Largest Mortgage - Real Estate Partnership in Georgia History (2026)

Two similar Cultures Aligned

www.southeastmortgage.com Phone: 770-279-0222

I had to share this email. This is why we have been around for so many years.

I wrote an article a few days ago about Money vs. Passion.  The email below answers the question.  I get these emails from time to time and they truly warm my heart not just for me but knowing the great team that makes SEM what it gets the recognition they so deserve.  In the market you hear a few names but reality is the 40+ operations people at SEM Club Drive and their support make SEM what it is and provides the fantastic dependable closings that drive our organic growth.

Below is an actual email from Kim Arrington to Jeff and JD.  Kim is well known in the Atlanta mortgage industry and has worked at Large Banks, Correspondents, and other variations of Lenders.  Kim's background is what makes her statements moving to me since she fully understands what most MLOs at other company's experience and can make an expert comparison.

Our operations team and MLOs work hard to earn client's and when our MLO team realizes how it comes together with all facets of the team harmonizing, I get a beaming sense of pride for the people I have worked with for so many years.  Better than a big check because the memory and relationships last longer.

From: Kim Arrington
Sent: Wednesday, September 10, 2014 12:25 PM
To: JD Crowe; Jeff Brown
Subject: Re: XXXXXXX  MTG LTR MF

Jeff and JD,

… I am not being corny or smoozy … though I can be!   Truth is, it does make me cry and smile at the same time, but I have not found this much favor with clients before ???

I am working from that same place of wanting to give excellence and here at Southeast I find many more “gratitude moments”.  People love us and I am so very thankful.

I know you invested from day 1 - you did not have to share Lynne with me, but you did and I could not have achieved what I have to date without her smarts and ambition. Thank you!

JD, we spent many calls on whether to come over or not and at the end of the day, people feel like home here!  I am not doing half the advertising I’ve done in the past and then look again, an agent lovin’ our process, lovin’ our email notifications that I forward… It gives such an authentic sense of status that they know it’s not fluff… it’s date stamped... it’s great!  And so with that, I got this agent emailing “I want to refer you“ … Thank you and Jeff, ya’ll did not give up.

So, even when I am in the Diva drama mode over that dern QC timing,  know my heart - I am really happy that you offered me an opportunity to join the team.

… love ya’ll

Kim

Sincerely,

 

Kim Arrington
Sales Manager, Executive MLO

#218594, GA MLO#25861
Office:      (770) 279-0222 ext. 717  
Toll Free: (800) 344-8788 ext. 717
Cell:          (678) 644-6945
Fax:          (678) 840-0063
Email:       Kim.Arrington@SoutheastMortgage.com
Website:   www.SoutheastMortgage.com 

Behind the Mortgage Rate Curtain - by Cal Haupt

For the past twenty plus years I have stated Mortgage Rates are what they are and are set by the market.  There is only a market rate.  I.E. If you want to buy AT&T stock, there is one market for the public and the price is set by supply, demand, and valuation and sold by SEC licensed agents.  This holds true for Mortgage Rates except valuation is a little more complicated.  Focusing on client needs and matching the correct product to those needs is the path to organic revenue and a stability for Mortgage Loan Originators, MLOs, and Mortgage Companies.

Only Mortgage Lenders with access to secondary markets can provide true adjustments to market rates via dislocations in hedge activities.  This only lowers rates IF it is not reserved for the unfavorable consequence of the dislocation assuming the market moves to a less favorable level.

I constantly see rate focused MLOs moving from company to company.  The reason they cannot build a career is they are teased with lower unsustainable rates and then move when the company returns rates to sustainable levels.  Brokers and Correspondents cannot take advantage of secondary market dislocation so when they lower rates, the offsetting revenue has to come from somewhere or expenses must be lowered which can reduce MLO service needed for referrals.  In some cases, unsustainable rates are obtained from Wholesalers that sell servicing over and over and over which angers clients and potentially risks their credit rating if they cannot keep up with where their payment should go.

Mortgage Rates are set by the market and if a rate advertised is lower than market the company probably did not account properly and will not be able to balance the equation over time.  Time is not a friend to unsustainable low rate strategies.  Look at history and the names that used this strategy and are no longer in existence.  This is the primary reason companies fail over time or when the economy enters challenging periods.

My advice to MLOs and Clients is to work with the highest certified lender you can find.  The same logic applies to buying stock from an SEC licensed agent, choose a Licensed Mortgage Originator.  The higher the certification, the better access to efficient market rates due to the reduction of hands in the pot and benefits derived from hedging activities. 

