Often life finds a way of changing a normal work day into a docu-drama and we find ourselves in a starring role without a script. Such was the day my desk phone rang at 1:30 with a distraught neighbor on the first floor of our building telling me that he just watched one of my employees steal a computer. What? With each floor the elevator descended my anxiety rose.
My good neighbor explained that his first floor window gave him a wide open view of the parking lot. “I have been watching this delivery truck most of the morning. The hard working driver is delivering computers upstairs somewhere and he is leaving his roll up door open as he comes and goes.”
He went on to tell me about how a woman, (who he was fairly certain worked for me) stopped her car next to the open delivery truck door, got out and picked up one of the large boxes right off the truck and popped it into her hatch-back car and drove out of the lot. After he described the woman and the car I felt that sick feeling of knowing just who it was.
How I got her back to the parking lot is a long story so suffice it to say my call to her cell phone gave her very little choice. Convincing the driver to wait for her and not call the police was like putting toothpaste back in the tube, but he also had little choice. After all, what would his company think of him leaving dozens of expensive computers out in the open, unguarded? The exchange of his computer for her freedom happened quietly. She quit her job without thanking me, however; each of us learned a huge lesson that day.
For the driver: Take better care of the merchandise.
For the employee: Don’t steal. You may get caught.
For me the realization that temptation sat there in the parking lot for all to see and yet many people passed it by. But for her, it was just too much of a temptation and she succumbed to greed. This has an interesting correlation to the mortgage industry that also created a temptation that many people could not pass by. The “No Doc” loan, which was initially set up for self employed business owners with complex tax returns, tempted even the most seasoned mortgage professionals when it was allowed for general use. The open door of easy loans lured people into the parking lot of home lending. Loose jargon was thrown around such as, “liar’s loans” and “If they breathe give them a loan”….“If they fog a mirror they are ok”….credit quality went out the window as fellow colleagues would shrug their shoulders and say, “If the investors will buy them on the secondary market I’ll make these loans all day long.” Responsibility took a back seat.
Once the general public realized the concept of no income qualifying loans people quickly figured out how they could now have the house of their dreams. Income numbers were either lied about, fudged, fantasized, rationalized or faked. Whatever the label, many loans went through the system with an ultimate destination of the foreclosure department. Quality Control departments often found the discrepancy in the post close phase but by then it was too late. Worse, servicing departments trying to collect payment would learn from the borrower that they just ‘can’t afford the house’. Really? And you make $22,000.00 a month? “No I don’t.”
That is the thing about temptation
– there are always consequences hiding in its shadow.
The mortgage nightmare that still makes us tremble has many arrows. One of them is the No Income Verification loans……Did Loan Originators press the borrowers for a higher income dollar to justify the loan? Or did the borrowers lie? Or should the creators of these loan products have acted more responsibly? Or perhaps Wall Street should have considered the consequences.
Saturday, May 16, 2009
Monday, May 11, 2009
Leadership and Ethics
Much can be said about truth. Many people make a huge fuss about ‘seeking truth’ while others profess that if they believe something to be true than it is BUT should someone else believe a differing opinion is true, then that is “their “ truth. Even the explanation of that way of thinking gives me an ice cream headache. However, Bill Clinton tried to clear up the subject when he said, and I paraphrase, It depends on what the meaning of the word ‘is’ is.
If you have ever wrestled with the concept of truth at work you are not alone. Many managers, department heads and executive leaders caucus before employee meetings to determine how best to put a “positive spin” on company announcements. No wonder the business owner who stands before his/her employees and tells them “like it is” retains a loyal following of devotees. Then, if and when things do turn sour, these employees are equipped to help build something good out of what could have been ruins.
Truth gathers a following. A by-gone can be a by-gone when the basis for the workplace is truth. It is easier to clean up a mess when it is clear what the mess really is. Truth flowing freely in the air helps most people sleep better at night.
When hiring employees for my business, the interview process always found me saying to the potential employee “It is very easy to work here. There are three key things you need to do.
1) Be here. Come to work mentally and physically everyday. The reason we are hiring for this position is that we need the help
2) Do your best each day.
