’s perspective, the cost of originating a mortgage is six, seven thousand dollars. And that seems to be way higher than it used to be. Do you think there’s an opportunity to bring it down significantly? And what will it take?
Amy Brandt: Logically yes. And it’s frankly somewhat surprising with all of the technology that’s been implemented in the last five, seven years in the mortgage space that you haven’t seen that decline. But at the same time there’s been a equally high pace of regulatory implementations and changes that require quite a bit of resources to implement the technology, change management, people to verify, so that continues. As those are digested I would expect that to go down. But it just hasn’t happened at the pace that I would’ve thought.
SA Ibrahim: After the downturn, HELOCs and seconds were blamed for some of the problems that were created. What is your view on how that’s going to be avoided this time around?
Amy Brandt: I think they’re being underwritten to much more stringent standards, at least for what I’ve seen so far. So all those second mortgages will always be more inherently risky than a first mortgage. They’re also a much smaller balance. And I don’t think necessarily pose the same amount of systemic threat as a first mortgage does because of the likelihood of foreclosure. If a second defaults and the first is much larger, will they foreclose? I don’t necessarily think they always do. Still, I think the underwriting standards have been changed dramatically and our technology to understand the value of the assets is better. So they’re not risk-free but I think they’re probably much better.
SA Ibrahim: Any other trends you’re observing or things that excite you about our industry?
Amy Brandt: Well, the trend I’d like to see more of is more young people joining our industry, more diversity both in gender and race joining our industry. Housing is just such an important part of the entire economic ecosystem. So having all of those groups represented in the creating of the housing and the finance of housing I think would be better for everyone. So I’m just really hopeful that as kids graduate college and look to careers that they think about the housing industry.
SA Ibrahim: Good, good. The last thing I’d like to ask you is we’ve had so many years of home prices going up, terrific economic environment, yet in the mortgage industry right now all I hear about is with the refis going away and the rising rate environment things getting touch. Maybe home buying is slowing down or is limited to certain pockets. Do you think we’re approaching a bump in the road? And, if so, what is your advice on how to best navigate it?
Amy Brandt: Well, my prognostication, which is about as good as anyone else’s, which is probably not that good, is that obviously with rates rising and expected to continue to rise the refinance opportunities will be diminished. So I do expect second mortgages and HELOCs to have greater volume. Because Americans will still need to tap into some element of the equity that’s been created in rising home values in their homes to pay for lifestyle and things that happen in people’s lives. So I think that will start to tick up a little bit. The purchase market has been relatively flat and expected to remain so for the next several years. I think that’s right. Although you look around and see new homes being built, still the housing stock and the creation of new housing stock isn’t keeping pace with household formation. So that will constrain the purchase market a little bit. Which I think, although rates are rising, I think home prices will remain relatively stable because of supply/demand issues.
SA Ibrahim: And, as people continue to buy homes and take out mortgages, your company’s going to make it easier for them to deal with the massive amounts of documents. So keep doing it. I’m looking forward to whenever I buy my next home or take out my next mortgage or refinance to having that process made easier.
Amy Brandt: Absolutely.
SA Ibrahim: Thank you.
Amy Brandt: Thank you SA.