This is the hierarchy of Mortgage Providers:

#1 Highest Certification - Direct Lender - Secondary Broker Dealer, Fannie & Freddie Seller Servicer (GSEs), with FHA
Direct Lender with full access to secondary markets and can trade between the GSEs- Can Service Production - Southeast Mortgage of Georgia, Inc., operates in this category of certification

#2 Direct Lender - Fannie & Freddie Seller Servicer
Access to GSEs and considered a direct lender that can service production

#3 Fannie or Freddie Seller
Access to GSEs BUT not qualified or approved to service and will sell servicing rights
#4 Correspondent
Works on behalf of another Direct Lender.  Usually has small warehouse lines and servicing can be re-sold for higher yield by wholesalers 
#5 Broker (very few of these after 2009)
Middle person in the transaction - Works to put a consumer together with a Direct Lender.  Consumer pays the extra cost of the middle person even if the rate appears lower.  Servicing can be sold several times to account for the extra hand in the transaction.

Note: Banks (state-chartered, national banks, or federal thrift/savings banks) can operate in any of the categories above.  Most Georgia Community Banks engage as a correspondent or Fannie / Freddie variation.  Being an FDIC insured institution or Georgia State Bank only exempts their Loan Originators from Federal and State Licensing.  At Banks consumers work with Registered MLOs.  At Non-Bank Mortgage Companies consumers work with Licensed Mortgage Originators as set forth by the 2008 SAFE Act.  Click to learn more about the 2008 SAFE Act passed by our Government.

How can consumers or MLOs find the daily Mortgage Market Rate?  You have to average the daily par rate of Direct Lenders in your geographic area (50 mile circumference) with a sample size of at least 5.  Southeast Mortgage does this daily to keep our Referral partners and clients informed.

Cal Haupt
Chairman and Chief Executive Officer
Southeast Mortgage of Georgia, Inc.
770-279-0222
www.southeastmortgage.com

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Testimonial - CRM works 24 / 7 keeping MLOs in front of Clients - Another example how SEM helps MLOs get more loans

Email 8/12/2014

Cal,   I want to share with you that our CRM is working.   I closed the (omitted) loan 3 years ago and Steve (omitted) received a birthday card from me recently ( thanks to the CRM team ).   I have had no contact with him since their closing and he and his wife are now buying a lake house.   He called me yesterday and said because he received the b-day card  he remembered me and what a great job Southeast did on their refinance 3 years ago.   Long story short is he is bringing his docs to me today for a 250k lake house loan.  

Thank you Cal for providing this great service.

Sincerely,

John Young

Click here to learn more about the SEM Difference

Qualified Mortgage (QM) - Lender Responsibility and Definition

Residential Mortgage Lenders primary purpose is to provide consumer loans secured by single family housing to facilitate acquisition for a consumer purpose.  Consumer purpose is housing the primary borrower, co-borrower, and or family.  Residential Mortgage Lenders have due care responsibility to ensure applicants can afford the loan for the term of the loan and it fits the applicants purpose.
 
Commercial Purpose loans secured by residential zoned property (Rental Properties, Industrial, and general purpose) should be handled by a small business lender that is tasked to originate this type of credit facility.
 

IMO: Just because a Residential Non-Qualified Mortgage product is offered for a residential consumer purposes is not a justification for a licensed or registered residential mortgage professional to sell it.  Licensed Mortgage Loan Originators (NMLS and State License Compliant Mortgage Loan Originators) and Registered Bank Mortgage Employees (Bank Employees whose job is to Originate Mortgages and is not Licensed) should be a fiduciary for the consumer and ensure they recommend the right product.  Mortgage product recommendations should only be made after understanding the client's needs through an interview process and ensuring the client can afford the loan today and for the term of the loan.  In the future all Bank and Non-Bank Mortgage Professionals will be licensed to the same standard which will ensure all consumers have consistent protection when shopping for their mortgage.
This trust and due care is the key to referrals and the key to longevity in this business. 
 

In its simplest form, Qualified Mortgages (QM) meet the following requirements:
> A loan that meets the requirements of GSEs, FHA, VA, or USDA and can be sold in the primary secondary market
> Consumer has a documented and verified ability to repay
 

Starting January 10, 2014, you must assess the borrower’s ability to repay all term residential mortgage loans. All QMs are presumed to comply with this requirement. As described below, a loan that meets the product feature requirements can be a QM under any of three main categories:

 

 

Mandatory product feature requirements for all QMs

1. Points and fees must be less than or equal to 3% of the loan amount (amounts less than $100k, higher % thresholds are allowed);
2. No negative amortization, interest-only, or balloon loans that increase risk (BUT NOTE: balloon loans originated until January 10, 2016 that meet the other product features are QMs if originated and held in portfolio by small creditors);
3. Maximum loan term is less than or = 30 years. 