3) Tell me the truth. No matter how big the mistake; no matter what the problem is you face, tell me the truth and I can deal with that much better than a lie that I am bound to find out about.“
Then I would ask “ Can you do these three things?” The confirming answer of yes was the buy in for the new hire to understand our company culture and integrate into our workplace ethics.
As company leader these three things applied to me as well. Employees look to their leadership for the key ingredients to the company culture. From dress; to manners; to over flowing with ideas…employees pick up on leadership and gravitate to that direction. Companies with huge ethical problems within their ranks need to consider their leadership style.
If you have ever wrestled with the concept of truth at work you are not alone. Many managers, department heads and executive leaders caucus before employee meetings to determine how best to put a “positive spin” on company announcements. No wonder the business owner who stands before his/her employees and tells them “like it is” retains a loyal following of devotees. Then, if and when things do turn sour, these employees are equipped to help build something good out of what could have been ruins.
Truth gathers a following. A by-gone can be a by-gone when the basis for the workplace is truth. It is easier to clean up a mess when it is clear what the mess really is. Truth flowing freely in the air helps most people sleep better at night.
When hiring employees for my business, the interview process always found me saying to the potential employee “It is very easy to work here. There are three key things you need to do.
1) Be here. Come to work mentally and physically everyday. The reason we are hiring for this position is that we need the help
2) Do your best each day.
3) Tell me the truth. No matter how big the mistake; no matter what the problem is you face, tell me the truth and I can deal with that much better than a lie that I am bound to find out about.“
Then I would ask “ Can you do these three things?” The confirming answer of yes was the buy in for the new hire to understand our company culture and integrate into our workplace ethics.
As company leader these three things applied to me as well. Employees look to their leadership for the key ingredients to the company culture. From dress; to manners; to over flowing with ideas…employees pick up on leadership and gravitate to that direction. Companies with huge ethical problems within their ranks need to consider their leadership style.
Monday, May 4, 2009
Who Stole The Scissors?
Back in the day….
When I was twenty two years old; the world still had fresh air and my new job as office manager came with a few challenges. My seven staff members were all women with children, family, home and work balanced neatly on their small paychecks. We believed in and trusted each other.
The reason for this story is not to bore you with the mundane for we were at best, normal for a group of working women; we were at worst normal for a group of poor working women. I didn’t realize we were poor until I became responsible for the office P&L and saw first hand the seemingly vast revenue stream brought in by the sales men who dropped their new client files on our desks each day by noon and promptly headed for the golf course.
Working through these files meant using offices supplies….LOTS of them....file folders for duplicate copies, reams of paper, boxes of copy toner, and staples. Friday’s supply order became routine until I noticed an item kept popping up on my group’s supply order – scissors. Unlike paper or even paper clips, scissors had a certain ‘shelf life’ that didn’t warrant reordering so often. This was a time when scissors cost considerably more than today, were made here in America and made quite well, I might add.
But still, I asked…”Are they breaking?”
No, came the reply.
“Then why reorder? “
Can’t find my pair, came the meek reply over and over.
The mystery of the missing scissors continued until corporate wrote me up for exceeding the quarterly supply budget. Now it was serious! We are talking about my job here. The problem was eventually eliminated but the question of what happened to a dozen or so scissors remained unanswered. My staff came to the realization that there was someone who cared just as much about ‘how’ the job was done as the results.
In fairness to this story, we were marooned in a poor rural area of America before the internet. These were the 60s. The moral and social sappers were beginning their work. Yet, mid-west Americans valued family and faith. I had to believe that the scissors were taken by aliens from another galaxy. To believe anything else would only lead to disaster for one of us. As Pascal wrote, “the heart has reasons that the mind knows not”. Knowledge follows love; it does not precede it.
It wasn’t about the scissors. It was and is about staying responsible; respecting others property; and remaining truthful. All good office policy.
When I was twenty two years old; the world still had fresh air and my new job as office manager came with a few challenges. My seven staff members were all women with children, family, home and work balanced neatly on their small paychecks. We believed in and trusted each other.