Three main categories (CFPB Definition) 
1. General definition of QMs

Any loan that meets the product feature requirements with a debt-to-income ratio of 43% or less is a QM

2. "GSE-eligible" category of QMs

 

Any loan that meets the product feature requirements and is eligible for purchase, guarantee, or insurance by a GSE, FHA, VA, or USDA is QM regardless of the debt-to-income ratio (this QM category applies for GSE loans as long as the GSEs are in FHFA conservatorship and for federal agency loans until an agency issues its own QM rules, or January 10, 2021, whichever occurs first).

 

3. Small creditor category of QMs  

 

If you have less than $2B in assets and originate 500 or fewer first mortgages per year, loans you make and hold in portfolio are QMs as long as you have considered and verified a borrower’s debt-to-income ratio (though no specific DTI limit applies).

I truly hope our industry learned from the last recession that mortgages are a cornerstone of the US economy.  We make a difference every day and should govern the products we offer consumers with due care at the fore front.  Today we are seeing a similar trend to 2006 - 2009 when the industry evolved product features to target a broader category of borrower to increase origination volume.  I believe there are some products that are needed for borrowers that are not currently participating in today's mortgage market; however, we need to ensure industry risk remains low.   

Cal Haupt
Chairman and CEO
Southeast Mortgage of Georgia, Inc.
770-279-0222
www.southeastmortgage.com

The "Secret" Key to Success in this phase of the Mortgage Cycle

The Mortgage Industry and Consumer Mortgage Demand follow definitive patterns that span 7 year periods.

If you are a Mortgage Professional who pays attention to this pattern, you will be prepared as opportunity presents itself.  Focusing on life cycle changes is the key to staying ahead of the pattern.  Great service and competent advice is what survives the test of time in the Mortgage Industry.  There are not short cuts that last.

Many in the industry think mortgage rates matter.  They do not.  Although clients want market rates, we sell a commodity that has limited variability.  Mortgages satisfy a need that is different for each client.  Lower rates make loans more accessible and give clients a sense of a better deal; however, everything in the economy holds certain relationships. 

When rates are at 4%, employment is low, housing valuations are low, consumer confidence is generally low.  When rates move higher as they are today, employment is generally improving, housing valuations are inflating, and consumer confidence is strong due to higher stock prices and rising wages.  Mortgages that meet a consumer’s need are always a great idea in any market.  Focus on the mortgage product and how it benefits your life. 

Work with a Licensed Mortgage Originator.  At Southeast Mortgage, we train our Originators to ask questions to determine the true client need so they can fit the product properly.  Although mortgage rates are rising, everything else is also.  If your expenses double and your income double, has anything changed?  Need matters.

Real Estate Agents and Realtors that want client referrals and clients throughout their life cycle choose Mortgage Service Providers like Southeast Mortgage to ensure the service is fast and pleasant with the client getting the right product for their need.  A great Client Relationship Management process that keeps Realtors in front of their past clients each year builds organic growth for Realtors and Mortgage Professionals.  As the cycle repeats, you will be prepared.

Cal Haupt
Chief Executive Officer
Southeast Mortgage of Georgia, Inc. est. 1993

www.southeastmortgage.com
770-279-0222

Good article from CNBC discussing the surge in applications that results from this phase of the cycle.  Although rates are moving up, everything else is moving up faster thus mortgage volumes surge.  The issue is you have to be structured properly to support Real Estate Agents and Realtors in the purchase side of the mortgage industry.  90% of Southeast Mortgage's volume is purchase loans due to a structure that meets client need and helps Realtor's grow their business through great service and our free Client Relationship Manager.

http://www.cnbc.com/id/100944993

Perimeter Social Max Tour with Jeff Brown

770-279-0222
www.southeastmortgage.com

Optimal Buying Opportunity Revealed - Metro Atlanta, Georgia

In previous posts, I have discussed the cycles in the economy and the capitulation in Mortgage Interest Rates coinciding with the turn in housing prices resulting in part due to reduced inventory as compared to demand.  Case-Shiller reported US Home Prices Rise Just 12.2% which confirms this reality.

Metro Atlanta was one of the strongest markets in Case-Shiller's data.  The reason?  Sophisticated the market economies like Metro Atlanta enter a deflationary cycles first and exit sooner.  The recovery can be amplified by job seekers and industry seeking better job opportunities and resources respectively.

As a result, Metro Atlanta has stripped housing inventory due to new product delays that resulted from limited bank funding for builders.

Now is the time to buy if you have a need.  Always seek a Licensed Mortgage Loan Originator to ensure you get the correct product for you and your family.  If they are registered, they did not pass the state and federal tests required by Federal Law.  Click the link below to learn more about the types of Mortgage Loan Originators.  There are significant differences every consumer should know! 

http://southeastmortgage.blogspot.com/2013/01/real-estate-agent-realtor-and-consumer.html

Cal Haupt
Chief Executive Officer, Southeast Mortgage of Georgia, Inc.

www.southeastmortgage.com
Need a Licensed Mortgage Loan Originator?  Call 770-279-0222