The reason for this story is not to bore you with the mundane for we were at best, normal for a group of working women; we were at worst normal for a group of poor working women. I didn’t realize we were poor until I became responsible for the office P&L and saw first hand the seemingly vast revenue stream brought in by the sales men who dropped their new client files on our desks each day by noon and promptly headed for the golf course.
Working through these files meant using offices supplies….LOTS of them....file folders for duplicate copies, reams of paper, boxes of copy toner, and staples. Friday’s supply order became routine until I noticed an item kept popping up on my group’s supply order – scissors. Unlike paper or even paper clips, scissors had a certain ‘shelf life’ that didn’t warrant reordering so often. This was a time when scissors cost considerably more than today, were made here in America and made quite well, I might add.
But still, I asked…”Are they breaking?”
No, came the reply.
“Then why reorder? “
Can’t find my pair, came the meek reply over and over.
The mystery of the missing scissors continued until corporate wrote me up for exceeding the quarterly supply budget. Now it was serious! We are talking about my job here. The problem was eventually eliminated but the question of what happened to a dozen or so scissors remained unanswered. My staff came to the realization that there was someone who cared just as much about ‘how’ the job was done as the results.
In fairness to this story, we were marooned in a poor rural area of America before the internet. These were the 60s. The moral and social sappers were beginning their work. Yet, mid-west Americans valued family and faith. I had to believe that the scissors were taken by aliens from another galaxy. To believe anything else would only lead to disaster for one of us. As Pascal wrote, “the heart has reasons that the mind knows not”. Knowledge follows love; it does not precede it.
It wasn’t about the scissors. It was and is about staying responsible; respecting others property; and remaining truthful. All good office policy.
Friday, May 1, 2009
Ethics in Mortgage Lending - Then and Now
As a member of the mortgage community I witnessed the comings and goings of many mortgage employees for the last twenty years. In recent years, we witnessed first hand the ultimate human tragedy – people getting what they wanted. On a national scale we watched unashamed homebuyers signing promissory notes for homes they could not afford, MI companies taking on more and more risk, investors making erroneous assumptions based on never ending appreciation and the entire time mortgage personnel around the country worked over time and double time to keep the Humpty Dumpty mortgage world smiling.
Then Humpty Dumpty’s wall began to sag and sag and sag until off he went! Some say he was pushed and the blame game started. I say he wasn’t pushed but just got fat, lazy, greedy and brazen from bottom to top – especially at the top – the part that hit the bottom hardest. Ethical behavior was thrown out the window like ticker tape for the parade of money to be made.
So now put Humpty Dumpty back together again, or as the story goes, we can at least try. We will run into barriers, especially those of us in sales. Polishing the tarnished image held by consumers, rebranding our offerings and finding sales channels that work best are all daunting tasks.
So now put Humpty Dumpty back together again, or as the story goes, we can at least try. We will run into barriers, especially those of us in sales. Polishing the tarnished image held by consumers, rebranding our offerings and finding sales channels that work best are all daunting tasks.
In the last few years most mortgage professionals whether in sales or operations, have had their world rocked, turned upside down and perhaps even ruined. People who were reading others credit reports and approving loans find themselves in foreclosure. To stay in this business over the last two years has taken an act of faith and commitment to ourselves and the mortgage industry. With luck and hard work our efforts will be rewarded and our lives righted again…maybe not as flamboyant but hopefully not struggling to survive and surely with a steady eye on strong ethics.
Before the recent collapse we mortgage professionals lived in unbelievably rich times. Most loan officers, processors, underwriters and even vendors made really good money. Wages grew and commissions abounded. Company parties and trips were free and frequent and sales soared.
When it ended we found ourselves realigning our relationships and re budgeting our families. Then we began the journey back to learning the true purpose of mortgage lending (putting and keeping people in their homes) and re-learning our profession (calculating real income and doing FHA loans!). We also now understand the mine-field that is our industry. We no longer play at our work but put thoughtful effort into each loan so as to deter any unintended consequences. Liars loans, false appraisals, misrepresented income...are they a thing of the past? No, there are still those out there that need lesson in truth but for the majority of the people who once or still work in mortgage lending they have found a new the joy of working with the old saying "Tell it like it is".
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